FISCAL SYSTEM MCQS SET 22

FISCAL SYSTEM MCQS SET 22

211) What are “Open Market Operations”?
A) Activities of SEBl-registered brokers
B) Selling of currency by the RBI
C) Selling of gilt-edged securities by the Government
D) Sale of shares by Flls
Answer: Selling of gilt-edged securities by the Government

   
212) The 'gilt-edged' market deals in :
A) worn and torn currency notes
B) bullion
C) Govt. securities
D) Corporate bonds
Answer: Govt. securities

   
213) How does the consumer benefit with VAT?
A) It removes tax on tax and thus reduces price-rise
B) It reduces the cost of production
C) With the abolition of the sales tax
D) Due to the exemption of small Businesses from the tax within certain limits prescribed by the State
Answer: It removes tax on tax and thus reduces price-rise

   
214) Investment in public works is known as :
A) revenue expenditure
B) capital expenditure
C) current expenditure
D) either (a) or (b)
Answer: capital expenditure

   
215) The rising prices in India can be checked through:
1. Budgetary policy
2. Monetary policy
3. Increasing production
4. Increasing income levels
Choose your answer from:
A) 1 and 2
B) 1, 2 and 3
C) 1, 2, 3 and 4
D) 2 and 3
Answer: 1, 2 and 3


216) A budgetary deficit means:
A) total expenditure is more than total revenue
B) current expenditure is more than current revenue
C) capital expenditure is more than capital revenue
D) total expenditure is more than current revenue
Answer: total expenditure is more than total revenue

   
217) Fiscal deficit in the budget means:
A) Revenue deficit plus the net borrowings of the government
B) Budgetary deficit plus the net borrowings of the government
C) Capital deficit plus revenue deficit
D) Primary deficit minus capital deficit
Answer: Budgetary deficit plus the net borrowings of the government

   
218) What do you mean by a revenue budget?
A) It is the current receipts such as taxation, dividends of PSUs and expenditure of the government
B) It is all the capital receipts and expenditure such as domestic and foreign income and foreign aid
C) It consists of all receipt and payments in the nature of deposit account with the government
D) None of these
Answer: It is the current receipts such as taxation, dividends of PSUs and expenditure of the government

   
219) Fiscal deficit in the Union Budget means:
A) the difference between current expenditure and current revenue
B) net increase in Union Government's borrowings from the Reserve Bank of India
C) the sum of budgetary deficit and net increase in internal and external borrowings
D) the sum of monetised deficit and budgetary deficit
Answer: the sum of budgetary deficit and net increase in internal and external borrowings

   
220) Among the structural changes which of the following is not wholly welcome?
A) Increase in the share of construction in the GNP
B) Relative contribution of agriculture to our GNP is declining
C) Marked improvement in the contribution of manufacturing to the GNP
D) Substantial increase in the percentage contribution of public administration and defence to GDP
Answer: Substantial increase in the percentage contribution of public administration and defence to GDP