introduction to indian economy section 8 Practice Questions Answers Test with Solutions & More Shortcuts

Answer: (a)

Apart from taxes levied and collected by the States, the Constitution has provided for the revenues for certain taxes on the Union List to be allotted, partly or wholly to the States.

There are taxes that are levied and collected by the Union, but the entire proceeds of which are assigned to the states, in a proportion determined by the Parliament.

These taxes include:

1. Succession and Estate duty;
2. Terminal taxes on goods and passengers;
3. Taxes on railway freight and fares;
4. Taxes on transactions in stock exchanges and
5. future markets; and Taxes on sale and purchase of newspapers and advertisements therein.

Answer: (c)

Gilts are bonds issued by certain, national governments. The term is of British origin and originally referred to the debt securities issued by the Bank of England, which had a gilt (or gilded) edge.

Hence, they are called gilt-edged securities, or gilts for short. The term is also sometimes used in Ireland and some British Commonwealth Countries, South Africa and India.

The term “Gilt Account” is also a term used by the RBI of India to refer to a constituent account maintained by a custodian bank for maintenance and servicing of dematerialised Government Securities owned by a retail customer.

Answer: (b)

Both statements are correct.

Answer: (b)

Mumbai is the commercial capital of India. It is one of the world's top 10 centres of commerce in terms of global financial flow, generating 5% of India's GDP, and accounting for 25% of industrial output, 70% of maritime trade in India (Mumbai Port Trust & JNPT), and 70% of capital transactions to India's economy.

The city houses important financial institutions such as the Reserve Bank of India, the Bombay Stock Exchange, the National Stock Exchange of India, the SEBI and the corporate headquarters of numerous Indian companies and multinational corporations.

Answer: (d)

GDP at factor cost is GDP at market price minus indirect taxes plus subsidies. GDP at factor cost measure the value of output in terms of what it really costs to produce.

However, adjustments have to be made for government subsidies to firms that make up market prices purchasers pay so price plus subsidy represent the true income to the factor of production.

Therefore, We can value domestic output at prices received by producers after indirect taxes and subsidies have been taken into account.