“20-20” English Question | Crack SBI Clerk 2018 Day-114

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“20-20” English Questions | Crack SBI Clerk 2018 (Day-114)

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Direction (1-10): Read the following passage carefully and answer the questions given below it.

We now have a peculiar combination in the economic policy of India, a declared attempt at fiscal consolidation, combined with a reluctance to do what it takes to raise tax revenues. This unfortunate juxtaposition has meant a squeeze on Central government expenditures, and particularly those relating to social spending that directly affects most people in the country. Despite various signs of economic slowdown such as languishing industrial production and adverse effects of the drought on rural livelihoods and demand, the government is apparently unable or unwilling to increase public spending to mitigate people’s material distress or to kick-start economic activity to increase employment. Whenever demands are made for such spending to be increased which is also required to fulfill the government’s obligations for meeting the social and economic rights of citizens the official response is that there just isn’t enough money in the public coffers to do this. Increases in such spending will therefore cause the fiscal deficit to increase, which is seen as unacceptable not because of the inflationary implications but because it will send a wrong signal to global investors and therefore affect future investment and growth. Obviously, if fiscal deficit targets are sought to be maintained, the only way to provide the necessary increases in public spending is to increase government revenues, and tax revenues in particular provide the obvious mechanism. India already has one of the lowest tax-to-GDP ratios among the G20 countries in fact, only Mexico and Indonesia perform as poorly. This is not just because India’s per capita income is still relatively low; many countries that are even lower in the income ladder show higher ratios. At around 18 per cent the tax-to-GDP ratio in India is lower than several Sub-Saharan African countries and significantly below China.

New data from the Ministry of Finance give us a sense of how tax revenues and particularly direct taxes have moved in recent years. The first disturbing trend is that the tax-to-GDP ratio has barely increased over the years of the economic boom, unlike the expected pattern whereby it increases as incomes rise. More worryingly, there is a greater reliance on indirect taxes, which are inherently more regressive because they fall disproportionately on the poor. In fact, the perception among the elites and middle classes that they are the only ones who pay tax is hugely misplaced: it is possible for tax incidence to be even higher among the poor than the rich. Because the poor tend to spend nearly all of their income, they end up paying substantial amounts of taxes in the form of excise duties, sales taxes and import tariffs that are reflected in higher prices. By contrast, the rich do not spend all of their income, and they are able to utilise various tax incentives provided to savers and producers to reduce their tax burden. In 2014-15, nominal GDP increased by 10.5 per cent but direct tax collections increased by less than 9 percent. In 2015-16, nominal GDP increased by 8.2 per cent but direct taxes increased by only 6.7 per cent. In that same year, indirect taxes increased by a whopping 31 per cent, as the government chose to grab all benefits of the lower global oil prices through successive increase in petroleum product duties. So, increasingly, the poor have been paying to provide revenues for the Central government. This is also because the tax system provides many tax breaks and incentives to rich individuals and companies that allow them to avoid paying the full tax rate.

Corporate taxes have not increased as they should have along with corporate profits. Although the statutory rate of taxation for companies is 33.84 per cent, the average tax rate actually paid in 2014-15 was only 24.64 per cent. The larger the companies the lower the effective tax rates: companies that had profits of less than Rs.1 crore paid taxes at 29.37 per cent, but those with profits in excess of Rs.500 crore paid only 22.88 per cent. Public sector companies had a higher tax rate than private sector companies. This system creates some bizarre anomalies. Indeed, the Budget documents provide estimates of the revenues foregone through various tax concessions that are explicit and legal. In the past two years these have amounted to as much as 4.5 per cent of GDP significantly higher than the declared fiscal deficit. Personal income tax collection is similarly inadequate. The data show that the number of individual tax assessees was only 48.6 million in 2014-15, just 6 per cent of the estimated adult population of around 800 million in that year. Many of these assessees do not actually pay any income tax; in fact, data for 2012-13 suggest that around 2 million taxpayers accounted for the bulk of the personal income tax collections. Only Rs.35,754 crore was spent on the Mahatma Gandhi National Rural Employment Guarantee Scheme, which could benefit several hundred million rural people if only it were to be taken seriously. The Integrated Child Development Services got only Rs.15,394 crore, while maternal and infant health and nutrition indicators remain appalling in most of India. School education got only Rs.42,187 crore even though government schooling is woefully inadequate in terms of both quantity and quality. The low and declining rates of direct taxation are therefore an indication of the political choices of the government.

1) According to the passage why only the poor end up paying increasingly to the Central government?

  1. Because the tax system issue many tax breaks to rich individuals
  2. Because the tax system extend incentives to companies that allow them to avoid paying the full tax rate.
  3. Because of the low and declining rates of direct taxation

a) ii and iii

b) i and ii

c) i and iii

d) Only i

e) None of these

2) According to the passage which of the following is the way to provide the necessary increases in public spending?

  1. By lowering tax-to-GDP ratio
  2. By increasing government revenues
  3. By curtailing direct taxes collections

a) Only i

b) Only iii

c) ii and iii

d) Only ii

e) None of these

3) According to the passage why the indirect taxes were increased by a whopping 31% in 2015-16?

  1. Because of the government forbearance regarding illegal tax-avoidance mechanisms
  2. Because of the unchecked tax concessions that were explicit and illegal
  3. Because the government chose to take hold of all benefits of the lower global oil prices.

a) Only ii

b) i and ii

c) Only iii

d) ii and iii

e) None of these

4) Which of the following is not true in the context of the passage?

  1. The larger the companies the higher the effective tax rates.
  2. Mahatma Gandhi National Rural Employment Guarantee Scheme got Rs.35,754 crore for its upliftment
  3.  In 2015-16, nominal GDP was increased by 10.5 per cent

a) i and iii

b) ii and iii

c) i and ii

d) Only iii

e) None of these

5) Which of the following statements have been mentioned correct regarding tax-to-GDP ratio?

  1. In the past years tax-to-GDP ratio has amounted to as much as 4.5 per cent significantly higher than the declared fiscal deficit
  2. At around 18% the tax-to-GDP ratio in India is lower than several Sub-Saharan African countries
  3. The tax-to-GDP ratio has barely increased over the years of the economic boom, unlike the expected pattern whereby it increases as incomes rise.

a) i and ii

b) ii and iii

c) Only ii

d) i and iii

e) All are correct

6) Which of the following is true in the context of the passage?

  1. Public sector companies had a lower tax rate than private sector companies.
  2. In 2014-15, direct tax collections increased by less than 9 per cent
  3. School education got only Rs.42,187 crore even though government schooling is woefully inadequate in terms of both quantity and quality

a) i and iii

b) i and ii

c) Only iii

d) ii and iii

e) All are true

7) Choose the word which is most nearly the same in meaning as the word “appalling” printed in bold as used in the passage.

a) Invigorating

b) Assuaging

c) Atrocious

d) Consolatory

e) Analeptic

8) Choose the word which is most nearly the same in meaning as the word “languishing” printed in bold as used in the passage.

a) Repining

b) Sprouting

c) Pullulating

d) Maturating

e) Mounting

9) Choose the word which is most opposite in meaning of the word “regressive” in bold as used in the passage

a) Austere

b) Lenient

c) Intransigent

d) Chiseled

e) Adamant

10) Choose the word which is most opposite in meaning of the word “juxtaposition” in bold as used in the passage

a) Abutment

b) Proximity

c) Contiguity

d) Concurrence

e) Purview

Directions (11-15): Each sentence below has one or two blanks, each blank indicating that something has been omitted. Below the sentence are five sets of words. Choose the set of words for each blank that best fits the meaning of the sentence as a whole.

11) History is full of examples of governments empowering their people to _______ a________ approach to what we now term universal health coverage.

a) Fecundate, integrate

b) Propagate, holistic

c) Procreated, comprehensive

d) Enshroud, unified

e) Fathered, plenary

12) With that kind of a market price crash, Bhavantar has basically _______ into a full-fledged MSP, the only difference being that there is no government _________ and therefore no need for public warehousing.

a) Contorted, acquisitioning

b) Distort, attainment

c) Sustained, redemption

d) Morphed, procurement

e) Mutate, salvage

13) Instead of creating a statistical data ecosystem that _________the energy of diverse institutions and disciplines in which innovative thinking on data collection and analysis could be undertaken, this tendency may well ________ official statistical systems.

a) Constrains, disengaged

b) Accouter, seclude

c) Harnesses, isolate

d) Muzzles, confined

e) Fetters, integrate

14) The draft National Policy on Official Statistics offers a great start for _________ trust in statistics but _______ its inclusiveness will go a long way towards encouraging competence, reliability and honesty in public statistics.

a) Fostering, enhancing

b) Nurturing, supplement

c) Harboring, intensify

d) Fomenting, exalted

e) Rattling, boosting

15) A ________survey management structure that understands the difficulties of on-the-ground data collectors and responds appropriately to find ways of _______ quality and honesty must form the cornerstone of good data collection.

a) Adept, certified

b) Proficient, warranted

c) Nimble, ensuring

d) Lissome, fortified

e) Sluggish, assuring

Direction (16-20): In each of the questions given below a sentence is given which is then divided into five parts out of which one bold part is correct. There are no errors in three out of four remaining parts and therefore only one of the parts other than the bold one is incorrect. You must choose the grammatically incorrect part as your answer. Choose no error if you find out there is no error.

16) Activity in India’s manufacturing sector grew at a weak a)/pace in May from the previous b)/month while inflationary pressures picked c)/up again amid rising oil prices in another sign d)/that an interest rate hike is around the corner e)/

a) c

b) a

c) d

d) e

e) No error

17) With borrowing costs setting to rise and global trade tensions a)/ adding to uncertainties for India’s exporters who are yet to b)/capitalise on the rupee weakness, policymakers will c)/ need to eschew populism and stick to policy prudence d)/if the tenuous momentum is to be sustained e)/

a) b

b) c

c) d

d) a

e) No error

18) Lofty sentiments expressed prior to alliance a)/formation tend to melt away and b)/ideological considerations take a back seat c)/when the exigencies of seat-sharing d)/and later ministry-making kick around e)/

a) d

b) a

c) e

d) b

e) No error

19) A sober thought here is that the very same growth a)/ momentum is likely to spur price pressures across b)/the economy that combined with the bullish c)/trend in global oil could fan faster inflation, this may d)/leave the RBI with little option but to raise interest rates e)/

a) b

b) a

c) d

d) e

e) No error

20) Alliances work best when the vote bases a)/of partners are complementary rather b)/than overlap or antagonistic and c)/party workers and leaders alike d)/ are able to see the larger picture e)/

a) c

b) d

c) b

d) e

e) No error

Answers:

1). Correct Answer is: b)

It is mentioned in para 2- So, increasingly, the poor have been paying to provide revenues for the Central government. This is also because the tax system provides many tax breaks and incentives to rich individuals and companies that allow them to avoid paying the full tax rate.

2). Correct Answer is: d)

It is mentioned in para 1- Obviously, if fiscal deficit targets are sought to be maintained, the only way to provide the necessary increases in public spending is to increase government revenues.

3). Correct Answer is: c)

It is mentioned in para 2- In that same year, indirect taxes increased by a whopping 31 per cent, as the government chose to grab all benefits of the lower global oil prices

4). Correct Answer is: a)

It is clearly mentioned in para 2&3- The larger the companies the lower the effective tax rates, Only Rs.35,754 crore was spent on the Mahatma Gandhi National Rural Employment Guarantee Scheme, which could benefit several hundred million rural people, In 2014-15, nominal GDP increased by 10.5 per cent

5). Correct Answer is: b)

It is mentioned in para 1&2- At around 18 per cent the tax-to-GDP ratio in India is lower than several Sub-Saharan African countries and significantly below China. The first disturbing trend is that the tax-to-GDP ratio has barely increased over the years of the economic boom, unlike the expected pattern whereby it increases as incomes rise.

6). Correct Answer is: d)

It is mentioned in para 2&3- Public sector companies had a higher tax rate than private sector companies. This system creates some bizarre anomalies. School education got only Rs.42,187 crore even though government schooling is woefully inadequate in terms of both quantity and quality. In 2014-15, nominal GDP increased by 10.5 per cent but direct tax collections increased by less than 9 per cent.

7). Correct Answer is: c)

Appalling means unsatisfactory or substandard

8). Correct Answer is: a)

Languishing means to go into a decline

9). Correct Answer is: b)

Regressive means to take a proportionally greater amount of tax from those on lower incomes.

10). Correct Answer is: e)

Juxtaposition means the fact of two things being seen or placed close together with contrasting effect.

Direction (11-15)

11). Correct Answer is: b)

The meaning of “propagate” is “to raise or generate” and it is suitable for i blanks and the meaning of “holistic” is “complete or whole” so it is appropriate for ii blank.

12). Correct Answer is: d)

The meaning of “morphed” is “to change something” and it is suitable for i blanks and the meaning of “procurement” is “the action of obtaining something” so it is appropriate for ii blank

13). Correct Answer is: c)

The meaning of “harnesses” is “to control and make use of resources” and it is suitable for i blanks and the meaning of “isolate” is “to separate or set apart” so it is appropriate for ii blank

14). Correct Answer is: a)

The meaning of “fostering” is “to encourage the development of something” and it is suitable for i blanks and the meaning of “enhancing” is “to further improve the quality or value” so it is appropriate for ii blank

15). Correct Answer is: c)

The meaning of “nimble” is “skillful” and it is suitable for i blanks and the meaning of “ensuring” is “to confirm or make something certain” so it is appropriate for ii blank

Direction (16-20):

16). Correct Answer is: b)

In part a in place of weak it should be weaker

17). Correct Answer is: d)

In part a in place of setting it should be set

18). Correct Answer is: c)

In part e in place of around it should be in (kick in means to come into effect or operation)

19). Correct Answer is: b)

In part a in place of sober it should be sobering

20). Correct Answer is: a)

In part c in place of overlap it should be overlapping

Daily Practice Test Schedule | Good Luck

TopicDaily Publishing Time
Daily News Papers & Editorials8.00 AM
Current Affairs Quiz9.00 AM
Quantitative Aptitude “20-20”11.00 AM
Vocabulary (Based on The Hindu)12.00 PM
General Awareness “20-20”1.00 PM
English Language “20-20”2.00 PM
Reasoning Puzzles & Seating4.00 PM
Daily Current Affairs Updates5.00 PM
Data Interpretation / Application Sums (Topic Wise)6.00 PM
Reasoning Ability “20-20”7.00 PM
English Language (New Pattern Questions)8.00 PM