There are 3 major functions of budget, which of the following deals with the "Stabilisation function" of the budget?
Answer & explanation
Correct answer: option 1
The stabilisation function of government budget includes providing an economic stability in the country. With the help of its revenue and expenditure policies, the government ensures economic stability. In case of inflation decrease in expenditure and increase in revenue is done whereas, in case of deflation, increase in expenditure and decrease in revenue is seen.