Q150. On capital expenditure, assess:
I. It never creates physical or financial assets.
II. Buying machinery is capital expenditure.
Which is correct?
[SSC CHSL Tier I, 25 November 2025, Shift 1]
(A) Only I
(B) Only II
(C) Both I and II
(D) Neither I nor II
Answer: (B) Only II
Explanation: Capital expenditure typically creates or acquires durable assets or reduces government liabilities. Machinery purchases ordinarily fall in this category. The claim that capital spending cannot create financial or physical assets is the opposite of its defining accounting characteristic.
Q149. What is the common name of the annual financial statement placed before Parliament?
[SSC Selection Post (Matriculation), 30 July 2025, Shift 1]
(A) Budget
(B) Economic Survey
(C) Balance sheet
(D) Fiscal policy
Answer: (A) Budget
Explanation: Article 112 requires an annual statement of estimated government receipts and expenditure for each financial year. This document is commonly called the Union Budget. The Economic Survey is separate and reviews the economy rather than replacing the annual financial estimates.
Q148. In the cited examination, which term was used as another name for a budgetary deficit?
[SSC Selection Post (Higher Secondary), 30 July 2025, Shift 2]
(A) Fiscal deficit
(B) Revenue deficit
(C) Primary deficit
(D) Trade deficit
Answer: (A) Fiscal deficit
Explanation: The examination used fiscal deficit as the relevant modern measure of a government budgetary shortfall. Fiscal deficit compares total outlay with non-borrowing receipts, revealing the borrowing requirement. Revenue, primary and trade deficits each capture a different balance.
Q147. What is a benefit of the input-tax-credit mechanism under GST?
[RPSC RAS Prelims 2024 (held 2 February 2025), Q40]
(A) It prevents cascading or double taxation
(B) It completely removes taxes on production
(C) It grants every start-up an unconditional exemption
(D) It removes the need for traders to maintain records
Answer: (A) It prevents cascading or double taxation
Explanation: The input tax credit mechanism permits eligible businesses to offset GST already paid on purchases against the GST owed on outward supplies. Tax then effectively applies to incremental value instead of being repeatedly charged on the full value at successive stages.
Q146. About Rajasthan’s fiscal deficit, examine:
A. It was 3.76% of GSDP in 2022–23.
B. This was below the relevant FRBM limit.
C. It exceeded the 2021–22 fiscal deficit.
Which combination did the official examination key mark correct?
[RPSC RAS Prelims 2024 (held 2 February 2025), Q48]
(A) A and C only
(B) A and B only
(C) B and C only
(D) A, B and C
Answer: (D) A, B and C
Explanation: The Rajasthan state fiscal accounts were assessed against both the corresponding borrowing limit and the preceding year’s deficit. In the official key, all three statements were accepted. Such questions require reading the particular state budget’s historical figures, not national deficit numbers.
Q145. Article 243J of the Constitution concerns which aspect of Panchayat finances?
[CGPSC Prelims, 9 February 2025, Paper I]
(A) Constitution of a Finance Commission
(B) Audit of Panchayat accounts
(C) Election of Panchayat members
(D) None of these
Answer: (B) Audit of Panchayat accounts
Explanation: Article 243J empowers the State Legislature to make provisions for maintaining and auditing Panchayat accounts. It concerns local financial accountability, whereas Article 243I deals with the State Finance Commission and the latter recommends fiscal transfers for Panchayati Raj bodies.
Q144. Which of these does NOT characterise expansionary fiscal policy?
[SSC CGL Tier I, 26 September 2025, Shift 1]
(A) Reduction in personal taxes
(B) Increase in government expenditure
(C) Decrease in government expenditure
(D) Reduction in business taxes
Answer: (C) Decrease in government expenditure
Explanation: Expansionary fiscal policy attempts to raise aggregate demand using higher public spending or lower taxation. Reduced government expenditure tends to have a contractionary effect instead. The other three measures generally support greater private disposable income or direct public demand.
Q143. Assertion: Revenue receipts create no repayment obligation for the government.
Reason: Such receipts are normally taxes or recurring non-tax inflows that do not have to be returned.
Which statement is accurate?
[SSC CGL Tier I, 25 September 2025, Shift 1]
(A) Both are correct and the reason explains the assertion
(B) Both are correct but the reason does not explain the assertion
(C) Assertion correct; reason incorrect
(D) Assertion incorrect; reason correct
Answer: (A) Both are correct and the reason explains the assertion
Explanation: Revenue receipts include taxation and non-tax income such as interest, dividends and fees. They neither create an obligation to repay nor arise from selling government assets. The non-repayable character described in the reason therefore explains the assertion about liabilities.
Q142. Arrange these GST milestones chronologically:
I. GST Council constituted.
II. Constitution (101st Amendment) Act enacted.
III. Nationwide GST launched.
[SSC CGL Tier I, 16 September 2025, Shift 1]
(A) I, II, III
(B) II, I, III
(C) III, II, I
(D) II, III, I
Answer: (B) II, I, III
Explanation: The constitutional amendment received assent in September 2016, and the GST Council was established under the newly inserted Article 279A shortly afterwards. Goods and Services Tax was rolled out on 1 July 2017. Hence the correct sequence is amendment, council, launch.
Q141. The recommendations of the Chellaiah Committee led to reform efforts in which field?
[CGPSC Prelims, 9 February 2025, Paper I]
(A) Monetary policy
(B) Trade policy
(C) Foreign exchange policy
(D) Tax policy
Answer: (D) Tax policy
Explanation: The Raja J. Chelliah Tax Reforms Committee was constituted in 1991 to examine India’s tax structure. Its proposals emphasised rationalising rates, broadening the base and simplifying administration. Such work belongs to direct and indirect tax reform, not the management of money supply.
