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what is finance?
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Answer Posted / swathi
Means by which a budget deficit is financed or a surplus is
used. Means of financing are not included in the budget
totals. The primary means of financing is borrowing from
the public. In general, the cumulative amount borrowed from
the public (debt held by the public) will increase if there
is a deficit and decrease if there is a surplus, although
other factors can affect the amount that the government
must borrow. Those factors, known as other means of
financing, include reductions (or increases) in the
government's cash balances, seigniorage, changes in
outstanding checks, changes in accrued interest costs
included in the budget but not yet paid, and cash flows
reflected in credit financing accounts.
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