Important source of revenue and major type of expenditure
What is the most important source of revenue and the major type of expenditure at the Federal level?
Expert
At the Federal level, the most important source of revenue is the personal income tax. The main expenditure is for income security.
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Cost of debt= (1-tax rate)* interest rate * (debt ÷capital employed)Cost of equity = risk free rate + market premium (equity shareholders funds÷ capital employed)
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The advocates of laissez-faire policies favor: (i) Govt. control of economy. (ii) Public ownership of all the resources. (iii) Income to be distributed according to requirement. (iv) Surpluses in the balance of trade. (v) Minimal govt. intervention in economy.
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