Class name Subject Book title Chapter number Content Created at
Class XII Economics Introductory Macroeconomics 5 current financial year only are included in the revenue account (also called revenue budget) and those that concern the assets and liabilities of t...
Class XII Economics Introductory Macroeconomics 5 buy a ticket, you will not be allowed to watch a movie at a local cinema hall. However, in case of public goods, there is no feasible way of exclud...
Class XII Economics Introductory Macroeconomics 5 to the GDP growth rate, fiscal balance of the central d government and external balance 5. t I 5.2 BALANCED, S URPLUS ANDDEFICITBUDGET The governme...
Class XII Economics Introductory Macroeconomics 5 is the redistribution function. Reprint 2026-27 Stabilisation Function of Government Budget The government may need to correct fluctuations in inco...
Class XII Economics Introductory Macroeconomics 5 rate. Firms are taxed on a proportional basis, where the tax rate is a particular proportion of profits. With respect to excise taxes, necessities ...
Class XII Economics Introductory Macroeconomics 5 paid on these loans. Similarly, when government sells an asset, then it means that in future its earnings from that asset, will disappear. Thus, th...
Class XII Economics Introductory Macroeconomics 5 Defenceexpenditure,iscommittedexpenditureinthesensethatgiventhenational securityconcerns,thereexistslittlescopefordrasticreduction.Subsidiesarean i...
Class XII Economics Introductory Macroeconomics 5 (a+b+c) of which 5.8 (a) Recovery of loans 0.1 (b) Other receipts (mainly PSU disinvestment) 0.1 (c) Borrowings and other liabilities 5.6 5. Capita...
Class XII Economics Introductory Macroeconomics 5 not give rise to debt. Examples are recovery of loans and the proceedsfromthesaleofPSUs.FromTable5.1wecanseethatnon-debtcreating capital receipts e...
Class XII Economics Introductory Macroeconomics 5 liabilities consist of interest payments minus interest receipts by the government on net domestic lending. Box 5.1: Fiscal Policy One of Keynes’s ...
Class XII Economics Introductory Macroeconomics 5 include the government will be — AD = C + c(Y – T +TR ) + I + G (5.2) Graphically, we find that the lump-sum tax shifts the consumption 73 schedule...
Class XII Economics Introductory Macroeconomics 5 t)Y + I + G will now be given by E ∆Y = ∆G + c (1 – t)∆Y (5.19) 1 ∆G ∆Y = 1– c(1– t) (5.20) Y Y' Y The income increases from Y * Fig. 5.5 to Y′ as ...
Class XII Economics Introductory Macroeconomics 5 income to increase from Y to Y’. Changes in Taxes We find that a cut in taxes increases disposable income (Y – T ) at each level of income. This sh...
Class XII Economics Introductory Macroeconomics 5 1– 0.8 = 0.2 = 5. For an increase in government spending by 100, the equilibrium income will increase by 500(1− c ∆ G = 1×0) . The tax multiplier i...
Class XII Economics Introductory Macroeconomics 5 y d themselves out. We find that output increases by exactly the amount of e increased G with no induced consumption spending due to increase in ta...
Class XII Economics Introductory Macroeconomics 5 cR Y = AD (5.14) AD = C + cY + I + G We note that proportional taxes not only lower consumption at each AD' = C + c(1 – t)Y + I + G level of income...
Class XII Economics Introductory Macroeconomics 5 During a recession when GDP falls, disposable income falls less sharply, and consumption does not drop as much as it otherwise would have fallen ha...
Class XII Economics Introductory Macroeconomics 5 less than the amount by which it increases when government expenditure increases because a part of any increase in transfer payments is saved. Usin...
Class XII Economics Introductory Macroeconomics 5 be true for the government’s debt, and one must deal with the ‘whole’ differently from the ‘part’. Unlike any one trader, the government can raise ...
Class XII Economics Introductory Macroeconomics 5 savings now, which will fully offset the increased government dissaving so that national savings do not change. This view is called Ricardian equiv...
Class XII Economics Introductory Macroeconomics 5 by issuing bonds to finance its deficits, these bonds will compete with corporate bonds and other financial instruments for the available supply of...
Class XII Economics Introductory Macroeconomics 5 subsidy, showing that cash transfers would lead to increase in welfare. The other way is to change the scope of the government by withdrawing from ...
Class XII Economics Introductory Macroeconomics 5 government. 2.The three functions of allocation, redistribution and stabilisation operate through the expenditure and receipts of the government. 3...
Class XII Economics Introductory Macroeconomics 5 build up adequate revenue surplus. 2. It requires the reduction in fiscal deficit by 0.3 per cent of GDP each year and the revenue deficit by 0.5 p...
Class XII Economics Introductory Macroeconomics 5 was enacted, the Indian economy has graduated to a middle income country. At the time of enactment of the FRBM, there was a general thinking that f...