Government Budget and the Economy MCQ Class 12 Economic Chapter 5

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MCQ Questions for Class 12 Macroeconomics with Answers: Introductory Macroeconomics

Question1.

Which of the following is a non-tax revenue?

(i) export duty
(ii) import duty
(iii) dividends
(iv) excise duty

(iii) dividends

Question2.

Which of the following is an example of direct tax?

(i) VAT
(ii) Excise duty
(iii) Entertainment tax
(iv) Wealth tax

(iv) Wealth tax

Question3.

Which of the following are the objectives of government budget?

(i) Redistribution of income wealth
(ii) Economic stability
(iii) GDP growth
(iv) all of these

(iv) all of these

Question4.

Which of the following is a non- tax receipt ?

(i) Gift tax
(ii) Sales tax
(iii) Gift and grants
(iv) Excise duty

(iii) Gift and grants

Question5.

Direct tax is called direct because it is collected from the

(i) the producers on goods produced
(ii) the sellers on goods sold
(iii) the buyers of goods
(iv) the income earners

(iv) the income earners

Question6.

What is the period of a fiscal year?

(i) 1 April to 31 March
(ii) 1 January to 31 December
(iii) 1 March to 28 February
(iv) None of these

(i) 1 April to 31 March

Question7.

Regressive tax is a tax which is :

(i) Charged at a increasing rate when income of the individual increases
(ii) Charged at a decreasing rate when income of the individual increases
(iii) Relatively a low percentage of an individual’s income
(iv) None of these

(ii) Charged at a decreasing rate when income of the individual increases

Question8.

Which one of the following is indirect tax ?

(i) Wealth tax
(ii) Excise duty
(iii) Income tax
d) None of these

(ii) Excise duty

Question9.

Which one of these is a revenue expenditure?

(i) Purchase of an asset
(ii) Loans advanced
(iii) Subsidies
(iv) Expenditure on acquisition of land

(iii) Subsidies

Question10.

Which of the following is the component of a budget?

(i) Fiscal budget
(ii) Capital budget
(iii) Both of these
(iv) None of these

(iii) Both of these

Question11.

Tax, the impact of which lies on the person on whom it is legally imposed, is known as:

(i) Indirect tax
(ii) direct tax
(iii) value added tax
(iv) none of these

(ii) direct tax

Question12.

Deficit budget refers to that situation in which government’s budget expenditure is :

(i) less than its budget receipts
(ii) More than its budget receipts
(iii) Equal to its budget receipts
(iv) None of these

(ii) More than its budget receipts

Question13.

Which one of the following is a combination of direct taxes?

(i) Excise duty and wealth tax
(ii) Service tax and income tax
(iii) Excise duty and service tax
(iv) Wealth tax and income tax

(iv) Wealth tax and income tax

Question14.

What is the annual statement of the government’s fiscal revenue and fiscal expenditure known?

(i) Budget
(ii) Fiscal Budget
(iii) Capital Budget
(iv) All of these

(ii) Fiscal Budget

Question15.

Which of the following is a non-tax receipt?

(i) Fees
(ii) Fines
(iii) gift tax
(iv) grants and donations

(iii) gift tax

Question16.

Fiscal deficit=

(i) Total expenditure – total receipt other than borrowing
(ii) Revenue expenditure- revenue receipts
(iii) Capital expenditure – capital receipts
(iv) Revenue expenditure + Capital expenditure – revenue receipts

(i) Total expenditure – total receipt other than borrowing

Question17.

Which of the following is not a revenue receipt?

(i) Recovery of loans
(ii) Foreign grants
(iii) Profit of public enterprises
(iv) Wealth tax

(i) Recovery of loans

Question18.

How many types of revenue receipts are there?

(i) 2
(ii) 3
(iii) 4
(iv) 6

(i) 2

Question19.

Deficit budget refers to that situation in which government’s budget expenditure is:

(i) less than its budget receipts
(ii) more than its budget receipts
(iii) equal to its budget receipts
(iv) none of these

(ii) more than its budget receipts

Question20.

Capital expenditure is that estimated expenditure of the government which?

(i) Assets are increased
(ii) liability is decreased
(iii) Both (i) and (ii)
(iv) Assets and liabilities do not change

(iii) Both (i) and (ii)

Question21.

Which of the following sources of receipts in the government budget increases its liabilities?

(i) Direct taxes
(ii) Recovery of loans
(iii) Borrowings
(iv) Dividend from PSUs

(iii) Borrowings

Question22.

Borrowing in the government budget is:

(i) Revenue deficit
(ii) Fiscal deficit
(iii) Primary deficit
(iv) Deficit in taxes

(ii) Fiscal deficit

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Government Budget and the Economy MCQ Questions for Class 12 Economics Chapter 5 with Answers