Multi-choice 6 Question 1. The Wanchoo Committee (1971) probed Answers Option 1 Indirect Taxes Option 2 Agricultural holding tax Option 3 Non-tax revenue Option 4 Direct taxes Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 2. A state Government draws its revenue from- Answers Option 1 Taxes on agricultural income Option 2 Taxes on road vehicles Option 3 Taxes on advertisements and sale of goods Option 4 All of the above Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 3. Assertion (A): The Central Government cannot impose agricultural income tax. Reason (R): State Governments have refused to allow the Centre to impose and collect agricultural income tax as agriculture is a State subject. Answers Option 1 (A) is correct but (R) is incorrect Option 2 (A) and (R) are wrong Option 3 Both (A) and (R) are correct, but (R) does explain (A) Option 4 Both (A) and (R) are correct, but (R) correctly explains (A) Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 4. To reach an economically efficient output level, the size of an excise tax impaired on a firm generating negative externality should be- Answers Option 1 The firms marginal cost Option 2 The social marginal cost Option 3 The difference between the social marginal cost and firm’s marginal cost Option 4 The sum of the social marginal cost and the firm’s marginal cost Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Question 5. Which authority recommends the principles governing the grants-in-aid of the revenues of the states out of the Consolidated Fund of India ? Answers Option 1 Inter-State Council Option 2 Finance Commission Option 3 Union Ministry of Finance Option 4 Public Accounts Committee Feedback Wrong choice Correct option Wrong choice Incorrect selection Solution Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Question 6. Expenditure tax was first imposed in India in 1957 on the recommendations of- Answers Option 1 Nicholas Kaldor Option 2 Hugh Dalton Option 3 B.R. Shenoy Option 4 TT. Krishnamachari Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 7. Which of the following does not form the part of capital receipts of the Union Government? Answers Option 1 Net external assistance Option 2 Non-tax revenue Option 3 Net market borrowings Option 4 Loan recoveries Feedback Wrong choice Correct option Incorrect selection Wrong choice Solution Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Question 8. The revenue of the state governments are raised from the following sources, except- Answers Option 1 Expenditure tax Option 2 Entertainment tax Option 3 Agricultural income tax Option 4 Land revenue Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 9. The Indian income tax is- Answers Option 1 Direct and progressive Option 2 Indirect and progressive Option 3 Indirect and proportional Option 4 Direct and proportional Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 10. Which of the following taxes is not a source of revenue of the Union Government? Answers Option 1 Land revenue Option 2 Income tax Option 3 Corporation tax Option 4 Customs duties Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback)
Multi-choice 6 Question 1. The Wanchoo Committee (1971) probed Answers Option 1 Indirect Taxes Option 2 Agricultural holding tax Option 3 Non-tax revenue Option 4 Direct taxes Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 2. A state Government draws its revenue from- Answers Option 1 Taxes on agricultural income Option 2 Taxes on road vehicles Option 3 Taxes on advertisements and sale of goods Option 4 All of the above Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 3. Assertion (A): The Central Government cannot impose agricultural income tax. Reason (R): State Governments have refused to allow the Centre to impose and collect agricultural income tax as agriculture is a State subject. Answers Option 1 (A) is correct but (R) is incorrect Option 2 (A) and (R) are wrong Option 3 Both (A) and (R) are correct, but (R) does explain (A) Option 4 Both (A) and (R) are correct, but (R) correctly explains (A) Feedback Wrong choice Incorrect selection Wrong choice Correct option Solution Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Question 4. To reach an economically efficient output level, the size of an excise tax impaired on a firm generating negative externality should be- Answers Option 1 The firms marginal cost Option 2 The social marginal cost Option 3 The difference between the social marginal cost and firm’s marginal cost Option 4 The sum of the social marginal cost and the firm’s marginal cost Feedback Wrong choice Incorrect selection Correct option Wrong choice Solution Wrong (Feedback) Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Question 5. Which authority recommends the principles governing the grants-in-aid of the revenues of the states out of the Consolidated Fund of India ? Answers Option 1 Inter-State Council Option 2 Finance Commission Option 3 Union Ministry of Finance Option 4 Public Accounts Committee Feedback Wrong choice Correct option Wrong choice Incorrect selection Solution Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Question 6. Expenditure tax was first imposed in India in 1957 on the recommendations of- Answers Option 1 Nicholas Kaldor Option 2 Hugh Dalton Option 3 B.R. Shenoy Option 4 TT. Krishnamachari Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 7. Which of the following does not form the part of capital receipts of the Union Government? Answers Option 1 Net external assistance Option 2 Non-tax revenue Option 3 Net market borrowings Option 4 Loan recoveries Feedback Wrong choice Correct option Incorrect selection Wrong choice Solution Wrong (Feedback) Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Question 8. The revenue of the state governments are raised from the following sources, except- Answers Option 1 Expenditure tax Option 2 Entertainment tax Option 3 Agricultural income tax Option 4 Land revenue Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 9. The Indian income tax is- Answers Option 1 Direct and progressive Option 2 Indirect and progressive Option 3 Indirect and proportional Option 4 Direct and proportional Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback) Question 10. Which of the following taxes is not a source of revenue of the Union Government? Answers Option 1 Land revenue Option 2 Income tax Option 3 Corporation tax Option 4 Customs duties Feedback Correct option Wrong choice Incorrect selection Wrong choice Solution Correct Option (Feedback) Wrong (Feedback) Wrong (Feedback) Wrong (Feedback)
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