Question

Which of the following is correct about public finance?

• A. Public finance relates the income and expenditure one person or one family
• B. In public finance, individuals calculate their income before hand and then spend it accordingly
  
• C. Public finance relates to the income and expenditure of the government
• D. In public finance, the government calculates its expenditure first and then adjusts its income accordingly

Answer 1

The correct option is C Public finance relates to the income and expenditure of the government

• The government, through its fiscal policies, enhances the public expenditure in priority areas like agriculture, small scale industries and basic infrastructure. By these means, the government takes steps to ensure a balanced growth in all spheres of the economy.
  
• Developing countries like India utilize public finance in order to eradicate poverty and unemployment, regulate financial upheavals and commodity prices, and thereby establish financial stability.