Question 1

Printing of new currency notes and RBI borrowings by government is called:

Accepted Answer

A)  Government Loans.
B)  Government Securities.
C)  Government Bonds.
D)  Deficit Financing.E) A) and D)
F) A) and C)

Question 2

Classical canons of taxation are propounded by:

Accepted Answer

A)  adam smith
B)  bastable
C)  dalton
D)  keynesE) All of the above
F) C) and D)

Question 3

The final resting place of the burden of tax is called:

Accepted Answer

A)  tax avoidance
B)  tax evasion
C)  impact
D)  incidenceE) A) and C)
F) None of the above

Question 4

In the case of relatively elastic demand, the money burden of tax is on:

Accepted Answer

A)  Entirely on seller.
B)  More on seller.
C)  Entirely on buyer.
D)  More on buyer.E) B) and C)
F) A) and D)

Question 5

The idea of 'Democratic Decentralization' in India was popularized by:

Accepted Answer

A)  a.d. gorwala committee, 1951
B)  b.r. mehta committee, 1957
C)  ashok mehta committee, 1978
D)  none of theseE) B) and C)
F) A) and D)

Question 6

The controlling authority of Government expenditure is:

Accepted Answer

A)  rbi
B)  planning commission
C)  ministry of finance
D)  finance commissionE) B) and D)
F) B) and C)

Question 7

The Kelkar Proposals are concerned with:

Accepted Answer

A)  recommendations for re4forms in the power sector
B)  recommendations for tax reforms
C)  guidelines for the privatization of public sector undertakings
D)  none of the aboveE) A) and B)
F) B) and C)

Question 8

Merit goods are those which, when consumed, generate positive external benefits. This is likely to mean that, in a free market economy, the good will be:

Accepted Answer

A)  Over-consumed.
B)  Over-supplied.
C)  Subject to VAT.
D)  Under-supplied.E) B) and C)
F) All of the above

Question 9

In the case of direct tax, impact and incidence are on:

Accepted Answer

A)  Same person.
B)  Sellers.
C)  Different person.
D)  Producer.E) A) and C)
F) None of the above

Question 10

The income of the government through all its sources is called

Accepted Answer

A)  public expenditure
B)  public revenue
C)  public finance
D)  none of theseE) A) and B)
F) A) and C)

Question 11

Which of the following is NOT the effect of taxation on production?

Accepted Answer

A)  Effects on the distribution of income and wealth.
B)  Effects on the ability to work, save and invest.
C)  Effects on the will to work, save and invest.
D)  Effects on the allocation of resources.E) B) and D)
F) All of the above

Question 12

Which of the following does NOT determine the nature of Public Economics?

Accepted Answer

A)  Public economics studies the government and how its policies affect the economy.
B)  Public economics is the study of government policy through the lens of economic efficiency and equity.
C)  Public economics builds on the theory of welfare economics and is ultimately used as a tool to improve social
D)  Public Economics studies the behaviour of private firms and is called economics of Priavte Sector.E) None of the above
F) C) and D)

Question 13

Which is the method of financial adjustment between Centre and States?

Accepted Answer

A)  tax sharing
B)  grant?in?aid
C)  public debt
D)  federal financeE) B) and D)
F) B) and C)

Question 14

The Principle of Maximum Social Advantage is associated with:

Accepted Answer

A)  dalton
B)  pigou
C)  seligman
D)  hicksE) B) and C)
F) A) and B)

Question 15

When expenditure exceeds total tax revenue, it is called:

Accepted Answer

A)  surplus budget
B)  balanced budget
C)  deficit budget
D)  none of theseE) A) and D)
F) None of the above

Question 16

Public Debt Management refers to

Accepted Answer

A)  terms of new bonds
B)  proportion of different components of public debt
C)  maturity
D)  all the aboveE) None of the above
F) A) and D)

Question 17

The following is an example of direct taxes:

Accepted Answer

A)  sales tax
B)  income tax
C)  estate duties
D)  toll taxE) B) and C)
F) A) and B)

Question 18

Fiscal Federalism refers to

Accepted Answer

A)  sharing of political power between centre and states
B)  organising and implementing economic plans
C)  division of economic functions and resources among different layers of govt.
D)  none of theseE) A) and B)
F) B) and C)

Question 19

Following are some of examples of Transfer Expenditure EXCEPT:

Accepted Answer

A)  Interest payments on public debt.
B)  Social infrastructure such as education, health and family welfare.
C)  Unemployment allowances.
D)  Subsidies.E) A) and D)
F) B) and C)

Question 20

A criterion by which public goods are distinguished from private goods:

Accepted Answer

A)  exclusion principle
B)  externality principle
C)  public choice principle
D)  none of the aboveE) None of the above
F) A) and B)

Exam 1: Public Finance and Taxation Policy

Which of the following is NOT the effect of taxation on production?

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The Principle of Maximum Social Advantage is associated with:

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Merit goods are those which, when consumed, generate positive external benefits. This is likely to mean that, in a free market economy, the good will be:

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Following are some of examples of Transfer Expenditure EXCEPT:

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Printing of new currency notes and RBI borrowings by government is called:

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The idea of 'Democratic Decentralization' in India was popularized by:

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Which is the method of financial adjustment between Centre and States?

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Fiscal Federalism refers to

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In the case of relatively elastic demand, the money burden of tax is on:

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The final resting place of the burden of tax is called:

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In the case of direct tax, impact and incidence are on:

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The following is an example of direct taxes:

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Classical canons of taxation are propounded by:

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The Kelkar Proposals are concerned with:

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The income of the government through all its sources is called

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Which of the following does NOT determine the nature of Public Economics?

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The controlling authority of Government expenditure is:

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When expenditure exceeds total tax revenue, it is called:

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Public Debt Management refers to

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A criterion by which public goods are distinguished from private goods:

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Correct Answer
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