introduction to indian economy section 10 MCQ Questions & Answers Detailed Explanation
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The following question based on Introduction to Indian Economy topic of indian economy mcq
(a) Income tax, Custom duty and House tax
(b) Excise duty, Sales tax and Custom duty
(c) Excise duty, Custom duty and Income tax
(d) Custom duty, Entertainment tax and Income tax
The correct answers to the above question in:
Answer: (c)
The taxing powers of the central government encompass taxes on income (except agricultural income), excise on goods produced (other than alcohol), customs duties, and inter-state sale of goods.
The authority to levy a tax is coming from the Constitution which allocates the power to levy various taxes between the Centre and the State.
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Question : 1
Which of the following comes under Non-plan expenditure?
- Subsidies
- Interest payments
- Defence expenditure
- Maintenance expenditure for the infrastructure
a) 1 and 3
b) 2 and 4
c) 1 and 2
d) 1, 2, 3 and 4
Answer »Answer: (d)
Expenditure incurred on the non-development plans is called non-plan expenditure which includes subsidies, interest payments etc.
Non-plan revenue expenditure is accounted for by,
- interest payments,
- subsidies,
- wage and salary payments to government employees,
- grants to States and Union Territories governments,
- pensions,
- police,
- economic services in various sectors,
- other general services such as tax collection,
- social services, and grants to foreign governments.
Non-plan capital expenditure mainly includes,
- defence,
- loans to public enterprises,
- loans to States, Union Territories and foreign governments.
Question : 2
Among the following, which is the reason for different types of economic system?
- Time requirement
- Money requirement
a) 2 Only
b) 1 and 2
c) 1 Only
d) None of the Above
Answer »Answer: (b)
Different types of economy are dependent on time which helps in providing several ways to structure an economy.
Question : 3
In which sector of the Indian economy is productivity the highest ?
a) Transport, Communication and Commerce
b) Manufacturing
c) Agriculture
d) Other sectors
Answer »Answer: (b)
Lately, the manufacturing industry has been witnessing positive overall growth across the spectrum. This can be said on the basis of the Industrial Outlook survey that was conducted by the Reserve Bank of India (RBI) for 2010 on the Indian manufacturing sector.
As per UNIDO’s new report titled ‘Yearbook of Industrial Statistics 2010’, India has emerged as one of the world’s top 10 countries in industrial production, while as per the report ‘2010 Global Manufacturing Competitiveness Index’, by Deloitte Touche Tohmatsu and the US Council on Competitiveness, India has ranked second for its manufacturing competence.
Question : 4
The single largest item of expenditure of the Central Government in India in recent years is
a) Subsidies
b) Defence
c) Interest payment
d) General services
Answer »Answer: (c)
Interest payments are the single largest item of expenditure.
As per the Economic Survey 2011-2012,
- Interest payments constituted 3 per cent of India’s GDP in 2011-12.
- Major subsidies constituted 1.5 per cent,
- While defence expenditure comprised 1.1 per cent of India’s GDP in 2011-12.
- Of the revenue expenditure in 2011-12, interest payments comprised 24.4 per cent;
- Major subsidies: 12.3 per cent and Defence expenditure: 8.7 per cent.
Question : 5
In India, rural incomes are generally lower than urban incomes. Which of the following reasons account for this?
- A large number of farmers are illiterate and know little about scientific agriculture.
- Prices of primary products are lower than those of manufactured products.
- Investment in agriculture has been lower when compared to investment in the industry.
a) 1 and 2
b) 1 and 3
c) 1, 2 and 3
d) 2 and 3
Answer »Answer: (c)
In India a large number of farmers are illiterate and know little about scientific agriculture, prices of primary products are lower than those of manufactured products and Investment in agriculture has been lower when compared to investment in the industry.
All these reasons are responsible for lower rural income.
Question : 6
As the economy develops, the share of the tertiary sector in the GDP:
a) Decreases then increases
b) Remains constant
c) Increases
d) Decreases
Answer »Answer: (c)
As the economy develops, the share of the tertiary sector in the GDP increases.
The tertiary sector of the economy consists of activities where people offer their knowledge and time to improve productivity like,
- telecommunication,
- hospitality industry/tourism,
- mass media,
- healthcare/ hospitals,
- information technology,
- banking,
- insurance,
- investment management,
- accountancy,
- legal services,
- consulting,
- retail sales,
- real estate, and
- education.
As the economy develops people develop more skills and knowledge which they offer as services.
GET Introduction to Indian Economy PRACTICE TEST EXERCISES
introduction to indian economy section 1
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introduction to indian economy section 9
introduction to indian economy section 10
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introduction to indian economy section 12
introduction to indian economy section 13
introduction to indian economy section 14
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