Free Public Finance MCQs with Answers

406 Public Finance MCQs from Economics, each with the correct answer and a written explanation of why it is correct. Free and unlimited, with no account needed.

Government revenue and expenditure are analysed through taxation, public borrowing, budgets, subsidies, transfers and public debt. The topic explains how fiscal policy affects resource allocation, income distribution, economic stability and growth, while distinguishing direct from indirect taxes, progressive from regressive taxation, and public goods from goods supplied by private markets.

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406 questions · page 10 of 21

  • A. Italy
  • B. the United States
  • C. England
  • D. all nations take the same time to campaign

Explanation: The United States is known for an unusually long campaign period, with candidates campaigning and fundraising well before the formal…

Correct answer: the United States
  • A. the need to have religious representation in government
  • B. proportional representation
  • C. extremist ideologies
  • D. broad agreement on basic principles

Explanation: The US two-party system is sustained by broad agreement on fundamental constitutional and economic principles, even though the parties…

Correct answer: broad agreement on basic principles
  • A. eliminate the opposition
  • B. gain power
  • C. eliminate power
  • D. control the media

Explanation: Political parties organise candidates, policies, and voters primarily to win elections and obtain governing authority.

Correct answer: gain power
  • A. physical force
  • B. manipulation of the masses
  • C. explaining the truth to the people
  • D. none of the above

Explanation: Elitist theory holds that a small ruling group preserves its position mainly by shaping or manipulating mass opinion and political…

Correct answer: manipulation of the masses
  • A. the elite is not always against the masses
  • B. the elite always works against the public interest
  • C. the elite displays a monolithic power structure
  • D. the masses should rebel against the elite

Explanation: Elitist theory does not necessarily claim that every elite decision is against the masses or the public interest.

Correct answer: the elite is not always against the masses
  • A. the masses
  • B. a power elite
  • C. representatives of the people
  • D. the participants in the political process

Explanation: C. Wright Mills argued that major national decisions in the United States are shaped by a relatively small power elite drawn from…

Correct answer: a power elite
  • A. the dignity of the individual
  • B. representation of the majority
  • C. protection of minority rights
  • D. all of the above

Explanation: American democracy combines respect for individual dignity, majority-based representation and constitutional protection of minority…

Correct answer: all of the above
  • A. the elite may be influenced by the masses but it is more likely that it influences the masses
  • B. the elite constitutes a monolithic ruling class
  • C. elite groups have maximum control over decisions that affect the majority of people
  • D. the elite works against the public good

Explanation: Dye and Zeigler describe influence as running mainly from elites to the masses, although public opinion can sometimes affect elite…

Correct answer: the elite may be influenced by the masses but it is more likely that it influences the masses
  • A. C.Wright Mills
  • B. Karl Marx
  • C. Paul Samuelson
  • D. BOTH Mills and Marx

Explanation: C. Wright Mills is directly associated with modern elite theory, while Marx explained political power through the dominance of a ruling…

Correct answer: BOTH Mills and Marx
  • A. control of Congress
  • B. Ways and Means
  • C. oversight
  • D. supervision

Explanation: Oversight is the legislature's process of monitoring agencies and investigating how they implement laws.

Correct answer: oversight
  • A. govern every state in the Union
  • B. ensure a system of representation
  • C. ensure that neither of the chambers has the upper hand
  • D. pass laws consistent with moral values

Explanation: Besides making laws, a legislature provides a system through which citizens and territorial units are represented in government.

Correct answer: ensure a system of representation
  • A. to enact legislation
  • B. ensure that legislation is carried out
  • C. get around the administration
  • D. none of the above

Explanation: The legislature's primary constitutional role is to debate and enact laws.

Correct answer: to enact legislation
  • A. Corporate growth
  • B. The Social Security system
  • C. Public education
  • D. Public housing

Explanation: Public education is heavily dependent on state and local government funding, including revenue raised through taxes and grants.

Correct answer: Public education
  • A. powers not claimed by individual states are reserved by the national government
  • B. there is no national government whatsoever
  • C. power is centralized in a national government
  • D. all political power ultimately belongs to the states

Explanation: A confederacy is a loose union in which the member states retain ultimate political sovereignty, while the common government has limited…

Correct answer: all political power ultimately belongs to the states
  • A. aristocracy
  • B. oligarchy
  • C. republicanism
  • D. democracy

Explanation: Aristocracy is rule by a privileged upper class, such as hereditary nobles, landed gentry, or an educated elite.

Correct answer: aristocracy
  • A. traditional authority
  • B. legal rational authority
  • C. charismatic authority
  • D. all of the above

Explanation: Appealing to the intentions and established traditions of the Constitution's framers invokes traditional authority.

Correct answer: traditional authority
  • A. unitary system
  • B. confederate system
  • C. catholic system
  • D. BOTH unitary and confederate systems

Explanation: A federal system divides authority between a national government and constituent states, so it is distinct from both a unitary system…

Correct answer: BOTH unitary and confederate systems
  • A. Foreign Affairs Committee
  • B. Farm Affairs Committee
  • C. Rules Committee
  • D. Forest Preservation Committee

Explanation: The House Rules Committee is powerful because it determines how and when many bills will be debated, including limits on debate and…

Correct answer: Rules Committee
  • A. are absolutely separated from one another
  • B. undergo checks and balances among one another
  • C. are integrated into a cohesive unit
  • D. make for speedy decision making

Explanation: The branches are separate but not completely isolated: checks and balances allow each branch to restrain parts of the others.

Correct answer: undergo checks and balances among one another
  • A. vote funds for conducting foreign affairs
  • B. conduct foreign affairs
  • C. unanimously approve treaties
  • D. decide the constitutionality of specific laws

Explanation: Congress controls public expenditure by appropriating funds, including money for foreign-affairs activities.

Correct answer: vote funds for conducting foreign affairs