Lack of financial discipline by the government can lead to A excess expenditure B inflation ........

General Studies (CHSL) Indian Economy

Lack of financial discipline by the government can lead to ____________.

(A) excess expenditure

(B) inflation

This questions was previously asked in

SSC CHSL 26th May 2022 Shift-1

Only B

Only A

A and B

Neither A nor B

- Lack of financial discipline by the government can lead to several economic issues.

- A) Excess Expenditure:

- When the government lacks financial discipline, it often spends more than its revenues.

- This can lead to budget deficits and increased borrowing.

- B) Inflation:

- Overspending can also lead to inflation if the supply of money increases faster than economic output.

- Inflation diminishes the purchasing power of money and can destabilize the economy.

- Option Analysis:

- Option 1: Only B - Implies inflation is the only outcome, ignoring excess expenditure.

- Option 2: Only A - Suggests excess expenditure is the only result, ignoring inflation.

- Option 3: A and B - Recognizes both excess expenditure and inflation as potential consequences of lack of financial discipline.

- Option 4: Neither A nor B - Implies neither consequence occurs, which is incorrect.

- Correct Answer: Option 3 - A and B

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