Explanation:

Explanation: Option A: The government can still borrow leading to further expansion of the fiscal deficit. This has been the GOI’s budget position since decades.

Option B: This is because the government is spending more than it is earning. It is not maintainable in the long-run, the extra spending will somehow has to be financed else it will lead to a debt spiral.

Option C: It is not necessary because even a better managed economy in terms of taxation can have poor revenue yield if the revenue resources are not significant. But, if tax evasion is rampant, it will surely deplete the revenue resources and add to the revenue deficit.

Option D: This is only a possibility and that too when the revenue deficit is very high and the government ignores creation of supply chain and production capacity in the economy. This is because due to high revenue expenditure, demand will increase but supply will not increase in the same proportion.