Tag: public finance, budget and fiscal policy

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Questions Related to public finance, budget and fiscal policy

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

What are the features of Fiscal Responsibility and Budget Management Act, (FRBMA) 2003? 

  1. To reduce fiscal deficit to not more than 3 percent of GDP

  2. To ensure greater transparency in fiscal operations.

  3. To eliminate the revenue deficit by March 31, 2009

  4. All the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The FRBMA is an act which institutionalizes and regulates financial discipline and help manage public funds in order to strengthen India's fiscal position. The purpose of FRBMA was to reduce fiscal deficit. 

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

Borrowing from all the sides like net borrowing from RBI and from abroad gives _______.

  1. fiscal deficit

  2. budget deficit

  3. primary deficit

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

The budget deficit is the difference between current government's spending on goods and services and total current revenue from all types of taxes net of transfer payments. So when borrowing is done from RBI or other sources, that creates the budget deficit.

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

The difference between total expenditure and total receipts except loans and other liabilities is called _______.

  1. fiscal deficit

  2. budget deficit

  3. primary deficit

  4. revenue deficit
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The fiscal deficit is the primary deficit plus interest payments on the debt. Therefore, if refers to the difference in total expenditure and total receipts without loan and other liability.

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

The government manages the public finance through __________.

  1. fiscal policy

  2. budget policy

  3. revenue policy

  4. primary policy
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

By means of fiscal policy, government adjusts its spending levels and tax rates to monitor and influence a nation's economy. Though fiscal policies, government makes its public finance.

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

Which of the following is the wrong pair?

  1. Share Market-Stock Exchange

  2. Income Tax -Monetary Policy

  3. Export Subsidy-Fiscal Policy

  4. General Price Index-Inflation
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Income tax is a form of direct tax. This comes under the fiscal policy of the government. 

Fiscal Policy is the mechanism by means of which a government makes adjustments to its planned spending and the imposed tax rates to monitor and thus in turn influence the performance of a country’s economy. 

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

Which of the following s the benefit of adopting a social security system?

  1. Annual bonus

  2. Non financial incentives

  3. Old age pension

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

A social security system is designed to provide financial protection to individuals against risks like old age, disability, or unemployment. Old age pension is a classic example of such a benefit.

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

The term public means ________.

  1. household, firm and local authorities

  2. non-Banking Financial Institution, Non-Departmental PSU

  3. reserve of foreign banks, Government and International Monetary fund

  4. all the three
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

In the context of public finance and macroeconomics, the term 'public' is broad and encompasses the government, various public sector entities, and institutions that operate within the public sphere.

Multiple choice economics meaning and scope of public finance public finance, budget and fiscal policy government budget and economy public finance and budget

Which of these activity is not included in service sector?

  1. Tourism services.

  2. Education services.

  3. Mining services.

  4. Health and social welfare services.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Mining is classified under the industrial sector (specifically the primary sector), whereas tourism, education, and health are categorized as service sector activities.