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which of the following is a debt creating capital receipt?
  • a)
    Disinvestment proceed from psu
  • b)
    Interest received
  • c)
    Loan recovery
  • d)
    Market borrowing
Correct answer is option 'D'. Can you explain this answer?
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which of the following is a debt creating capital receipt?a)Disinvestm...
Market borrowing create debt on government and government has to repay the borrowed money
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which of the following is a debt creating capital receipt?a)Disinvestm...
Market Borrowing:
Market borrowing is a debt creating capital receipt because it involves borrowing money from the financial markets by issuing bonds or securities. This type of borrowing creates a liability for the government as it has to repay the borrowed amount along with interest in the future.

Disinvestment Proceed from PSU:
Disinvestment proceeds from PSU are not considered a debt creating capital receipt. It is a non-debt capital receipt as it involves selling the government's stake in public sector undertakings (PSUs) to raise funds. This does not create any additional debt for the government.

Interest Received:
Interest received is not a capital receipt, it is a revenue receipt. It represents income earned by the government on its investments or loans given to other entities. It does not involve borrowing or creating any debt.

Loan Recovery:
Loan recovery is also not a debt creating capital receipt. It involves the repayment of loans given by the government to other entities. It is a recovery of funds previously lent out by the government and does not create any new debt.
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which of the following is a debt creating capital receipt?a)Disinvestment proceed from psub)Interest receivedc)Loan recoveryd)Market borrowingCorrect answer is option 'D'. Can you explain this answer?
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