Economics Unit Test: Supply and Demand, Keynesian Theory, Public Revenue, Expenditure

J.B Say's statement 'Supply creates its own demand' means that the act of producing goods and services automatically generates the income needed to purchase those goods and services.

The sources of public revenue include taxes, fees, fines, grants, and donations.

The Keynesian theory of employment states that the level of aggregate demand determines the level of employment in an economy. A diagram illustrating this theory would show the relationship between aggregate demand and employment.

<p>Federal finance involves the financial activities of the central government, including revenue generation through taxes, allocation of funds to states, and management of public debt.</p> Signup and view all the answers

<p>The Finance Commission in India is a constitutional body that recommends the distribution of financial resources between the central government and states. Its functions include reviewing the financial situation of states, recommending grants, and advising on fiscal matters.</p> Signup and view all the answers

<p>Primary deficit refers to the fiscal deficit of a government excluding the interest payments on past borrowings. It indicates the shortfall in revenue compared to expenditure, excluding debt servicing costs.</p> Signup and view all the answers