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Public Finance Multiple Choice Questions and Answers | Public Finance MCQs

(1) Taxes are levied to:
[A] Penalise people
[B] Provide direct benefits to tax payers
[C] Provide general benefits for the people
[D] To accumulate funds
Answer: Provide general benefits for the people
(2) Whom of the following propounded principles of taxation:
[A] Keynes
[B] Marshall
[C] Adam Smith
[D] Al Ghazali
Answer: Adam Smith

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(3) Taxes on commodities are:
[A] Direct taxes
[B] Indirect taxes
[C] Progressive taxes
[D] Proportional taxes
Answer: Indirect taxes
(4) Govt. prepares its budget:
[A] Weekly
[B] Monthly
[C] Quarterly
[D] Annually
Answer: Annually
(5) One of the following is NOT a feature of private finance:
[A] Balancing of income and expenditure
[B] Secrecy
[C] Saving some part of income
[D] Publicity
Answer: Publicity
(6) One of the following is NOT a feature of private finance:

[A] Publicity
[B] Secrecy
[C] Efforts to balance income and expenditure
[D] Taking steps to increase income
Answer: Secrecy
(7) It is direct tax:
[A] Excise tax
[B] Sales tax
[C] Income tax
[D] Custom duty
Answer: Income tax
(8) These are heads of expenditure of the government EXCEPT?
[A] Provide social services
[B] Defence
[C] Improve transport and communication
[D] Provide cosmetics
Answer: Provide cosmetics
(9) The most important source of income of a government is:
[A] Foreign loans
[B] Taxes
[C] Printing of new money
[D] Sale of government property
Answer: Taxes
(10) Progressive taxes:
[A] Increase government revenue
[B] Bring equality in distribution of incomes
[C] Act as penalty for rich people
[D] Both (a) & (b)
Answer: Both (a) & (b)

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