What is public revenue primarily used for?
a) To reduce national debt
b) To finance government expenditure
c) To increase government reserves
d) To invest in private sector businesses
Which of the following is considered a major source of public revenue?
a) Borrowing from foreign countries
b) Tax collection
c) Government-owned enterprises
d) Privatization of assets
What is public expenditure?
a) Money spent by private individuals on goods
b) Money spent by the government on public goods and services
c) Money spent by businesses on production
d) Money collected from private individuals for taxes
Which of the following is an example of public expenditure?
a) Private investment in stocks
b) Government spending on health and education
c) Income tax collection
d) Private business loans
How is public revenue mainly classified?
a) Direct taxes
b) Indirect taxes
c) Borrowing
d) All of the above
What is the primary purpose of tax collection for the government?
a) To increase inflation
b) To finance public expenditure
c) To reduce government spending
d) To subsidize private businesses
Which of the following taxes is a direct tax?
a) Sales tax
b) Excise duty
c) Income tax
d) Value-added tax
What is an indirect tax?
a) A tax paid directly by individuals
b) A tax collected from the manufacturer or seller and passed on to the consumer
c) A tax on international trade
d) A tax on income from capital gains
Which of the following is a key factor influencing public expenditure decisions?
a) Political ideology
b) Global stock market trends
c) Private sector growth
d) Consumer demand
Which of the following is a major type of public expenditure?
a) Subsidies for private businesses
b) Government spending on infrastructure, education, and healthcare
c) Loans to private individuals
d) Payments to foreign investors
How does government borrowing affect public revenue?
a) It increases revenue through loan repayments
b) It does not affect revenue directly
c) It reduces tax rates for citizens
d) It decreases revenue in the long term
What is the effect of public expenditure on economic growth?
a) It always leads to inflation
b) It can stimulate economic growth by creating jobs and investing in infrastructure
c) It has no effect on economic activity
d) It always leads to a decrease in private sector investment
Which of the following best describes a fiscal deficit?
a) Government expenditure exceeds government revenue
b) Government revenue exceeds government expenditure
c) Total tax collections exceed government spending
d) Private savings exceed public spending
What is the primary purpose of borrowing by the government?
a) To increase tax rates
b) To finance public projects and services
c) To fund private enterprises
d) To reduce economic inequality
Which of the following is a method used to reduce public expenditure?
a) Increasing government loans
b) Reducing subsidies for public services
c) Increasing government taxes
d) Reducing public sector wages and benefits
What is the effect of reducing taxes on public revenue?
a) Increases public revenue
b) Reduces public revenue
c) Has no effect on public revenue
d) Increases government expenditure
How can public expenditure be financed in a developing country with low public revenue?
a) By borrowing from international organizations
b) By reducing government spending on health and education
c) By increasing income taxes significantly
d) By privatizing government services
Which of the following is NOT a type of public expenditure?
a) Government spending on defense
b) Spending on public education and healthcare
c) Income support payments to the unemployed
d) Private company investments
What is the relationship between public revenue and government spending?
a) Public revenue is always greater than government spending
b) Public revenue must always equal government spending
c) Government spending is funded by public revenue, borrowing, and other sources
d) Government spending is independent of public revenue
Which of the following is an example of a progressive tax system?
a) Flat tax on all incomes
b) Higher tax rates on higher incomes
c) Sales tax on all goods
d) Fixed tax on business profits
What is the main reason for a government to implement fiscal policies related to public revenue and expenditure?
a) To stabilize the economy and address issues like inflation and unemployment
b) To fund military operations
c) To reduce public debt to zero
d) To encourage private sector spending
Which of the following is a characteristic of regressive taxes?
a) Higher taxes on higher incomes
b) Lower taxes on higher incomes
c) Same tax rate for everyone regardless of income
d) No taxes on basic goods
How does inflation affect public revenue?
a) Increases the value of tax revenue due to higher nominal incomes
b) Decreases the purchasing power of public revenue
c) Has no effect on revenue
d) Reduces the amount of taxes collected
What is the effect of public expenditure on government debt?
a) It decreases government debt
b) It has no effect on government debt
c) It increases government debt if financed through borrowing
d) It reduces government debt by increasing tax revenue
Which of the following is NOT a source of public revenue?
a) Taxes
b) Borrowing
c) Printing money
d) Bank interest payments
What is the purpose of government grants in the context of public expenditure?
a) To increase the national debt
b) To support specific sectors or projects, such as healthcare or education
c) To raise money from the private sector
d) To reduce income inequality
What is the effect of cutting public expenditure on economic growth?
a) It always leads to higher economic growth
b) It may slow down economic growth by reducing government investments in infrastructure
c) It increases consumer spending
d) It has no impact on economic growth
How can a government reduce its fiscal deficit?
a) Increase public spending
b) Raise taxes and reduce expenditure
c) Increase borrowing
d) Reduce tax rates
