A proportional tax is one where: MCQ with Answer and Explanation

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A proportional tax is one where:

A. only high incomes are taxed

B. the tax rate falls with income

C. the average tax rate is constant across income levels

D. the tax rate rises with income

Answer: Option C

Solution (By JKSSB Mock Tests)

A proportional tax applies the same tax rate to all income levels.

This question belongs to: Economy GK Economy Set 1

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Question #1

The 'National Institution for Transforming India' was formed on:

A. 1 January 2014

B. 1 January 2015

C. 15 August 2014

D. 26 January 2015

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Correct Answer: Option B

Explanation:
NITI Aayog was established on 1 January 2015.

This question belongs to: Economy GK Economy Set 1

Question #2

Loss assets are those where:

A. loss has been identified but the amount has not been written off

B. loss has been written off fully

C. no loss has been identified

D. assets are standard

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Correct Answer: Option A

Explanation:
Loss assets are assets where a loss has been identified but not yet fully written off.

This question belongs to: Economy GK Economy Set 1

Question #3

In the context of public goods, the 'Lindahl Equilibrium' is characterised by:

A. Zero provision of the public good

B. Personalised prices (Lindahl taxes) such that each individual demands the same quantity of the public good and the sum of prices equals marginal cost

C. A single uniform price for the public good

D. Private provision only

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Correct Answer: Option B

Explanation:
In a Lindahl equilibrium each individual faces a personalised price for the public good equal to his or her marginal benefit; the sum of these prices equals marginal cost and all individuals agree on the quantity.

This question belongs to: Economy GK Economy Set 1

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