UPSC 1996 › Indian Economy › Fiscal Policy & Budget

2 questions · 1996 · answers as per the UPSC key

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UPSC 1996 · Q2 · Indian Economy › Fiscal Policy & Budget · Save

A redistribution of income in a country can be best brought about through

(a) progressive taxation combined with progressive expenditure
(b) progressive taxation combined with regressive expenditure
(c) regressive taxation combined with regressive expenditure
(d) regressive taxation combined with progressive expenditure
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Answer: (a) progressive taxation combined with progressive expenditure
UPSC 1996 · Q21 · Indian Economy › Fiscal Policy & Budget · Save

The following Table shows the percentage distribution of revenue expenditure of Government of India in 1989-90 and 1994-95: (Heads: Defence, Interest Payments, Subsidies, Grants to States/UTs Other) Based on this table, it can be said that the Indian economy is in poor shape because the Central Government continues to be under pressure to

(a) reduce expenditure of defence
(b) spend more and more on interest payments
(c) reduce expenditure on subsidies
(d) spend more and more as grants-in-aid to State Governments/Union Territories
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Answer: (b) spend more and more on interest payments
This question uses a table or figure from the original paper that is not reproduced here.