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  1. Token privatisation or deficit privatisation of public sector units occur when the government sells
    1. 5% of shares
    2. 10% of shares
    3. 15 % of shares
    4. 20% of shares
Correct Option: A

There are different forms of privatization. When the government disinvests its shares to the extent of 5 to 10 per cent to meet the deficit in the budget, this is termed as deficit privatization. This is also referred to as token privatization. A typical tactic adopted towards privatization is the incremental method where shares are sold in steps. On the other hand token privatization is adopted in circumstances of acute budget deficit wherein a lump of shares is sold off.



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