Business Economics and Business and Commercial Knowledge - 1 mtp MTP

1. What was the main objective of the Fiscal Responsibility and Budget Management Act, of 2003? (a) Achieve Fiscal Surplus (b) Stop Money Laundering (c) Eliminate Fiscal Deficit (d) Eliminate Revenue deficit

2. Contractionary fiscal policy can involve: (a) Increasing consumption and investment and taxes. (b) Decreasing government spending and increasing taxes. (c) Increasing government spending and increasing taxes. (d) None of the above. 3. ‘Who gave ‘The Theory of Public Finance (1959)? (a) Adam Smith (b) Richard Musgrave (c) A.C. Pigou (d) Alfred Marshall

4. The stabilization function is concerned with the performance of the aggregate economy in the term of- (a) Overall output & income (b) General price level (c) Balance of international payments (d) All of these

6. Which of the following is NOT a conclusion about market allocations of commodities causing pollution externalities? (a) The prices of products responsible for pollution are too high. 315 10. 11.

(b) The output of the commodity is too large. (c) Recycling and reuse of the polluting substances are discouraged since release into the environment is so inefficiently cheap. (d) Too much pollution is produced. Which of the following is true of an imperfect market structure? (a) Participants in the market have little or no control over outcome in the market. (b) Consumer surplus is maximized. (c) The maximization of producer surplus may lead to a loss of net benefit for…