Which of the following relates to those expenses incurred for the normal functioning of the government departments?
Show answer & explanation
Correct answer: A
Explanation
Revenue Expenditure -
Revenue expenditure refers to government expenditure incurred for the normal functioning of government departments and the maintenance of services.
Its Key Features -
Nature: It is recurring, meaning it is an expense that has to be incurred repeatedly.
Effect: This expenditure neither creates any government asset (such as building a school or hospital) nor does it reduce the government's liability.
Key examples:
Salaries and pensions of government employees.
Interest payments on loans.
Various subsidies (food, fertilizer, etc.).
General maintenance of defense services.v