The 'Goods and Services Tax' on a supply is determined by the: MCQ with Answer and Explanation

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The 'Goods and Services Tax' on a supply is determined by the:

A. location of supplier

B. place of supply

C. mode of payment

D. type of product only

Answer: Option B

Solution (By JKSSB Mock Tests)

GST liability depends on the place of supply and the nature of supply.

This question belongs to: Economy GK Economy Set 1

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Practice More Economy Set 1 Questions

Question #1

In the context of monetary policy, the 'Zero Lower Bound' problem refers to:

A. The floor on the fiscal deficit

B. The inability of nominal interest rates to fall significantly below zero

C. The minimum reserve requirement

D. The inability of real interest rates to be positive

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Correct Answer: Option B

Explanation:
The zero lower bound refers to the constraint that nominal interest rates cannot be reduced much below zero, limiting the effectiveness of conventional monetary policy in deep recessions.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'Gross Value Added' at basic prices excludes:

A. all taxes

B. depreciation

C. indirect taxes net of subsidies

D. net factor income from abroad

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Correct Answer: Option C

Explanation:
GVA at basic prices is measured before net product taxes, so it excludes net indirect taxes.

This question belongs to: Economy GK Economy Set 1

Question #3

The 'marginal propensity to consume' can never be greater than:

A. infinity

B. 1

C. 2

D. 0.5

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Correct Answer: Option B

Explanation:
MPC is the fraction of additional income consumed, so it ranges from 0 to 1.

This question belongs to: Economy GK Economy Set 1

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