Government Budget-Question Bank
Government Budget-Question Bank
Government Budget-Question Bank
THIRUVALUR
QUESTION BANK
2. Direct tax is called direct because it is collected directly from: (Choose the correct
alternative)
(a) The producers on goods produced
(b) The sellers on goods sold
(c) The buyers of goods
(d) The income earners
5. Which one of the following is an indirect tax? (Choose the correct alternative)
(a) Profit tax (b) Wealth tax
(c) Custom duty (d) Gift tax
11. Interest payments are subtracted from which deficit to arrive at Primary Deficit:
(a) Revenue Deficit
(b) Capital Deficit
(c) Fiscal Deficit
(d) None of these
14. While financing a deficit, under which measure government can print more currency:
(a) Deficit financing (b) Disinvestment
(c) By issuing bonds (d) none of them
16. Primary deficit in a government budget is: (Choose the correct alternative)
(a) Revenue expenditure — Revenue receipts
(b) Total expenditure — Total receipts
(c)Revenue deficit — Interest payments
(d) Fiscal Deficit —- Interest payments
17. Fiscal deficit equals: (Choose the correct alternative)
(a) Primary deficit minus interest payments
(b) Primary deficit plus interest payments
(c) Total budget expenditure minus total budget receipts
(d) None of the above
18. The receipts which neither create any liability nor lead to any reduction in asset are called
______
19. Recovery of loans, borrowing and disinvestment etc. are the example of___________
receipts.
22. Government budget is presented only by the central government in India. (True/False)
23. Budget is in surplus when the last year receipts of the government greater than last years'
expenditure of the government. (True/False)
25. Revenue expenditure does not create assets for the government. (True/False)
27. Borrowing from the general public leads to an increase in revenue deficit. (True/False)
44. Why are the borrowings by the government treated as capital receipts?
55. What is the difference between Revenue Budget and Capital Budget?
56. Which of the following is/are included in the revenue budget of the government? Give
reasons for your answer.
57. Which of the following is/are included in the capital budget of the government? Give
reasons for your answer.
58. Giving reasons, classify the following as revenue expenditure and capital expenditure:
(a) Subsidies
59. How can a government's budget help in reducing inequalities of income? Explain. Or
Explain how the government can use its budgetary policy in reducing inequality of income in
the country.
Explain how government budget can be helpful in bringing economic stabilization in the
economy.
61. Distinguish between revenue receipts and capital receipts in a government budget. Give
two examples of each. Or
How are capital receipts different from revenue receipts? Discuss briefly.
62. Give the meaning of (a) tax revenue, and (b) non-tax revenue. Give one example of each.
Or
Explain how the government can use its budgetary policy in reducing inequality of income in
the country.
62. Give the meaning of (a) tax revenue, and (b) non-tax revenue. Give one example of each.
63. Giving reasons categorise the following into direct of tax and indirect tax:
64. How will Goods and Services Tax (GST) be a comprehensive indirect tax? Explain.
66. Define capital receipts of government. Describe briefly the groups in which these are
classified.
67. Categorise the following government receipts into revenue and capital receipts. Give
reasons for your answer.
68. Classify the following into capital receipts and revenue receipts. Give reasons for your
answer.
(a)Recovery of loans
69. Explain the basis of classifying government expenditure into revenue expenditure and
capital
73. Discuss briefly the role of the government budget in influencing 'allocation of resources'
in the economy.
Or
Explain the role the government can play through the budget in influencing allocation of
resources.
Or
Explain how the allocation of resources can be influenced in the government budget through
taxes expenditure and subsidies.
74. Explain how the government can use the budgetary policy in reducing inequalities in
incomes.
75. Explain the distinction between Revenue receipts and Capital receipts in a government
budget. Give their components.
77. "Governments across nations are too much worried about the term fiscal deficit". Do you
think that fiscal deficit is necessarily inflationary in nature? Support your answer with valid
reasons.