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Economics · 2025 · 3 marks
Government Budget and the EconomyGovernment Budget – Meaning and its Components3 marksUnderstandshort answer
CBSE 2025 · Region 5 · Set 1 · Q12
“As per the Economic Survey of India 2022 – 23, due to the outbreak of geopolitical conflict, the result was higher international prices for…
“As per the Economic Survey of India $\displaystyle 2022$ – $\displaystyle 23$, due to the outbreak of geopolitical conflict, the result was higher international prices for fertilizer and fuel. Thus, there was a higher fuel and fertilizer subsidy requirement for supporting the people.”On the basis of given text, identify and explain the indicated objective of the government budget.
Marking-scheme solution
The indicated government budget objective is the ‘stabilisation function’.The stabilisation function aims at controlling large-scale fluctuation in prices through the government’s taxation and expenditure policy. The government may incur expenditure on providing fuel and fertilizer subsidy in order to ensure price stability.
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CBSE Class 12 Economics past-paper question from the 2025 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.