GOVERNMENT BUDGET AND THE 
                               ECONOMY
                            MODULE-2/2 (PPT)
                                   PREPARED BY
                               MRS TANUPRIYA SINGH
                                    PGT (ECO)
                                AECS-2,  JADUGODA
                                     PAGE NO-1
                     BUDGET EXPENDITURE
         It is the estimated expenditure of the government relating to
         its development and non- development programmes during a
         fiscal year.
          Budget expenditure of the government is broadly
         classified as:
           RevenueExpenditure                 Capital Expenditure
                                     PAGE NO-2
                   REVENUE EXPENDITURE
        Revenue Expenditure of the government is that expenditure
        which shows the following two characteristics:
        (i) It does not create any asset for the government.
            Example:- Expenditure by government on old-age pension,
        salaries and scholarship.
        (ii) It does not cause any reduction in liability of the
        government.
            Example:- Expenditure by way of grants to the state
        government to cope with natural calamities.
                                    PAGE NO-3
                    CAPITAL    EXPENDITURE
        Capital expenditure of the government is that expenditure
        which shows the following two characteristics:
          (i) It creates assets for the government.
               Example:- Equity (or shares) of the domestic or
        multinational corporation purchased by the government may
        be cited as an example.
         (ii) It causes reduction in liabilities of the government.
                Example:- Repayment of loans reduces liability of the
        government.
                                    PAGE NO-4