Q. Fiscal deficit was 4% of the GDP in 2015 and that increased to 5% in 2016. If the GDP increased by 10% from 2015 to 2016, the percentage increase in the actual fiscal deficit is
(A) 37.50 (B) 35.70 (C) 25.00 (D) 10.00
Sol: 37.50
Sol:
GDP increased by 10% from 2015 to 2016 ⇒
Let GDP in 2015 = X
GDP in 2016 = 1.1 X
Fiscal deficit was 4% of the GDP in 2015 and that increased to 5% in 2016 ⇒
FD in 2015 = 0.04 X
FD in 2016 = 0.05 (1.1 X) = 0.055 X
Percentage increase in the actual fiscal deficit:
