Questions and Answers
Which of the following taxes was passed on 29th March 2017 in the Parliament of India?
What is the primary objective of implementing the GST Act?
Which of the following taxes is levied on the transfer of immovable property in a state of India?
What type of tax is levied by the Centre on the Intra-State supply of goods or services?
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How many goods were taken into consideration when GST was implemented?
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Which of the following is NOT a type of tax under GST?
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How many services were taken into consideration when GST was implemented?
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What is the name of the tax that replaces multiple layers of taxation with one tax?
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What is the formula for calculating GDP?
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What does the 'Q' in the GDP formula represent?
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What is Net National Product (NNP) at Market Price?
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What does National Income (NI) represent?
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What is the primary objective of public businesses?
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What is the formula for calculating National Income (NI)?
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What is Gross National Product (GNP)?
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What is the external sector of a country's economy?
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What are the two types of foreign investment?
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What is the difference between GDP and GNP?
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What is the formula for calculating NNP?
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What is reinvested earnings in the context of foreign direct investment?
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What is the primary component of portfolio investment?
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What is the exchange rate?
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Since when has the definition of FDI been broadened to include reinvested earnings?
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What is not a component of the external sector?
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Study Notes
Types of Taxes
- Excise duty is levied on specific items like petrol and diesel.
- Value-Added Tax (VAT) is applicable to movable products sold directly to customers and is collected by the respective state government.
- Custom Duty is charged on imported goods, depending on their value and type.
- Stamp Duty is levied on the transfer of immovable property and includes legal documents.
- Entertainment Tax is charged on transactions related to entertainment, such as video games, movie shows, and sports activities.
Goods and Services Tax (GST)
- GST is a single, indirect tax that integrates all indirect taxes in the Indian economy.
- GST replaced 17 indirect taxes and 23 cesses, including Central excise duty, Service tax, and VAT.
- The aim of GST is "One Nation and One Tax".
- GST has three types of taxes: Central Goods and Services Tax (CGST), State Goods and Services Tax (SGST), and Integrated Goods and Services Tax (IGST).
- CGST is levied by the Centre on the intra-state supply of goods or services.
National Income
- Gross Domestic Product (GDP) = P × Q, where P is the price of goods and services, and Q is the quantity of goods and services.
- GDP has four components: Consumption, Investment, Government expenditure, and Net foreign exports.
- Net National Product (NNP) at Market Price is the market value of the net output of final goods and services produced by an economy within a financial year.
- National Income (NI) is the total income earned by the factors of production, including rent, interest, wages, and profit.
External Sector
- The external sector refers to international economic interactions between a country's inhabitants and the rest of the world.
- Components of the external sector include export, import, foreign investment, external debt, current account, capital account, and balance of payment.
- Foreign investment has two types: Foreign Direct Investment (FDI) and Portfolio Investment.
- FDI includes equity capital, reinvested earnings, and other direct capital.
- Portfolio investment includes investments made by Foreign Institutional Investors (FIIs), Global Depository Receipts (GDRs), and American Depository Receipts (ADRs).
- Exchange rate is the rate at which one currency is exchanged for another, and it has two types.
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Description
This quiz covers the basics of taxes in India, including excise duty, Value-Added Tax, and custom duty, and how they are levied on different products.