Question 1

External debts can be raised from ...........

Accepted Answer

External debts are typically raised from international financial institutions like the World Bank, which provide loans to countries.

Question 2

Debts that are repaid at some specific future date are known as

Accepted Answer

Redeemable debts are those that have a specific maturity date on which the principal amount is due to be repaid.

Question 3

External loans are raised from

Accepted Answer

External loans are typically raised from international organizations or foreign entities, and the World Trade Organization (WTO) is an international body that can be involved in such financial arrangements.

Question 4

The concept of Merit goods was developed by ................

Accepted Answer

The concept of Merit goods was developed by Richard Musgrave to describe goods that governments should provide or subsidize because they generate benefits that may not be fully recognized or valued by consumers, leading to under-consumption if left to the market.

Question 5

Non-rival consumption is the feature of ..............

Accepted Answer

Non-rival consumption means that one person's consumption of a good does not reduce the amount available for others to consume. This is a characteristic of public goods.

Question 6

The theory of second best was introduced by ...............

Accepted Answer

The theory of second best was introduced by Lipsey and Lancaster, not by the names listed in the other options. This theory suggests that if one optimality condition in an economic model cannot be satisfied, then an optimal outcome may require that other optimality conditions are not satisfied either.

Question 7

Wagner's Law of increasing ............ activities.

Accepted Answer

The answer of Wagner's Law of increasing ............ activities.
...

Question 8

Wiseman-Peacock was studied expenditure of .............. in 1890-1955.

Accepted Answer

The Wiseman-Peacock study focused on the expenditure patterns of the United Kingdom (UK) during the period from 1890 to 1955.

Question 9

Pure theory of public expenditure is based on ..............

Accepted Answer

The pure theory of public expenditure is based on the principle of benefit, where the allocation of resources and the distribution of the costs of public goods and services are related to the benefits received by individuals or groups.

Question 10

Social marginal productivity criteria was developed by ...........

Accepted Answer

A. E. Khan developed the social marginal productivity criteria, which is used in the context of evaluating the social benefits of investment projects.

Question 11

Balanced budget means ................ between revenue and expenditure.

Accepted Answer

A balanced budget occurs when revenue is equal to expenditure, meaning there is a balance between the amount of money coming in and going out.

Question 12

................... budget concept was first introduced in USA in 1964.

Accepted Answer

The zero-base budget concept was first introduced in the USA in 1964, focusing on building a budget from a "zero base," meaning every expense must be justified for each new period.

Question 13

Public debt is the debt owed by ................

Accepted Answer

Public debt refers to the total amount of money that the central government owes to creditors within the country and abroad. It does not include the debts of individuals, industries, or banks.

Question 14

In a concept of budgetary deficit, ............... is always greater than the total revenue.

Accepted Answer

Public expenditure is always greater than the total revenue in the concept of a budgetary deficit, indicating that the government is spending more than it is earning.

Question 15

............ tax is in the jurisdiction of the Central government.

Accepted Answer

Corporation tax is in the jurisdiction of the Central government, as it is a tax levied on the income of companies and firms at the national level.

Question 16

In internal debt ................ are important.

Accepted Answer

Market loans are important in internal debt as they are raised within the country through the issuance of government securities.

Question 17

Public debt in Indian Economy is .................... in nature.

Accepted Answer

Public debt in the Indian Economy is generally increasing in nature due to the government's continuous need to finance deficits and development projects.

Question 18

Fiscal Crisis was carried in ................. period.

Accepted Answer

Fiscal Crisis was carried in planning period.

Question 19

Which of the following is a Revenue Receipt?

Accepted Answer

Grants received from the World Bank are considered Revenue Receipts because they are typically non-repayable funds provided for specific projects or purposes and do not create any liability or decrease any asset.

Question 20

Which of the following is a Capital Receipt?

Accepted Answer

Capital receipts are those receipts that either create a liability or reduce a financial asset. Borrowing from the public increases the government's liability, hence it is considered a capital receipt.

Quiz 3: Public Finance and Economic Concepts and Terms