Types of budgets, Managerial Economics

Assignment Help:

TYPES OF BUDGETS

1.     Deficit budget 

If the proposed expenditure is greater than the planned revenue from taxation and miscellaneous receipts, this is a budget deficit. The excess of expenditure over revenue will be met through borrowing both internally through the sale of Treasury Bills and externally from other organisations.

2.     Balanced budget

If the proposed expenditure is equal to the planned revenue from taxation and other miscellaneous receipts, this is a balanced budget.  Usually, balanced budgets are not presented, unless the expenditure is very limited.  It would mean the government would have to over-tax the population which can create disincentives.  It is to avoid this that the tax revenue is supplemented by borrowing.

3.     Surplus budgets

If the proposed expenditure is less than the planned revenue from taxation and other miscellaneous receipts, this is a surplus budget.  Usually, surplus budgets are not presented for they are deflationary and can create unemployment as the government takes out of the economy more than it puts back.


Related Discussions:- Types of budgets

Phillips curve, PHILLIPS CURVE   The Phillips  curve,  named  after  A....

PHILLIPS CURVE   The Phillips  curve,  named  after  A.  W.  Phillips,  describes  the  relationship between unemployment  and  inflation. In  1958  Phillips, then  professor a

Bertrand equilibrium benefits, The computer graphics chip industry is one w...

The computer graphics chip industry is one with a little number of competitors that earn normal economic profit. Two chip manufacturers, NVIDIA and ATI both face the prospect of lo

the occupancy rate of the hospital, In 2006, a hospital with 130 beds had ...

In 2006, a hospital with 130 beds had 8,795 admissions. The average length of stay?for every patient was 4.7 days. Assuming full capacity is 100 percent, detremine the occupancy ra

Central bank functions-controller of credit, Controller of Credit The p...

Controller of Credit The principles of credit control by the central bank were discovered and enunciated after the publication of Bagehot Lombard street in 1873. Even after 187

Least cost factor combination, Producers Equilibrium or Optimal Combination...

Producers Equilibrium or Optimal Combination of Inputs  The analysis of production function has demonstrated that alternative combinations of factors of production that are tech

Insurance Premiums, Green Shield Insurance gives NEMO Corporation with cove...

Green Shield Insurance gives NEMO Corporation with coverage for prescriptions, dental work, and extended health services. Every subscriber uses $435 worth of dental services per ye

Meaning of inflation, Meaning of Inflation There has been a proliferati...

Meaning of Inflation There has been a proliferation of definitions of inflation. Many of these definitions, however, embody the description of the processes by which the underl

Neoclassical thinking, neoclassical thinking assumes that all firms are est...

neoclassical thinking assumes that all firms are established to make profit has been challenged by managerial discretion model.How successful have been these models to maximize pro

Electron control inc, electron control,inc.,cells voltage regulators to oth...

electron control,inc.,cells voltage regulators to other manufacturers , who then customize and distribute the products to quality assurance labs for their sensitive test equipment.

Describe the managerial functions, Describe the Managerial functions A ...

Describe the Managerial functions A manager has to take numerous decisions that conform to the objectives of the firm. Several business decisions fall prey to conditions of ris

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd