public finance fiscal & monetary policy section 3 Practice Questions Answers Test with Solutions & More Shortcuts

Question : 1

After 1947, development and non-development expenditures have increased, the increase in the former being more. Nondevelopment expenditure involves

1. interest payments
2. subsidies
3. defence
4. irrigation

a) 1 and 2

b) 1, 2 and 3

c) 1 only

d) 2, 3 and 4

Question : 2

With reference to steps taken to achieve financial inclusion in India, consider the following statements:

1. Scheduled commercial banks initiatives to masses.
2. Formation of RRB
3. Adoption of village by bank branches

a) 1 and 3

b) 2 and 3

c) 1 and 2

d) 1, 2 and 3

Question : 3 [SSC SO 2001]

Buoyancy of a tax is defined as

a) percentage increase in tax revenue/ increase in tax coverage

b) increase in tax revenue/ percentage increase in tax coverage

c) percentage increase in tax revenue/percentage increase in tax base

d) increase in tax revenue/increase in tax base

Question : 4

Fiscal deficit means:

a) Total receipts minus expenditure

b) Revenue receipts minus defense expenditure

c) Total receipts minus interest payments on external debt

d) Revenue receipts minus ex-penditure

Question : 5

Which of the following means rates of tax increase for increasing values or volumes on which the tax is levied

1. Progressive tax
2. Proportional tax
3. Regressive tax
4. Indirect tax

a) 1 only

b) 3 only

c) 2 only

d) 1, 2 and 4