1. E- CONTENT
FOR
ECONOMICS
CLASS XII

4.  A budget is an annual statement of the
estimated receipts and expenditure of the
government over the fiscal year, which runs
from APRIL 1ST
to MARCH 31ST
.

5. 1. Redistribution of income and wealth:
Govt.through fiscal tools of taxation,subsidies and
transfer payments brings about fair distribution of
income.
2. Reduction of inequalities:
Govt. can reduce inequalities of income by taking the
rich people more in budget and spending more on
poor.
3. Economic stability:
The tries to prevent business fluctuation and
maintain price and employment stability.
4. Economic growth:
Development of heavy and basic industry.

6. R evenue receipts C apital receipts
B udget receipts
R evenue expenditure C apital expenditure
B ubget expenditure
G overnm ent budget

8. D eve lo p-
m en tal
N o n-d evelo p-
m en tal
R e ve n ue
expe nditu re
D e velo p-
m ental
N on -de velop-
m en tal
C a pital
expen diture
P lan
e xpen ditu re
D eve lop-
m en tal
N o n-de velo p-
m ental
R e ve nue
e xpe nditu re
D e ve lo p-
m ental
N o n -d evelop-
m en tal
C a pital
expe n diture
N on-plan
e xpen diture
C om p on en ts of B ud get exp en diture

9.  Budget expenditure:It is the expense which the
govt.incurs for its own maintenance as also for the society
and the country as a whole.
 Components
1.Plan expenditure and non-plan expenditure:
i) Plan expenditure:It is the expenditure to be incurred
during the year on the programmes under the current five
year.
Ex:the assistance provided by the Central govt.for the
plans states and Union territories.
ii) Non-plan expenditure:Expenditure other
than the expenditure related to the
current five year plan.

10.  REVENUE EXPENDITURE AND CAPITAL
EXPENDITURE
 Revenue expenditure:It refers to expenditure which either
create assets nor reduce liabilities.
 Capital expenditure:It refers to expenditure which which
either creates assets or reduce liabilities.
2.Developmental and Non-developmental
expenditure:
i) Non-Developmental expenditure:Expenditure on essential
general services of the govt.
Ex:defence &administration

11. Video Courtesy: http://www.youtube.com/watch?v=TlwL7vLlXz8

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B) False
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14. A) Revenue receipts
B) Capital Receipts
C) Capital Expenditure
D) Revenue Expenditure
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15. A) Fiscal Deficit
B) Revenue Deficit
C) Primary Deficit
D) Budgetary Deficit
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