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JAMB Economics 1989 Question 38

Question 38

Public Finance

A balanced budget is defined as a condition of

  1. A.balance of payments equilibrium
  2. B.equality of aggregate demand and aggregate supply
  3. C.equality of planned receipts and planned expenditure
  4. D.equality of planned exports and planned imports.
Show the answer and explanation

Answer: C (equality of planned receipts and planned expenditure)

Explanation

A budget is balanced when the government's planned revenue equals its planned spending.