Home/FBR/Fiscal Policy of Pakistan Test Online

Fiscal Policy of Pakistan Test Online

Mustansar KhanLast Updated: July 8, 2025

Fiscal Policy of Pakistan Test Online

Fiscal Policy of Pakistan Test

Total Questions:	41
Time Allowed:	20 Minutes
Total Marks:	41
How to Attempt Test:	Please choose the right Option in MCQ-type question.
Test Helpful For:	FBR Sub Inspector Test Customs Inspector Test FBR Interviews FBR Sepoy Test Preparation for Customs and Tax Related Questions

Please wait...

Page 1 of 2

1. Which government body is primarily responsible for implementing fiscal policy in Pakistan?

Pakistan State Bank

Federal Board of Revenue (FBR)

Pakistan Stock Exchange

Ministry of Finance

2. Which of the following taxes is used by the government of Pakistan to raise revenue for fiscal policy?

All of the above

Corporate tax

Income tax

Sales tax

3. What is the main purpose of "fiscal consolidation" in Pakistan’s fiscal policy?

To increase government borrowing

To reduce the budget deficit and national debt by cutting unnecessary spending and increasing revenues

To increase trade barriers

To boost government spending to create jobs

4. Which of the following is a tool used in fiscal policy to manage economic cycles in Pakistan?

Exchange rate management

Import quotas

Taxation rates

Public debt management

5. What is the purpose of taxation in Pakistan’s fiscal policy?

To fund government expenditure and services

To reduce public services

To control population growth

To limit the wealth of individuals

6. Which of the following is a major goal of fiscal policy in Pakistan?

To promote exports only

To control the exchange rate

To increase interest rates

To stabilize the economy through government spending and taxation

7. What is the primary challenge of managing Pakistan's fiscal policy in a developing economy?

High inflation rates and public debt

Excessive government savings

The absence of a tax system

Low population growth

8. What fiscal policy tool is used to manage inflation in Pakistan?

Lowering interest rates

Subsidizing exports

Reducing government spending

Increasing income taxes

9. Which of the following best defines the term "public expenditure" in the context of Pakistan's fiscal policy?

Expenditures on foreign imports

Spending by private companies on manufacturing goods

Spending by individuals in the economy

Government spending on public services such as education, healthcare, and infrastructure

10. What does the term 'budget deficit' mean in Pakistan’s fiscal policy?

The government has excess revenue over its expenditures

The government has no borrowing requirements

The government’s expenditures exceed its revenue

The government borrows money from foreign countries

11. Which of the following is an example of fiscal policy’s role in economic stabilization in Pakistan?

Collecting taxes from citizens and redistributing through welfare programs

Providing subsidies to foreign businesses

Adjusting interest rates through the State Bank

Fixing the exchange rate for foreign currencies

12. Which of the following is a consequence of a fiscal deficit in Pakistan?

The government increases tax rates

The government borrows money to finance the deficit

The government reduces its spending

The country’s currency strengthens

13. What is the impact of fiscal policy on unemployment in Pakistan?

By increasing government spending on infrastructure projects, fiscal policy can create jobs and reduce unemployment

By increasing taxes, fiscal policy leads to higher unemployment

Fiscal policy only impacts inflation and not unemployment

Fiscal policy does not affect unemployment

14. Which of the following fiscal measures is used by Pakistan to improve the business environment?

Imposing high corporate tax rates

Reducing government spending on infrastructure

Reducing foreign investment

Offering tax exemptions and incentives for businesses in specific sectors

15. What is meant by “contractionary fiscal policy” in Pakistan?

Increasing government borrowing to finance public services

Lowering interest rates to boost investments

Increasing government spending to stimulate the economy

Reducing government spending and increasing taxes to reduce inflation

16. What is the relationship between fiscal policy and government debt in Pakistan?

Fiscal policy has no effect on government debt

Fiscal policy may increase government debt if there is a fiscal deficit

Fiscal policy directly reduces government debt

Fiscal policy reduces government borrowing through higher taxes

17. Which of the following is the main purpose of the “Public Debt Management” in Pakistan’s fiscal policy?

To ensure the country can meet its borrowing obligations

To increase taxes

To ensure the country’s foreign relations

To control the private sector’s investment

18. Which of the following is an example of the government’s role in fiscal policy through public debt management?

Government taxing its citizens more heavily

Reducing tariffs on imported goods

Borrowing funds from international financial institutions to finance a budget deficit

Offering tax breaks to multinational corporations

19. What does "tax buoyancy" refer to in fiscal policy?

The ability of the government to collect taxes from a large number of people

The ability of the tax system to generate revenue in response to economic growth

The rate at which taxes are imposed on businesses

The ability of the government to increase tax rates

20. What is "tax compliance" in the context of Pakistan’s fiscal policy?

The ability of the government to reduce taxes

The degree to which taxpayers follow the laws and regulations regarding taxes

The government’s ability to monitor foreign investment

The collection of income taxes from multinational companies only

21. What is the primary objective of a budget surplus in Pakistan’s fiscal policy?

To increase government spending

To increase the government’s debt

To reduce inflation

To decrease the national debt

22. Which of the following taxes is directly linked to Pakistan’s fiscal policy?

Sales tax

All of the above

Income tax

Customs duty

23. What is the role of "tax incentives" in Pakistan’s fiscal policy?

To reduce government spending

To regulate imports and exports

To encourage investments in certain sectors and stimulate economic growth

To increase tax rates across the board

24. How does the government of Pakistan utilize fiscal policy during periods of economic recession?

By increasing interest rates

By decreasing public sector wages

By reducing government expenditure

By cutting taxes and increasing government spending to stimulate economic activity

25. How does Pakistan’s fiscal policy help in reducing income inequality?

By taxing high-income earners and redistributing wealth through social welfare programs

By encouraging only private sector investments

By providing tax exemptions for wealthy citizens

By raising taxes on all income groups equally

Page 2 of 2

26. What is the main objective of Pakistan's fiscal policy during periods of high inflation?

To reduce government borrowing

To increase government spending on infrastructure

To reduce exports to stabilize the economy

To decrease public spending and increase taxes to reduce inflationary pressures

27. What is the main purpose of subsidies in Pakistan’s fiscal policy?

To collect more taxes from consumers

To reduce government spending

To discourage foreign investment

To encourage specific sectors or industries to grow

28. Which of the following is an effect of a fiscal stimulus in Pakistan?

Increased taxation

Decrease in inflation rates

Reduction in government spending

Boost in economic activity through increased government spending

29. What is the role of the Ministry of Finance in Pakistan’s fiscal policy?

To manage government revenue and expenditures

To supervise the private sector

To control inflation rates

To regulate foreign trade agreements

30. Which of the following measures is used in Pakistan’s fiscal policy to control inflation?

Reducing the money supply through increased taxes

Decreasing government spending

Increasing public sector wages

Providing subsidies to consumers

31. Which of the following is a primary challenge faced by fiscal policy in Pakistan?

High taxation rates

Lack of foreign trade agreements

Increasing public debt

Low inflation rates

32. Which of the following best defines the term 'fiscal deficit' in the context of Pakistan’s fiscal policy?

The amount of money the government collects from private investors

The total amount of money the government owes to foreign countries

The difference between the government’s total revenue and its total expenditure

The amount of money spent on infrastructure projects

33. Which of the following is NOT a fiscal policy objective of Pakistan?

Promoting high employment levels

Reducing income inequality

Maintaining government financial stability

Ensuring tax collection only from multinational companies

34. Which of the following is considered a "fiscal tool" used by the government of Pakistan to manage inflation?

Increasing government spending on welfare programs

Raising interest rates

Decreasing public sector employment

Increasing taxes to reduce consumption

35. What is the impact of fiscal policy on the balance of payments in Pakistan?

Fiscal policy exclusively manages foreign investments

Fiscal policy only affects the banking sector

Fiscal policy does not affect the balance of payments

Fiscal policy can impact exports and imports through taxation and government spending

36. What is the relationship between fiscal policy and economic growth in Pakistan?

Fiscal policy hinders economic growth by raising taxes

Fiscal policy only affects the financial sector

Proper fiscal policy can promote economic growth by investing in infrastructure and social programs

Fiscal policy is irrelevant to economic growth

37. How does Pakistan’s fiscal policy address poverty reduction?

By offering incentives to large multinational corporations

By reducing government expenditure

By raising taxes on essential goods

By providing social welfare programs to low-income households

38. How does Pakistan's fiscal policy help in managing unemployment?

By limiting foreign investment

By providing direct employment in the public sector

By increasing government spending on development projects to create jobs

By reducing taxes for large corporations only

39. Which of the following would be a likely consequence of a fiscal stimulus in Pakistan?

Lower government spending

A decrease in government debt

Increased unemployment

Higher inflation due to increased demand in the economy

40. What does "monetary expansion" refer to in Pakistan's fiscal policy context?

Increasing government borrowing

Lowering interest rates to encourage saving

Increasing the supply of money in the economy

Raising taxes to reduce inflation

41. Which of the following is an example of expansionary fiscal policy in Pakistan?

Increasing government spending to boost economic activity

Reducing government spending on public services

Increasing interest rates to reduce borrowing

Increasing taxes on businesses

You Can Learn and Gain more Knowledge through our Online Quiz and Testing system Just Search your desired Preparation subject at Gotest.

Tax Administration and Reforms in Pakistan Test Online
Income Tax Ordinance 2001 Pakistan Test Online
Sales Tax Act 1990 Pakistan Test Online
Sales Tax and Federal Excise Duty Basic Concept Test Online
Pakistan Customs Role, Functions and Laws Test Online
Federal Board of Revenue (FBR) Function and Role Test Online
Federal Excise Act 2005 Pakistan Test Online
Basic Concepts of Auditing and Accounting Test Online

Basic Concepts of Taxation Test Online
Federal Board of Revenue (FBR) Function and Role Test Online
Pakistan Customs Role, Functions and Laws Test Online
Sales Tax and Federal Excise Duty Basic Concept Test Online
Key Economic Terms Test Online (Basic Economic Indicators)
Tax Administration and Reforms in Pakistan Test Online
Sales Tax Act 1990 Pakistan Test Online
Federal Excise Act 2005 Pakistan Test Online
Income Tax Ordinance 2001 Pakistan Test Online
Basic Concepts of Auditing and Accounting Test Online

Mustansar KhanLast Updated: July 8, 2025

Facebook Twitter Reddit WhatsApp Share via Email Print

Fiscal Policy of Pakistan Test Online

Fiscal Policy of Pakistan Test Online

Fiscal Policy of Pakistan Test

Related:

You Might Also Like

Mustansar Khan

Leave a Reply Cancel reply