MCQOPTIONS
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MCQOPTIONS
This section includes 2956 Mcqs, each offering curated multiple-choice questions to sharpen your UPSC IAS Exam knowledge and support exam preparation. Choose a topic below to get started.
| 2501. |
Which of the following is/are the components of Public debt? 1. External debt 2. Other internal liabilities 3. Internal debt |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2502. |
With reference to ?Cash Reserve Ratio?, which of the following statements is/are correct? 1. The RBI varies Cash Reserve Ratio to change the liquidity of market 2. CRR is subject to frequent changes as RBI intervenes from time to time to correct monetary or exchange rate imbalances 3. CRR currently is 4% 4. RBI is empowered to fix the CRR at a rate ranging between three per cent and 15 per cent |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 1, 2, 3 and 4 |
| Answer» E. | |
| 2503. |
In the context of economic liberalization, which of the following is/are the major themes of the fiscal policy? 1. A deliberate move to a regime of reasonable direct tax rates and better administration and enforcement 2. A systematic effort to simplify tax structure and tax laws |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | Neither 1 nor 2 |
| Answer» D. Neither 1 nor 2 | |
| 2504. |
Which of the following statements is/are correct with reference to Primary deficit? 1. India started using this term since 1997-98 2. Primary deficit is fiscal deficit minus interest payments 3. It shows the current state of government finances |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2505. |
Which of the following taxes is the one by which the revenue collected rises proportionally with income? 1. Regressive tax 2. Progressive tax 3. Corporate tax 4. Proportional tax |
| A. | 1 only |
| B. | 2 only |
| C. | 3 only |
| D. | 4 only |
| Answer» E. | |
| 2506. |
Where was VAT introduced? 1. France 2. USA 3. Australia 4. China |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 1, 2 and 3 |
| Answer» B. 1 and 2 | |
| 2507. |
Which of the following is not a technique of Deficit financing? 1. Internal Borrowings 2. Counting Currency 3. Printing Currency 4. External aid and borrowings |
| A. | 1 only |
| B. | 2 only |
| C. | 2 and 3 |
| D. | 1, 2, 3 and 4 |
| Answer» C. 2 and 3 | |
| 2508. |
Which of the following means rates of tax increase for increasing values or volumes on which the tax is levied 1. Progressive tax 2. Proportional tax 3. Regressive tax 4. Indirect tax |
| A. | 1 only |
| B. | 2 only |
| C. | 3 only |
| D. | 1, 2 and 4 |
| Answer» B. 2 only | |
| 2509. |
In which year was Service tax introduced? 1. 1983-84 2. 1994-95 3. 1967-68 4. 2003-2004 |
| A. | I only |
| B. | 2 only |
| C. | 3 only |
| D. | 4 only |
| Answer» C. 3 only | |
| 2510. |
Which of the following is the process of bridging the gap between the revenue and expenditure? 1. Multiple financing 2. Bridge financing 3. Accurate financing 4. Deficit financing |
| A. | 1 only |
| B. | 2 only |
| C. | 3 only |
| D. | 4 only |
| Answer» E. | |
| 2511. |
Mobilization of resources and channelizing the same for productive investment is the primary purpose of 1. Expenditure 2. VAT 3. Taxation 4. CRR |
| A. | 1 only |
| B. | 2 only |
| C. | 3 only |
| D. | 1, 2 and 4 |
| Answer» D. 1, 2 and 4 | |
| 2512. |
With reference to 'Central excise duty', which of the following statements is/are correct? 1. Commodities on which state governments impose excise duties are exempted from the central excise duty 2. In recent years large number of goods has come under excise duty. Moreover, the rates of these duties have also been increasing 3. Commodities which are produced within the country levied by central excise duty |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2513. |
Which of the following statements is/are correct in regards to Revenue budget? 1. It consists of all capital receipts and expenditure such as domestic and foreign loans loan repayment foreign and etc. 2. It consists of all current receipts such as taxation dividends of public sector units (PSU's) and expenditure of the government |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | Neither 1 nor 2 |
| Answer» C. 1 and 2 | |
| 2514. |
Which among the following statements is incorrect in regards to statutory liquid ratio? 1. Statutory liquid ratio refers to the amount that the commercial banks require to maintain in the form of cash, or gold or govt. approved securities before providing credit to the customers 2. Statutory liquid ratio is determined and maintained by RBI in order to control the expansion of bank credit 3. At present, the SLR is 4 % 4. It is determined as percentage total demand and percentage of time liabilities |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | None of the above |
| Answer» D. None of the above | |
| 2515. |
Which of the following is the tax imposed on commodities imported into India (import duty) or those exported from India (export duty)? 1. Customs duty 2. Central excise duty 3. Incorporate duty |
| A. | 1 only |
| B. | 2 only |
| C. | 3 only |
| D. | 2 and 3 |
| Answer» B. 2 only | |
| 2516. |
Which of the following refers to the RBI buying and selling eligible securities to regulate money supply? 1. Repo and Reverse Repo 2. Open Market Operations 3. Response and Reverse Repo 4. Relative Market Operations |
| A. | 1 and 2 |
| B. | 2 only |
| C. | 3 only |
| D. | 1, 2 and 4 |
| Answer» C. 3 only | |
| 2517. |
High fiscal deficit is cause for concern for any economy. What does it denote? |
| A. | It is a measure of the borrowing of an economy |
| B. | It is total expenditure less total receipts excluding borrowings |
| C. | It reflects the decrease in tax collections for the year |
| D. | It means the lack of liquidity and earnings for the economy. |
| Answer» C. It reflects the decrease in tax collections for the year | |
| 2518. |
Which of the following refers to the freedom for firms and residents to freely buy into overseas assets? 1. Capital Account Consumption 2. Capital Across Convertibility 3. Capital Account Continuity 4. Capital Account Convertibility |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 4 only |
| Answer» E. | |
| 2519. |
Which of the following statements is/are correct in terms of Direct and Indirect taxes? 1. Excise duty and sales tax are examples of indirect taxes 2. Taxes like income tax and property tax are direct taxes 3. There is no difference between Direct and Indirect tax Select the correct answer using the code given below: |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | 1, 2 and 3 |
| Answer» D. 1, 2 and 3 | |
| 2520. |
Which of the following refers to mat part of deficit for which the government borrows from the RBI? 1. Primary deficit 2. Secondary deficit 3. Regulatory deficit 4. Monetised deficit |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 4 only |
| Answer» E. | |
| 2521. |
Which of the following are included in the category of direct tax in India?1. Corporation tax 2. Tax on income3. Wealth tax 4. Customs duty5. Excise dutySelect the correct answer using the codes given below |
| A. | 1, 2 and 3 |
| B. | 1, 2, 4 and 5 |
| C. | 2 and 3 |
| D. | 1, 3, 4 and 5 |
| Answer» B. 1, 2, 4 and 5 | |
| 2522. |
With reference to Union Budget, which of the following is/are covered under Non-Plan Expenditure? 1. Defence expenditure 2. Interest payments 3. Salaries and pensions 4. Subsidies Select the correct answer using the code given below. |
| A. | 1 only |
| B. | 2 and 3 only |
| C. | 1, 2, 3 and 4 |
| D. | None |
| Answer» D. None | |
| 2523. |
Consider the following statements: The Indian rupee is fully convertible: 1. in respect of Current Account of Balance of payment 2. in respect of Capital Account of Balance of payment 3. into gold Which of these statements is/are correct? |
| A. | 1 alone |
| B. | 3 alone |
| C. | 1 and 2 |
| D. | 1, 2 and 3 |
| Answer» B. 3 alone | |
| 2524. |
Which of the following are among the non-plan expenditures of the Government of India? 1. Defence expenditure 2. Subsidies 3. All expenditures linked with the previous plan periods 4. Interest payment Codes: |
| A. | 1 and 2 |
| B. | 1 and 3 |
| C. | 2 and 4 |
| D. | 1, 2, 3 and 4 |
| Answer» E. | |
| 2525. |
Which of the following is/are type of Budget? 1. Capital budget 2. Revenue budget |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 2 only |
| D. | Neither 1 nor 2 |
| Answer» B. 1 and 2 | |
| 2526. |
Consider the following statements Full convertibility of the rupee may mean 1. Its free float with the international currencies. 2. Its direct exchange with any other international currency at any prescribed place inside and outside the country. 3. It acts just like any other international currency. Which of these statements are correct? |
| A. | 1 and 2 |
| B. | 1 and 3 |
| C. | 2 and 3 |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2527. |
Plan expenditure in India is met by- |
| A. | Internal debt and other resources |
| B. | Assistance from Aid India Club |
| C. | Assistance from IMF |
| D. | Assistance from OECD countries |
| Answer» B. Assistance from Aid India Club | |
| 2528. |
Which are the pre-requisites required by the Indian economy to implement convertibility of rupee on trade account as suggested by the Rangarajan Committee? 1. There should be comfortable foreign exchange resources 2. Low rate of inflation. 3. Mechanism by which me government can pass on the changes in the price of imported goods to the consumers 4. SLR and CRR must below. |
| A. | 1 and 2 |
| B. | 1, 2 and 3 |
| C. | 1 and 4 |
| D. | All of the above |
| Answer» C. 1 and 4 | |
| 2529. |
Which statements about indirect taxes in India are true? 1. Yield from indirect taxes is more than that from direct taxes. 2. Indirect taxes have grown faster than direct taxes after 1947. 3. Indirect taxes are ultimately paid for by persons who do not actually pay taxes to the government. 4. Increase in indirect taxes is good in a developing country. |
| A. | 1, 2 and 4 |
| B. | 1 and 2 |
| C. | 2 only |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2530. |
Which of the following is /are among the noticeable features of the recommendations of the Thirteenth Finance Commission? 1. A design for the Goods and Services Tax, and a compensation package linked to adherence to the proposed design. 2. A design for the creation of lakhs of jobs in the next ten years in consonance with India's demographic dividend. 3. Devolution of a specified share of central taxes to local bodies as grants. Select the correct answer using the codes given below |
| A. | 1 only |
| B. | 2 and 3 |
| C. | 1 and 3 |
| D. | 1, 2 and 3 |
| Answer» B. 2 and 3 | |
| 2531. |
With reference to the Indian Public Finance, consider the following statements. 1. External liabilities reported in the Union Budget are based on historical exchange rates. 2. The continued high borrowing has kept the real interest rates high in the economy. 3. The upward trend in the ratio of Fiscal Deficit to GDP in recent years has an adverse effect on private investments. 4. Interest payments is the single largest component of the non-plan revenue expenditure of the Union Government.Which of these statements are correct? |
| A. | 1, 2 and 3 |
| B. | 1 and 4 |
| C. | 2, 3 and 4 |
| D. | 1, 2, 3 and 4 |
| Answer» D. 1, 2, 3 and 4 | |
| 2532. |
Which of the following is the main aim of Indian Monetary Policy? 1. Control inflationary pressure 2. Boost economic development |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | Neither 1 nor 2 |
| Answer» D. Neither 1 nor 2 | |
| 2533. |
Increase in net RBI credit for Central Government represents- 1. Budgetary Deficit 2. Revenue Deficit 3. Fiscal Deficit 4. Monetised Deficit Choose the right option |
| A. | 1 only |
| B. | 1 and 2 |
| C. | 3 only |
| D. | 4 only |
| Answer» E. | |
| 2534. |
Consider the following statements in respect of Financial Commission: 1. It is mandatory to appoint a Finance Commission every five years. 2. Finance Commission lays down the principles governing grant-in-aid to states. 3. Finance Minister is the ex-officio Chairperson of the Finance Commission. 4. The award given by the Finance Commission is binding on Central and State governments. Which of the above statements are correct? |
| A. | 1, 2, 3 and 4 |
| B. | 1, 2 and 4 |
| C. | 1, 2 and 3 |
| D. | 1, 3 and 4 |
| Answer» C. 1, 2 and 3 | |
| 2535. |
After 1947, development and non-development expenditures have increased, the increase in the former being more. Non-development expenditure involves 1. interest payments 2. subsidies 3. defence 4. Irrigation |
| A. | 1 and 2 |
| B. | 1 only |
| C. | 1, 2 and 3 |
| D. | 2, 3 and 4 |
| Answer» D. 2, 3 and 4 | |
| 2536. |
When the Reserve Bank of India reduces the Statutory Liquidity Ratio by 50 basis points, which of the following is likely to happen? [IAS Prelims 2015] |
| A. | India?s GDP growth rate increases drastically |
| B. | Foreign Institutional Investors may bring more capital into our country |
| C. | Scheduled Commercial Banks may cut their lending rates |
| D. | It may drastically reduce the liquidity to the banking system |
| Answer» D. It may drastically reduce the liquidity to the banking system | |
| 2537. |
CENVAT is related to- |
| A. | Sales Tax |
| B. | Excise Duty |
| C. | Custom Duty |
| D. | Service Tax |
| Answer» B. Excise Duty | |
| 2538. |
Convertibility of rupee implies [IAS Prelims 2015] |
| A. | being able to convert rupee notes into gold |
| B. | allowing the value of rupee to be fixed by market forces |
| C. | freely permitting the conversion of rupee to other currencies and vice versa |
| D. | developing an international market for currencies in India |
| Answer» D. developing an international market for currencies in India | |
| 2539. |
Corporation tax is imposed by |
| A. | State Government |
| B. | Central Government |
| C. | Local Government |
| D. | State as well as Central Government |
| Answer» E. | |
| 2540. |
Fiscal Policy in India is formulated by |
| A. | the Reserve Bank of India |
| B. | the Planning Commission |
| C. | the Finance Ministry |
| D. | the Securities and Exchange Board of India |
| Answer» D. the Securities and Exchange Board of India | |
| 2541. |
As per the Economic Survey 2007-2008, which one of the following is the largest source of revenue of the Government of India? |
| A. | Excise Duty |
| B. | Personal income Tax |
| C. | Corporation Tax |
| D. | Customs Duties |
| Answer» D. Customs Duties | |
| 2542. |
According to the provisions of the Fiscal Responsibility and Budget Management Act., 2003 and FRBM Rules, 2004, the Government is under obligation to present three statements before the parliament along with the Annual Budget. Which one of the following is not one of them? |
| A. | Macroeconomic Framework Statement |
| B. | Fiscal Policy Strategy Statement |
| C. | Medium-term Fiscal Policy Statement |
| D. | Statement showing Short term Fiscal Policy |
| Answer» E. | |
| 2543. |
The sales tax you pay while purchasing a toothpaste is a |
| A. | tax imposed by the Central Government |
| B. | tax imposed by the Central Government but collected by the State Government |
| C. | tax imposed by the State Government but collected by the Central Government |
| D. | tax imposed and collected by the State Government |
| Answer» E. | |
| 2544. |
The banks are required to maintain a certain ratio between their cash in hand and total assets. This is called: |
| A. | SBR (Statutory Bank Ratio) |
| B. | SLR (Statutory Liquid Ratio) |
| C. | CBR (Central Liquid Reserve) |
| D. | CLR (Central Liquid Reserve) |
| Answer» C. CBR (Central Liquid Reserve) | |
| 2545. |
Which one of the following is the correct statement? Service tax is a/an: |
| A. | direct tax levied by the Central Government. |
| B. | indirect tax levied by the Central Government. |
| C. | direct tax levied by the State Government. |
| D. | indirect tax levied by the State Government. |
| Answer» C. direct tax levied by the State Government. | |
| 2546. |
In India, deficit financing is used for raising resources for |
| A. | economic development |
| B. | redemption of public debt |
| C. | adjusting the balance of payments |
| D. | reducing the foreign debt |
| Answer» B. redemption of public debt | |
| 2547. |
If a government budgets for a surplus and there is an unexpected increase in the level of economic activity, which of the following is likely to occur? |
| A. | There will be an increase in tax revenues and an increase in the budget surplus |
| B. | There will be an increase in tax revenues and a decrease in the budget |
| C. | There will be a decrease in tax revenues and an increase in the budget surplus |
| D. | There will be a decrease in tax revenues and a decrease in the budget surplus |
| Answer» B. There will be an increase in tax revenues and a decrease in the budget | |
| 2548. |
Tarapore Committee submitted its report on "Full Convertibility on Rupee" in- |
| A. | Current account |
| B. | Capital account |
| C. | Both in current as well as in capital account |
| D. | Special Drawing Rights (SDRs) |
| Answer» C. Both in current as well as in capital account | |
| 2549. |
The diagram shows a relationship between inflation and unemployment for an economy. Which of the following policies would move the economy from A to B? |
| A. | Reduce interest rate and increase income tax rates |
| B. | Reduce interest rates and decrease income tax rates |
| C. | Increase interest rates and decrease income tax rates |
| D. | Increase interest rates and increase Income tax rates |
| Answer» E. | |
| 2550. |
Which one of the following statements regarding the levying, collecting, and distribution of Income Tax is correct? |
| A. | The Union levies, collects, and distributes the proceeds of income tax between itself and the states. |
| B. | The Union levies, collects, and keeps all the proceeds of income tax itself. |
| C. | The Union levies and collects the tax but all the proceeds are distributed among the states |
| D. | Only the surcharge levied on income tax is shared between the Union and the states. |
| Answer» B. The Union levies, collects, and keeps all the proceeds of income tax itself. | |