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    Question

    Which among the following is generally known as twin deficit?

    A Revenue deficit and current account deficit Correct Answer Incorrect Answer
    B Revenue deficit and capital account deficit Correct Answer Incorrect Answer
    C Fiscal deficit and current account deficit Correct Answer Incorrect Answer
    D Fiscal deficit and capital account deficit Correct Answer Incorrect Answer

    Solution

    The "twin deficit" refers to a situation where a country simultaneously experiences both a fiscal deficit and a current account deficit. A fiscal deficit occurs when a government spends more money than it generates in revenue. A current account deficit arises when a country imports more goods and services than it exports.

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