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This set of Indian Economy Multiple Choice Questions & Answers (MCQs) focuses on Fiscal System of India Set 6

Q1 | Under increasing returns the supply curve is [SSC (10+2) 2010]
  • positively sloped from left to right
  • negatively sloped from left to right
  • parallel to the quantity-axis
  • parallel to the price-axis
Q2 | Development is : [CDS 1999]
  • synonymous with economic growth
  • narrower than economic growth
  • wider than economic growth
  • not related to economic growth
Q3 | In the short run, a producer continues his production as long as he covers: [Asstt Grade 1992]
  • variable cost
  • fixed cost
  • average cost
  • marginal cost
Q4 | Invisible trade is a trade: [IAS 1992]
  • of government with public institutions
  • of the services like the bank, marine companies and shipping companies
  • of corporate and financial institutions with government
  • of government with other countries
Q5 | What is 'Recession'?
  • Rise in the cost of production, especially because of wage increase
  • Increase in money supply without a matching increase in production
  • Reduction in production and employment for want of sufficient demand for goods
  • None of these
Q6 | A Multinational is: [CDS 1991]
  • a company operating in several countries
  • a company having shareholders from more than one country
  • a company which does charitable work in poor countries
  • a company that operates only in those countries that do not have import restrictions
Q7 | The Indian budget includes:
  • revised estimates for the current year
  • budget estimates for the following year
  • actual figures of the preceding year
  • all of these
Q8 | Funds belonging to Government of India are kept in: 1. Consolidated Fund of India 2. Public Account Fund of India 3. Contingency Fund of India
  • 1 and 2
  • 2 and 3
  • 1 and 3
  • 1, 2 and 3
Q9 | A deflator is a technique of: [IAS 1992]
  • adjusting for changes in price level
  • adjusting for change in commodity
  • accounting for higher increase of GNP
  • accounting for decline of GNP
Q10 | Buyer's market denotes the place where:
  • the supply exceeds the demand
  • the demand exceeds the supply
  • the demand and supply are well balanced
  • commodities are available at competitive rates
Q11 | Deficit financing is spending:
  • by getting foreign aid
  • less than what is needed
  • in excess of revenue
  • by borrowing from abroad
Q12 | Main bearers of the burden of indirect tax are:
  • manufacturers
  • traders
  • consumes
  • tax payers
Q13 | A tax that takes away a higher proportion of one's income as the income rises is termedas [I. Tax & Central Excise 1990]
  • indirect tax
  • progressive tax
  • regressive tax
  • proportional tax
Q14 | The Indian income tax is : 1. direct 2. progressive 3. indirect 4. proportional
  • 1and 2
  • 1and 4
  • 2 and 3
  • 3 and 4
Q15 | Excise Duties are taxes on :
  • sale of commodities
  • export of commodities
  • production of commodities
  • import of commodities
Q16 | The minimum effect of Direct Taxes is on :
  • food price
  • consumer goods
  • capital goods
  • income
Q17 | Companies pay Corporation Tax on their: [UDC 1993]
  • investment
  • production
  • sales proceeds
  • incomes
Q18 | In a country like India, why should an increase of direct taxes be preferred to an increase in indirect taxes?
  • Direct taxes serve the end of Socialism by taking away the excessive wealth from the rich
  • Direct taxes involve the well-off sections of the society while indirect taxes affect the masses
  • It is easy to realise direct taxes and is thus useful in a country troubled by tax evasion
  • All of the above
Q19 | Fresh evalution of every item of expenditure from the very beginning of each financial year is called: [SBI PO 1991]
  • fresh Budgeting
  • deficit Budgeting
  • performance Budgeting
  • zero-based Budgeting
Q20 | The rate of growth of per capita income is equal to:
  • Rate of growth of national income divided by the rate of growth of population
  • Growth in national income divided by the increase in population
  • Rate of growth of national income minus the rate of growth of population
  • Rate of growth of national income
Q21 | Consider the following statements relating to estimation of National Income : 1. Foreigners working in Indian Embassies are normal residents of India. 2. Foreigners working in the office of WHO, World Bank. UNO etc. located in India are not normal residents of India. 3. Indians working in foreign embassies in India are not normal residents of India. Which of the statements given above is/are correct? [CDS 2010]
  • 1 only
  • 1 and 2
  • 3 only
  • 1, 2 and 3
Q22 | Consider the following items of wholesale price index: [Asstt Commt 2010] 1. Primary articles 2. Fuel, power, lights and lubricants 3. Manufacturing products Arrange the above items in descending order in terms of their weightage in calculating wholesale price index
  • 1, 2, 3
  • 1, 3, 2
  • 3, 1, 2
  • 3, 2, 1
Q23 | When the Reserve Bank of India announces an increase of the Cash Reserve 'Ratio, what does it mean? [IAS 2010]
  • The commercial banks will have less money to lend
  • The Reserve Bank of India will have less money to lend
  • The Union Government will have less money to lend
  • The commercial banks will have more money to lend
Q24 | In India, the tax proceeds of which one of the following as a percentage of gross taxrevenue has significantly declined in the last five years? [IAS 2010]
  • Service tax
  • Personal income tax
  • Excise duty
  • Corporation tax
Q25 | Consider the following statements:In India, taxes on transactions in Stock Exchanges and Futures Markets are 1. levied by the Union 2. collected by the States Which of the statements given above is/are correct? [IAS 2010]
  • 1 only
  • 2 only
  • Both 1 and 2
  • Neither 1 nor 2