Recoveries of loans and advances, borrowings, are an example of ________.
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. capital receipts.
Recoveries of loans and advances, as well as borrowings, are examples of capital receipts. Capital receipts are non-recurring in nature and typically include funds obtained from sources like loans, disinvestment of assets, or recoveries of previous loans. They are used to finance capital expenditures and are not part of the regular income of the government. Unlike revenue receipts, which come from taxes and other regular sources, capital receipts involve transactions that affect the government’s financial position in a more significant way.