introduction to indian economy section 12 Practice Questions Answers Test with Solutions & More Shortcuts

Answer: (c)

RBINet is a communication software, developed in ‘C’ and available for both DOS and UNIX machines. It allows free format messaging and file transfer on the existing BANK NET infrastructure with the help of UNIX servers installed at the 4 NCCs.

Each RBINet user interacts with the local UNIX server through PADs connected to the X.25 switch.  The UNIX servers in turn communicate with each other using TCP/IP over the X.25 protocol.

The software allows free format messaging without any restrictions on the length of the message, enables file transfer of both ASCII-text and Binary (spreadsheets, databases, programs etc.) files, facilitates dial-up access, and has security features such as end-to-end encryption, audit trail, etc.

Answer: (d)

As per Article 268-A of the Constitution of India, Service tax is levied by Union and collected and appropriated by the Union and States. Service tax is a part of Central Excise in India. It is a tax levied on services provided in India, except the State of Jammu and Kashmir.

As per article 269, the taxes levied and collected by the Union but assigned to the States are:

1. duties in respect of succession to property other than agricultural land;
2. estate duty in respect of property other than agricultural land;
3. terminal taxes on goods or passengers carried by railway, sea or air;
4. taxes on railway fares and freights;
5. taxes on the sale or purchase of newspapers and
6. on advertisements published therein;
7. taxes on the consignment of goods (whether the consignment is to the person making it or to any other person), where such consignment takes place in the course of inter-State trade or commerce, etc.

Answer: (a)

The money market consists of financial institutions and dealers in money or credit who wish to either borrow or lend. Participants borrow and lend for short periods of time, typically up to thirteen months. Money market trades in short-term financial instruments commonly called “paper.”

Answer: (b)

Redistribution of income and redistribution of wealth are respectively the transfer of income and of wealth (including physical property) from some individuals to others by means of taxation, monetary policies, etc. This can be achieved with a combination of progressive taxation and progressive expenditure.

A progressive tax is one such means since they are imposed in an attempt to reduce the tax incidence of people with a lower ability to pay, as such taxes shift the incidence increasingly to those with a higher ability-to-pay. Regarding the distributive impact of public expenditure, the principle of maximum social advantage should be the underlying criteria of public spending. Hence, progressive public expenditure is the best antidote to reduce income inequality existing in society.

The expenditure on social security like free medical aid, free education, subsidized houses etc. is progressive in nature. For example, if only the lower-salaried employees were given free residential quarters, it is a case of progressive expenditure. Such expenditure helps to reduce the glaring inequality existing in the distribution of income. Progressive redistributive expenditure may also take the shape of provision of cheap or free services and commodities.

Free primary education, free medical aid, subsidies to food and housing and the provision of free meals to school children are examples of this type of progressive grant. Such expenditure benefits the poorer among the poorest and helps to raise the living standards of the weaker sections.

Answer: (c)

To rip maximum demographic dividend, India has to promote skill development. This is what Economic Survey and 12th FYP have been advocating.