Chapter Exam

Chapter 31: Public Finance and Budget — Online MCQ Test

Q: Which of the following is an example of tax revenue?

Answer: C. Income tax — Income tax is a direct tax and forms part of tax revenue. The other options are examples of non-tax revenue.

Q: Which of the following is a direct tax?

Answer: B. Income tax — Income tax is paid directly by the person on whom it is imposed. Sales tax, customs duty, and excise duty are indirect taxes.

Q: A government increases tax on luxury goods but keeps basic food items tax-free. What is the main aim of this policy?

Answer: B. To make the tax system more equitable — Taxing luxury goods more while protecting essential goods helps make taxation fairer. It places a larger burden on those who can afford more.

SOCIAL SCIENCE · CLASS 10th · Karnataka State Board

Practice Chapter 31: Public Finance and Budget with a free chapter-wise online MCQ test for Karnataka State Board CLASS 10th SOCIAL SCIENCE. This chapter covers: This chapter details government revenue tax non-tax revenue public expenditure fiscal deficit public debt budget concepts preparation and fiscal policies.. AI-generated questions from basic to board-exam level, with instant results and explanations.

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Chapter 31: Public Finance and Budget — Important Questions & Answers (FAQ)

Frequently asked questions from Karnataka State Board CLASS 10th SOCIAL SCIENCE — Chapter 31: Public Finance and Budget, with answers and explanations. These are sample questions; the exam has its own separate question set.

What is meant by public finance?

A. The study of private savings and household expenditure
B. The study of government income, expenditure, and borrowing ✓
C. The study of industrial production and trade
D. The study of bank deposits and interest rates

Answer: B. The study of government income, expenditure, and borrowing
Public finance deals with the government's income, expenditure, borrowing, and financial management. It explains how the state collects and spends money.

Which of the following is an example of tax revenue?

A. Fees collected for issuing a passport
B. Dividend from government companies
C. Income tax ✓
D. Interest received on loans given by the government

Answer: C. Income tax
Income tax is a direct tax and forms part of tax revenue. The other options are examples of non-tax revenue.

Which of the following is a direct tax?

A. Sales tax
B. Income tax ✓
C. Customs duty
D. Excise duty

Answer: B. Income tax
Income tax is paid directly by the person on whom it is imposed. Sales tax, customs duty, and excise duty are indirect taxes.

A government increases tax on luxury goods but keeps basic food items tax-free. What is the main aim of this policy?

A. To increase burden on the poor
B. To make the tax system more equitable ✓
C. To reduce total government expenditure immediately
D. To eliminate all indirect taxes

Answer: B. To make the tax system more equitable
Taxing luxury goods more while protecting essential goods helps make taxation fairer. It places a larger burden on those who can afford more.

Which of the following is the most appropriate reason for the government to borrow funds?

A. To avoid collecting any taxes
B. To cover expenditure when revenue is insufficient ✓
C. To reduce the population of the country
D. To stop all public expenditure

Answer: B. To cover expenditure when revenue is insufficient
The government borrows when its current revenue is not enough to meet planned expenditure. Borrowing helps finance development and other essential spending.

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