D) the latter includes small-denominated time deposits, noncheckable savings accounts, money market deposit accounts, and money market mutual fund balances. C. the fall in tax revenue as the economy goes into recession. The text also includes many current … Notes: i. Fiscal consolidation is one of the objectives of India's economic policy. _____ policy refers to policy measure taken by RBI to control & regulate money supply a) Credit b) Monetary c) Fiscal d) Financial 28. Answer: B Type: Basic Understanding Page: 218 2. The Nature and Purpose of Financial Management. The fiscal policy variables considered in the study include government gross fixed capital formation, tax expenditure and government consumption expenditure as well as budget deficit. Fiscal Policy gives direction to the economy. The authors take a balanced approach to micro- and macroeconomics, to both Keynesian and classical views, and to the theory and application of economics concepts. Fiscal policy Question 1. A) Forestry B) Manufacturing C) Mining D) Agriculture 4. Theories of Economic Development: 30. MCQ Questions for Class 12 Economics Chapter 11 Government Budget and the Economy with Answers December 17, 2020 by Kishen Leave a Comment Government Budget and the Economy Class 12 MCQs Questions with Answers We have provided Government Budget and the Economy Class 12 Economics MCQs Questions with Answers to help students understand the … However, the issue of whether monetary policy should target the inflation rate or the price level remains a live one. It is mandated by the Fiscal Responsibility and Budget Management Act, 2003. 3 However, there are those who worry about fiscal dominance and/or budgetary independence of the central bank. Fiscal policy doesn’t always work as designed, Some of these reasons are because businesses and consumers preempt policy changes or act in unpredictable ways. Consumers may demonstrate Ricardian equivalence by choosing to save money from a tax cut, which would cause no shift to aggregate demand and have no effect on the multiplier. D) Interest rates. A statement on relations and dialogue with investors. Fiscal policy helps to accelerate the rate of economic growth by raising the rate of investment in public as well as private sectors. ... output and then consumption spending suddenly decreases b/c of a fall in consumer confidence then the appropriate fiscal policy would be. Discretionary fiscal policy to stimulate the economy includes _____. Fiscal policy includes- 1) Taxation 2) Public debt 3) Public expenditure etc. Costs , Supply And Perfect Competition: 26. The expenditures and the tools to finance the Government expenditures form an important part of the study of Public Finance. National Income And The Standard Of Living: 28. The concept of functional finance was developed by: a) J.M. contractionary fiscal policy includes. FDI includes mergers and acquisitions, construction of new facilities, intra-company loans and reinvesting profits from foreign operations. On the other hand when government slashes rates to stimulate consumption to kick start the economy, it is known as expansionary fiscal policy. stagflation is a combo of? […] Prelims MCQs Quiz 15 : Economy 1. A) the latter includes cash held by commercial banks and the U.S. Treasury. A. lowering the tax rate paid by households with middle incomes. M ULTIPLE C HOICE Q UESTIONS T ESTBANK – C HAPTER 14 Go to memorandum Answer the following questions by selecting the appropriate answer from the list below. (b) Implications of fiscal deficit: (i) Causes Inflation: An important component of government borrowing includes borrowing from the Reserve Bank of India. 2. Therefore, fiscal deficit should be as low as possible. when tax receipts are greater than government spending resulting in exports exceeding imports. 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