Tag: public finance, taxes and budget

Questions Related to public finance, taxes and budget

Governments generally impose higher taxes on the rich, moderate taxes on the not-so-rich and exempt the poor from paying taxes. This principle of taxation is called ______.

economics public expenditure public expenditure public finance and budget public finance, taxes and budget

  1. progressive taxation policy

  2. heavy taxation policy

  3. direct taxation policy

  4. protective taxation policy

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Correct Option: A
Explanation:

A progressive tax is a tax in which the tax rate increase as the taxable amount increases. The term "progressive" refers to the way the tax rate progresses from low to high, with the result that a taxpayer's average tax rate is less than the person's marginal tax rate

The statement of estimated income and expenditure of the Government for a year is ______.

economics public expenditure public expenditure public finance and budget public finance, taxes and budget

  1. public finance

  2. public expenditure

  3. planned expenditure

  4. budget

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Correct Option: D
Explanation:

A budget is an estimation of the revenue and expenses over a specified future period of time and is compiled and re-evaluated on a periodic basis. A surplus budget means profits are anticipated, while a balanced budget means that revenues are expected to equal expenses. A deficit budget means expenses will exceed revenues.

Which of these is a productive public expenditure?

economics public expenditure public expenditure public finance and budget public finance, taxes and budget

  1. Expenditure on law and order

  2. Expenditure on defense

  3. Expenditure on infrastructure development

  4. Expenditure on education

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Correct Option: C

Which of these is a transfer payment?

economics public expenditure public expenditure public finance and budget public finance, taxes and budget

  1. Pension

  2. Scholarship

  3. Unemployment allowance

  4. All of the above

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Correct Option: D

Among these statements which one clearly explains the meaning of "Subsidies"?

economics public expenditure public expenditure public finance and budget public finance, taxes and budget

  1. Payment by Government for purchase of goods and services.

  2. Payment by business enterprises to factors of production.

  3. Payment by companies to shareholders.

  4. Payment by Government to business enterprise without buying any goods and services.

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Correct Option: D

Which of the following is not a productive public expenditure?

economics public expenditure public expenditure public finance and budget public finance, taxes and budget

  1. Expenditure on defence

  2. Expenditure on infrastructure development

  3. Expenditure on setting up basic industries

  4. Expenditure to increase the welfare of the population

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Correct Option: A