Question

Which one of the following is a feature of public finance?

• A. Individual adjusts expenditure to income
• B. Government adjusts income to expenditure
• C. Government adjusts expenditure to income
• D. Individual adjusts income to expenditure

Answer 1

The correct option is B

Government adjusts income to expenditure

A public authority first determines the size of expenditure which it has to spend on different heads, and then it tries to find out resources to meet this expenditure. Hence, the government adjusts income to expenditure.