Page:Indian Journal of Economics Volume 2.djvu/249

_PRINCIPLES 0_? FINANCE supplemented by their new experience, or their friends' advice. These are all uncertain guides because nothing but a general principle can meet the circumstances of all possible events. 3. Th? Three Systems of Financ.--According to the relations o[ revenue and expenditure to one another we may recognise three distinct systems of finance, I think it is appropriate to convenient to name them as call them. [ollows: as ?It will be (1) The system of Predetermined income, (2) The system o[ Predetermined expenditure, (3) The Commercial system. Predetermined income is the ?o indicate the type of finance is more or less a fixed quantity; in which the income best name I can find in which the income or more practice accurately, at finance in this system is to ascertain what income will become available [or the ensuing year and to adjust the ex- penditure under the various heads in such a way as to get the maximum o[ advantage out o[ the income a hich, it is estimated, will be available. The simplest example o[ this [orm o[ finance is the case o[ any pri- vate individual employed in a permanent position either at a fixed salary or at a salary increasing according to a pre-arrangcd scale. He may earn a little extra money with work taken in his spare time; but in the main his income is predetermined. Other examples can be [ound amongst associations and institutions such as charitable homes, or any schools and colleges which subsist upon inco?ne from endow- ments or upon state grants. The most interesting and important example is to be found in the public finances of any state or territory which is in a primi. will by the recipient, very slowly. It is not subject to variation except within narrow limits follows that the o[ or