Public Finance-Online Practice Exam 7
Public Finance-Online Practice Exam 7

Public Finance-Online Practice Exam 7

NET / SET Online Practice Exams

Public Finance

Test

Multi-choice 7

Question

1. States earn maximum revenue through-

Answers

Land revenue

Commercial taxes

Excise duties on intoxicants

Custom duties

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Question

2. Which of the following taxes are levied by centre and not divided between the Centre and States?

  1. Income tax
  2. Union excise duties
  3. Custom duties
  4. Corporation tax

Answers

I, II and IV

I, II and III

III and IV

II, III and IV

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Question

3. The maximum effect of direct taxes is on-

Answers

Income

Consumer goods

Capital goods

Price of food

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Question

4. Which one of the following taxes is levied by the State Government only

Answers

Wealth tax

Corporation tax

Entertainment tax 

Income tax

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Question

5. Zero based budgeting (ZBB) lays emphasis in 

  1. Unlimited deficit financing
  2. Preparing new budget right from the scractch
  3. Preparing the budget neglecting history

Answers

II and III

I, II and III

I and III

I and II

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Question

6. Which of the following are indirect taxes?

  1. Custom duties
  2. Excise duties
  3. Sales tax
  4. Estate duty

Answers

I, II, III and IV

I, II and III

II and III

II and IV

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Question

7. Which of the following agency effectively control the income and expenditure of central government ?

  1. Comptroller and Auditor General of (GAG)
  2. Public Accounts Committee (PAC)
  3. Estimates Committee

Answers

Only I

I and II

I, II and III

II and III

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Question

8. Consider the following Assertion (A) and Reason (R) and choose the correct answer given below- 

Assertion (A): Sales of spurious and substandard drugs and under-reporting of sales by firms a com- mon phenomenon in India.

Reason (R): India’s pharmaceuticals sector generates a large quantity of unaccounted income.

Answers

Both A and R are correct and R is the incorrect explanation of A 

Both A and R are correct and R is the correct explanation of A 

A is correct, but R is incorrect

A is incorrect, but R is correct

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Question

9. The ‘Ad hoc Treasury Bill System’ of meeting budget deficit in India was replaced by ‘Ways and Means Advances System’ which has come into force on-

Answers

March 31, 1997 

April 1. 1996

April 1, 1997

None of these

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Question

10. Which of the following indicators can be used to identify the sector which is/are more prone to generate or utilize unaccounted income.

  1. Backward and forward linkages based input-output framework

  2. Proportionate share of informal sector in the economy

  3. Sectors flagged by different government agencies (Such as CBI)

Answers

Only III

I, II and III

I and III

None of these

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