Public Finance - Principles of Economics

A deficit budget occurs when _____________.

• the government's total expenditure equal revenue

• the government's total expenditure exceeds revenue

• tax collection exceeds government expenditure

• the public debt decreases

What is regressive tax?

• Tax rate varies positively with income

• Tax rate varies inversely with income

• Tax rate is not dependence on income

• None of the above

All the following are the examples of direct tax, except

• personal income tax

• company tax

• stamp duties

• services tax

All the following are the objectives of government taxation, except

• to increase in inquality of income distribution between the rich and the poor

• to restraint the consumer from consuming unhelathy products

• to protect local and infants industries

• to increase government revenue

An increasing rate of income tax structure is called a __________.

• regressive tax

• progressive tax

• proportional tax

• rate tax

A budget surplus can be achieved by __________.

• open market operation

• increasing government expenditure and decrease tasationby the same amount

• increasing income taxes

• increasing government development expenditures

Government expenditure consist of

• transaction expenditure and precautionary exppenditure

• public expenditure and private expenditure

• operating expenditure and development expenditure

• economic expenditure and non-economic expenditure

Which of the following is the most appropriate fiscal policy for recession?

• decrease in government spending

• increase in interest rate

• decrease in tax rate

• increase in tax rate

Government revenue from non-tax contribution are below, except

• petroleum and gas royalties

• treasury bills, bonds and loans

• sales of goods and services

• import duties

The government increase the personal income tax rates that discourage household spending. This is an example of _________.

• an expansionary fiscal policy

• an inflationary fiscal policy

• a contractionary fiscal policy

• a monetary policy