taxes types, methods & budgeting process section 5 MCQ Questions & Answers Detailed Explanation

Question : 1

Which one of the following is not a tax/duty levied by the Government of India?

a) Education Cess

b) Custom Duty

c) Service Tax

d) Toll Tax

Question : 2

Surplus reserve of RBI transferred to Government of India (GOI) will come under which of the following?

a) Non-tax revenue receipts

b) Non-debt capital receipts

c) Market borrowings and other liabilities

d) Debt receipts

Question : 3

The term ‘Crowd-in’ in the economy is related to which of the following?

1. Targeted government spending acts as an engine of growth in the short run
2. Government spending complements the private investment
3. Government spending substitutes the private investment
4. Government spending boosts demand for goods which in turn increases private demand

a) (i) & (iii) only

b) (i), (ii) & (iv) only

c) (i) & (ii) only

d) (i), (iii) & (iv) only

Question : 4

Which among the following are true for Central Sales Tax?

1. It is levied on interstate trade.
2. It is levied in the Union Territories.
3. It is levied in the SEZ.

a) Only 2

b) Only 2 and 3

c) Only 1 and 2

d) All of these

Question : 5

Consider the following statements regarding the "Composition Scheme" in GST:

1. It exempts small taxpayers from payment of GST
2. It allows small businesses to pay tax at a fixed per cent of their turnover
3. It reduces the compliance cost for small businesses

a) (i) & (iii) only

b) (ii) only

c) (i) only

d) (ii) & (iii) only

Question : 6

The most important source of revenue for Indian Government is

a) Indirect Tax

b) Deficit financing

c) Direct Tax

d) Loans from RBI