CHAPTER 4: ROLE of GOVERNMENT POLICY

Government operating expenditure consists of 

• pension and gratuities

• agriculture and transport

• housing and medical

• communication and mineral resources

Compulsory contribution by an individual or a firm to the government to be used the common interest of economy refers to _________________.

• non-revenue receipts

• non tax revenue

• tax revenue

• direct tax

The deficit budget occurs when

• the public debt decreases

• the government's total expenditure equals revenue

• tax collection is more than government expenditure

• the government's total expenditure exceeds revenue

Petroleum income tax and stamp duties are two examples of the government revenues. The revenues fall under which category?

• Direct taxes

• Indirect taxes

• Non-tax revenue

• Non-revenue receipts

Government revenue obtained from fees for issue of license and permit is

• non-tax revenue

• tax revenue

• indirect tax

• direct tax

The purpose of purchasing government securities by a central bank in the open market operation is for ________________.

• increasing money supply and reduce interest rate

• increasing money supply and raise interest rate

• reducing money supply and raise interest rate

• decreasing money supply and lower interest rate

Federal government revenue comprises sources such as 

• direct tax and indirect tax

• tax revenue, non tax revenue and non-tax revenue receipts

• tax revenue, import and export

• tax revenue and petroleum royalty

The expansionary fiscal policy is imposed by the government to _______________.

• reduce problem of inflation

• reduce problem of deflation

• increase aggregate demand

• increase the money supply in the economy

Which of the following pairs is TRUE?

• Taxes - Monetary Policy

• Government expenditure - Monetary Policy

• Government securities - Monetary Policy

• Transfer payment - Monetary Policy

Government's total expenditure is less than its total revenue refers to ____________

• negative budget

• deficit budget

• balanced budget

• surplus budget