Download App

Government Budget and Economy — Economics STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceEconomicsGovernment Budget and Economy3 Marks
Question
Explain the allocation function of a government budget.
✓

Answer

Govt. uses budgetary policy to allocate resources. This is done by imposing higher rate of taxation on goods whose production is to be discouraged and subsidies provided on goods whose production is to be promoted.

Need a full question paper?

Generate a complete, print-ready paper with questions like this in minutes — across 16+ boards, with answer keys.

Start Generating Free

Explore more

More "3 Marks Question" from Government Budget and Economy→Government Budget and Economy — all question types→Economics STD 12 Commerce question papers→CBSE Board STD 12 Commerce question papers→CBSE Board question paper generator→

Similar questions

Distinguish between Average Propensity to Consume and Marginal Propensity to Consume using a numerical example.
→
Calculate National Income by (a) Income method and (b) Expenditure method from the following data:
S.No.
Contents
₹ (in crore)
(i)
Interest
$150$
(ii)
Rent
$250$
(iii)
Government Final Consumption Expenditure
$600$
(iv)
Private Final Consumption Expenditure
$1,200$
(v)
Profit
$640$
(vi)
Compensation of Employees
$1,000$
(vii)
Net Factor Income to Abroad
$30$
(viii)
Net Domestic Capital Formation
$340$
(ix)
Net Exports
$(-)40$
(x)
Net Indirect Taxes
$60$
→
Explain the relationship between revenue deficit and fiscal deficit. Can there be fiscal deficit without a revenue deficit?
→
Giving reason, classify the into normal resident of India or not.
Indian employees working in WHO, located in India.
→
Draw a diagram showing inflationary gap.
→
If in an economy:
Change in initial Investment $(\triangle\text{I})=\text{₹ 1200 crores}$
Marginal Propensity to Save (MPS) = 0.2
Find the values of:
  1. Investment multiplier (k)
  2. Change in final income $(\triangle\text{Y})$
→
Explain the meaning of inflationary gap with the help of a diagram.
→
It is given that MPC is 1/3rd of MPS, while consumption at zero level of income is given as ₹ 100 crore. Derive the consumption and saving functions. What does you suggest about this economy?
→
If Real GDP is Rs. 200 and Price Index (with base = 100) is 110, Calculate Nominal GDP.
→
State whether the following are a stock or a flow:
  1. Population of a country.
  2. Number of births.
→