Identify from the following, the three functions that operate through the expenditure and receipts of the government are.......

Allocation, Redistribution and Stabilisation.

The correct answer is Option (4) → Allocation, Redistribution and Stabilisation.

Allocation function. The government allocates resources to produce public goods and services (like defence, roads, education) which the private sector may not provide efficiently.

Redistribution function. Through taxation and welfare schemes, the government redistributes income to reduce economic inequalities.

Stabilisation function. The government uses fiscal policies (expenditure and taxation) to stabilise the economy — controlling inflation, reducing unemployment, and managing economic cycles.