public finance fiscal & monetary policy section 4 MCQ Questions & Answers Detailed Explanation

Question : 1

Consider the following statements regarding the Fourteenth Finance Commission:

1. It would recommend on sharing of tax proceeds between the centre and the states which will apply for a five-year period beginning April 1, 2014.
2. To suggest steps for pricing of public utilities, such as electricity and water.
3. It would review the state of finances, deficit and debt levels of the centre and states.

a) 1 and 3 only

b) 2 and 3 only

c) 1 and 2only

d) 1, 2 and 3

Question : 2

With reference to Indian economy, consider the following.

1. Bank rate
2. Open market operations
3. Public debt
4. Public revenue

a) 1 only

b) 1 and 2

c) 2, 3 and 4

d) 1, 3 and 4

Question : 3

Match the following:

a) C A D B

b) A B C D

c) B A C D

d) D A B C

Question : 4

With reference to ‘Central excise duty’, which of the following statements is/are correct?

1. Commodities on which state governments impose excise duties are exempted from the central excise duty
2. In recent years large number of goods has come under excise duty. Moreover, the rates of these duties have also been increasing
3. Commodities which are produced within the country levied by central excise duty

a) 1 only

b) 3 only

c) 1 and 2

d) 1, 2 and 3

Question : 5

“Functional Finance” is associated with :

a) Abba ‘P’ Lerner

b) Adam Smith

c) Adolph Wogner

d) Adams

Question : 6

Increase in net RBI credit for Central Government represents

1. Budgetary Deficit
2. Revenue Deficit
3. Fiscal Deficit
4. Monetised Deficit

a) 1 only

b) 3 only

c) 1 and 2

d) 4 only