Difference Between Private And Public Finance

    Private finance (individual)

    Public finance ( government)

    An individual adjusts his or her expenditure according to his or her income.

    The public authority adjusts its income to its expenditure.

    A private individual tries to have a surplus of income over expenditure i.e. surplus budget.

    A public authority will spend all that it gets

    An individual can borrow money from other individual only and externally

    A public authority esp a state can raised loans from both internally

    Finances of individuals are limited

    Finances of government are flexible

    Private individuals cannot use force to get their income; they cannot compel others to get income

    The government can use coercive method to realize revenues

    Not a single individual can print notes

    A state can print currency notes in order to meet its expenditure in difficult times