#1
What is the primary objective of a government budget?
Maximize profits
Minimize taxes
Minimize unemployment
Allocate resources efficiently
#2
What is the primary source of revenue for the government in a budget?
Borrowing
Taxation
Grants
Fees and fines
#3
Which fiscal policy tool involves changing the money supply to influence economic activity?
Taxation
Government spending
Monetary policy
Public debt management
#4
Which type of fiscal policy aims to increase aggregate demand during economic downturns?
Expansionary fiscal policy
Contractionary fiscal policy
Neutral fiscal policy
Progressive fiscal policy
#5
Which of the following is a part of the capital budget?
Government salaries
Infrastructure development
Subsidies
Social welfare programs
#6
What is the term used to describe a situation where government spending exceeds revenue?
Surplus
Deficit
Debt
Austerity
#7
Which of the following is an example of capital expenditure in the government budget?
Salary payments
Purchasing office supplies
Building a new highway
Subsidies to farmers
#8
What is the main goal of contractionary fiscal policy?
Stimulate economic growth
Reduce inflation
Increase government spending
Decrease taxes
#9
What is the fiscal deficit in a government budget?
The excess of government expenditure over revenue, excluding borrowings
The total amount of government borrowings
The surplus in the government budget
The difference between total revenue and total expenditure
#10
What is the purpose of an expansionary fiscal policy?
To reduce government debt
To decrease aggregate demand
To stimulate economic growth
To control inflation
#11
Which of the following is considered an indirect tax in a government budget?
Income tax
Value-added tax (VAT)
Corporate tax
Customs duty
#12
Which fiscal policy tool involves changing the interest rates to influence economic activity?
Government spending
Taxation
Monetary policy
Supply-side policy
#13
What is the Laffer Curve associated with in fiscal policy?
Taxation and revenue
Government spending
Inflation targeting
Unemployment
#14
In the context of fiscal policy, what does the term 'automatic stabilizers' refer to?
Government regulations
Economic indicators
Built-in mechanisms that stabilize the economy
International trade agreements
#15
What is the crowding-out effect in fiscal policy?
Increased private investment due to government spending
Decreased government spending due to inflation
Reduced private investment due to increased government borrowing
Increased government revenue due to higher taxes
#16
Which economic concept is associated with the 'Laffer curve' in fiscal policy?
Supply-side economics
Keynesian economics
Monetarism
Austrian economics
#17
Which component of the government budget includes payments on past borrowings?
Revenue expenditure
Capital expenditure
Fiscal deficit
Debt servicing
#18
What is the purpose of a 'countercyclical fiscal policy'?
To amplify economic fluctuations
To stabilize the economy by opposing the prevailing cycle
To follow the natural economic cycle
To promote government intervention in all economic phases