BANKING AFFAIRS

Detailed explanation-1: -Government’s budget is widely used as a policy tool to stimulate or contract aggregate demand as required. The budget is simply a statement of revenues earned from taxes and other sources and expenditures made by a nation’s government in a year.

Detailed explanation-2: -The correct answer is fiscal policy of the government. The budget is an instrument of fiscal policy of the government. The purpose of a budget is to plan, organize, track, and improve your financial situation.

Detailed explanation-3: -The main instruments of fiscal policy are public revenue, public expenditure and public debt.

Detailed explanation-4: -The two main instruments of fiscal policy are government expenditures and taxes. The government collects taxes in order to finance expenditures on a number of public goods and services-for example, highways and national defense. Budget deficits and surpluses.

Detailed explanation-5: -The budget is a management instrument used by any entity, financially ensuring the dimension of the objectives, revenues, expenses and results at the management centers level and finally evaluating the economic efficiency through comparing the results with those budgeted for.