Government Budget and Economy Economics - Government Budget and Economy

Primary deficit equals: (Choose the correct alternative)

1. Borrowings.
2. Interest payments.
3. Borrowings less interest payments.
4. Borrowings and interest payments both.

Primary deficit in a government budget is: (Choose the correct alternative)

1. Revenue expenditure - Revenue receipts.
2. Total expenditure - Total receipts.
3. Revenue deficit - Interest payments.
4. Fiscal deficit - Interest payments.

Direct tax is called direct because it is collected directly from: (Choose the correct)

1. The producers on goods produced.
2. The sellers on goods sold.
3. The buyers of goods.
4. The income earners.

Disinvestment by government means:

1. Selling of its fixed capital assets.
2. Selling of shares of public enterprises held by it.
3. Selling of its buildings.
4. All the above.

The non-tax revenue in the following is: (choose the correct alternative)

1. Export duty.
2. Import duty.
3. Dividends.
4. Excise.

Assertion (A): Fiscal deficit indicates the total borrowing requirements of the government.
Reason (R): Government mainly borrows from RBI to meet its fiscal deficit.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): “Borrowings is an example of a capital receipt.
Reason (R): It neither leads to an increase in liability of repayment on government nor reduction of assets.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Taxes received by the government are not revenue receipts.
Reason (R): Because taxes neither create any liability nor reduce any asset of the government.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): A custom duty on cotton raised from 0 percent to 10 percent in the Budget 2021.
Reason (R): Custom Duty is not subsumed in GST.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

Assertion (A): Primary Deficit is the Root Cause of Fiscal Deficit.
Reason (R): High Primary Deficit indicates that interest commitments (on earlier loans) have forced the government to borrow.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c) Assertion (A) is true but Reason (R) is False
d) Assertion (A) is False but Reason (R) is true.

State whether the following statement is true or false:
‘‘As per Keynesian theory in an economy, full employment can never exist.’’

Are the following statements true or false? Give reasons.
Primary deficit is the difference between capital deficit and interest payments.

Are the following statements true or false? Give reasons.
Rise in revenue deficit will always lead to higher fiscal deficit.

Expenditure on interest payment is a capital expenditure. (True/ False)

Are the following statements true or false? Give reasons.
Expenditure made on the development of a railway line is a capital expenditure.

Fill in the blank with the correct formula.
Fiscal deficit can be estimated using the formula ________.

Fiscal deficit is always equal to_________.

Value added tax is an example ______ of tax.

The receipts which neither create any liability nor lead to any reduction in asset are called _________.

________ is equal to fiscal deficit less interest payment.

Is the following a revenue receipt or a capital receipt in the context of government budget and why?

1. Tax receipts
2. Disinvestment

Distinguish between direct taxes and indirect taxes. Give an example of each.

Distinguish between revenue receipts and capital receipts. Give an example of each.

Explain the role of government budget in bringing economic stability.

Distinguish between revenue receipts and capital receipts in a government budget. Give example in each case.

What are non-debt creating capital receipts? Give two examples of such receipts.

Explain how government budget can be helpful in bringing economic stabilisation in the economy.

Explain the concept of 'fiscal deficit' in a government budget. What does it indicate?

Explain the 'redistribution of income' objective of a government budget.

What is the difference between direct tax and indirect tax? Explain the role of government budget in influencing allocation of resources.

What is the difference between revenue expenditure and capital expenditure? Explain how taxes and government expenditure can be used to influence distribution of income in the society.

Explain how the government can use the budgetary policy in reducing inequalities in incomes.

Explain the meaning of under-employment equilibrium. Explain two measures by which full-employment equilibrium can be reached.

Explain the concept of 'inflationary gap'. Also, explain the role of 'legal reserves' in reducing it.

Define revenue deficit.

What are capital receipts in a government budget?

What are revenue receipts in a government budget?

Define fiscal deficit.

What is revenue deficit?