SSC CGL Economy – Public Finance: Budget & Deficits – Tier II Level · Marathon
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55.6% in BE 2026-27 against 56.1% in RE 2025-26; target 50±1% by 2030-31.
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SSC CGL Economy – Public Finance: Budget & Deficits – Tier II Level · Marathon – 10 questions, subject: Indian Economy. Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.
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1.
Debt is 8,000 and GDP 16,000. FD this year is 800 and nominal GDP grows by 25%. Next year's debt-to-GDP ratio is:
Correct Answer: D [44%]
Explanation:
(8,000 + 800) ÷ 20,000 × 100 = 44%.
2.
Revenue receipts are ₹ 30 lakh crore and interest payments ₹ 12 lakh crore. Interest takes what share of revenue receipts?
Correct Answer: A [40%]
Explanation:
Answer: 40%. 12 ÷ 30 × 100 = 40%.
3.
Which way of financing the fiscal deficit directly adds to the money supply?
Correct Answer: C [Borrowing from the RBI (monetisation)]
Explanation:
RBI credit creates new money – the monetised deficit.
4.
Assertion–Reason
A: A high ratio of revenue deficit to fiscal deficit is a sign of poor quality of spending.
R: It means a large part of borrowing is used for consumption rather than creating assets.
A: A high ratio of revenue deficit to fiscal deficit is a sign of poor quality of spending.
R: It means a large part of borrowing is used for consumption rather than creating assets.
Correct Answer: A [Both A and R are true and R explains A]
Explanation:
Borrowing for revenue spending creates no asset to repay the debt.
5.
FD is 6% of GDP and interest payments are 3.5% of GDP. The primary deficit is:
Correct Answer: B [2.5% of GDP]
Explanation:
Answer: 2.5% of GDP. 6 − 3.5 = 2.5.
6.
Two-quantity comparisonTwo-quantity comparison (imaginary budget):
Quantity I: effective revenue deficit when RD = 300 and grants for capital assets = 80
Quantity II: primary deficit when FD = 500 and interest = 290
Quantity I: effective revenue deficit when RD = 300 and grants for capital assets = 80
Quantity II: primary deficit when FD = 500 and interest = 290
Correct Answer: A [Quantity I > Quantity II]
Explanation:
Answer: Quantity I > Quantity II. ERD 220 > PD 210.
7.
Heavy government borrowing that raises interest rates and reduces private investment is called:
Correct Answer: D [crowding out]
Explanation:
Answer: crowding out. Crowding out.
8.
The FRBM Review Committee of 2017 was chaired by:
Correct Answer: D [N. K. Singh]
Explanation:
N. K. Singh committee – debt anchor of 60% of GDP.
9.
FD = ₹ 4,50,000 crore. Expressed in lakh crore this is:
Correct Answer: C [₹ 4.5 lakh crore]
Explanation:
1 lakh crore = 1,00,000 crore.
10.
As per the PIB release of 1 February 2026, the debt-to-GDP ratio of the Centre in BE 2026-27 is estimated at:
Correct Answer: A [55.6%]
Explanation:
55.6% in BE 2026-27 against 56.1% in RE 2025-26; target 50±1% by 2030-31.
➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Indian Economy book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-indian-economy
📘 SSC CGL 2026 – Indian Economy (Tier I + Tier II)
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