Tag: main feature of tax

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Multiple choice economics income-output determination public debt public debt main feature of tax

At $ P _X  $ = Rs.  5, demand for Good-X is $30$ units and supply of Good-X is $20$ units, it is a situation of:

  1. excess demand.

  2. excess supply.

  3. equilibrium.

  4. none of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Excess demand is a situation where the demand for a product is more than the supply for the product. In the given question, demand for good X is 30 units and supply for good X is 20 units. Hence, the excess demand is 10 units. 

Multiple choice economics income-output determination public debt public debt main feature of tax

What would price ceiling lead to when the maximum price is fixed lower than the equilibrium price?

  1. Excess demand.

  2. Excess supply.

  3. Deficient demand.

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Price ceiling means that a maximum price that can be charged for a product is fixed by the government. The sellers cannot charge a price beyond it. Price ceiling is done to help the people to get goods at a lower rate and save them from getting exploited. Hence, when the prices are reduced the demand for that commodity increases due to the mechanism of law of demand, while supply decreases, leading to excess demand.

Multiple choice economics income-output determination public debt public debt main feature of tax

In case of excess demand, equilibrium price must rise.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

True.
Excess demand generates pressure of demand on the existing supply. As an immediate impact, market price rises. It leads to extension of supply and contraction of demand. Finally, equilibrium is reached in the market where DX=SXDX=SX. This new equilibrium price happens to be higher than the initial equilibrium price.

Multiple choice economics income-output determination public debt main feature of tax

Equilibrium price may not change even when market demand happens to change.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

True.
Equilibrium price may not change with a change in market demand, if the market supply changes in a proportion equal to the change in market demand.

Multiple choice economics income-output determination public debt public debt main feature of tax

Household expenditures on consumer goods and services during the current period is a part of _____________.

  1. aggregate supply

  2. aggregate demand

  3. investment

  4. saving
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Aggregate demand refers to the total demand in the economy as a result of consumption expenditure of households, investments made and the government expenditure in a given year. The expenditure of households on consumption goods, in a given period is, thus, a part of aggregate demand in the economy for the given period of time.

Multiple choice legal studies arbitration, tribunal adjudication and alternate dispute resolution public debt public debt main feature of tax

Which one of the following is the main source of revenue in the states?

  1. Property Tax

  2. Excise Duty

  3. Sales Tax

  4. None of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

States collect revenue within its territory on the subjects under List II or State List of Seventh schedule of the Constitution. Excise duty comes under Union List  whereas Property tax is generally levied by local authorities and not state government. So, the main source of revenue in the states is the sales tax which is a consumption tax imposed by the government on the sale of goods and services.  It is the tax imposed on the sale and purchase of goods within the state and different states have different sales tax laws for their states.

 It is levied by the Government. Sales tax is charged at both the levels of Legislation, Central and State. The tax imposed by the Central Government is known as the Central Sales Tax, whereas tax imposed by the states is called Sales Tax.

Multiple choice economics macro economic analysis public debt public debt main feature of tax

Which of the following consists of the total or accumulated borrowings by the government?

  1. Balanced budget

  2. Budget deficit

  3. Government debt

  4. Budget surplus
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Government debt is the amount of borrowings by government. It also known as public interest, national debt and sovereign debt.

Multiple choice social science the government budget and taxation public debt public debt main feature of tax

Which of the following is an administrative non-tax revenue?

  1. Gifts and grants

  2. Earnings from state enterprise

  3. Fines

  4. Surpluses
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Non Tax Revenue receipts are those revenue receipts which are not generated by taxing the public. Under administration, public authorities can raise some funds in the form of fines, fees and penalties.