Top 150+ Solved Public Finance MCQ Questions Answer
Q. During the process of economic development, the share of public expenditure to Gross DomesticProduct tends to expand. This is called:
a. wagner’s law
b. keynes law
c. adam smith’s theory
d. brettonwoods law
Q. The principle of public expenditure that requires that Government should avoid shortfall ofrevenue in comparison with its expenditure is termed as
a. canon of deficit
b. canon of surplus
c. canon of elasticity
d. canon of sanction
Q. The ratio of change in the national income in relation to the change in government spending thatcauses it is referred to as:
a. fiscal multiplier
b. spending ratio
c. expenditure ratio
d. cost multiplier
Q. Which of the following occurs when all taxes and other revenues exceed governmentexpenditures for a year?
a. public debt
b. budget surplus
c. balanced budget
d. budget deficit
Q. Public goods have two criteria, one of which is non-excludability. What does that mean?
a. it is not possible to exclude individuals from consumption.
b. it is not possible to produce them without externalities
c. consumption by one does not affect consumption of others
d. a and c.
Q. The role of the Finance Commission in Central-State fiscal relations has been undermined by
a. the state governments
b. the zonal councils
c. the planning commission
d. the election commission
Q. The term ‘Performance Budget’ was coined by
a. administrative reforms commission of india
b. second hoover commission of usa
c. estimates committee of india
d. first hoover commission of usa
Q. If the public debt can be financed without adding to inflation or causing interest rates to rise, it issaid to be:
a. only a burden on future generations.
b. in primary balance
c. sustainable
d. following the golden rule of the public finances.
Q. Progressive Tax System is that system in which what happens in the rate of tax if there is anincrease in income?
a. destruction
b. becomes equal
c. growth
d. becomes unequal
Q. Statutory incidence of a tax deals with
a. the amount of revenue left over after taxes.
b. the amount of taxes paid after accounting for inflation.
c. the person(s) legally responsible for paying the tax.
d. the amount of tax revenue generated after a tax is impose
Q. Who deals with income and expenditure of public authorities?
a. public finance
b. private finance
c. local govt
d. none of these
Q. Unfunded debts are those debts which are paid back within …………
a. two year
b. one year
c. three year
d. six months
Q. Which one of the following is not a feature of private finance:
a. balancing of income and expenditure
b. secrecy
c. saving some part of income
d. publicity
Q. Government budget is balanced when
a. govt. expenditure outstrips tax receipts
b. govt. tax receipts outstrips expenditure
c. govt. expenditure equals tax revenues
d. none of the above
Q. The government can collect funds from
a. taxes
b. fees
c. prices of public goods
d. all the three