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

Answer: (c)

Under his concept of creative destruction, Schumpeter distinguished between two types of investment that he called induced and autonomous.

Induced investment arose from the discrepancy between supply and demand and autonomous investment from resources and technology created by the entrepreneurs.

He also introduced a concept of "saving up" which is different from saving in the neoclassical growth models. Saving up constituted the part of the output that is withheld from investment and consumption.

Answer: (b)

Some examples of indirect taxes include value added tax, excise duty, sales tax, stamp duty and custom duty levied on imports. These are taxes levied by the state on expenditure and consumption, but not on property or income.

Answer: (d)

The Act requires the government to lay before the parliament three policy statements in each financial year namely Medium Term Fiscal Policy Statement; Fiscal Policy Strategy Statement and Macroeconomic Framework Policy Statement.

Answer: (a)

It was introduced in France to overcome the cascading effect of several taxes-from raw material to the final product in the process of production

Answer: (b)