Human capital formation is the process of adding to the stock of human capital over a period of time. It is the ratio of a country's import expenditure … In the given diagram, speculative demand for money curve l (r) has four regions R1, R2, R3 and R4. Government Budget and the Economy – CBSE Notes for Class 12 Macro Economics. Expenditure c. Liabilities d. Assets 17. In _____, machines and equipments are arranged in the order or sequence in which they are to be used for manufacturing the product A. (i) Expenditure on education. Investments in shares and loans and advances granted by the central government are part of this. 156. Ans. This is a descriptive chapter on government budget of Indian economy, wherein its objectives, importance, types, components, budget deficits and its types (Revenue, Fiscal, Primary Deficit) and their implications are studied. Sources of human capital formation. Gordon model. ANSWER: B 30. Meaning: Capital expenditure is the money spent by the government on the development of machinery, equipment, building, health facilities, education, etc. B. Hence, all the options are correct. risk-indifferent. C. Process Layout. Comparison to GDP. If it creates an asset or reduces a liability, it is categorised as capital expenditure. A very senior citizen shall be that individual for purpose of Income Tax whose age is More than following– Reason: This expenditure creates an asset for the railway and government. 5. TYBCOM SEM 5 Business Economics III - MCQ TYBCOM - SEM 5 - 2014 Exams Business Economics III Important MCQ list ... 3 State Trur or False: External debt creates more burden than internal debt. A. Question 8. Answer. The asset’s market risk premium is . The AO held that lease of land for 90 years conferred a benefit of enduring nature to the assessee, particularly in the light of the definition of the expression “immovable property” furnished in section 269UA(d)(i) and, consequently, it was in the nature of capital expenditure. A leader B. HRM multiple choice questions and answers on HRM MCQ questions quiz on HRM objectives questions. What are factor incomes? B. Multiple Choice Questions. 8) Asset Y has a beta of 1.2. Practice Multiple Choice Chapter 1—Ten Principles of Economics Creates future benefits. The protection of proprietary information of commercial value C. _____scheme creates team spirit which in turn leads to high output a) Time rate b) Piece rate c) Group bonus 191. 11 per unit Q.2 Define Tax. It is a revenue expenditure as it neither creates any asset nor reduces any liability of the government. Ans. D. Combined Layout. But there are much disagreement among various It is that part of subscribed capital, which is called by the company to pay on shares allotted. Revenue Expenditure and Capital Expenditure of India! risk-adverse. 13.2%. there will be an increased production of capital goods. An expenditure that neither creates assets nor reduces a liability is categorised as revenue expenditure. A manager C. A professional D. An entrepreneur ANSWER: D 2. (ii) Expenditure on health. An expenditure that neither creates assets nor reduces a liability is categorised as revenue expenditure. TEST 1) If a person’s required return decreases for an increase in risk, that person is said to be risk-seeking. 7) Borrowings:When government revenue is not sufficient to meet the public expenditure government borrows either from internal or external sources. Expenditure made on the development of a railway line is a capital expenditure. Factory Layout. This classification is also known as functional classification. Group bonus is divided among the workers of the group in proportion to the _____by them a) Hours worked b) Rate per hour c) Basic wage earned 190. The aggregate expenditure is one of the methods that is used to calculate the total sum of all the economic activities in an economy, also known as the gross domestic product (GDP). If it creates an asset or reduces a liability, it is categorised as capital expenditure. Which of the following best describes Debt Service Coverage Ratio? Answer: True. Land, Labour, Capital and Entrepreneurship are the four factors of production and rent, wages, interest and profits are the respective […] A double entry system of record of all economic transactions between the residents of a country and rest of the world is called balance of trade Capital expenditure or capital expense (capex or CAPEX) is the money an organization or corporate entity spends to buy, maintain, or improve its fixed assets, such as buildings, vehicles, equipment, or land. C. Seed capital. c. budgeted income statement. wL0FCDQ:UHTgncn. 2. 41) When a commercial bank creates credit, its immediate effect is that it raises (A) The exchange rate (B) The interest rate (C) The money supply An individual who starts, creates and manages a new business can be called _____. It is the amount of export earnings needed to meet a country's annual external debt. Q.1. For achieving economic stability, the objective of low interest cost will have to be sacrificed Solution: Issued capital is taken up by the general public. ADVERTISEMENTS: Q.2. The risk-free rate of return is 6%, while the return on the market portfolio of assets is 12%. capital asset pricing model . Value Added is the excess of value of output over that of intermediate consumption. It is considered a capital expenditure when the asset is newly purchased or when money is used towards extending the useful life of an existing asset, such as repairing the roof. Download. On the job experience creates "learning by doing". D. Venture capital. the people will save more and interest rate will all. Lark Corp.’s direct materials budget shows total cost of direct materials purchases for January $250,000, February $300,000 and March $350,000. ... Capital expenditure is incurred on _____. ; It also includes the expenditure incurred on acquiring fixed assets like land and investment by the government that gives profits or dividend in future. (iii) On the job training. the people will save more and interest rate will all. TALLY 9.0 MULTIPLE CHOICE QUESTIONS 1. […] It is not necessary for the company to call for the entire amount on … Whereas capital expenditure includes all capital transactions. Way: By minimising the wastage of diesel. the cost of production of capital goods will fall. Reduce the profit of the concern . First purchase 35 units @ Rs. The entrepreneur was distinguished from capital provider in: a) Middle ages b) 17th century c) 18th century d) 19th and 20th century Answer: c … All Unit MCQ’s … Expenditure incurred by a publisher for acquiring copyrights is a– (A) capital expenditure (B) revenue expenditure (C) deferred revenue expenditure (D) None of the above (Ans : A) 112. 84. Who postulated the law Supply creates its own demand (A) Keynes (B) J B say (C) Marshall (D) Pigou 85. Consider the following statements and identify the right ones. Answer: (d) Maker Explanation: A monopoly firm is a price maker or price setter because it is the sole producer of a product.This is in contrast to a competitive firm which is a price taker with zero market power. Such capital can be offered to the public at a later date. 10%. Autonomous investment is A. b. capital expenditure budget. In which workers become more knowledgeable about the best ay to accomplish a task as they do the task. Income inelastic B. Instable C. Interest elastic D. Income elastic 86. Trademarks relate to _____. The expenditure of the government has increased due to the emergence of welfare state. thee will be a rise in the prospective return from capital. A. (v) Migration and expenditure … mYxvcR1:40hGGyz. A. 6%. 7.2%. Which one of the following is NOT true about Capital Expenditure? Fixed capital. Income b. Explain the canons of taxation. Capital account is classified into 3 parts in India- private, banking and official capital. MEC for a capital good was found out to be 10% and the market rate of interest is 9%, then the investment is A. Capital Expenditure. Practice Multiple Choice Chapter 1—Ten Principles of Economics. Capital expenditure does not reduce the profit of the concern. thee will be a rise in the prospective return from capital. 111. MCQ Questions for Class 12 Economics Chapter 10 Determination of Income and Employment with Answers December 17, 2020 by Kishen Leave a Comment Determination of Income and Employment Class 12 MCQs Questions with Answers Capital expenditures refer to funds that are used by a company for the purchase, improvement, or maintenance of long-term assets to improve the efficiency or capacity of the company. This amount was, as a result not allowed as deduction. 10 per unit. Equilibrium exchange rate occurs when supply of and demand for foreign exchange are equal to each other. The aggregate expenditure determines the total amount that firms and households plan to spend on goods and services at each level of income. Tally package is developed by ... a. Current capital. d. budgeted balance sheet. human capital, the accumulated skills and knowledge people possess comes from both formal education and training and from on the job experience. The term working capital is commonly used for the capital required for day-to-day working in a business concern, such as for purchasing raw material, for meeting day-to-day expenditure on salaries, wages, rents rates, advertising etc. ANSWER: D 29. Define the concept of value added. These capital payments consist of capital expenditure on acquisition of assets like land, buildings, machinery, equipment etc. the cost of production of capital goods will fall. (iv) Study programmes for adults. (a) Infrastructure (b) Highways (c) Irrigation projects (d) All the above. Question 2. Not profitable B. Product Layout. Incurred to acquire fixed assets. Practice and knowledge acquired through experience B. ADVERTISEMENTS: National Income and Related Aggregates! This is the basis of classification between revenue expenditure and capital expenditure. In the given diagram, speculative demand for money curve l (r) has four regions R1, R2, R3 and R4. Cash payments are 60% in the month of purchase and 40% in the following month. i. 1. Incurred to increase the economic life of existing fixed assets. This creates a gulf between the revenue and expenditure. B. A. Borrowing is income of the government which creates liability because the government has to repay the borrowings with interest. 29. Introduction. Qno.9 Consider the following: Beginning inventory 10 units @ Rs. there will be an increased production of capital goods. A monopolist is a price (a) Acceptor (b) Taker (c) Giver (d) Maker. Note: As per CBSE guidelines, no marks will be given if reason to the answer is not explained. Purpose of income and knowledge people possess comes from both formal education and training and on... Unit an expenditure that neither creates assets nor reduces a liability, it is as. Meet a country 's annual external Debt a professional D. an entrepreneur answer b... Railway line is a capital expenditure budget of existing fixed assets, R2 R3... 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