Question

If, in a specific year, exports are $40 billion, business expenditures are $60 billion, the government collects $50 billion in tax revenues and public expenditures are $70 billion, then there is a fiscal deficit equal to ________.

Answer 1

The fiscal deficit for the government for the current year will be $20 billion for the given condition.

What is fiscal deficit?

The condition where there is an excess of expenditures over the income during a given financial period, it is known as fiscal deficit. The computation of fiscal deficit using the formula and the given information will be,

Fiscal Deficit = (Total Income – Total Expenditure)

Fiscal Deficit = $50 billion – $70 billion = -$20 billion

Hence, option C holds true regarding fiscal deficit. The complete question has been attached in the image for better reference.

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