Q13 of 39 Page 1

Primary deficit in a government budget will be zero, when ___________ . (Choose the correct alternative)

Primary deficit is equal to fiscal deficit less interest payments. Hence when Fiscal deficit is equal to interest payment, primary deficit will be zero.

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11

(a) What is meant by increasing returns to a variable factor?

(b) Discuss briefly, any two reasons for the decreasing returns to a


variable factor.


 12

Explain the following Conditions ?

(a) Movement along the same indifference curve.


(b) The shift from a lower to a higher indifference curve.


OR


Explain the Law of Equi-Marginal Utility.


 14

In order to encourage investment in the economy, the Central Bank may

___________. (Choose the correct alternative)


(a) Reduce Cash Reserve Ratio


(b) Increase Cash Reserve Ratio


(c) Sell Government securities in open market


(d) Increase Bank Rate


 15

What do you mean by a direct tax?

OR


What do you mean by an indirect tax?