Maximum Mark 20 Question 1) The deliberate action in fiscal policy taken by the government to stablize the economy is called Answers Option 1 Fiscal policy Option 2 Discretionary Fiscal policy Option 3 Automatic stablizer Option 4 Budget Question 2) The policy of the government regarding public expenditure, taxation, borrowing and revenue are called Answers Option 1 Fiscal policy Option 2 Budget Option 3 Capital receipt Option 4 None of these Question 3) The priciple of exclusion is applicable in case of Answers Option 1 Public goods Option 2 Private goods Option 3 Both of above Option 4 None of these Question 4) If MPC is 0.8, then tax multiplier is Answers Option 1 1 Option 2 8 Option 3 5 Option 4 50 Question 5) In the given equation C = 20 + .8Y, income is 100. Then consumption will be Answers Option 1 20 Option 2 .8 Option 3 20.8 Option 4 100 Question 6) Government finances deficit in budget by Answers Option 1 Taxation Option 2 Borrowings Option 3 Printing currency Option 4 All of the above Question 7) The borrowing of the government to finance deficit in budget leads to Answers Option 1 Revenue Option 2 Public debt Option 3 Taxation Option 4 None of these Question 8) Select the odd one Answers Option 1 Income tax Option 2 Sales tax Option 3 Fees Option 4 Customs duty Question 9) Which of the following is not a major item of revenue expenditure ? Answers Option 1 Defence service Option 2 Acqusition of land Option 3 Interest payment Option 4 Subsidies Question 10) Autonomous expenditure, A = 100 and MPC is 0.75 , equilibrium income is Answers Option 1 4000 Option 2 400 Option 3 300 Option 4 133.3 Question 11) Select the odd one Answers Option 1 Surplus budget Option 2 Balanced budget Option 3 Deficit budget Option 4 Supplementary budget Question 12) Excess of total expenditure over total income excluding borrowing is Answers Option 1 Revenue deficit Option 2 Fiscal deficit Option 3 Primary deficit Option 4 Monetized deficit Question 13) Which of the following is the AD in a closed economy with government ? Answers Option 1 C + I + G + X Option 2 C + G + NX Option 3 C + I + G - X Option 4 C + I + G Question 14) Balnced budget multiplier is Answers Option 1 One Option 2 Less than one Option 3 More than one Option 4 Zero Question 15) Which of the following is an indirect tax ? Answers Option 1 Excise duty Option 2 Sales tax Option 3 Customs duty Option 4 All of these Question 16) Goods in which the consumption should be encouraged are called Answers Option 1 Public good Option 2 Private good Option 3 Club good Option 4 Merits good Question 17) Which of the following are the functions of government ? Answers Option 1 Allocation Option 2 Distribution Option 3 Stabilization Option 4 All of the above Question 18) Fiscal deficit reduced by interest payment is Answers Option 1 Primary deficit Option 2 Total deficit Option 3 Monetized deficit Option 4 Trade deficit Question 19) The expenditures which neither create assets nor reduces liabilities are called Answers Option 1 Revenue expenditure Option 2 Capital expenditure Option 3 Revenue receipts Option 4 None of these Question 20) Revenue receipts Answers Option 1 Reduce assets Option 2 Increase assets Option 3 Neither increase nor reduce assets Option 4 None of these Enable JavaScript
