Answer: Option [A]The main reason for low growth rate in India, inspite of high rate of saving and capital formation is High capital/output ratio. The main reason for low growth rate in india, in spite of high rate of savings and capital formation is high birth rate, low level of foreign aid, low capital / output ratio and high capital or output ratio.
Answer: Option [C]The correct answer is the rate of interest is so low that no one wants to hold interest bearing assets and people wants to hold cash. Liquidity trap is a situation when interest rate is so low that people prefer to hold money rather than invest it. It is the extreme effect of monetary policy. Consumers choose to avoid bonds and keep their funds in savings because of the prevailing belief that interest rates will soon rise.
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Answer: Option [D]The correct answer is Tax on production. The tax whose share in overall taxation revenue has gone up rapidly during the planning period is Tax on production.
Answer: Option [A]The most appropriate measure of a country’s economic growth is the Per capita real income. Per capita income or average income measures the average income earned per person in a given area in a specified year. It is calculated by dividing the area's total income by its total population. It is used to measure a country's standard of living thus a better indicator of economic growth.
Answer: Option [D]Value-added tax is An indirect tax on the domestic consumption of goods collected at all stages between production and the point of final sale. A value-added tax (VAT) is a type of consumption tax that is placed on a product whenever value is added at a stage of production and at the point of retail sale. In other words, its is an ad valorem tax on domestic final consumption collected at all stages between production and point of final sale.
Answer: Option [B]The correct answer is As compared to other taxes, there is a less chance of tax evasion. VAT minimizes tax evasion due to its catch-up effect. It reduces the cost of production.
Answer: Option [A]The expenditure expensed immediately is known as Revenue expenditure. Revenue expenditures are short-term expenses used in the current period or typically within one year.
Answer: Option [B]The correct answer is the commercial banks will have less money to lend. CRR refers to the percentage of deposits banks have to keep as reserve (in cash). This reserve sum is not available for banks for lending and thus if the CRR increases, banks will have less money to lend.
Answer: Option [C]Economically developed countries are referred to as countries having large per capita income.
Answer: Option [A]Usually two months advanced grants made by the house to enable the government functions to carry on until the voting of the demands for grants and passing of the General Appropriation Bill is called vote on account. Vote on Account is a grant in advance to enable the government to carry on until the voting of demands for grants and the passing of the Appropriation Bill and Finance Bill. This enables the government to fund its expenses for a short period of time or until a full-budget is passed.
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