The 'Goods and Services Tax' is an indirect tax because: MCQ with Answer and Explanation

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The 'Goods and Services Tax' is an indirect tax because:

A. the burden can be shifted to the final consumer

B. it is paid by the seller only

C. it is paid only by companies

D. it is paid by the government

Answer: Option A

Solution (By JKSSB Mock Tests)

GST is an indirect tax as the burden is ultimately borne by the final consumer.

This question belongs to: Economy GK Economy Set 1

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Practice More Economy Set 1 Questions

Question #1

Which of the following is a component of Gross National Product?

A. GDP minus net factor income from abroad

B. GDP plus net factor income from abroad

C. GDP minus depreciation

D. NDP plus depreciation

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Correct Answer: Option B

Explanation:
GNP = GDP + Net factor income from abroad. Net factor income from abroad is the difference between factor income received from abroad and factor income paid to abroad.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'Goods and Services Tax' on tobacco products is:

A. 0%

B. 18%

C. 28% plus cess

D. 12%

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Correct Answer: Option C

Explanation:
Tobacco products attract 28% GST plus additional cess.

This question belongs to: Economy GK Economy Set 1

Question #3

The concept of 'Pass-Through' of exchange-rate changes refers to:

A. The complete absence of price adjustment

B. Only the effect on interest rates

C. Only the effect on output

D. The extent to which changes in the nominal exchange rate are reflected in domestic prices of traded goods

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Correct Answer: Option D

Explanation:
Exchange-rate pass-through measures the degree to which a change in the nominal exchange rate is transmitted to import prices and ultimately to consumer prices in the domestic economy.

This question belongs to: Economy GK Economy Set 1

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