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Government Budget

Total questions: 62

Worksheet time: 31mins

Name
Class
Date
1.

Which of the following are objectives of budget?

a)

Reallocation of resources

b)

Redistribution of income

c)

Economic stability

d)

All of these

2.

Which of the following is not non tax revenue receipts of government?

a)

Excise duty

b)

Escheat

c)

Special assessment

d)

Fees and fines

3.

Recovery of loan is:

a)

Revenue receipt

b)

Capital receipt

c)

Revenue expenditure

d)

Capital expenditure

4.

Payment of loan is:

a)

Revenue expenditure

b)

Capital expenditure

c)

Revenue receipts

d)

Capital receipts

5.

When incidence and burden of tax falls on different persons that type of tax is called:

a)

Direct tax

b)

Indirect tax

c)

Regressive tax

d)

None of these

6.

Fiscal deficit is equal to

a)

Direct tax

b)

Interest

c)

Borrowings

d)

All of these

7.

Primary deficit=fiscal deficit_

a)

Loan

b)

Interest payments

c)

Borrowings

d)

None of these

8.

When budget receipts are greater than budget expenditure such type of budget is called:

a)

Balanced budget

b)

Deficit budget

c)

Surplus budget

d)

None of these

9.

Construction of school building is:

a)

Capital expenditure

b)

Revenue receipts

c)

Revenue expenditure

d)

Capital receipts

10.

Which bank has sole right of issuing notes

a)

ADB

b)

SBI

c)

RBI

d)

UBI

11.

When money value is equal to commodity value it is called

a)

Fiat money

b)

Credit money

c)

Fiduciary money

d)

Full bodied money

12.

Money supply is

a)

Currency with public

b)

Demand deposits

c)

Other deposits

d)

All of these

13.

when any commercial bank is unable to meet financial obligation then it approaches Central Bank for financial accommodation this function of Central Bank is called

a)

Banker of bank

b)

Lander of last resort

c)

Bank of Government

d)

Controller of credit

14.

If LRR is .25, what will be money multiplier

a)

4

b)

1

c)

5

d)

2

15.

A Govt. Budget is prepared for a fiscal year running from :

a)

1st January to 31st December

b)

1st April to 31st December

c)

1st April to 31st March

d)

1st January to 30th April

16.

Direct tax is called direct because it is collected directly from :

a)

The producers on goods produced

b)

the sellers on goods sold

c)

The buyers of goods

d)

The income earners

17.

Which of the following is an indirect tax?

a)

Corporation tax

b)

Value Added tax

c)

Income tax

d)

Wealth tax

18.

Pension payment is an example of :

a)

Plan expenditure

b)

Revenue expenditure

c)

Capital expenditure

d)

Non-plan expenditure

19.

Subsidies are an example of :

a)

Revenue expenditure

b)

Capital expenditure

c)

Plan expenditure

d)

None of them

20.

Which out of the following is a non-developmental expenditure?

a)

Scientific research

b)

Social Welfare

c)

Administration

d)

None of them

21.

Interest payment are subtracted from which deficit to arrive at Primary Deficit :

a)

Revenue Deficit

b)

Capital deficit

c)

Fiscal Deficit

d)

None of these

22.

Borrowing in government budget is :

a)

Revenue Deficit

b)

Fiscal deficit

c)

Primary Deficit

d)

Deficit in taxes

23.

Which of the following statement is true?

a)

Loan from IMF is a Revenue Receipt

b)

Higher revenue deficit necessarily leads to higher fiscal deficit

c)

Borrowing by a government represents a situation of fiscal deficit.

d)

Revenue deficit is the excess of capital receipts over the revenue receipts

24.

While financing a deficit, under which measure government can print more currency :

a)

Deficit financing

b)

Disinvestment

c)

By issuing bonds

d)

none of them

25.

Identify which of the following statement is true?

a)

Fiscal deficit is difference between planned revenue expenditure and planned revenue receipts.

b)

Fiscal deficit is difference between total planned expenditure and total planned receipts

c)

Primary deficit is the difference between total planned receipt and interest payment

d)

Fiscal deficit is the sum of primary deficit and interest payment

26.

The receipts which neither create any liability nor lead to any reduction in assets are called

a)

revenue receipts

b)

capital receipts

c)

both (a) and (b)

d)

none of these

27.

In the government budget, if revenue receipts = ₹100 lakh, capital receipt = ₹50 lakh and revenue deficit = ₹25 lakh, how much is the revenue expenditure?

a)

75 lakh

b)

150 lakh

c)

125 lakh

d)

50 lakh

28.

The government budget has a revenue deficit. This gets financed by:

A. Borrowings B. Disinvestment C. Tax revenue D. Indirect Tax

a)

A and D

b)

C and D

c)

A and B

d)

C and D

29.

In government, budget primary deficit is ₹10000 crore, interest payment is ₹5000 crore, then fiscal deficit is ₹ _______ crore.

a)

15000

b)

16000

c)

18000

d)

5000

30.

Construction of flyover is a capital expenditure of the government.

a)

True

b)

False

31.

Capital expenditure increases the liabilities of the government.

a)

True

b)

False

32.

Primary deficit indicates the government's inability to meet its regular and recurring expenditure.

a)

True

b)

False

33.

Which of the following is not true for fiscal deficit? A fiscal deficit:

a)

represents the borrowings of the government

b)

is the difference between total expenditure and total receipts of the government

c)

is the difference between total expenditure and total receipts other than borrowings

d)

increase future liability of the government

34.

Assertion :Highway and roads are announced in Kerala, Tamil Nadu and West Bengal in Budget, 2021.


Reason: Such announcements will increase the revenue expenditure of the Government.

a)

Both Assertion (A) and Reason (R ) are true and Reason (R ) is the correct explanation of the

Assertion (A)

b)

Both Assertion (A) and Reason (R ) are true and Reason (R ) is not the correct explanation of the

Assertion (A)

c)

Assertion (A) is true but the Reason (R ) is false

d)

Assertion (A) is false but the Reason (R ) is true

35.

Assertion (A): Income tax is a great source of revenue to the government.

Reason(R): It is a direct tax as its burden can't be shifted.

a)

Both Assertion (A) and Reason (R ) are true and Reason (R ) is the correct explanation of the

Assertion (A)

b)

Both Assertion (A) and Reason (R ) are true and Reason (R ) is not the correct explanation of the

Assertion (A)

c)

Assertion (A) is true but the Reason (R ) is false

d)

Assertion (A) is false but the Reason (R ) is true

36.

Assertion (A): Fiscal position shows a better position of the government expenditure in comparison to the budget deficit.

Reason(R): Fiscal deficit means borrowings to the govt.

a)

Both Assertion (A) and Reason (R ) are true and Reason (R ) is the correct explanation of the

Assertion (A)

b)

Both Assertion (A) and Reason (R ) are true and Reason (R ) is not the correct explanation of the

Assertion (A)

c)

Assertion (A) is true but the Reason (R ) is false

d)

Assertion (A) is false but the Reason (R ) is true

37.

Which of the following are objectives of budget?

a)

Reallocation of resources

b)

Redistribution of income

c)

Economic stability

d)

All of these

38.

Which of the following is not non tax revenue receipts of government?

a)

Excise duty

b)

Escheat

c)

Special assessment

d)

Fees and fines

39.

Recovery of loan is:

a)

Revenue receipt

b)

Capital receipt

c)

Revenue expenditure

d)

Capital expenditure

40.

Subsidies on fertilizers is a

a)

capital receipt

b)

revenue receipt

c)

capital expenditure

d)

revenue expenditure

41.

the component of budget that creates an asset of the government is

a)

revenue receipt

b)

revenue expenditure

c)

capital receipt

d)

capital expenditure

42.

Interest paid on foreign loan is a capital expenditure.

a)

true

b)

false

43.

corporate tax is a direct tax.

a)

true

b)

false

44.

escheats are

a)

revenue receipts

b)

capital receipts

c)

revenue expenditure

d)

capital expenditure

45.

it neither creates an asset nor reduces liability

a)

revenue expenditure

b)

capital expenditure

c)

revenue receipt

d)

capital receipt

46.

expenditure on the vaccination of people for Covid 19 is

a)

revenue expenditure

b)

capital expenditure

c)

both 1 and 2

d)

none

47.

repayment of loan to the US government is

a)

revenue receipt

b)

capital receipt

c)

revenue expenditure

d)

capital expenditure

48.

the incidence of this tax cannot be shifted

a)

direct

b)

indirect

49.

Financial Aid from abroad is a revenue receipt.

a)

true

b)

false

50.

Pick the odd one out

a)

VAT

b)

Excise duty

c)

Wealth tax

d)

sales tax

51.

pick the odd one out

a)

income tax

b)

profit tax

c)

import duty

d)

gift tax

52.

pick the odd one out

a)

interest received on government lending

b)

profits of PSUs

c)

receipts from sale of Air India

d)

special assessment

53.

Which statement(s) is/are correct regarding revenue receipts?

a)

they reduce assets

b)

they create assets

c)

they reduce liability

d)

they do not create liability

54.

Which statement(s) is/are correct regarding revenue expenditure?

a)

they do not create assets

b)

they create liability

c)

they reduce liability

d)

they create assets

55.

Zero primary deficit means

a)

no liabilities with government

b)

the government has to resort to borrowing only to meet interest payments

c)

no interest payments

d)

no borrowing

56.

Which of the following is a non tax eceipts?

a)

Gift tax

b)

sale tax

c)

Donations

d)

Excise duty

57.

Which of the fololowing are the objective of government budget?

a)

Distrtibution of Income nd wealth

b)

Economic stability

c)

GDP growth

d)

all of these

58.

Which of the following is a part of the revenue expenditure in the indian government budget?

a)

Intreast payment

b)

Defence Purchase

c)

Wage bill of the Government

d)

All of these

59.

Capital receipts is that receipts of the Government which:

a)

creats a liability

b)

reduce the assets

c)

Both (1) and (2)

d)

none

60.

The programme and policies of the government as presented in the budget are know as (a)   policy of the government.

61.

When revenue expenditure is greater than revenue receipts it is called

a)

Fiscal deficit

b)

Primary deficit

c)

Revenue deficit

d)

None of these

62.

•When government estimated expenditure is either more or less than government estimated receipts, the budget is said to be a/ an _____.

a)

balanced budget.

b)

unbalanced budget

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