fbpx

Prelims-IAS –ECONOMICS MCQ-16

1..With regard to convertibility of currency, consider the following statements:

  1. If the capital account is fully convertible, importers and exporters are allowed free conversion of rupee.
  2. Capital account of India is fully convertible.
  3. India is planning to achieve fully convertible current account in the next 5 years.

Which of the statements given above is/are correct?
(a) 1 and 3 only
(b) 1 and 2 only
(c) 3 only
(d) None


2..With regard to taxation, consider the following statements:

  1. Progressive taxes reduce the incidence of taxes on people with lower incomes.
  2. In case of proportional taxation, the tax rate increases with income.
  3. Sales tax on food items is an example of regressive tax.

Which of the statements given above is/are correct?
(a) 1 only
(b) 1 and 2 only

(c) 2 and 3 only
(d) 1 and 3 only


3..Consider the following statements with regard to the budgeting techniques:

  1. Zero base budgeting means that the government prepares its annual budget assuming that there was no budget in the past i.e. the base is zero.
  2. Outcome budgeting implies that total expenditure on a project is correlated not only with the resultant physical output but also its fiscal outcome which is by and large a qualitative aspect.
  3. Gender budgeting means that there will be a separate budget for the Ministry of women and child development.

Select the incorrect statement/statements using the codes given below.
(a) 1 and 2 only
(b) 3 only

(c) 1 and 3 only
(d) None of the above


4..Which of the following best describes Revenue Neutral Rate?

(a) Taxing procedure that allows government to receive same amount of money despite changes in tax laws.
(b) Taxing procedure in which rate of taxation remains over a long period of time.
(c ) Rate at which amount of revenue received by NBFC same as that of the amount is received by banks.
(d) Base rate prescribed by the RBI to various commercial banks.


5..Which of the following statement defines the concept of ‘Debt Trap’:

(a)  A situation in which an economy borrows to repay its past borrowings.
(b)  A situation when an economy is borrowing more than its repaying of its past borrowing.
(c)  A situation when an economy is borrowing to repay even the interest on its past borrowing.
(d)  A situation when the foreign currency reverses growth rate of an economy start lagging behind the growth rate of its external borrowings.


525 total views, 2 views today

Please follow and like us:

Leave a Reply

Your email address will not be published. Required fields are marked *

error: Content is protected !!