MCQs
Total Questions : 217
| Page 4 of 22 pages
Answer: Option C. -> Life Insurance Policies
Answer: (c)
Government debt (also known as public debt, national debt) is the debt owed by a central government. Government debt is one method of financing government operations, but it is not the only method.
Governments can also create money to monetize their debts, thereby removing the need to pay interest. But this practice simply reduces government interest costs rather than truly cancelling government debt. Governments usually borrow by issuing securities, government bonds and bills.
Less creditworthy countries sometimes borrow directly from a supranational organization (e.g. the World Bank) or international financial institutions.
Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against.
Answer: (c)
Government debt (also known as public debt, national debt) is the debt owed by a central government. Government debt is one method of financing government operations, but it is not the only method.
Governments can also create money to monetize their debts, thereby removing the need to pay interest. But this practice simply reduces government interest costs rather than truly cancelling government debt. Governments usually borrow by issuing securities, government bonds and bills.
Less creditworthy countries sometimes borrow directly from a supranational organization (e.g. the World Bank) or international financial institutions.
Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against.
Question 32. With reference to ‘Central excise duty’, which of the following statements is/are correct?
- Commodities on which state governments impose excise duties are exempted from the central excise duty
- In recent years large number of goods has come under excise duty. Moreover, the rates of these duties have also been increasing
- Commodities which are produced within the country levied by central excise duty
Answer: Option D. -> 1, 2 and 3
Answer: (d)
The commodities which are produced within the country are levied by central excise duty.
However, commodities on which state governments impose excise duties (e.g., liquor, drugs) are exempted from the central excise duty
Answer: (d)
The commodities which are produced within the country are levied by central excise duty.
However, commodities on which state governments impose excise duties (e.g., liquor, drugs) are exempted from the central excise duty
Answer: Option B. -> Both 1 and 2
Answer: (b)
A country going for foreign aid has to take several precautions.
However, two major precautions are: Keeping the borrowing level low so that country does not fall into a debt trap, and Keeping foreign aid strings-free
Answer: (b)
A country going for foreign aid has to take several precautions.
However, two major precautions are: Keeping the borrowing level low so that country does not fall into a debt trap, and Keeping foreign aid strings-free
Answer: Option D. -> 4 only
Answer: (d)
Answer: (d)
Answer: Option A. -> Abba ‘P’ Lerner
Answer: (a)
Functional finance is an economic theory proposed by Abba P. Lerner, based on the effective demand principle and chartism.
It states that government should finance itself to meet explicit goals, such as taming the business cycle, achieving full employment, ensuring growth, and low inflation.
Answer: (a)
Functional finance is an economic theory proposed by Abba P. Lerner, based on the effective demand principle and chartism.
It states that government should finance itself to meet explicit goals, such as taming the business cycle, achieving full employment, ensuring growth, and low inflation.
Answer: Option B. -> Progressive tax
Answer: (b)
A progressive tax is a tax by which the tax rate increases as the taxable base amount increases.” Progressive” describes a distribution effect on income or expenditure, referring to the way the rate progresses from low to high, where the average tax rate is less than the marginal tax rate.
It can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime.
Progressive taxes attempt to reduce the tax incidence of people with a lower ability-to-pay, as they shift the incidence increasingly to those with a higher ability-to-pay.
Answer: (b)
A progressive tax is a tax by which the tax rate increases as the taxable base amount increases.” Progressive” describes a distribution effect on income or expenditure, referring to the way the rate progresses from low to high, where the average tax rate is less than the marginal tax rate.
It can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime.
Progressive taxes attempt to reduce the tax incidence of people with a lower ability-to-pay, as they shift the incidence increasingly to those with a higher ability-to-pay.
Answer: Option B. -> 1 and 2
Answer: (b)The RBI implements the monetary policy through open market operations, bank rate policy, reserve system, credit control policy, moral persuasion and through many other instruments.
Answer: (b)The RBI implements the monetary policy through open market operations, bank rate policy, reserve system, credit control policy, moral persuasion and through many other instruments.
Question 38. Consider the following statements regarding the Fourteenth Finance Commission:
Which of the statements given above is/are correct?
- It would recommend on sharing of tax proceeds between the centre and the states which will apply for a five-year period beginning April 1, 2014.
- To suggest steps for pricing of public utilities, such as electricity and water.
- It would review the state of finances, deficit and debt levels of the centre and states.
Which of the statements given above is/are correct?
Answer: Option B. -> 2 and 3 only
Answer: (b)
Fourteenth finance commission would recommend on sharing of tax proceeds between the Centre and the states which will apply for a five-year period beginning April 1, 2015.
It will suggest steps for the pricing of public utilities such as electricity and water. It would review the state of finances, deficit and debt levels of the Centre and states.
Answer: (b)
Fourteenth finance commission would recommend on sharing of tax proceeds between the Centre and the states which will apply for a five-year period beginning April 1, 2015.
It will suggest steps for the pricing of public utilities such as electricity and water. It would review the state of finances, deficit and debt levels of the Centre and states.
Answer: Option D. -> D A B C
Answer: (d)
11th Finance Commission was appointed in 1998, 12th in 2002, 13th in 2007 and 14th in 2013.
Answer: (d)
11th Finance Commission was appointed in 1998, 12th in 2002, 13th in 2007 and 14th in 2013.
Answer: Option B. -> policy relating to government spending, taxation and borrowing
Answer: (b)
Answer: (b)
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