If government in a fiscal year has its revenue receipts less than the expenditure, such country is having

Step 1: Analyze the question The question describes a government whose revenue receipts are less than its expenditure in a fiscal year. We need the correct term for this situation.

Step 2: The concept Government budgets are classified by comparing revenue (income from taxes, oil earnings, fees, etc.) with expenditure (spending on roads, schools, salaries, etc.):

• Balanced budget: Revenue = Expenditure
• Surplus budget: Revenue > Expenditure
• Deficit budget: Revenue < Expenditure

Step 3: Apply it Here, Revenue < Expenditure, so the government is spending more than it earns. This is a deficit budget. The gap is usually financed by borrowing (domestic or foreign loans) or by drawing on reserves.

Step 4: Check the other options

• A. Balanced budget: this would require revenue to equal expenditure, so it is wrong.
• C. Favorable budget: not a standard budget classification.
• D. Surplus budget: this is the opposite case, where revenue exceeds expenditure.
• E. Unfavorable budget: not a standard classification either.

Answer: B. Deficit budget

Exam tip: Think of a "deficit" as a "shortfall." Deficit means revenue falls short, while surplus means there is extra. Many Nigerian budgets are deficit budgets, which is why you often hear about borrowing to fund them.