DOWNLOAD MOBILE APPLICATION TO LEARN MORE: PUBLIC FINANCE MCQ WITH ANSWERS
DOWNLOAD MOBILE APPLICATION TO LEARN MORE: PUBLIC FINANCE MCQ WITH ANSWERS
DOWNLOAD MOBILE APPLICATION TO LEARN MORE: PUBLIC FINANCE MCQ WITH ANSWERS
Table of Contents
PUBLIC FINANCE MCQ WITH ANSWERS
1.The first budget of the independent India was presented by
a.Vallabhbhai Patel
b.Dr Bhabha
c.Baldev Sahai
d.RK Shanmukham chetty
2.In which country zero based budgeting was used for the first time?
a.USA
b.France
c.India
d.Germany
3.The concept of performance budget was taken from
a.Germany
b.France
c.UK
d.USA
4.The controlling authority of government expenditure is the
a.RBI
b.Planning commission
c.Finance ministry
d.Finance commission
5.The finance minister who announced long term policy for the country?
a.VP Singh
b.P Chidambaram
c.Dr Man Mohan Singh
d.Yashwant Singh
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6.Identify the correct sequences of passing a budget in the parliament
a.Vote on account – finance bill – appropriation bill – discussion on budget
b.Finance bill – appropriation bill – discussion on budget – vote on account
c.Discussion on budget – vote on account – finance bill – appropriation bill
d.Discussion on budget – appropriation bill – finance bill – vote on account
7.Identify the correct sequence of passing a budget from the given options
(i)Presentation of budget
(ii)Scrutiny of budget by departmentally related standing committee
(iii)Passing of finance bill
(iv)Passing of appropriation bill
Codes
a.(i) (ii) (iv) (iii)
b.(i) (iii) (ii) (iv)
c.(ii) (i) (iii) (iv)
d.(i) (ii) (iii) (iv)
8.As per the budget estimates of 2019 -20 the following are some of the important sources of tax receipts for the union government
(i)Corporation tax
(ii)Taxes on income other than corporation tax
(iii)Goods and service tax
(iv)Union excise duties
Which one of the following is the correct descending order of the foresaid tax receipts as a percentage of GDP?
a.(i) (ii) (iii) (iv)
b.(i) (iii) (ii) (iv)
c.(iii) (ii) (i) (iv)
d.(ii) (iv) (iii) (i)
9.Assertion (A) In India zero based budgeting method is being promoted.
Reason (R) in this method before allocating revenue all expenses for each new period must be justified
Codes
a.Both A and R are true and R is the correct explanation of A
b.Both A and R are true but R is not the correct explanation of A
c.A is true but R is false
d.A is false but R is true
10.All government receipts which either create liability or reduce assets are treated as?
a.Revenue receipts
b.Capital receipts
c.Primary receipts
d.None of the above
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11.Which one of the following is not a component of revenue receipts of the union government?
a.Corporate tax receipts
b.Dividends and profits
c.Disinvestment receipts
d.Interest receipts
12.Development expenditure of the central government does not include
a.Defence expenditure
b.Expenditure on economic services
c.Expenditure on social and community services
d.Grant to states
13.Expenditure for public administration falls under
a.Plan expenditure
b.Non plan expenditure
c.Profitable expenditure
d.None of the above
14.Effective revenue deficit was introduce in the union budget of
a.2010- 11
b.2011 – 12
c.2009 – 10
d.2012 – 13
15.Interest payment is an item of
a.Revenue expenditure
b.Capital expenditure
c.Plan expenditure
d.None of the above
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16.Consider the following expenditure
(i)Salary paid to government employee
(ii)Interest paid on national debt
(iii)Loan given to state government
(iv)Construction of tunnel
Which of the following is an example of revenue expenditure?
a.(i) and (ii)
b.(ii) and (iii)
c.(i) and (iii)
d.All of these
17.Which of the following constitute capital account?
(i)Foreign loans
(ii)Foreign direct investment
(iii)Private remittances
(iv)Portfolio investment
Select the correct answer using the codes given below
a.(i) (ii) and (iii)
b.(i) (ii) and (iv)
c.(ii) (iii) and (iv)
d.(i) (iii) and (iv)
18.Fiscal deficit is
a.Revenue receipts + capital receipts (only recoveries of loans and other receipts – total expenditure
b.Budget deficit + governments market borrowings and liabilities
c.Primary deficit + interest payments
d.All of the above
19.If interest payments is taken out of fiscal deficit then remaining amount will be
a.Primary deficit
b.Revenue deficit
c.Budgetary deficit
d.Capital deficit
20.Ad hoc treasury bill system of meeting budget deficit in India was abolished on
a.1st April, 1992
b.1st April, 1994
c.31st March ,1996
d.31st March ,1997
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21.Fiscal deficit in the union budget means
a.The difference between current expenditure and current revenue
b.The net increase in union government borrowings from the reserve bank of India
c.The sum of budgetary deficit and net increase in internal and external borrowings
d.The sum of monetised deficit and budgetary deficit
22.The objective of the fiscal responsibility and budget management
a.To reduce revenue deficit
b.To reduce fiscal deficit
c.To ensure that public debt does not exceed 50 % of the GDP of the year from 2011
d.All of the above
23.In India deficit financing is used for raising resources for
a.Economic development
b.Redemption of public debt
c.Adjusting the balance of payments
d.Reducing the foreign debt
24.In the context of governance consider the following
(i)Encouraging foreign direct investment
(ii)Privatisation of higher educational institutions
(iii)Down – sizing of bureaucracy
(iv)Selling / offloading the shares of public sector undertakings
Which of the above can be used as measures to control the fiscal deficit in India?
a.(i) (ii) and (iii)
b.(ii) (iii) and (iv)
c.(i) (ii) and (iv)
d.(ii) and (iii)
25.There has been a persistent deficit budget year after year which of the following actions can be taken by the government to reduce the deficit?
(i)Reducing revenue expenditures
(ii)Introducing new welfare schemes
(iii)Rationalising subsidies
(iv)Expanding industries
Codes
a.Only (i)
b.ii) and (iii)
c.(i) and (iii)
d.(i) (ii) (iii) and (iv)
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26.The difference between GDP at market prices and GDP at factor cost is
a.Direct taxes
b.Indirect taxes
c.Transfer payment
d.Subsides
27.Which committee recommended abolition of taxes rebates under section 88?
a.Chelliah committee
b.Kelkar committee
c.Shome committee
d.None of these
28.Which of the following statements are correct?
(i)Ability to pay principle of taxation holds that the amount of taxes people pay should relate to their income or wealth
(ii)The benefit principle of taxation states that individual should be taxed in proportion to the benefit they receive from government programmes
(iii)A progressive tax takes a larger share of tax from poor families than it does from rich families
(iv)Indirect taxes have the advantage of being cheaper and easier to collect
Select the correct answer using the codes given below
a.(i) and (ii)
b.(ii) and (iv)
c.(i) (ii) and (iv)
d.(i) (ii) (iii) and (iv)
29.Consider the following statements
(i)Tax revenue as a per cent of GDP of India has steadily increased in the last decade
(ii)Fiscal deficit as a percent of GDP of India has steadily increased in the last decade
Which of the statements given above is correct?
a.Only (i)
b.Only (ii)
c.Both (i) and (ii)
d.Neither (i) nor (ii)
30.Direct tax code in India is related to which of the following?
a.Sales tax
b.Income tax
c.Excise tax
d.Service tax
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31.In India non – agricultural income tax is
a.Levied by the centre and fully distributed among the states
b.Levied by the states
c.Levied and appropriated by the centre
d.Levied by the centre ad shared with the states
32.Which one of the following is the major source at gross tax revenue for the government of India?
a.Income tax
b.Corporation tax
c.Custom duty
d.Service tax
33.Who among the following is the convener of the task force set up in November 2017 by the government of India to review the income tax act and draft a new direct tax law?
a.Girish Ahuja
b.Mukesh Patel
c.Arbind Modi
d.Mansi Kedia
34.Which one of the following is correct about Aaykar Setu?
a.It is a mechanism for achieving excellence in public sector delivery related to GST
b.With the use of a mobile app, it facilities online payment of taxes
c.It is a communication strategy designed to collect information and build a database of tax defaulters
d.It enables electronic filing and processing of import and declarations
35.Which one of the following represents a progressive tax structure?
a.Tax rate is the same across all incomes
b.Tax rate increase as income increases
c.Tax rate decreases as income increases
d.each household pays equal amount of tax
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36.service tax in India was introduced in the year
a.1994 – 95
b.1996 – 97
c.1998 – 99
d.1991 – 92
37.Service tax was introduced in India on the recommendation of
a.Kelkar committee
b.Raja j Challiah committee
c.Manmohan Singh committee
d.Yashwant Sinha committee
38.The goods and service tax were proposed by a task force whose president was?
a.Vijay Kelkar
b.Montek Singh Ahluwalia
c.Arun Jaitley
d.Narasimha
39.Which among the following taxes has not been subsumed under the GST?
a.Custom tax
b.Value added tax
c.Service tax
d.Entry tax
40.Goods and services tax would replace which of the following taxes levied at present?
a.Income tax
b.Corporate tax
c.Capital gains tax
d.Value – added tax
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41.What is the uniform GST rate that has been fixed up for lottery prizes by the GST council?
a.28%
b.18%
c.18%
d.32%
42.The provision of goods and service tax has been included into……. Constitutional amendment
a.98th constitutional amendment act 2012
b.99th constitutional amendment act 2014
c.100th constitutional amendment act 2015
d.101st constitutional amendment act 2016
43.Which one of the followings statements is correct in relation to the GST bill passed by the Rajya Sabha in august 2016?
a.It will replace all central taxes, duties etc. only by a single tax
b.It will subsume central as well as state taxes duties etc.
c.GST will be levied on alcoholic liquor for human consumption at uniforms rate of 25%
d.Petroleum and petroleum products shall not be subjected to the levy of GST
44.Why was constitutional amendment needed for introducing GST?
a.States were not willing to agree with the union for introducing of GST without amendment in the constitution
b.GST was to be implemented on concurrent base and article 246 was inadequate for such a case
c.The empowered committee of finance ministers had recommended for constitutional amendment
d.The GST council had recommended for constitutional amendment so that the power enhances
45.What is the most likely advantage of implementing goods and services tax?
(i)It will replace multiple taxes collected by multiple authorities and will thus create a single market in India
(ii)It will drastically reduce the current account deficit of India and will enable it to increase its foreign exchange reserves
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(iii)It will enormously increase the growth and size of economy of India and will enable it to overtake China in the near future
Select the correct answer using the codes given below
a.Only (i)
b.(ii) and (iii)
c.Both (i) and (ii)
d.Neither (i) nor (ii)
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46.Which of the following tax is levied by union and collected and appropriated by states?
a.Stamp duties
b.Passenger and goods tax
c.Estate duty
d.Taxes of newspapers
47.The union government has decided to impose 0.5% cess on which services to fund the swash bharat programmed?
a.All non -taxable services
b.All charitable services
c.Non – refundable services
d.All taxable services
48.A decrease in tax to GDP ratio of a country indicates which of the following?
(i)Slowing economic growth rate
(ii)Less equitable distribution of national chrome
Select the correct answer using the codes given below
a.Only (i)
b.Only (ii)
c.Both (i) and (ii)
d.Neither (i) nor (ii)
49.With reference to India decision to levy an equalisation tax of 6% on online advertisement services offered by non – resident entities which of the following statements is correct
(i)It is introduced as a part of the income tax act
(ii)Non – resident entities that offer advertisement services in India can claim a tax credit in their home country under the double taxation avoidance agreements
Select the correct answer using the codes given below
a.Only (i)
b.Only (ii)
c.Both (i) and (ii)
d.Neither (i) nor (ii)
50.Finance commission of India is constituted under the provision of constitution
a.Article 280
b.Article 269
c.Article 268
d.Article 265
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51.According to the 14th finance commission the percentage share of states in the net proceeds of the shareable central tax revenue should be
a.32%
b.35%
c.40%
d.42%
52.Which one of the following criteria got the highest weight for determination of shares in the formula given by the 14th finance commission?
a.Population
b.Income distance
c.Area
d.Tax effort
53.The 14th finance commission assigned different weights to the following parameters for distribution of tax proceeds to the states
(i)Income distance
(ii)Population
(iii)Demographic changes
(iv)Area
Arrange the aforesaid parameters in descending order in terms of their weights
a.(i) (ii) (iii) (iv)
b.(i) (ii) (iv) (iii)
c.(i) (iii) (ii) (iv)
d.(iv) (iii) (ii) (i)
54.Rise in the price of a commodity means
a.Rise in the value of currency only
b.Falls in the value of currency only
c.Rise in the value of commodity only
d.Fall in the value of currency and rise in the value of commodity
55.Which one of the following had set a goal of stabilizing inflation rate at 4% (+ 1 – 2% tolerance limit) for the year 2016 – 2021?
a.RBI
b.Government of India
c.Niti Aayog
d.Fourteenth finance commission
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56.Indexation is a method whose use can be associated with one of the following?
a.Reserve bank of India act, 1934
b.Deposit insurance and credit guarantee corporation act , 1961
c.The industrial finance corporation of India act , 1948
d.Banking regulation act , 1949
57.With reference to inflation in India which of the following statements is correct?
a.Controlling the inflation in India is the responsibility of the government of India only.
b.The reserve bank of India has no role in controlling the inflation.
c.Decreased money circulation helps in controlling the inflation.
d.Increased money circulation helps in controlling the inflation.
58.India has experienced persistent and high food inflation in the recent past what could be the reasons?
(i)As a consequence of increasing incomes, the consumption pattern of the people has undergone a significant change.
(ii)The food supply chain has structural constraints.
(iii)Due to gradual switch over to the cultivation of commercial crops the area under the cultivation of food grains has steadily decreased in the last five years by about 30%.
Which of the statements given above is correct?
a.(i) and (ii)
b.(i) and (iii)
c.(ii) and (ii)
d.Only (ii)
59.Who among the following is the chairman of the economic advisory council to the prime minister?
a.Ratan P Watal
b.Bibek Debroy
c.Ashima Goyal
d.Sajjid Chinoy
60.Sakshman project initiated by government of India is related with
a.Skill development of SCs/ STs
b.Mobilisation of protection for effective disaster management
c.New indirect tax network
d. Empowerment of youths of person with disabilities
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61.Who among the following publishes the economic survey of India?
a.National development council
b.Ministry of finance
c.Institute of finance
d.Indian statistical institute
62.The pan card starts with five English letters like AFZPK7190K here P denotes
a.Individual
b.Firm
c.Undivided Hindu of finance
d.Associations of persons
63.Which one of the following statements about Indian economy during not correct?
a.There has been declaration in growth rate.
b.There has been sluggish growth in tax revenue relative to budget estimates.
c.Fiscal deficit as percentage of GDP has been as per the budget estimates.
d.The non – tax revenue registered a considerably higher growth.
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64.Consider the following statements.
(i)The fiscal responsibility and budget management review committee report has recommended a debt to GDP ratio of 60% for the general government by 2023 comprising 40% for the central government and 20% for the state governments.
(ii)The central government has domestic liabilities of 21% of GDP as compared to that of 49% of GDP of the state governments.
(iii)As per the constitution of India it is mandatory for a state to take the central governments consent for raising any loan if the former owes any outstanding liabilities to the latter.
Which of the statements given above is correct?
a. Only (i)
b.(ii) and (iii)
c.(i) and (iii)
d.(i) (ii) and (iii)
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ALSO VISIT : INDIAN ECONOMY
DOWNLOAD MOBILE APPLICATION TO LEARN MORE: PUBLIC FINANCE MCQ WITH ANSWERS
DOWNLOAD MOBILE APPLICATION TO LEARN MORE: PUBLIC FINANCE MCQ WITH ANSWERS