Question
GSEasyPrelims 2025Economy

Consider the following statements:

I. Capital receipts create a liability or cause a reduction in the assets of the Government. II. Borrowings and disinvestment are capital receipts. III. Interest received on loans creates a liability of the Government.

Which of the statements given above are correct?

Explanation

Capital receipts involve transactions that either increase liabilities or reduce assets for the government. Revenue receipts, on the other hand, are routine incomes like interest or taxes that don’t affect assets or liabilities.

Statement I: Correct

  • Capital receipts create liabilities (like borrowings) or reduce assets (like disinvestment).

Statement II: Correct

  • Borrowings and disinvestment are both capital receipts.

Statement III: Incorrect

  • Interest received is a revenue receipt, not a capital receipt—it’s income, not a liability.

More questions fromEconomy

See All Answers

Trusted by 2L aspirants

Practice UPSC Prelims PYQs Smarter

Practice Now
  • Track accuracy & weak areas
  • See past trends & repeated themes
Start Practicing Now

PYQs by Papers

Most repeated Topics from Economy in Last 5 years

Repeated Topics
Questions in Last 5 Years
Finance and Financial Markets27 (34%)
Money, Banking and Monetary Policy16 (20%)
Public Finance in India11 (14%)
Infrastructure and Investment Models in India9 (11%)
Services and Digital Economy9 (11%)

Crack UPSC with your
Personal AI Mentor

An AI-powered ecosystem to learn, practice, and evaluate with discipline

SuperKalam
SuperKalam is your personal mentor for UPSC preparation, guiding you at every step of the exam journey.

Download the App

Get it on Google PlayDownload on the App Store
Follow us

ⓒ Snapstack Technologies Private Limited