public finance fiscal & monetary policy section 5 Practice Questions Answers Test with Solutions & More Shortcuts

Question : 6

A high fiscal deficit is a cause for concern for any economy. What does it denote?

a) It is a measure of the borrowing of an economy

b) it means the lack of liquidity and earnings for the economy

c) It is total expenditure less total receipts excluding borrowings

d) It reflects the decrease in tax collections for the year

Question : 7

Consider the following:

1. Income tax
2. Fringe tax
3. Interest tax
4. Security transaction tax (STT)

a) 1, 2 and 3

b) 2 and 3

c) 1 and 2

d) 1, 2, 3 and 4

Question : 8 [SSC IT 2006]

What is Value Added Tax (VAT) ?

a) A new tax to be imposed on the producers of capital goods

b) A new initiative taken by the Government to increase the tax-burden of high income groups

c) A simple, transparent, easy to pay tax imposed on consumers

d) A single tax that replaces State taxes like, surcharge, turnover tax, etc.

Question : 9 [SSC CML 2002]

The tax levied on gross sales revenue from business transactions is called

a) Corporation Tax

b) Sales Tax

c) Turnover Tax

d) Capital Gains Tax

Question : 10 [HCS (Pre) 2014]

Which one of the following is not the objective of fiscal policy of government of India?

a) Economic growth

b) Regulation of inter-state trade

c) Full employment

d) Price stability