WBCS MAIN 2016 P-5 Economics MCQ
WBCS MAIN 2016 P-5 Economics One Liner Questions
Topic 1: Banking and Monetary Policy
1. Who benefits from inflation?
Ans: Borrower
2. What rate of interest is effective when RBI gives short-term loans to commercial banks?
Ans: Repo Rate
3. What is the percentage of demand and time liabilities that banks must keep with RBI?
Ans: CRR (Cash Reserve Ratio)
4. What does open market operation refer to?
Ans: Purchase and sale of government securities
5. Who introduced Credit Planning in the banking sector?
Ans: Reserve Bank of India
6. How did RBI tackle economic depression in recent years?
Ans: Lowering the Repo rate and Reverse repo rate
7. Regional Rural Banks work at which levels?
Ans: All levels (Hobli, Taluk, District)
8. What is the ratio between cash in hand and total assets called?
Ans: Cash Reserve Ratio
9. Which bank was NOT nationalised in 1969?
Ans: Vijaya Bank
10. When was the Infrastructure Development Finance Company constituted?
Ans: During the Eighth Five Year Plan
11. Who introduced the Lead Bank Scheme?
Ans: Reserve Bank of India
12. What is the market for transaction of Government Securities called?
Ans: Gilt-edged market
13. What are the weaknesses of nationalised commercial banks?
Ans: All of the above – Increase in NPAs, Decline of Capital Adequacy Ratio, Low Capital-Asset Ratio
14. How has the dual role of RBI made monetary policy a ‘policy of controlled expansion’?
Ans: All of the above
15. When was RBI nationalised?
Ans: January 1, 1949
16. What is Cash Reserve Ratio (CRR)?
Ans: The fraction of deposits that Commercial Banks must keep with RBI
17. How can RBI increase money supply in the market?
Ans: By buying government securities
18. What structure do Co-operative credit societies have?
Ans: Three-tier structure
19. When was the Fiscal Responsibility and Budget Management Act implemented?
Ans: 2003
20. Operating parameters of commercial banks as percentage to assets are highest in which banks?
Ans: Foreign banks
21. What caused India’s economic crisis in 1991?
Ans: All of the above – Fiscal deficit, Balance of Payments, High inflation
22. What guidelines did RBI frame following the Narsimham Committee recommendations?
Ans: To govern entry of new private sector banks to make banking sector more competitive
23. Which institution is NOT included under the money market?
Ans: SEBI
Topic 2: Agriculture and Allied Sectors
24. What was the contribution of agriculture and allied sectors to India’s GDP in 2012-13?
Ans: 14.1%
25. Which agency implements the National Agricultural Insurance scheme?
Ans: Agricultural Insurance Company of India Limited
26. What are the institutional sources of agricultural credit?
Ans: All of the above – Commercial Banks, Regional Rural Banks, NABARD
27. What has been the average rate of increase in agricultural production in the Eleventh Five Year Plan?
Ans: 4%
28. What are the arguments in favour of crop-sharing?
Ans: If the share of land owner remains fixed, the farmer tries to maximise production
29. Which state introduced the Employment Guarantee Scheme first?
Ans: Maharashtra
30. In the First Five Year Plan, priority was given to which sector?
Ans: Food and agricultural production
Topic 3: Five Year Plans
31. In which plan was Krishi Vikas Yojana introduced?
Ans: Eleventh Five Year Plan
32. What is the main objective of the 12th Five Year Plan?
Ans: Faster, sustainable and more inclusive growth
33. When was the Twenty Point Programme launched?
Ans: 1975
34. When was the Infrastructure Development Finance Company constituted?
Ans: During the Eighth Five Year Plan
35. In which plan was National Food Security Mission introduced?
Ans: Eleventh Five Year Plan
36. Rapid industrialisation is the basic objective of which plan?
Ans: Second Five Year Plan
37. What is the estimated rate of growth in the second year of the 12th Five Year Plan?
Ans: 4.9%
38. In which plan were the concepts of ‘minimum needs’ and ‘directed antipoverty programmes’ introduced?
Ans: Fifth Five Year Plan
39. In the First Five Year Plan, priority was given to which sector?
Ans: Food and agricultural production
40. The Second Five Year Plan gave special emphasis on which industries?
Ans: Heavy and capital goods industries
Topic 4: National Income and GDP
41. What is the contribution of agriculture and allied sectors to India’s GDP in 2012-13?
Ans: 14.1%
42. In the composition of National Income, which sector’s contribution is highest?
Ans: Services sector
43. Has income inequality reduced with increased national income in the last three decades?
Ans: No
44. Which sector has attracted the highest foreign direct investment inflow in the last decade?
Ans: Services sector
45. What is the Global rank of India in terms of purchasing power parity?
Ans: 3rd
46. Development expenditure of Central Government does NOT include which item?
Ans: Defence expenditure
Topic 5: Poverty and Employment
47. What is the percentage of people below poverty line according to Rangarajan Committee?
Ans: 29.5%
48. Sampoorna Grameen Swarozgar Yojana was introduced in which year?
Ans: September 2001
49. Which government introduced Smart Card for unorganised sector workers?
Ans: Delhi
50. Which scheme was launched to help the poor in rural areas become self-employed?
Ans: IRDP
51. What is the main objective of the National Food Security Mission?
Ans: Ensuring adequate supply of rice, wheat and pulses
52. India is regarded as a country with ‘Demographic Divide’ due to which reason?
Ans: High population in the age group below 15 years
Topic 6: Taxation
53. Which tax is levied by the State Government only?
Ans: Entertainment Tax
54. On what basis is the benefits received principle of taxation based?
Ans: Marginal benefit received
55. Revenues from Professional Tax are used by which government?
Ans: State Government
56. Professional Tax is imposed by which government?
Ans: State Government
57. States can earn maximum revenue through which source?
Ans: Commercial taxes
58. Who was the Chairman of the Tax Reforms Committee in 1991?
Ans: Raja C. Chelliah
59. The tax levied on interstate trade of goods is called?
Ans: Central Sales tax
60. The condition of indirect taxes in the country’s revenue is approximately?
Ans: 86%
61. What is MAT?
Ans: Minimum Alternate Tax
62. Revenues from Service Tax have been following which trend?
Ans: Increasing year after year
Topic 7: Foreign Trade and Investment
63. From which country does India receive the highest Foreign Direct Investment?
Ans: Mauritius
64. What are the principal items of India’s import at present?
Ans: Fuel (petroleum goods)
65. What is FEMA?
Ans: Foreign Exchange Management Act
66. Which among the following is a debit entry in India’s balance of payments?
Ans: Imports of goods by India
67. What is the real measure of a country’s international competitiveness?
Ans: Real Exchange Rate
68. When did India announce full convertibility of Rupee in the current account?
Ans: 1993
69. Foreign Direct Investment ceilings in the telecom sector have been raised to what level?
Ans: 100%
70. Which item does NOT come under India’s import basket now-a-days?
Ans: Food grains
71. Devaluation of currency leads to what effect?
Ans: Increase in domestic prices
Topic 8: Inflation and Price Indices
72. Who benefits from inflation?
Ans: Borrower
73. In India, inflation is measured by which index?
Ans: Wholesale Price Index Number
74. Factors responsible for current inflation are?
Ans: All of the above – Black money, Subsidy expenditure, Excess demand
75. Which governmental step has been effective in controlling double-digit inflation?
Ans: Containing budgetary deficits and unproductive expenditure
76. In India, inflation is measured by which index?
Ans: Wholesale Price Index Number
77. Inflation appears when there is?
Ans: Continuous increase in price level
Topic 9: Demographic and Social Indicators
78. On the basis of Census Report, which is the biggest city in India?
Ans: Mumbai
79. Which state has literacy rate lower than the national average?
Ans: Andhra Pradesh
80. Arrange states in descending order of urbanisation: West Bengal, Tamil Nadu, Maharashtra, Gujarat
Ans: 3,4,2,1 (Maharashtra, Gujarat, Tamil Nadu, West Bengal)
81. What are the stages of demographic transition in correct order?
Ans: 2,3,1 (High birth rate with high death rate → High birth rate with low death rate → Low birth rate with low death rate)
82. The components of HDI include which of the following?
Ans: Life expectancy index
83. India is regarded as a country with ‘Demographic Divide’ due to?
Ans: High population in the age group below 15 years
Topic 10: Financial Institutions
84. When was EXIM Bank set up in India?
Ans: 1982
85. Which of the following is a function of NABARD?
Ans: All of the above
86. State Financial Corporations give assistance mainly to which industries?
Ans: Medium and small-scale industries
Topic 11: Fiscal Policy and Government Finance
87. What is the primary deficit in the budget?
Ans: Fiscal Deficit – Interest Payments
88. The Government Budget consists of which components?
Ans: Revenue Budget and Capital Budget
89. In India, which ministry formulates fiscal policy?
Ans: Ministry of Finance
90. The sources of non-tax revenue for government of India are?
Ans: All of the above – Railway receipts, Postal receipts, Recovery of loans
91. The average rate of domestic savings in India is estimated to be in which range?
Ans: 30 to 35%
92. Which of the following was NOT an objective of the 1956 industrial policy?
Ans: Development of co-operative sector
Topic 12: Industrial Policy and Reforms
93. The ceiling on foreign investment was revised in Industrial Policy 1991 from 40% to?
Ans: 51%
94. Which industry was de-reserved in 1993?
Ans: Mining of copper and zinc
95. In which year was the new ‘Liberalized Industrial Policy’ first announced?
Ans: 1991
96. The Industrial Policy of India was first announced in which year?
Ans: 1948
97. Which of the following was NOT an objective of the 1956 industrial policy?
Ans: Development of co-operative sector
Topic 13: Money and Capital Market
98. Sensitive Index or Sensex represents prices of how many shares?
Ans: 30 shares
99. Who issues metallic coins in India?
Ans: Government of India
100. Which of the following is NOT an advantage of full capital account convertibility?
Ans: Encourages import
TOPIC-WISE SUMMARY
| Topic No. | Topic Name | Question Numbers |
|---|---|---|
| 1 | Banking and Monetary Policy | 1-23 |
| 2 | Agriculture and Allied Sectors | 24-30 |
| 3 | Five Year Plans | 31-40 |
| 4 | National Income and GDP | 41-46 |
| 5 | Poverty and Employment | 47-52 |
| 6 | Taxation | 53-62 |
| 7 | Foreign Trade and Investment | 63-71 |
| 8 | Inflation and Price Indices | 72-77 |
| 9 | Demographic and Social Indicators | 78-83 |
| 10 | Financial Institutions | 84-86 |
| 11 | Fiscal Policy and Government Finance | 87-92 |
| 12 | Industrial Policy and Reforms | 93-97 |
| 13 | Money and Capital Market | 98-100 |
WBCS MAIN 2016 P-5 Economics MCQ
Topic 1: Banking and Monetary Policy
1. Which of the following benefits from inflation?
A. Lender
B. Borrower
C. Both
D. None of the above
Correct Answer: B. Borrower
2. What rate of interest is effective at the time of giving short-term loan to the Commercial Banks by the Reserve Bank of India?
A. Repo Rate
B. Bank Rate
C. Reverse Repo Rate
D. None of the above
Correct Answer: A. Repo Rate
3. The percentage of demand and time liabilities that banks have to keep with RBI is
A. SLR (Statutory Liquidity Ratio)
B. CRR (Cash Reserve Ratio)
C. OMO (Open Market operations)
D. Bank Rate
Correct Answer: B. CRR (Cash Reserve Ratio)
4. Open market operation refers to
A. borrowing by scheduled banks from the RBI.
B. borrowing by scheduled banks to industry and trade.
C. purchase and sale of government securities.
D. deposit mobilisation.
Correct Answer: C. purchase and sale of government securities.
5. Credit Planning in the banking sector of the country has been introduced by
A. Reserve Bank of India
B. State Bank of India
C. Commercial Banks
D. All of the above
Correct Answer: A. Reserve Bank of India
6. The monetary policy of the Reserve Bank of India tackled the economic depression in recent years by
A. lowering the Repo rate and Reverse repo rate.
B. lowering the rate of marginal Standing Facilities.
C. lowering the Statutory Liquidity Ratio and the Cash Reserve Ratio.
D. Not provided in options
Correct Answer: A. lowering the Repo rate and Reverse repo rate.
7. Regional Rural Banks work at
A. Hobli level
B. Taluk level
C. District level
D. All levels
Correct Answer: D. All levels
8. The banks are required to maintain a certain ratio between their cash in hand and total assets. This is called
A. Statutory Liquid Ratio
B. Cash Reserve Ratio
C. Liquid Ratio
D. Statutory Ratio
Correct Answer: B. Cash Reserve Ratio
9. Which of the following banks was not Nationalised in 1969?
A. Vijaya Bank
B. Canara Bank
C. Bank of India
D. Central Bank of India
Correct Answer: A. Vijaya Bank
10. When was the Infrastructure Development Finance Company constituted?
A. During the Eighth Five Year Plan
B. During the Ninth Five Year Plan
C. During the Tenth Five Year Plan
D. During the Seventh Five Year Plan
Correct Answer: A. During the Eighth Five Year Plan
11. Lead Bank Scheme as a part of Credit Planning has been introduced by
A. Commercial Banks in district-wise arrangement
B. Regional Rural Banks
C. State Co-operative Banks
D. Reserve Bank of India
Correct Answer: D. Reserve Bank of India
12. The market for transaction of Government Securities is called
A. Gilt-edged market
B. Industrial Securities market
C. Call money market
D. None of the above
Correct Answer: A. Gilt-edged market
13. Mention the weakness of the nationalised commercial banks.
A. Increase in Non-performing assets
B. Decline of Capital Adequacy Ratio
C. Low Capital-Asset Ratio
D. All of the above
Correct Answer: D. All of the above
14. The dual roles of the Reserve Bank is, the Regulatory and Promotional roles have made the monetary policy a ‘policy of controlled expansion’- How?
A. By maintaining a safe limit to credit expansion required for development of the country.
B. By lowering the Cash Reserve Ratio and Repo Rate within limits.
C. By helping the growth process through raising the availability of finance for development of agriculture, industry, export trade and service sector.
D. All of the above
Correct Answer: D. All of the above
15. The Reserve Bank of India was nationalised on
A. January 1, 1949
B. April 1, 1948
C. January 1, 1948
D. April 1, 1949
Correct Answer: A. January 1, 1949
16. What is the Cash Reserve Ratio (CRR)?
A. The fraction of the deposits that Commercial Banks lend to the customer.
B. The fraction of the deposits that RBI must keep with Commercial Banks.
C. The fraction of the deposits that Commercial Bank must keep with RBI.
D. None of the above
Correct Answer: C. The fraction of the deposits that Commercial Bank must keep with RBI.
17. The RBI can increase the money supply in the market by
A. selling government securities.
B. buying government securities.
C. borrowing money from Commercial Banks.
D. None of the above
Correct Answer: B. buying government securities.
18. The Co-operative credit societies have a
A. two-tier structure
B. three-tier structure
C. four-tier structure
D. five-tier structure
Correct Answer: B. three-tier structure
19. When was the Fiscal Responsibility and Budget Management Act implemented?
A. 1950
B. 1970
C. 1993
D. 2003
Correct Answer: D. 2003
20. Operating parameters of commercial banks as percentage to assets are the highest in case of
A. Foreign banks
B. Private banks
C. All scheduled commercial banks
D. None of the above
Correct Answer: A. Foreign banks
21. India’s economic crisis in 1991 was mainly the outcome of the following:
A. Acute Fiscal deficit crisis
B. Balance of Payments crisis
C. High rate of inflation
D. All of the above
Correct Answer: D. All of the above
22. In pursuance with the recommendations of Narsimham Committee, the RBI has framed new guidelines
A. to govern entry of new private sector banks to make the banking sector more competitive.
B. to reduce the freedom given to the banks to rationalise their existing branch network.
C. to set up more foreign exchange banks.
D. to lend more easily for industrial development.
Correct Answer: A. to govern entry of new private sector banks to make the banking sector more competitive.
23. Which of the following is not included under the money market?
A. RBI
B. Commercial Banks
C. SEBI
D. None of the above
Correct Answer: C. SEBI
Topic 2: Agriculture and Allied Sectors
24. The contribution of agriculture and allied sectors to the Gross Domestic Product of India in 2012-13 was
A. 15%
B. 14.1%
C. 17%
D. 20%
Correct Answer: B. 14.1%
25. Which of the following is the implementing agency for National Agricultural Insurance scheme?
A. Food Corporation of India
B. Commission for Agricultural costs and Prices
C. Agricultural Insurance Company of India Limited
D. Not provided in options
Correct Answer: C. Agricultural Insurance Company of India Limited
26. What are the institutional sources of agricultural credit in one country?
A. Commercial Banks
B. Regional Rural Banks
C. NABARD
D. All the above stated sources
Correct Answer: D. All the above stated sources
27. What has been the average rate of increase in agricultural production in the Eleventh Five Year Plan?
A. 3%
B. 4%
C. 4.1%
D. 3.1%
Correct Answer: B. 4%
28. What are the arguments in favour of crop-sharing?
A. Land owner is sure of getting a portion of sharing?
B. If the share of land owner remains fixed, the farmer tries to maximise production.
C. In this system, it is possible to make the optimum use of inputs.
D. Not provided in options
Correct Answer: B. If the share of land owner remains fixed, the farmer tries to maximise production.
29. Which of the following states introduced Employment Guarantee Scheme first?
A. Madhya Pradesh
B. Maharashtra
C. Tamil Nadu
D. Karnataka
Correct Answer: B. Maharashtra
30. In the First Five Year Plan of India, priority was given to
A. Food and agricultural production
B. Industrial production
C. Reducing unemployment
D. None of the above
Correct Answer: A. Food and agricultural production
Topic 3: Five Year Plans
31. Krishi Vikas Yojana was introduced in the
A. Tenth Five Year Plan
B. Eleventh Five Year Plan
C. Twelfth Five Year Plan
D. Second Five Year Plan
Correct Answer: B. Eleventh Five Year Plan
32. What is the main objective of the 12th Five year Plan?
A. Faster and inclusive growth
B. Faster and sustainable growth
C. Inclusive and sustainable growth
D. Faster, sustainable and more inclusive growth
Correct Answer: D. Faster, sustainable and more inclusive growth
33. Twenty point programme’ was launched in the year
A. 1969
B. 1975
C. 1977
D. 1980
Correct Answer: B. 1975
34. When was the Infrastructure Development Finance Company constituted?
A. During the Eighth Five Year Plan
B. During the Ninth Five Year Plan
C. During the Tenth Five Year Plan
D. During the Seventh Five Year Plan
Correct Answer: A. During the Eighth Five Year Plan
35. National Food Security Mission was introduced in the
A. Tenth Five Year Plan
B. Eleventh Five Year Plan
C. Twelfth Five Year Plan
D. Ninth Five Year Plan
Correct Answer: B. Eleventh Five Year Plan
36. Rapid industrialisation is the basic objective of
A. Second Five Year Plan
B. Third Five Year Plan
C. Fourth Five Year Plan
D. Fifth Five Year Plan
Correct Answer: A. Second Five Year Plan
37. What is the estimated rate of growth in the second year of the 12th Five Year Plan of India?
A. 4.7 per cent
B. 4.9 per cent
C. 4.5 per cent
D. 4.3 per cent
Correct Answer: B. 4.9 per cent
38. In India the concept of minimum needs’ and directed antipoverty programmes’ were the innovation of
A. Fourth Five Year Plan
B. Fifth Five Year Plan
C. Sixth Five Year Plan
D. Seventh Five Year Plan
Correct Answer: B. Fifth Five Year Plan
39. In the First Five Year Plan of India, priority was given to
A. Food and agricultural production
B. Industrial production
C. Reducing unemployment
D. None of the above
Correct Answer: A. Food and agricultural production
40. The Second Five Year Plan of India gave special emphasis on
A. Labour intensive industries
B. Heavy and capital goods industries
C. Consumer goods industries
D. Small scale and cottage industries
Correct Answer: B. Heavy and capital goods industries
Topic 4: National Income and GDP
41. The contribution of agriculture and allied sectors to the Gross Domestic Product of India in 2012-13 was
A. 15%
B. 14.1%
C. 17%
D. 20%
Correct Answer: B. 14.1%
42. In the composition of the National Income in India the contribution of the is the highest.
A. Primary sector
B. Secondary sector
C. Services sector
D. Social sector
Correct Answer: C. Services sector
43. Has the inequality of income been reduced very much because of increased national income in India in the last three decades?
A. Yes
B. No
C. May be
D. May be not
Correct Answer: B. No
44. In the last one decade, which one among the following sectors has attracted the highest foreign direct investment inflow into India?
A. Chemicals other than fertilizers
B. Services sector
C. Food processing
D. Telecommunication
Correct Answer: B. Services sector
45. What is the Global rank of India in terms of its purchasing power parity?
A. 3rd
B. 5th
C. 10th
D. 17th
Correct Answer: A. 3rd
46. Development expenditure of the Central Government does not include
A. Defence expenditure
B. expenditure on economic services
C. expenditure on social and community services
D. grant to states
Correct Answer: A. Defence expenditure
Topic 5: Poverty and Employment
47. What is the percentage of people below Poverty line according to Rangarajan Committee?
A. 32 per cent
B. 29.5 per cent
C. 26 per cent
D. 40 per cent
Correct Answer: B. 29.5 per cent
48. Sampoorna Grameen Swarozgar Yojana was introduced from
A. April 1999
B. September 2001
C. January 2002
D. Not provided in options
Correct Answer: B. September 2001
49. Which Government introduced Smart Card for unorganised sector workers?
A. Gujarat
B. Maharashtra
C. Bihar
D. Delhi
Correct Answer: D. Delhi
50. Which one of the following was launched with the objective of helping the poor in rural areas to become self employed?
A. DPAP
B. IRDP
C. TRYSEM
D. DDP
Correct Answer: B. IRDP
51. New National Food Security Mission (NFSM) with an expenditure of Rs. 4882 crore in the 11th plan aims at ensuring adequate supply of
A. rice, cereals, pulses
B. wheat, cereals, pulses
C. rice, wheat, pulses
D. rice, cereals, wheat
Correct Answer: C. rice, wheat, pulses
52. India is regarded as a country with ‘Demographic Divide’. This is due to
A. its high population in the age group below 15 years.
B. its high population in the age group below 15-64 years.
C. its high population in the age group above 65 years.
D. its high total population.
Correct Answer: A. its high population in the age group below 15 years.
Topic 6: Taxation
53. Which of the following taxes is levied by the State Government only?
A. Entertainment Tax
B. Wealth Tax
C. Income Tax
D. Corporation Tax
Correct Answer: A. Entertainment Tax
54. On which one of the following is the benefits received principle of taxation to achieve optimality bases?
A. Marginal benefit received
B. Total benefit received
C. Average benefit received
D. Ability to pay for the benefit
Correct Answer: A. Marginal benefit received
55. Revenues collected from Professional tax and used by the
A. Central Government
B. State Government
C. Both Central and State Government
D. None of the above
Correct Answer: B. State Government
56. Professional tax is imposed by the
A. Central Government
B. State Government
C. Both Central and State Government
D. None of the above
Correct Answer: B. State Government
57. States can earn maximum revenue through
A. land revenue
B. custom revenue
C. commercial taxes
D. excise duties on intoxicants
Correct Answer: C. commercial taxes
58. Who was the Chairman of the Tax Reforms Committee in 1991?
A. C. Rangarajan
B. Raja C. Chelliah
C. Partha Sarathi Som
D. None of the above
Correct Answer: B. Raja C. Chelliah
59. The tax levied on the interstate trade of goods is
A. Sales tax
B. Excise tax
C. Service tax
D. Central Sales tax
Correct Answer: D. Central Sales tax
60. The condition of indirect taxes in the country’s revenue is approximately
A. 70%
B. 75%
C. 80%
D. 86%
Correct Answer: D. 86%
61. What is MAT?
A. Maximum Alternate Tax
B. Minimum Alternate Tax
C. Multiple Alternate Tax
D. Major Alternate Tax
Correct Answer: B. Minimum Alternate Tax
62. Revenues from Service Tax have been
A. increasing year after year
B. decreasing year after year
C. static year after year
D. None of the above
Correct Answer: A. increasing year after year
Topic 7: Foreign Trade and Investment
63. Foreign Direct Investment in India is the highest from
A. United States
B. Mauritius
C. Japan
D. Korea
Correct Answer: B. Mauritius
64. What are the principal items of India’s import at present
A. Electronic goods
B. Chemical items
C. Gold and Silver
D. Fuel (petroleum goods)
Correct Answer: D. Fuel (petroleum goods)
65. What is FEMA?
A. First Exchange Management Act
B. Foreign Exchequer Management Act
C. Foreign Exchange Management Act
D. Foreign Evaluation Management Act
Correct Answer: C. Foreign Exchange Management Act
66. Which among the following will be a debit entry in India’s balance of payments?
A. Imports of goods by India
B. Income of Indian investments abroad
C. Receipts of transfer payments
D. Exports of services by India
Correct Answer: A. Imports of goods by India
67. Which among the following items is taken as the real measure of a country’s international competitiveness?
A. Real Exchange Rate
B. Nominal Exchange Rate
C. Superfluous Exchange Rate
D. None of the above
Correct Answer: A. Real Exchange Rate
68. At what time India announced full convertibility of Rupee in the current account into foreign currency?
A. 1991
B. 1992
C. 1993
D. 1994
Correct Answer: C. 1993
69. Foreign Direct Investment ceilings in the telecom sector have been raised from 74% to
A. 80%
B. 83%
C. 90%
D. 100%
Correct Answer: D. 100%
70. Which item does not usually come under India’s import basket now-a-days?
A. Petroleum
B. Crude oil
C. Fertiliser
D. Food grains
Correct Answer: D. Food grains
71. Devaluation of currency leads to
A. fall in domestic prices
B. increase in domestic prices
C. can’t be predicted
D. None of the above
Correct Answer: B. increase in domestic prices
Topic 8: Inflation and Price Indices
72. Which of the following benefits from inflation?
A. Lender
B. Borrower
C. Both
D. None of the above
Correct Answer: B. Borrower
73. In India, inflation measured by the
A. Wholesale Price Index Number
B. Consumer Price Index for urban non-manual workers
C. Consumer Price Index for agricultural workers
D. National Income Deflation
Correct Answer: A. Wholesale Price Index Number
74. Factors responsible for current inflation are
A. circulation of black money
B. government expenditure on subsidy
C. excess of demand over supply of goods
D. All of the above
Correct Answer: D. All of the above
75. Which of the following governmental steps has proved relatively effective in controlling the double digit rate of inflation in the Indian economy during recent years?
A. Containing budgetary deficits and unproductive expenditure
B. Streamlined public distribution system
C. Enhanced rate of production of all consumer goods
D. Pursuing an export-oriented strategy
Correct Answer: A. Containing budgetary deficits and unproductive expenditure
76. In India, inflation measured by the
A. National Income Deflation
B. Wholesale Price Index Number
C. Consumer Price Index
D. None of the above
Correct Answer: B. Wholesale Price Index Number
77. Inflation appears when there occurs,
A. increase in money supply.
B. one time increase in price level.
C. increase in profit and production.
D. continuous increase in price level.
Correct Answer: D. continuous increase in price level.
Topic 9: Demographic and Social Indicators
78. On the basis of the Report of the Census Commission, the biggest city in India is
A. Kolkata
B. Mumbai
C. Delhi
D. Nagpur
Correct Answer: B. Mumbai
79. Which of the following states has the literacy rate lower than the national average?
A. Karnataka
B. West Bengal
C. Andhra Pradesh
D. Maharashtra
Correct Answer: C. Andhra Pradesh
80. Arrange the following Indian states in descending order from urbanisation point of view.
- West Bengal
- Tamil Nadu
- Maharashtra
- Gujarat
Select the correct answer using the codes given below:
A. 1, 2, 3, 4
B. 2, 3, 4, 1
C. 3, 4, 2, 1
D. 4, 3, 2, 1
Correct Answer: C. 3, 4, 2, 1
81. Consider the following specific stages of demographic transition associated with economic development:
- Low birth rate with low death rate
- High birth rate with high death rate
- High birth rate with low death rate
Select the correct answer using the codes given below:
A. 1,2,3
B. 2,1,3
C. 2,3,1
D. 3,2,1
Correct Answer: C. 2,3,1
82. The components of HDI is/are
A. Life expectancy index
B. Infant mortality rate
C. Population growth rate
D. All of the above
Correct Answer: A. Life expectancy index
83. India is regarded as a country with ‘Demographic Divide’. This is due to
A. its high population in the age group below 15 years.
B. its high population in the age group below 15-64 years.
C. its high population in the age group above 65 years.
D. its high total population.
Correct Answer: A. its high population in the age group below 15 years.
Topic 10: Financial Institutions
84. When was the EXIM Bank of Export-Import Bank set up in India?
A. 1980
B. 1982
C. 1985
D. 1987
Correct Answer: B. 1982
85. Which of the following is a function of NABARD?
A. Monitoring flow of ground level credit in agriculture
B. Credit planning and monitoring
C. Formulation of operational guidelines for rural financial institutions
D. All of the above
Correct Answer: D. All of the above
86. In Indian states, the state financial corporation has given assistance mainly to develop
A. agricultural farms
B. cottage industry
C. large-scale industries
D. medium and small-scale industries
Correct Answer: D. medium and small-scale industries
Topic 11: Fiscal Policy and Government Finance
87. What is the primary Deficit in the Budget prepared by the finance ministry?
A. Total Expenditure—Total Revenue
B. Fiscal Deficit—Interest Payments
C. Revenue Expenditure—Revenue Receipts
D. Capital Expenditure—Capital Revenue
Correct Answer: B. Fiscal Deficit—Interest Payments
88. The Government Budget consists of which main component/s?
A. Revenue Budget and Capital Budget
B. Capital Budget only
C. Revenue Budget only
D. None of the above
Correct Answer: A. Revenue Budget and Capital Budget
89. In India which one among the following formulates the fiscal policy?
A. Planning Commission
B. Ministry of Finance
C. Finance Commission
D. The Reserve Bank of India
Correct Answer: B. Ministry of Finance
90. The sources of non-tax revenue for government of India are
A. net receipts from railway
B. net receipts from postal department
C. recovery of loans and advances
D. All of the above
Correct Answer: D. All of the above
91. The average rate of domestic savings (gross) for the Indian economy is currently estimated to be in the range of
A. 15 to 20%
B. 20 to 25%
C. 25 to 30%
D. 30 to 35%
Correct Answer: D. 30 to 35%
92. Which of the following was not an objective of the 1956 industrial policy?
A. Development of co-operative sector
B. Expansion of public sector
C. Develop heavy and machine making industries
D. None of the above
Correct Answer: A. Development of co-operative sector
Topic 12: Industrial Policy and Reforms
93. The ceiling on foreign investment was revised in the Industrial Policy, 1991 from 40 per cent to
A. 49 per cent
B. 50 per cent
C. 51 per cent
D. 52 per cent
Correct Answer: C. 51 per cent
94. Which of the following industries was de-reserved in 1993?
A. Atomic energy
B. Atopic minerals
C. Mining of copper and zinc
D. Railways
Correct Answer: C. Mining of copper and zinc
95. In which among the following years, a new ‘Liberalized Industrial Policy’ in India was announced for the first time?
A. 1986
B. 1991
C. 1992
D. 1993
Correct Answer: B. 1991
96. The Industrial Policy of India was first announced in
A. 1948
B. 1956
C. 1991
D. 1990
Correct Answer: A. 1948
97. Which of the following was not an objective of the 1956 industrial policy?
A. Development of co-operative sector
B. Expansion of public sector
C. Develop heavy and machine making industries
D. None of the above
Correct Answer: A. Development of co-operative sector
Topic 13: Money and Capital Market
98. Sensitive Index or Sensex represents the prices of shares of the main shares in the stock exchange.
A. 40 shares
B. 30 shares
C. 50 shares
D. 60 shares
Correct Answer: B. 30 shares
99. Who issues metallic coins in India?
A. RBI
B. Government of India
C. Banks and Financial Institutions
D. Any of the above can issue it
Correct Answer: B. Government of India
100. Which of the following is not advantage of full capital account convertibility?
A. Encourages import
B. Boosts exports
C. Easy access to forex
D. Promotes trade and capital flows between nations
Correct Answer: A. Encourages import
TOPIC-WISE SUMMARY
| Topic No. | Topic Name | Question Numbers |
|---|---|---|
| 1 | Banking and Monetary Policy | 1-23 |
| 2 | Agriculture and Allied Sectors | 24-30 |
| 3 | Five Year Plans | 31-40 |
| 4 | National Income and GDP | 41-46 |
| 5 | Poverty and Employment | 47-52 |
| 6 | Taxation | 53-62 |
| 7 | Foreign Trade and Investment | 63-71 |
| 8 | Inflation and Price Indices | 72-77 |
| 9 | Demographic and Social Indicators | 78-83 |
| 10 | Financial Institutions | 84-86 |
| 11 | Fiscal Policy and Government Finance | 87-92 |
| 12 | Industrial Policy and Reforms | 93-97 |
| 13 | Money and Capital Market | 98-100 |