Question : Which of the following functions of the government budget is associated with the distribution of income?
I. Allocation function
II. Redistribution function
Option 1: Only I
Option 2: Neither I nor II
Option 3: Both I and II
Option 4: Only II
Correct Answer: Only II
Solution : The correct option is Only II .
The function of the government budget associated with the distribution of income is the redistribution function. This function involves the use of various fiscal policies, such as progressive taxation and social welfare programmes, to redistribute income and wealth in a society.
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