Practice Quiz set 6 - indian economy mcq Online Quiz (set-1) For All Competitive Exams
Q-1) Which of the following refers to the set of measures adopted by the central bank? - Monetary policy
- GAAR
- Finance Commission
- Black Money
(a)
(b)
(c)
(d)
Monetary policy refers to the set of measures adopted by the central bank (RBI) for monetary management
Q-2) Mobilization of resources and channelizing the same for productive investment is the primary purpose of- Expenditure
- VAT
- Taxation
- CRR
(a)
(b)
(c)
(d)
Taxation is used for mobilizing and channelizing resources for productive investment. It can also be used as a measure to promote equity and reduce disparities or to encourage or discourage consumption of particular items
Q-3) In the context of economic liberalization, which of the following is/are the major themes of the fiscal policy? - A deliberate move to a regime of reasonable direct tax rates and better administration and enforcement
- A systematic effort to simplify tax structure and tax laws
(a)
(b)
(c)
(d)
Fiscal policy comprises of several major themes
Q-4) Which of the following statements is incorrect in regards to Black money? - Hawala market has deep roots with this black money
- It is unaccounted money which is concealed from tax authorities
- All legal economic activities are dealt with this Black Money
- It puts an adverse pressure on equitable distribution of wealth and income in the economy
(a)
(b)
(c)
(d)
Black money deals with all illegal economic activities
Q-5) Which of the following refers to that part of deficit for which the government borrows from the RBI?
- Primary deficit
- Secondary deficit
- Regulatory deficit
- Monetised deficit
(a)
(b)
(c)
(d)
Monetised deficit was adopted by India in 1997- 98. It refers to that part of the deficit for which the government borrows from the RBI.
To meet the government’s such requirements, the RBI prints fresh currency, as a result of which the economy gets monetised
Q-6) In public budgets, zero-base budgeting was first introduced in
(a)
(b)
(c)
(d)
Zero-based budgeting is an approach to planning and decision-making which reverses the working process of traditional budgeting.
This technique of budgeting was developed by Peter Phyrr in the United States and was first implemented at Texas Instruments in the 1960s.
In 1973, President Jimmy Carter contracted with Phyrr to implement a ZBB system for the State of Georgia executive budget process.
Q-7) Regressive tax can be defined as
- The one by which the revenue collected rises proportionally with income
- The rates of tax increase for increasing values or volumes on which the tax is levied
- The one where the proportion of tax paid falls as income rises
(a)
(b)
(c)
(d)
Regressive tax is one where the proportion of tax paid falls as income rises. The most regressive tax is a poll tax, levied at a fixed rate per person regardless of income.
A tax system can be made regressive by having indirect taxes levied at relatively high rates on goods heavily consumed by the poor
Q-8) Which of the following statements is incorrect about Repo and Reverse Repo?
- At present, the repo rate is 11.75%
- At present, the reverse repo rate is 5.75%
- Repo rate is the rate at which RBI lends to commercial banks
- Reverse Repo is the rate at which RBI borrows from commercial banks
(a)
(b)
(c)
(d)
At present, the repo rate is 4.00%
Q-9) CENVAT is related to-
(a)
(b)
(c)
(d)
Q-10) The aim of Differentiated Interest Scheme was to provide concessional loans to _______.
(a)
(b)
(c)
(d)
The Differential Rate of Interest Scheme, formulated in March 1972, offers financial assistance at concessional rate of interest @ 4% to those who intend taking up any productive activity and has been tailored for persons whose income is very low. This scheme is meant for:
• Persons belonging to SC/STs, Adivasis engaged in agricultural operations and/ or allied activities;
• Persons engaged in collection of forest products, fodder and selling these in markets;
• Persons engaged in Village and Cottage Industries on a very small scale; etc.