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What You Will Do: Self-Test 1.2

Public finance involves the collection and spending of government funds to achieve economic objectives like reducing economic fluctuations and promoting stable growth. It deals with taxation, expenditures, public debt, and their effects on the economy. Public finance must be studied because governments must raise and spend revenues to function, and these activities can significantly impact the economy.

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Pauline Joy Lumibao
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46 views

What You Will Do: Self-Test 1.2

Public finance involves the collection and spending of government funds to achieve economic objectives like reducing economic fluctuations and promoting stable growth. It deals with taxation, expenditures, public debt, and their effects on the economy. Public finance must be studied because governments must raise and spend revenues to function, and these activities can significantly impact the economy.

Uploaded by

Pauline Joy Lumibao
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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C. What is Public Finance?

1. Public Finance. It simply means collecting and spending of government’s funds. It covers the
whole gamut of fiscal administration including tax collection, expenditures of government funds,
preparation of the annual government budget, securing foreign and domestic loans and the
floating of bonds.
(by Abletez, J.P. and R.B. Chua, “Local Finance and Budgeting”)

2. Public Finance. It is the study of facts, principles, techniques and effects of obtaining and
spending funds and managing public debts.
( by Schaultz & Barris, “American Public Finance”)

3. Public Finance. It is that part of economics that deals with the revenue and expenditure patterns
of the government and their effects on the economy. (by Romualdez, et al., “Philippines
Public Finance”)

4. Public Finance. It is concerned with the utilization of the combined use of public expenditure,
taxation and public debt s o as to achieve economic objectives: (by Sicat, “Economics”)

a) Reduction of the Wild Swings of the Business Cycle. This means that during expansion,
the government should spend less and tax more, however, in times or recession, the
government should spend more and tax less.

b) Stable Growth of Income. This could be attained through increased employment and
equitable distribution of income/wealth.

D. Why do we study Public Finance?

The presence of a political body that governs a given economy requires a study of public finance, because
the government, throughout its existence, will have to raise revenues and spend them, both of which, can
substantially affect the economy.

Download and watch this short video:

13.Economics_Grade_10___Meaning_and_Scope_of_Public_Finance_(1)___Public_Finance___UPSC_Exam.mp4

What you will do


Self-Test 1.2

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