Answer: Option C. -> 2 only
Answer: (c)
Fiscal deficit is budget deficit plus borrowings and other liabilities.
Fiscal deficit = Budget deficit + Government’s market borrowing and liabilities.
The fiscal deficit situation shows whether the government is spending beyond its income. India has, unfortunately, been a country prone to constant and high fiscal deficit situations.
A high fiscal deficit implies high indebtedness of the government and a deficit above 3% in the Indian context means an alarming situation for the government finances

Answer: Option C. -> Prof. Keynes
Answer: (c)

Answer: Option B. -> 1, 2, 3 and 4
Answer: (b)
Non-plan expenditure covers
interest payments,
subsidies (mainly on food and fertilisers),
wage and salary payments to government employees,
grants to States and Union Territories governments,
pensions,
police,
economic services in various sectors,
defence,
loans to public enterprises,
loans to States, Union Territories and foreign governments.

Answer: Option A. -> 1 only
Answer: (a)Corporation tax is the tax on income/profit of the organizations. In India, at one time, corporation tax was quite high

Answer: Option B. -> Canon of simplicity
Answer: (b)
In this book, titled ‘The Wealth of Nations, ‘Adam smith only gave four canons of taxation:
canon of equity;
canon of certainty;
canon of convenience; and
canon of the economy.

Answer: Option A. -> 1 only
Answer: (a)In 1996, govt introduced minimum Alternate tax (MAT) on companies which escaped the corporation tax net by using the provisions of exemptions, deductions incentives, deprecation and so on

Answer: Option D. -> 1, 2 and 3
Answer: (d)
In under-developed countries, deficit-financing has been considered essential for financing the plans of economic development. It is used as a tool for meeting the financial needs of the government, especially in times of war.
It is used for the mobilization of surplus, non-utilized and idle resources in the economy. It is also used as an instrument of economic policy for removing the conditions of depression 4 to raise the level of output and employment.