public finance fiscal & monetary policy section 6 Practice Questions Answers Test with Solutions & More Shortcuts

Question : 6 [SSC LDEO 2012]

Which one of the following is the most appropriate reason for Inequalities in Income ?

a) Differences in Ability

b) Lack of opportunities

c) Racial factors

d) Inheritance from family Environment

Question : 7

Which of the following statements is incorrect about Repo and Reverse Repo?

1. At present, the repo rate is 11.75%
2. At present, the reverse repo rate is 5.75%
3. Repo rate is the rate at which RBI lends to commercial banks
4. Reverse Repo is the rate at which RBI borrows from commercial banks

a) 1 only

b) 1, 3 and 4

c) 1 and 2

d) None of the above

Question : 8

The process of budget making after re-evaluating every item of expenditure in every financial year is known as-

a) Performance Budgeting

b) Fresh Budgeting

c) Deficit Budgeting

d) Zero Based Budgeting

Question : 9

When RBI announces an increase in Cash Reserve Ratio (CRR) it means:

a) The Union Government will have less money to lend.

b) The RBI will have less money to lend.

c) The commercial banks will have less money to lend.

d) The commercial banks will have more money to lend.

Question : 10

Current account in the Balance of Payment comprise is ___?

a) difference of total exports and imports in one year

b) trade balance plus invisible balance

c) invisible account like tourism, shipping, insurance, etc.

d) transactions like net external assistance, NRI deposits, etc.