Fiscal System of India Set 7 MCQs

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