There has been a persistent deficit budget year after year. Which of the following actions can be taken by the

Question

There has been a persistent deficit budget year after year. Which of the following actions can be taken by the government to reduce the deficit? 1. Reducing revenue expenditure 2. Introducing new welfare schemes 3. Rationalizing subsidies 4. Expanding industries Select the correct answer using the code given below.

Accepted Answer

Reducing revenue expenditure directly lowers government spending, thereby decreasing the deficit. Similarly, rationalizing subsidies curtails government outlays by making them more targeted and efficient. Conversely, introducing new welfare schemes and expanding industries typically involve increased government spending, which would likely widen, not reduce, the deficit.