ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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government spending and income tax only
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government revenue and government expenditure
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transfer payment and government revenue
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government spending and indirect tax
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Detailed explanation-1: -Government Budget, therefore, comprises Revenue Budget and Capital Budget. The estimates of expenditure included in the Annual Financial Statement are for the net expenditure, i.e., after taking into account the recoveries, as will be reflected in the accounts.
Detailed explanation-2: -A government budget, on the other hand, often termed as an Annual Financial Statement of a nation, gives an estimate about how much expenditure and revenue is planned for a particular financial year. This kind of fiscal statement is presided over by the country’s finance minister.
Detailed explanation-3: -The federal budget comprises three primary components: revenues, discretionary spending, and direct spending.
Detailed explanation-4: -The Revenue Account: which includes Revenue Receipts (Tax and Non Tax Revenue) and Revenue Expenditure (Plan Revenue Expenditure and Non-Plan Revenue Expenditure). The Capital Account: which includes Capital Receipts and Capital Expenditure (Plan Capital Expenditure and Non-Plan Capital Expenditure).
Detailed explanation-5: -Those expenditures of the government that do not lead to the creation of fixed assets are called revenue expenditures. The government spends money under various accounting heads, such as paying interest on loans, salaries and pensions, subsidies, spends on different ministries and departments, etc.