Sources of revenue Reserve Bank of India fiscal policy and monetary policy finance commission. - One Line Questions

1. When did the Reserve Bank of India (RBI) come into existence? — 1935
2. Which Article of the Constitution empowers the Parliament to impose taxes for the purpose of the Union? — Article 246
3. The Finance Commission is constituted under which Article of the Indian Constitution? — Article 280
4. The 'Monetary Policy Committee' (MPC) was constituted under which Act? — Reserve Bank of India Act, 1934
5. When the government increases its spending without a corresponding increase in taxes, it leads to: — Budget Deficit
6. The 'Statutory Liquidity Ratio' (SLR) requires banks to maintain a certain percentage of their deposits in the form of: — Government securities and cash or gold
7. Which of the following is a 'revenue expenditure' of the government? — Payment of salaries and pensions.
8. The 'Bank Rate' policy is a tool used by the RBI to: — Control the inflation rate.
9. Which of the following is a tax levied by the State Government? — Stamp Duty on property transactions
10. Which of the following is a non-tax revenue for the Central Government? — Profits from Public Sector Undertakings
11. The 'Quantitative Tools' of monetary policy aim to: — Control the overall volume of credit in the banking system.
12. Which of the following is a 'Capital Receipt' for the government? — Disinvestment proceeds
13. The primary objective of monetary policy in India is to maintain price stability while keeping in mind the objective of: — All of the above
14. Which of the following represents the 'non-plan expenditure' of the government? — Expenditure on defence services.
15. What is the primary difference between a budget deficit and a fiscal deficit? — Budget deficit is the shortfall in revenue, while fiscal deficit includes the government's borrowings as well.
16. Which policy aims to manage the supply of money and credit in an economy? — Monetary Policy
17. The concept of 'Repo Rate' is associated with which policy? — Monetary Policy
18. The tenure of a Finance Commission is: — Determined by the President
19. What is the primary source of revenue for the Tamil Nadu State Government? — State Goods and Services Tax (SGST)
20. Which tax is levied by the Union Government but collected and appropriated by the States? — Excise Duty on alcoholic liquors for human consumption
21. Which of the following is an example of an indirect tax? — Goods and Services Tax (GST)
22. Which tax is levied on the consumption of goods and services across India? — Goods and Services Tax (GST)
23. Which of the following is a 'debt' receipt for the government? — Borrowings from financial institutions
24. The 'Fiscal Responsibility and Budget Management (FRBM) Act' aims to: — Reduce the fiscal deficit and public debt.
25. When the RBI decides to increase the Repo Rate, it generally aims to: — Reduce inflation.
26. The RBI can control inflation by: — All of the above
27. Which of the following is a component of fiscal policy? — Government Expenditure
28. Which of the following is a source of revenue for the Central Government of India? — Corporation Tax
29. The Finance Commission's recommendations on the distribution of net proceeds of taxes are: — Advisory in nature.
30. What does 'Open Market Operations' by the RBI involve? — Buying and selling government securities in the open market.
31. The RBI's objective of ensuring financial stability includes: — Overseeing the stability of the banking and financial system.
32. The primary function of the 'Finance Commission' is to: — Advise on the distribution of financial resources between the Union and States.
33. What does 'Fiscal Policy' primarily involve? — Using government spending and taxation to influence the economy.
34. Which institution in India is responsible for formulating and implementing monetary policy? — Reserve Bank of India (RBI)
35. The recommendations of the Finance Commission primarily relate to: — Distribution of tax revenues between the Union and the States.
36. The Finance Commission is appointed by the: — President of India
37. The 'Reverse Repo Rate' is the rate at which: — Commercial banks lend to RBI.
38. The 'Welfare measure' expenditure by the government is part of: — Revenue Expenditure
39. Which of the following is a direct tax collected by the central government? — Income Tax
40. Which of the following is a tool of quantitative credit control used by the RBI? — Bank Rate
41. The Finance Commission makes recommendations regarding: — All of the above
42. The RBI's role in managing India's foreign exchange reserves is governed by: — The Foreign Exchange Management Act (FEMA), 1999.
43. What is the 'Cash Reserve Ratio' (CRR)? — The percentage of deposits that banks must keep with the RBI in the form of cash.
44. When the RBI undertakes 'devaluation' of the rupee, it means: — The value of the rupee has been officially lowered by the government.
45. The primary role of the Governor of the Reserve Bank of India is: — To oversee the day-to-day operations of the RBI and implement monetary policy.
46. What is the primary role of the Finance Commission? — All of the above
47. What is the main objective of fiscal policy? — To influence the aggregate demand through government spending and taxation.
48. What is the main purpose of 'Moral Suasion' used by the RBI? — To persuade banks to adopt certain policies or follow specific guidelines.
49. What is the primary function of the Reserve Bank of India (RBI) concerning monetary policy? — To regulate the issue of bank notes and the supply of money.
All One Line Questions
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