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This set of Indian Economy Multiple Choice Questions & Answers (MCQs) focuses on Fiscal System of India Set 7

Q1 | With reference to Indian economy, consider the following statements: 1. The Gross Domestic Product (GDP) has increased by four times in the last 10 years. 2. The percentage share of Public Sector in GDP has declined in the last 10 years. Which of the statements given above is/are correct? [IAS 2010]
  • 1 only
  • 2 only
  • Both 1 and 2
  • Neither 1 nor 2
Q2 | Which of the following statements is/are correct? 1. If a country is experiencing increase in its per capita GDP, its GDP must necessarily be growing. 2. If a country is experiencing negative inflation, its GDP must be decreasing. Select the correct answer using the code given below: [CDS 2012]
  • 1 only
  • 2 only
  • Both 1 and 2
  • Neither 1 nor 2
Q3 | National income ignores [CDS 2012]
  • sales of firm
  • salary of employees
  • exports of the IT sector
  • sale of land
Q4 | An individual's actual standard of living can be assessed by [SSC Grad 2011]
  • Gross National Income
  • Net National Income
  • Per Capita Income
  • Disposable Personal Income
Q5 | Consider the following statements about Sinking Fund: 1. It is a method of repayment of public debt. 2. It is created by the government out of budgetary revenues every year. Which of the statements given above is/are correct? [CDS 2011]
  • 1 only
  • 2 only
  • Both 1 and 2
  • Neither 1 nor 2
Q6 | Which one among the following is not a component of fiscal policy? [Asstt Commdt 2011]
  • Taxation policy
  • Public debt policy
  • Trade policy
  • Public expenditure policy
Q7 | The total value of goods and services, produced' in a country during a given period is[CPO SI 2011]
  • Disposable income
  • National income
  • Per capita income
  • Net national income
Q8 | In the context of Indian economy, consider the following statements: 1. The growth rate of GDP has – steadily increased in the last five years. 2. The growth rate in per capita income has steadily increased in the last five years. Which of the statements given above is/are correct? [CSAT2011]
  • 1only
  • 2 only
  • Both 1and 2
  • Neither 1 nor 2
Q9 | Economic growth is usually coupled with [CSAT 2011]
  • deflation
  • inflation
  • stagflation
  • hyperinflation
Q10 | In terms of economy, the visit by foreign nationals to witness the XIX Common Wealth Games in India amounted to [CSAT 2011]
  • Export
  • Import
  • Production
  • Consumption
Q11 | Which one of the following statements appropriately describes the "fiscal stimulus"? [CSAT 2011]
  • It is a massive investment by the Government in manufacturing sector to ensure the supply of goods to meet the demand surge caused by rapid economic growth
  • It is an intense affirmative action of the Government to boost economic activity in the country
  • It is Government's intensive action on financial institutions to ensure disbursement of loans to agriculture and allied sectors to promote greater food production and contain food inflation
  • It is an extreme affirmative action by the Government to pursue- its policy of financial inclusion
Q12 | Consider the following actions which the Government can take: 1. Devaluing the domestic currency. 2. Reduction in the export subsidy. 3. Adopting suitable policies which attract greater FDI and more funds from FIIs. Which of the above action/actions can help in reducing the current account deficit? [CSAT 2011]
  • 1 and 2
  • 2 and 3
  • 3 only
  • 1 and 3
Q13 | A rapid increase in the rate of inflation is sometimes attributed to the "base effect" What is "base effect"? [CSAT 2011]
  • It is the impact of drastic deficiency in supply due to failure of crops
  • It is the impact of the surge in demand due to rapid economic growth
  • It is the impact of the price levels of previous year on the calculation of inflation rate
  • None of the statements (a), (b) and (c) given above is correct in this context
Q14 | Which one of the following is not a feature of "Value Added Tax"? [CSAT 2011]
  • It is a multi-point destination-based system of taxation
  • It is a tax levied on value addition at each stage of transaction in the productiondistribution chain
  • It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer
  • It is basically a subject of the Central Government and the State Governments are only a facilitator for its Successful implementation
Q15 | The National Income is more at current prices than at constant prices because: [CDS 1992]
  • increase in price is equal to increase in production
  • increase in price is more than production
  • increase in production is more than increase in price
  • of decrease in production only
Q16 | The first estimate of national income in India was made by:
  • Mahalanobis
  • V.K.R.V. Rao
  • Dadabhai Naoroji
  • Prof. Sheroi
Q17 | The per capita income is obtained by:
  • summing up the income of all the citizens of the country
  • dividing national income by the population
  • estimating the minimum income of individual citizens
  • dividing the total national capital with the profit earned
Q18 | Which of the following is correct regarding the Gross Domestic Saving In India? [Asstt Grade 1992]
  • Contribution of Household sector is the largest
  • Contribution of Government sector is the largest
  • Contribution of Corporate sector is the largest
  • None of these
Q19 | Which of the following is not required while computing Gross National Product (GNP)?[Asstt Grade 1992]
  • Net foreign investment
  • Private investment
  • Per capita income of citizens
  • Purchase of goods by government
Q20 | National income is the same as:
  • Net Domestic Product at market price
  • Net Domestic Product at cost factor
  • Net National Product at market price
  • Net National Product at factor cost
Q21 | The sum total of incomes received for the services of labour, land or capital in a country is called:
  • gross domestic product
  • national income
  • gross domestic income
  • gross national income
Q22 | Which of the following is not shared by the Centre and the States?
  • Sales Tax
  • Corporation Tax
  • Income Tax
  • Union Excise Duties
Q23 | Which of the following taxes is not levied by the Union Government?
  • Wealth Tax
  • Excise Duty
  • Profession Tax
  • Income Tax
Q24 | The principal source of revenue to the State Government in India is :
  • Income Tax
  • Sales Tax
  • State Excise Duties
  • Land Revenue
Q25 | Which of the following is an indirect tax?
  • Corporation Tax
  • Excise Duty
  • Wealth Tax
  • Capital Gains Tax