MCQs - Government Budget And The Economy | Crash Course of Macro Economics -Class 12 - Commerce PDF Download

Q.1 Which of the following is not a non-tax revenue receipt ?

(a) Interest receipts
(b) External grants
(c) Dividends and profits
(d) Disinvestment
Ans: D

Q.2 Administrative revenue includes which of the following ?

(a) Fines & penalties
(b) Dividends
(c) Commercial revenue
(d) Loans from abroad
Ans: A

Q.3 Total expenditure on national defence in India is categorized as

(a) Revenue expenditure
(b) Capital expenditure

(c) Partly each
(d) Confidential
Ans: C

Q.4 Escheats is an example of :

(a) Capital Receipts
(b) Revenue Receipts
(c) Capital expenditure
(d) Revenue Expenditure
Ans: B

Q.5 Borrowings are equivalent to :

(a) Revenue deficit
(b) Primary deficit
(c) Fiscal deficit
(d) None of these
Ans: C

Q.6 Union Budget is the budget of :

(a) Central Government
(b) Local Government
(c) State Government
(d) Election Commission
Ans: A

Q.7 Policies of surplus budget during inflation” is a part of which objective of government budget

(a) Economic Growth
(b) Economic Stability  

(c) Reducing Regional Disparities
(d) Reallocation of Resources
Ans: B

Q.8 Identify the non-tax revenue from the following statement: “ it refers to claim of the government on the property of a person who dies without leaving behind any legal heir or a wil l”

(a) Special Assessment
(b) Escheats
(c) Forfeitures
(d) Fees
Ans: B

Q.9 Which one of the following statements is incorrect ?

(a) Revenue receipts are regular in nature.

(b) There is no future obligation to return the amount in case of revenue receipts.

(c) Capital receipts either create an asset or cause a reduction in the liabilities 

(d) Borrowings are treated as capital receipt as they lead to an increase in liability.
Ans: C

Q.10 The incidence of tax refers to :

(a) Level and rate of taxation
(b) Who ultimately bears the money burden of the tax

(c) Growth of taxation
(d) Way in which a tax is collected.
Ans: B

Q.11 A tax, the burden of which can be shifted on to others, is called:

(a) indirect tax
(b) direct tax
(c) wealth tax
(d) none of these
Ans: A

Q.12 Which of the following is not a non-tax receipt?

(a) Fees
(b) Fines
(c) Gift tax
(d) Grants and donations
Ans: C

Q.13 Tax, the impact of which lies on the person on whom it is legally imposed, is known as:

(a) indirect tax
(b) direct tax
(c) value added tax
(d) none of these
Ans: B

Q.14 In the context of government budget, which of the following statement is correct ?

(a) Budget is a statement of expected annual receipts and expenditures of the government.

(b) It is a detail of actual receipts and expenditures of the government in a financial year

(c) It offers a detailed description of achievements of the government during the five year plans.
(d) It indicates BOP status of the domestic economy
Ans: A

Q.15 Which of the following is/are implication/s of fiscal deficit ?

(a) National debts for future generation
(b) Inflationary spiral

(c) Erosion of government credibility
(d) All of these
Ans: D

Q.16 Disinvestment by government means :

(a) Selling of its fixed capital assets
(b) Selling of its buildings
(c) Selling of shares of public enterprises held by it

(d) All of the above
Ans: D

Q.17 The estimated income receipts of the government in the budget of 2016-17 is Rs. 25,000 crores and its estimated expenditure is Rs. 27,500 crores. The budget of the government is 

(a) Balanced
(b) deficit
(c) Surplus
(d) None of these
Ans: C

Q.18 Given the following data :

(i) Total budgeted expenditure          Rs. 1,000

(ii) Total budgeted revenue receipts    Rs. 700

(iii) Proceeds of Disinvestment       Rs. 150

(iv) Loans                      Rs. 150

The fiscal deficit equals

(a) Rs. 150
(b) Rs. 300
(c) Rs. 700
(d) Rs. 1000
Ans: B

Q.19 Aerated drinks like Coke cause obesity, the government can help in restricting its consumption by : (Choose the correct alternative)

(a) imposing heavy tax on it.
(b) prohibiting its sale in the school canteen.

(c) increasing its price.
(d) counselling the students through the school.
Ans: A

Q.20 In the budget, which type of expenditure is expenditure on land ? 

(a) Revenue expenditure
(b) Plan expenditure
(c) Non-plan expenditure
(d) Capital expenditure

Ans: A