In India, every beginning of a year, the government presents its budget in front of the Lok Sabha explaining an estimated receipt and expense for the upcoming financial year. or (ii) Re-allocation of resources. Prepared by teachers of one of the best CBSE schools in Delhi. Management of Public Enterprises 5. Economic stability an objective of government budget Government tries to establish economic stability by its budgetary policies. (Delhi 2013) Economics. (ii) Surplus budget, i.e. 1. Ans. (Delhi 2010c, 2009 c) Explain the allocation function of government budget. Important & Viva Questions for Class 12 Economics CBSE academic session 2020-2021, these Questions are expected questions only, Important Questions are taken from various topics which are frequently asked in exams. Register for Online tuition on Vedantu.com to … Candidates who are ambitious to qualify the Class 12 with good score can check this article for Notes, Question & Practice Paper. (VBQ; Delhi 2014) OBJECTIVES OF BUDGET. expenses on the construction of national highways, payment of loan by the government, etc. Explain. The government does the allocation of resources in such a manner that there is a balance between the goals of profit maximisation of PSUs and social welfare in an economy. Here are a few reasons why it’s important for the government to have a budget: Proper resource pool allocation When it comes to budgeting, identifying areas of weakness helps the government to allocate resources in a useful and sustainable manner. Government encourages the production of certain commodities by giving tax reliefs and providing necessary infrastructural requirements. 34.Distinguish between revenue receipts and capital receipts. The main objective of the budgetary policy of the government is to reduce inequalities of income and wealth in the country. State any two sources of non-tax revenue receipts. (Delhi 2008) (Compartment 2014) burden of these taxes can be shifted to others, e.g. This is one of the most fundamental objectives behind framing a government budget. Economics class 12 important questions of Government Budget and the Economy ... Government Budget and the Economy class XII Economics NCERT book, refresher books and other reference books have many important questions. (i) Wealth Tax It is a kind of direct tax as it is paid by the same person on which it is levied or imposed, i.e. This document is highly rated by Class 12 students and has been viewed 6632 times. Which economic value does it reflect? . government imposes tax on liquors and cigarettes. Explain the economic stability objective of government budget. (Delhi 2011 C; All India 2008) Allocation of resources (All India 2009)                    ! CBSE Class 12. Two examples of indirect taxes are : actual burden of the taxes cannot be shifted, e.g. (All India 2011) Distribution of income Government budget shows its comprehensive exercise on the taxation and subsidies. When the expected receipts are equal to the expected expenditures in the government budget, the budget is said to be balanced (Expected receipts = Expected expenditures). (Delhi 2010) 33.Government raises its expenditure on producing public goods. actual burden of taxes cannot be shifted, e.g. service tax, entertainment tax, etc. 6 docs. The main objectives of government budget are given below : Ans. loans taken by the government, disinvestment of any PSUs, etc. tax rate increases with increase in income) to redistribute income from rich to poor. Government Budget And The Economy. Whereas indirect taxes are those taxes for which the incidence and impact fall on separate persons, i.e. The government allocates the resources in accordance with the social and economic priorities of the country. Results for pdf Class XII Macroeconomics Government Budget and the Economy Download CBSE NCERT Economics Important. (i) Expenditure on scholarships is a revenue expenditure because neither it lead to decrease in liabilities nor lead to an increase in assets. Impacts of Budget Economic stability is achieved by saving the economy from harmful effects of various trade cycles and its phases, i.e. Objectives of Government Budget Important Points of Govt. expenses on the construction of national highways, dams and repayment of loans, etc. Class 9 NCERT Economics. (iii) Can effectively and efficiently implement programme. 2. 5 docs 8 tests. The union budget is the prepared by the central government and is presented in the Lok Sabha; it is divided into the railway budget and main budget. By spending more on provision of free services like education and health, government is trying to promote social justice. (VBQ; Foreign 2014) 32. Ans. (i) Recovery of loans ADVERTISEMENTS: Government of India Budget: Meaning, Elements, Objectives and Types! Login. (Compartment 2014) (a) Direct tax These are the taxes for which the incidence and impact of tax falls on the same person, i.e. Explain any two objectives of government budget. (ii) Reduction of poverty and employment: To eradicate mass poverty and unemployment by creating maximum employment opportunities and providing maximum social benefits to the poor. Give an example. Government budget is a statement of expected receipts and expenditures of the government over the period of a financial year, i.e. What is government budget? Difference between revenue receipts and capital receipts. With the help of Notes, candidates can plan their Strategy for particular weaker section of the subject and study hard. Lastly, it also explains how to measure government deficits with its implications. Government Budget and The Economy Important Questions for class 12 economics Concept and Components of Government Budget 1. Giving reasons, classify the following into direct and indirect tax. Which economic value does it reflect? Download books and chapters from book store. 31. Class 12 Economics chapter … State its main objectives. Ans. 26.Give meanings of revenue expenditures and capital receipts m a government budget. Even distribution of wealth and social welfare remains the main objective of budgetary policy. (ii) Grants/donations. Define a government budget. Ans. It acts as a device that identifies and focuses on the development of an underprivileged person. Currently only available for. 16. 10. 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It improves the aggregate financial policy by controlling expenditure, given the number of revenues. Give two examples of indirect taxes. Reallocation of Resources 2. i. (Delhi 2010) Main elements of the budget are: (i) It is a statement of estimates of government receipts and expenditure. (i) Balanced budget, i.e. 11. Revenue receipts The receipts of government which neither create any corresponding liability of the government, nor it create any reduction in assets, are termed as revenue receipts, e.g. Revenue Expenditures Those expenditures of the government, which neither cause any increase in government assets nor cause any reduction in government liabilities are termed as revenue expenditures, e.g. Explain. The economic value that is reflected in the rise in tax rate for higher income group is the ‘equality and social welfare’. Ans. tax receipts of the government. (Delhi 2008C) (All India 2009,2008) Give meanings of revenue receipts and capital expenditures with one example for each. There are many objectives of the government budget, such as allocation of resources, public accountability, etc. (ii) Non-tax revenue It mainly consists of interest receipts on account of loans by the Central Government, dividends and profits on investment made by the government, fees and other receipts for services rendered by the government. (iii) Economic stability. Free PDF Download - Best collection of CBSE topper Notes, Important Questions, Sample papers and NCERT Solutions for CBSE Class 12 Economics Government Budget and the Economy. government imposes tax on liquors and cigarettes. Ans. (i) Capital expenditure The expenditure by the government which leads to an increase in government assets and reduction in government liabilities, is termed as capital expenditure, e.g. (ii) Value added tax. It refers to a situation where there is no fluctuation in price level  in an economy. Budget Expenditure: It refers to the estimated expenditure of the government on various developmental as well as non-developmental programs during a fiscal year. Distinguish between revenue expenditure and capital expenditure in a government budget. Obviously, the budget is the most important information document of the government because government implements its plans and programmes through the budget. expenditure on old age pensions, salaries, etc. Classification of Revenue Receipts Government budget is a statement of expected receipts and expenditure of the government during a fiscal year.Main objectives of government budget are: (A)Redistribution of income and wealth: It is one of the most important objective of the government budget.The government imposes heavy taxation on a high income groups redistribute it among the … (i) Re-distribution of income and wealth. Give two examples of non-tax revenue receipts. (ii) Capital budget It is an account of the assets as well as the liabilities of the Central Government, which takes into consideration changes in capital during a fiscal year. 4. (All India 2010) Giving reason, state whether the following is a revenue expenditure or a capital expenditure in a government budget: UNIT – IX. Even distribution of wealth and social welfare remains one of the main objective of budgetary policy. (ii) Reduction of poverty and employment: To eradicate mass poverty and unemployment by creating maximum employment opportunities and providing maximum social benefits to the poor. (ii) Budget estimates pertain to a fixed period, generally a year. 28. What is a direct tax? Ans. (i) Revenue budget It is the statement of estimated revenue receipts and estimated revenue expenditure during a fiscal year. expenditure on old age pensions, salaries, etc. Giving reasons to classify the following into direct tax and indirect tax. The main objective of the budgetary policy of the government is to reduce inequalities of income and wealth in the country. People with income below a certain level are not levied any direct tax altogether. In this receipt, both tax revenue (such as excise duty, income tax) and non-tax revenue (like profits, interest receipts) are recorded. (All India 2012) Explain any one objective of government budget. 5. Distinguish between the following. 6. (v) Economic stability Ans. (ii) Redistribution of incomeThe economic value that is reflected in the rise in tax rate for higher income group is the ‘equality and social welfare’. (Delhi 2010c) Give one example of each. That is why, it is a capital expenditure. Class 12th Economics important questions in chapter 8 Government Budget and the Economy for free download in PDF format. Important Topics in Economics: burden of these taxes can be shifted to other, e.g. tax receipts of the government. To know more, stay tuned to BYJU’S. Economic stability is achieved by saving the economy from harmful effects of various trade cycles and its phases, i.e. Explain the redistribution of income objective of government budget. Capital receipts are government liabilities or decrease financial assets, such as the recovery of loans, market borrowing, etc. (All India 2010) (ii) Disinvestment refers to the withdrawal of existing investment, e.g. Difference between revenue expenditure and capital expenditure, 20. This allocation is done with the help of government budgetary policy. Ans. A budget is needed to know the financial performance of the government over the past one year and to know the financial programs and policies of the government for the next one year. This allocation is done with the help of government budgetary policy. Revenue expenditures  The expenditure of the government which neither cause any increase in the government assets nor cause any reduction in government liabilities, are termed as revenue expenditures, e.g. The government uses progressive taxation policy to reduce the inequalities of income and wealth in the country. 1st April to 31st March. The government uses progressive taxation policy to reduce the inequalities of income and wealth in the country. 37. Ans. The government prepares an expenditure according to its objective and then starts gathering the resources and funds to fulfil the proposed investment. (b) Indirect tax These are the taxes for which the incidence and impact fall on separate persons, i.e. Ans. Ans. “A government budget is an annual statement of the estimated receipts and expenditure of the government during a fiscal year. Documents & Videos. Classification of capital receipts are : Introductory Macroeconomics. It refers to a situation where there is no fluctuation in price level  in an economy. As the public goods cannot be provided by the private sectors through market mechanism, hence the need for providing such goods is to be fulfilled by the government. 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