...i) Concept of public finance The concept of public finance deals with the budgeting techniques of the income and expenditures of a public sector organization, normally a government or federal organization. Public finance is also termed as government finance and is an important sector of economics . The concept of public finance focuses on these relationships and functions may be considered special as they include: Procuring public goods, arranging and funding various transfers (particularly in the social area), directing entities existing in the economy towards socially desirable behaviours; for instance through taxes, penalties, subsidies and other stimuli and charges. In order to arrange the funding of the above-mentioned areas, there is a fiscal system (public budgeting system) whose aim is to collect the required amount of public revenue. Public revenue serves, at various levels of public budgets (governmental, regional and local), to fund public expenditures. Public expenditures, public revenue and particularly taxes may be considered to be the fundamental elements of public finance. Important terms derived from these three elements include deficit, public debt, budgetary policy and fiscal policy. The development of public finance is connected with economic mechanisms that should ideally lead to the effective and fair allocation of limited resources. ii) Major economic functions of any government in the world Governments have in charge different functions for different...
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...subject of Public Finance such an important field in the study of economics. Government is made by the people for the people, and therefore government has the power to control resources based on what the people want. Sure, people don’t like to pay taxes. People would rather keep all of their money and spend it in the way that they’d like. However, people also know how important social security, Medicaid, and other governmental programs are to their future, and therefore are willing to pay taxes in exchange for the goods and services the government provides to its citizens. Essentially, it all comes down to an economic comparison between one option (no taxes and no governmental programs) versus another option (taxes and governmental programs), and how much people are willing to pay (money, opportunity costs, etc.) for one option versus another. Because taxation by the government is such an important subject to everyone, Public Finance is truly an important subject that affects everyone and is an important subject for everyone to learn about, since it affects their overall well-being. By know more about voting, government allocation of resources, redistribution programs, and other important topics in Public Finance, people can make better decisions about who to vote for and people can have a bigger say and better knowledge about how the government affects their income and lifestyle. It is the purpose of this paper to describe various important and broad topics in Public Finance...
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...PUBLIC FINANCE BOWIE STATE UNIVERSITY FALL 2012 FINAL PROJECT KaRon Campbell December 12, 2012 As the Production Manager of a T-shirt company, I am proposing the purchase of a $1 Million stamping machine to increase output. I have calculated that the selling price of the 100 additional T-shirts per hour multiplied by the number of production hours per month, in addition to that two percent for the units that aren't rejected because of the quality of the machine output will result in a good total benefit. By dividing the purchase price by 12 months per year then divide that by the 10 years the machine should last, can be used to calculate the monthly cost of the machine. The manufacturer's specs describe what the power consumption of the machine is, so I can figure the cost of electricity to run the machine and add the purchase cost to get a total cost figure. Cost Benefit Analysis - Purchase of New Stamping Machine (Costs shown are per month and repaid over four years) 1. Purchase of Machine .................... -$20,000 includes interest and taxes 2. Installation of Machine ..................... -3,125 including screens & removal of existing stampers 3. Increased Revenue .......................... 27,520 net value of additional 100 units per hour, 1 shift/day, 5 days/week 4. Reduced material costs ...................... 1,128 purchase of bulk supply reduces cost by $0.82 per hundred 5. Reduced Labor Costs ....................... 18,585 3 operators...
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...NATIONAL OPEN UNIVERSITY OF NIGERIA COURSE CODE: MPA 728 COURSE TITLE: PUBLIC FINANCIAL MANAGEMENT MPA 728 COURSE GUIDE ii MPA 728 PUBLIC FINANCIAL MANAGEMENT Course Team Mr. E. U. Abianga ( Developer/ Writer) - NOUN Dr. Bonaventure Nkup Haruna ( Editor ) - UNIJOS Dr. Dimis I. Mai - Lafia (Programme Leader) - NOUN Mr. E. U. Abianga (Coordinator) - NOUN NATIONAL OPEN UNIVERSITY OF NIGERIA COURSE GUIDE MPA728 PUBLIC FINANCIAL MANAGEMENT 97 Source: Koleade Oshisami (1992) quoted in Ola and Offiong (2008). Government Accounting and Financial Control Ibadan, Nigeria: Spectrum Books Limited, p. 55. Rolling Plan in Nigeria’s Planning and Budgeting System Owing to poor achievement of past eco nomic plans and poor budgetary implementation in Nigeria, the military administration in 1990, introduced the idea of a rolling plan based on three year perspective in order to address the planning and budgetary predicaments experienced in the past. The a im of this planning was to make provision for a long term vision of the economy taking into consideration the goals of socio - economic development for the distant future of 5, 10, 15, 20, 25 or 30 years. This aimed at setting long term targets and objectiv es of economic development. The strategic plan is also aimed at addressing three basic issues of capital growth, technological progress and population growth. This will serve as a background when preparing a medium or short term ...
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...CHAPTER 5 3. Both Governor Bill Richardson and senator Barrack Obama was correct about the distributional impact of the two policies because by implementing a cap-and-trade system to limit the release of greenhouse gases, this system would require companies emitting gases above the cap to buy allowances. A carbon cap is a more effective approach to solving global warming than a tax because it sets a clear goal for emissions reductions. By imposing a tax, we could count how much it will reduce carbon emissions, and it may not be sufficient to change the course of global warming. A carbon tax approaches the issues from a different perspective. The higher the tax, the more the emissions will decline. But in other side, Senator Barack Obama was correct. The carbon tax would be passed on consumer, while in a cap and trade system, business must purchase permits in order to emit carbon. So, if the cost of purchasing and using the equipment is less than the cost of buying a permit, the business will decrease the equipment usage. By that the costs for producer increase, decreasing supply and increasing the price of the final good in market. So, in either case, it will result in increasing market prices. 4. a. Cassanova will host P parties per month as proofed on the graph above. b. If suppose there’s a fixed marginal external benefit, then the graph could see on MSBp line. c. The socially optimal level of parties is P*. Social Committee could induce Cassanova by giving a...
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...PUBLIC SECTOR ACCOUNTING AND FINANCE 1.0. Introduction: One of the main distinguishing factors between public and private sector organisations lies in their objectives and sometimes funding structure. While public sector bodies have a more social objective and focus more on the allocation or distribution of public goods and services within the country, private sector bodies have the main objective of increasing the wealth of their shareholders (IFAC, 2011). However, both private and public sector bodies face similar operational and business challenges brought on by the economic environment and climate. A crucial question therefore is how to account for the activities of private sector bodies and public sector bodies in a way that reflects the operational structure of the organisation and yet their varying objectives (Barton, 2000). There exist two main schools of thought on the nature of accounting in the public sector, each of which is formulated by the view of the role of the public sector within the economy (Evans, 1995). The traditional method of accounting within public sector organisations has often advocated the use of the cash basis of accounting, with larger emphasis rather placed on compliance with the rules and regulations governing the sector (Wynne, 2003). However, weaknesses in public sector management have brought to the fore the importance of efficiency and hence the adoption of the accrual method of accounting within the public sector. According to...
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...Source of finance for public sector organistaion 1.direct changes of services Postal services such as selling stamps,savings and traavel insurance 2.government govt school and hospitals get financial support from the central govt funded from the tax revenue of the govt 3.donations Sources of finance for business strategy 1.purpose of finance Short term (improving working capital /day today running)-overdraft Longer term (buying expensive equipments or replacement of fixed assets –hire purchases 2.costs-consider not only purchase cost but also associated cost such as administative charges service and maintanance charges and short and long term consideration of interest rates.managers also have to bear in mind the opportunity cost of their final choice 3.amount required Large amount:issue shares,secured loans firm financial institution Small amount:overdraft 4.time Long period (for purchase of new buildings) -mortgages as debentures Short term :trade credit 5.stages and size of the firm A well known and large mnc will find it much easier to raise finance from a wider range of sources than a sole trader.in addition large organization are able to obtain finance cheaper due to financial economies of scale 6.financial situation of a firm poor cashflow makes it difficult for the firm to raise finance as they represent a higher risk to investor and landers.landers will assess their gearing (longterm external borrowing as a percentage to capital employed)of...
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...Public Finance Methods in Nigeria The Federal Republic of Nigeria is comprised of 36 states located in West Africa geographically bound by the Republic of Niger to the north, the Gulf of Guinea (on the Atlantic Ocean) to the south, the Republic of Cameroon and Chad on the east and Republic of Benin on the west. Since gaining full independence from the British in 1960, Nigeria has gone from a Parliamentary system of government (modeled after the British Parliament), the Biafran Civil War, and numerous dictatorships to the current Democratic system of government. Widely described as the most populous country in Africa (accounting for over half of West Africa’s population alone[i]), the US State Department estimated in 2010 a population of approximately 152 million people of 250 Ethnic groups with the largest ethnic groups comprising of Hausa-Fulani (north), Igbo (south-east), Yoruba (south-west) and Kanuri (north). The religions practiced in Nigeria are Islam, Christianity and indigenous African traditional worship. The Hausa’s are from the northern part of the country and are predominantly Muslims, the Yoruba are from the south west and are predominately an even mix of Christians and Muslims, the Igbos are from the southeast and are predominately Christians. The official language of Nigeria is English in addition to other local dialects. Nigeria’s commercial capital (and former political capital), Lagos, is located in the southwestern part of the country while the political...
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...ASSIGNMENT OF PUBLIC FINANCE ON The importance of broadening the Income Tax Base SUBMITTED TO Tanvir M H Arif, MIBM (UWL/TVU, UK); MBA (CU, BD) Assistant Professor, Department of Finance and Banking. University of Chittagong, Chittagong, Bangladesh. Ex-Asst. Professor, FBA, USTC ; Ex-Lecturer, AUB, Dhaka. And CEO, Corporate Trainer and Consultant (CTC), Chittagong, Bangladesh. UK Experiences: Adjunct Faculty of BRIT College, London Ambassador College and Nelson College. SUBMITTED BY GROUP D Group Profile| SERIAL NO.|NAME DETAILS|CLASS ID|E-MAIL ID| 01|SHAMIN JAHAN SHAWN|09303020|shahjahanh53@gmail.com[->0]| 02|JEWEL SHIL|09303036|takenfromlife@ymail.com[->1]| 03|TAMA SAHA|09303050|tama_cu@yahoo.com[->2]| 04|KUSHUM AKTER SOMA|09303056|Kushumsoma@yahoo.com[->3]| 05|DIPA BARUA|09303060|| 06|SHAMIM AKTHER|09303063|Shamim_cufb_17@yahoo.com| 07|HERO AKTER|09303085|hiruakter@gmail.com[->4]| 08| K. A.M. ATAUL ISLAM|09303111|hassanmrhridoy@ gmail.com| 09|MOHAMMAD JAMIR UDDIN |09303113|Jamir_cu@yahoo.com[->5]| 10|MEJBAH UDDIN AHMED|09303118|mejbah118@gmail.com[->6]| 11|BIBI JOYNUB CHOWDHURANI|09303126|| CONTENTS Chapter -1| Introductory Part| 1.1 Introduction1.2 Aims and Scope of the study1.3 Methodology of the study1.4 Vision of the study1.5 Limitations of the study| Chapter -2| Income Tax Background| 2.1 History of Income Tax2.2 Importance of Income Tax2.3 Drawback of Income Tax| Chapter -3| Tax...
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...The average rate at which an individual or corporation is taxed. The effective tax rate for individuals is the average rate at which their earned income is taxed. The effective tax rate for a corporation is the average rate at which its pre-tax profits are taxed. An individual's effective tax rate is calculated by dividing total tax expense by taxable income. For corporations, the effective tax rate is computed by dividing total tax expenses by the firm's earnings before taxes. The effective tax rate is the net rate a taxpayer pays if all forms of taxes are included and divided by taxable income. The effective tax rate is often a more accurate representation of a taxpayer's tax liability than its marginal tax rate. Two companies that are in the same marginal tax bracket, for example, may end up with different effective tax rates depending on their earnings. This occurs particularly with a progressive, or tiered, tax system, where different levels of income are taxed at different rates. For example, the first $100,000 of income may be taxed at 10%, and income between $100,001 and $500,000 might be taxed at a rate of 15%. The corporation's income is taxed at the various levels, and to determine the effective (or average) tax rate, the total tax is divided by the total taxable income The term effective tax rate has different meanings in different contexts. Generally its calculation attempts to adjust a nominal tax rate to make it more meaningful. It may incorporate econometric,...
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...Lashawn Holmes Obamacare Pros As we know Obamacare (the Affordable Care Act) contains many benefits specifically for low and middle income families and businesses. But on the other hand Obamacare also created some obstacles for high earners, larger firms that don’t offer insurance to their employees, and certain sectors of the healthcare industry. Also Obamacare effects taxpayers, government spending, employees and so forth. New tax laws were created to help ensure all individuals, mostly high earners and healthcare industry were affected. Individuals are directly affected by the individual mandate and the employee mandate. The individual mandate says all Americans who can affords health insurance have to obtain health coverage, get an exemption, or pay a fee. This creates a problem when filing taxes. Some individuals who just missed the Federal Poverty Level limit of 400% are hit the most because they don’t qualify for assistance. Individuals who do get cost assistance will need to adjust tax credits. Obamacare created more coverage options. There are more private coverage options and all medical coverage options must provide the minimum essential coverage for an individual. More options are great but it also creates more complications for consumers and the Private Health Insurance System. Consumers are at risk of under buying or over buying health insurance. The Healthcare system promotes that...
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...Trezoreria Conceptul de Trezorerie a apărut ca rezultat al unei lungi evoluţii istorice, care a condus mai întâi la identificarea noţiunii de „ban public”, apoi la ideia de centralizare a acestuia sub o autoritate unică având scopul de a veghea la respectarea unui ansamblu de reguli speciale. Trezoreria: concept, conţinut Diversificarea şi intensitatea intervenţiilor statului, îndeosebi în domeniul economic, au impus redimensionarea importanţei Trezoreriei, având în vedere amploarea fluxurilor care se derulează prin intermediul său. În funcţie de modul în care statul s-a angajat sau dezangajat în viaţa economică, după cel de-al doilea război mondial, se pot evidenţia următoarele faze specifice în evoluţia Trezoreriei publice: * faza de expansiune, care a urmat războiului, în care Trezoreria a preluat insuficienţele pieţei şi ale circuitelor financiare, fiind singura instituţie care putea impune restricţii şi oferi avantaje; * faza de restrângere, specifică perioadei 1960 - 1975, în care Trezoreria a cunoscut o relativă dezangajare economică, s-a caracterizat prin transferul către alte organisme financiare sau către pieţe financiare a sarcinii acoperirii cheltuielilor publice suplimentare (aşa-numita debugetizare). Această fază a avut ca obiectiv revenirea la o Trezorerie neutră, dezangajată, care nu se implică în economie; * faza reconsiderării mecanismelor de intervenţie a statelor, amorsată la mijlocul anilor ’70, accentuând voluntarismul şi selectivitatea intervenţiilor...
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...Public Finance and Administration The budget being a planning tool that estimates resources available and resources required for a particular program or project, careful study and understanding of how it came to existence is important. The budgeting process in an institution enhances accountability as perceived through budgetary practices. The history of accounting has developed over the decades with financial and budgeting theories being constructed. The construction and development of these theories resulted due to the expansion of social programs and healthcare leading to increased deficits. To counter these effects, it became inevitable for the decision makers to come up with strategies that could bring to a balance all the monetary issues. Budgeting thus grew to become a public affair rather than an inside oriented practice. The traditional public finance theory had no political or constitutional restrictions to be adhered to. Developments featuring the budgetary and financial theories gave rise to rules that had to be adhered to strictly to aid in the decision making processes in matters regarding finances (Musgrave, 1973). As a result of the developments and theories that were introduced, the budgeting environment that was initially characterized by optimism for growth shifted to an environment characterized by constraints and cutback management. In addition to that, various agencies had to follow suit and change the norms and strategies of budgeting. Today, the situation...
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...Voluntary versus Involuntary Unemployment At a very basic level, unemployment can be broken down into voluntary unemployment- unemployment due to people willingly leaving previous jobs and and now looking for new ones- and involuntary unemployment- unemployment due to people getting laid off or fired from their previous jobs and needing to find work elsewhere. Not surprisingly, economists generally view involuntary unemployment as a larger problem than voluntary unemployment since voluntary unemployment likely reflects utility-maximizing household choices. Frictional Unemployment The easiest type of unemployment to explain is known as frictional unemployment. Frictional unemployment is unemployment that occurs because it takes workers some time to move from one job to another. While it may be the case that some workers find new jobs before they leave their old ones, a lot of workers leave or lose their jobs before they have other work lined up. In these cases, a worker must look around for a job that it is a good fit for her, and this process takes some time. During this time, the individual is considered to be unemployed, but unemployment due to frictional unemployment is usually thought to last only short periods of time and not be specifically problematic from an economic standpoint. This is particularly true now that technology is helping both workers and companies make the job search process more efficient. Frictional unemployment can also occur when students move into...
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...Budgetary policy 2011-2015 Budgetary policy refers to government attempts to run a budget in equilibrium or in surplus. The aim is to reduce the public debt. The Rutte government made agreements on public finances in the coalition agreement and the 2010 parliamentary support agreement. The main financial agreements are to reduce the budget deficit and cut public spending. • Additional measures public finances • Measures to restore public finances Need for measures The global financial and economic crisis that commenced in 2008 has hit the Netherlands hard and public finances have deteriorated badly. To overcome the crisis and cushion the worst blows, the economy is being stimulated to keep people in work and investments are being made in business. Public spending has accordingly increased but tax revenue has fallen sharply. The crisis has led to a serious budget deficit and a sharp jump in the national debt. The gap in public finances will not go away by itself. The public debt will continue to rise as long as there is a budget deficit, as will the interest the government has to pay on the debt every year. Public finances in the Netherlands will be untenable without drastic measures. Furthermore, without robust public finances the Netherlands will lose the confidence of the financial markets. At the beginning of its term of office (October 2010), the Rutte government proposed a package of measures of €18 billion in total. As a result of the disappointing economic...
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