Questions and answers for exam Preparation

MCQs

Total Questions : 163 | Page 9 of 17 pages

Question 81. Consider the following statements. In India, Stamp duties on financial transactions are

Levied and collected by the state
Appropriated by the Union Government

Which of these statement(s) is/are correct?

Only 2
Both 1 and 2
Only 1
Neither 1 nor 2

Discuss Question

Answer: Option D. -> Neither 1 nor 2
Answer: (d)

Question 82. The term “Pump Priming” means:

It is a way to stimulate the economy by reducing tax

It is done in economic slowdown by increasing government spending

RBI prints extra money

Select the correct answer using the code given below:

(i) & (ii) only
(iii) only
(i) only
All of the above

Discuss Question

Answer: Option A. -> (i) & (ii) only
Answer: (a)
Pump priming is the action taken to stimulate an economy, usually during a recessionary period, through government spending and tax reductions.
The term pump-priming is derived from the operation of older pumps - a suction valve had to be primed with water so that the pump would function properly.

Question 83. Which of the following statements about Krishi Kalyan Cess (KKC) is/are correct ?

KKC is calculated in the same way as Service Tax is calculated.
The current rate of KKC is 0.50%
KKC is similar to the KKS (Krishi Kalyan Surcharge).

Select the correct answer using the code given below:

2 and 3 only
1, 2 and 3
1 and 2 only
1 only

Discuss Question

Answer: Option C. -> 1 and 2 only
Answer: (c)KK Surcharge is the additional percentage of tax which domestic tax players need to pay when declaring undisclosed income by paying tax at 30%. The KKS above the tax is 7.5%.

Question 84. Consider the following statements regarding Goods and Services Tax (GST):

Taxes need to be paid at each point in the value chain

It will have an input tax credit mechanism

The total taxes will be passed on to the consumers

Select the correct answer using the code given below:

(i) & (iii) only
(ii) & (iii) only
(i) & (ii) only
All of the above

Discuss Question

Answer: Option D. -> All of the above
Answer: (d)

Question 85. Tax revenue collection in our country mainly depends on which of the following:

Nominal GDP

Real GDP

Select the correct answer using the code given below:

(ii) only
Both (i) & (ii)
(i) only
Neither (i) nor (ii)

Discuss Question

Answer: Option C. -> (i) only
Answer: (c)
Most of the taxes in the country are imposed on value (Quantity X Price) and not on quantity.
So, tax revenue collection depends on the value of production i.e. Nominal GDP

Question 86. Consider the following statements regarding 'Contingency Fund of India'

The fund is at the disposal of the president of India

The fund is at the disposal of the Prime Minister of India

The funds spent shall ultimately be approved by the parliament

The funds spent are recouped from the Consolidated Fund of India

Select the correct answer using the code given below:

(ii) & (iv) only
(i), (iii) & (iv) only
(i) only
(i) & (iv) only

Discuss Question

Answer: Option B. -> (i), (iii) & (iv) only
Answer: (b)
This fund is in the nature of an imprest (a fixed fund for a specific purpose) account and is kept at the disposal of the President of India (by the Secretary to the Government of India, Ministry of Finance, Department of Economic Affairs) to enable the government to meet unforeseen expenses pending authorization by the Parliament.
The money is used to provide immediate relief to victims of natural calamities and also to implement any new policy decision taken by the Government pending its approval by the Parliament.

Question 87. Consider the following items.