Tag: economics

Questions Related to economics

Receipts in budget can be capital or revenue. Which of these is/are capital receipts?
1- Loan recoveries
2- Provident funds deposits
3- Grants

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. Only 1 and 2

  2. Only 1 and 3

  3. Only 2 and 3

  4. 1, 2 and 3

Show answer
Correct Option: A
Explanation:

Loan recoveries are the money, which the government had lent out in past, their capital comes back to the government when the borrowers repay them as capital receipts. long-term capital accruals to the government through the Provident Fund (PF), Postal Deposits, various small saving schemes (SSSs) and the government bonds sold to the public (as Indira VIkas Patra, Kisan Vikas Patra, Market Stabilization Bond, etc.) are also capital receipts. Grants are revenue receipts.

With reference to contribution from taxes, consider the following statements:
1- Contribution from direct taxes is more than that from indirect taxes.
2- Corporation tax is the largest contributor.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. Only 1

  2. Only 2

  3. Both 1 and 2

  4. Neither 1 nor 2

Show answer
Correct Option: C
Explanation:

Since 2007-08, the contribution of direct tax has been more than indirect tax. Before this, the trend was opposite. Corporation tax is the largest contributor among the taxes.

Gross capital formation will increase if which of the following takes place?
1- Gross domestic saving increases
2- Gross domestic consumption increases
3- GDP increases

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. only 1

  2. only 1 and 2

  3. only 1 and 3

  4. none of above

Show answer
Correct Option: D
Explanation:

Gross capital formation, in simple terms is equivalent to investment made. It was earlier called gross domestic investment. The part of GDP that is used is called gross domestic consumption, while the part that is saved is gross domestic savings (GDS). Some part of this GDS will be re-invested back, and that is called gross capital formation. Now, an increase in GDP or GDS will not necessarily lead to an increase in capital formation. Because how much in invested back will depend on many other factors.

If a government is unable to pass the budget in Lok Sabha, then ______.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. a totally new budget is presented

  2. the budget is revised and presented again

  3. the government has to resign

  4. none of the above

Show answer
Correct Option: C
Explanation:

If a government is unable to pass the budget in Lok Sabha, then the government has to resign.

The Economic Survey is compiled by ______.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. office of economic advisor

  2. central statistical office (CSO)

  3. national sample survey organization (NSSO)

  4. department of economic affairs

Show answer
Correct Option: D
Explanation:

The Economic Survey is compiled by Department of Economic Affairs, Ministry of Finance. Office of economic advisor publishes WPI, while CSO publishes IIP and CPI.

Income Tax is rounded off to ________________.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. Nearest one rupee

  2. Nearest ten rupees

  3. Nearest hundred rupees

  4. Nearest thousand rupees

Show answer
Correct Option: B
Explanation:

An income tax is a tax that governments enforce on income generated by businesses and individuals within their authority. By law, taxpayers must file an income tax return yearly to determine their tax obligations Income taxes are a source of revenue for governments. 

As per Section 288 B of the income tax act, the total tax computed shall be curved off to the nearest Rs 10. The income tax is rounding off would be done on the total tax payable or refundable and not to various dissimilar sub-heads of taxes like income tax, education cess, a surcharge etc.

Thus, the correct option is B.

Marginal Rate of Tax refers to ____________.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. lowest rate of Income Tax

  2. highest rate of Income Tax

  3. average rate of Income Tax

  4. nil rate of Income Tax

Show answer
Correct Option: B

The reasons for high tax incidence in India are____________.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. increase in expenditure on development planning

  2. rise in expenditure on defence and other non-developmental activities

  3. high cost of collection

  4. all of the above

Show answer
Correct Option: D

Tax reform committee (TRC) was constituted for comprehensive reform of _________.

economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

  1. direct tax laws

  2. indirect tax laws

  3. both direct and indirect tax laws

  4. none of the above

Show answer
Correct Option: C

The introduction of contaminants into the natural environment that cause adverse change is called ________.

economics environment pollution introduction to environmental pollution introduction to pollution environment and pollution

  1. Pollution

  2. Emission

  3. Greenhouse effect

  4. None of above

Show answer
Correct Option: A
Explanation:

Pollution is the introduction of contaminants into the natural environment that cause adverse change. Pollution can take the form of chemical substances or energy, such as noise, heat or light.


Hence, te correct option is $\text{A}$