Distinguish between : Public Finance and Private Finance
Q.2 (B) (v) Distinguish between : Public Finance and Private Finance
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Answer:
| Public Finance | Private Finance | |
|---|---|---|
| 1. Meaning | Study of income and expenditure of the central, state and local governments. | Study of income and expenditure of individuals, households and private firms. |
| 2. Order | Government decides expenditure first and then raises revenue (expenditure determines income). | Individuals first consider income and then decide expenditure (income determines expenditure). |
| 3. Objective | Maximum social welfare. | Maximum personal satisfaction or profit. |
| 4. Sources of funds | Taxes, fees, borrowing and also deficit financing (printing currency). | Wages, salaries, profit, interest, rent; cannot print currency. |
| 5. Secrecy and period | Budget is public and usually prepared for one year. | Kept secret and has no fixed period. |
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· 29 Oct 2026
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