Question

Which of the following is a characteristic of a Capital Receipt?

• A. It is used to cover day-to-day expenses.
• B. It is generated from the sale of goods and services.
• C. It is subject to income tax.
• D. It can be in the form of a loan from the public.

Answer 1

Answer:

D. It can be in the form of a loan from the public.

• A loan from the public, such as through the issuance of bonds, is a form of borrowing that increases government liability and is thus a capital receipt.