CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
An increase in nominal GDP, with the deficit unchanged in rupees, would generally:
A. Lower deficit-to-GDP ratio
B. Raise deficit-to-GDP ratio
C. Not affect the ratio
D. Make it equal to inflation
Correct Answer: A
A larger denominator lowers the ratio.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which statement about federal PSDP is correct?
A. It is a development allocation
B. It is the policy rate
C. It is a foreign reserve measure
D. It is a customs tariff
Correct Answer: A
PSDP is the federal development programme.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which expenditure is most likely classified as current rather than development?
A. Routine government operations
B. Construction of a new dam
C. New motorway project
D. New public university campus
Correct Answer: A
Routine operations are current expenditure.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Provincial share under NFC reduces:
A. Net revenue available to the federal government
B. Gross exports
C. Workers' remittances
D. SBP policy rate
Correct Answer: A
Transfers to provinces are deducted from gross federal revenue to derive net federal revenue.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which is most likely to increase debt-servicing cost?
A. Higher interest rates
B. Higher tax compliance alone
C. Lower borrowing needs
D. Lower debt stock
Correct Answer: A
Higher rates raise the cost of new and floating-rate debt.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
A higher primary surplus can help:
A. Stabilize public debt dynamics
B. Automatically increase imports
C. Abolish inflation
D. Eliminate all taxes
Correct Answer: A
A sustained primary surplus can improve debt sustainability.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which item is a financing source rather than ordinary tax revenue?
A. Government securities borrowing
B. Income tax
C. Sales tax
D. Customs duty
Correct Answer: A
Borrowing finances the gap and is not tax revenue.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which ratio is most useful for comparing fiscal deficits across years with different economy sizes?
A. Fiscal deficit as % of GDP
B. Deficit in rupees only
C. Population only
D. Exchange rate only
Correct Answer: A
GDP ratios normalize the deficit by the size of the economy.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
If FBR collection exceeds its target with spending unchanged, the deficit will generally:
A. Narrow
B. Widen
C. Have no relationship
D. Turn into imports
Correct Answer: A
Higher tax receipts improve the fiscal balance.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
If expenditure rises while revenue is unchanged, the fiscal deficit will generally:
A. Widen
B. Narrow
C. Disappear automatically
D. Become a trade surplus
Correct Answer: A
Other things equal, higher expenditure widens the fiscal gap.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Fiscal policy is mainly concerned with:
A. Government taxation and spending
B. Only bank reserve requirements
C. Only exchange-rate quotations
D. Only stock-market listing
Correct Answer: A
Fiscal policy operates through taxation, expenditure and borrowing.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which body prepares Pakistan's federal budget documents?
A. Finance Division
B. Election Commission
C. Supreme Court
D. Pakistan Bureau of Statistics alone
Correct Answer: A
The Finance Division prepares and publishes federal budget documents.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
A subsidy in the federal budget is intended primarily to:
A. Reduce the effective cost or support targeted sectors/consumers
B. Increase exchange-rate volatility
C. Replace the Constitution
D. Set the policy rate
Correct Answer: A
Subsidies provide financial support that lowers costs or sustains targeted activities.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Budget Estimates (BE) generally refer to:
A. Planned allocations/receipts for the budget year
B. Only actual audited spending
C. Only external debt
D. Only tax arrears
Correct Answer: A
BE are forward-looking budget figures.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Revised Estimates (RE) generally represent:
A. Updated estimates for an ongoing/previous budget year
B. Only provincial estimates
C. Foreign-exchange forecasts
D. Census projections
Correct Answer: A
RE update earlier budget estimates using newer information.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
A budgeted figure is best understood as:
A. A target/estimate for the fiscal year
B. An audited final outcome
C. A court order
D. A monetary-policy rate
Correct Answer: A
Budget estimates are planned figures and can differ from actual outcomes.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Interest payments in Pakistan's budget are strongly linked to:
A. Public debt stock and interest rates
B. Only exports
C. Only remittances
D. Only population growth
Correct Answer: A
Debt stock and borrowing costs drive interest payments.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Development expenditure is most directly associated with:
A. Long-term public projects and capital formation
B. Routine salaries only
C. Interest payments only
D. Foreign exchange dealing
Correct Answer: A
Development spending supports projects and public investment.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
A reduction in fiscal deficit-to-GDP ratio generally indicates:
A. Fiscal consolidation
B. Currency demonetisation
C. Trade embargo
D. Automatic recession
Correct Answer: A
A lower deficit ratio is generally associated with fiscal consolidation.
CSS - PMS - CCE - PCS - Current Affairs (C.A)
Federal Budget 2026–27
Which budget concept best measures the government's position before interest costs?
A. Primary balance
B. Trade balance
C. Current account
D. Exchange rate
Correct Answer: A
The primary balance excludes interest costs.