Question on: SS2 Economics - Meaning of Balanced Budget
Why is a balanced budget considered a positive financial situation?
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A
It helps to ensure financial stability and sustainability
B
It encourages the accumulation of debt
C
It results in a negative balance
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Correct Option: A
(A balanced budget is considered a positive financial situation because it helps to ensure financial stability and sustainability. This implies that the exact revenue derived is allocated to spend on a similar amount of expenses, ensuring that there is no instability in terms of income, price and employment of labour and resources)
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