public finance fiscal & monetary policy section 2 MCQ Questions & Answers Detailed Explanation

Answer: (c)

Answer: (c)

SLR or the Statutory Liquidity Ratio is that ratio of total deposits which a commercial bank has to maintain with itself at any given point of time in the form of liquid assets like cash in hand, current balances with other banks and first-class securities which can be turned into cash (gold, cash or other approved securities).

This ratio at present is 25%. Some assets have to be in liquid form to take care of financial emergencies which every bank has to face. It regulates the credit growth in India.

Answer: (c)

It is used to achieve the objectives of balanced economic development, full employment or to establish a welfare state Economics takes care of various needs and wants of life

Answer: (d)

A professional tax, also known as an occupation tax or a professional privilege tax, is a tax that a professional must pay to receive the right to practice a professional service.

Many state and local governments collect professional tax, and a professional who has clients in more than one state may owe professional taxes in several states.

Answer: (b)

Taxes on tooth paste come under GST which is administered by State government.Sales tax is paid to sales tax authority in the state from where the goods are moved.

Answer: (c)

Leasing is a process by which a firm can obtain the use of certain fixed assets for which it must pay a series of contractual, periodic, tax-deductible payments.

Equipment leasing is a financing alternative for businesses to acquire needed machinery while saving precious operating capital. Leasing provides opportunities to use available money to operate assets that can make more money over time.

There are many distinct differences between buying and leasing, regardless if such a transaction or agreement applies to property, machinery, equipment or other assets.

The difference lies in that a lease is conceptually very similar to the principle of “borrowing.” The ownership of the leased property (be it land, equipment, merchandise, or etc.) is not transferred under the terms of the lease agreement.