Objective Type Q & A- Public finance
1. Which of the following is a union tax?
a. Corporation tax
b. Taxes on agricultural income
c. Capitation taxes
d. Land revenues
ANSWER: a. Corporation tax
Union taxes are given in the list of 7th schedule in the constitution.
Union taxes are given in the list of 7th schedule in the constitution.
2. Which of the following is not a union tax?
a. Taxes on railway freights and fares
b. Stamp duties on financial documents
c. Tolls
d. A and b only
ANSWER: d. A and b only
Taxes on railway freights and fares and Stamp duties on financial documents are union taxes while tolls are state tax
Taxes on railway freights and fares and Stamp duties on financial documents are union taxes while tolls are state tax
3. Consider the following statements and identify the right ones.
i. Central government does not have exclusive power to impose tax which is not mentioned in state or concurrent list.
ii. The constitution also provides for transferring certain tax revenues from union list to states.
a. i only
b. ii only
c. both
d. none
4. The tax levied by the union government on income of individuals is known as
a. Personal income tax
b. Interest tax
c. Wealth tax
d. Corporation tax
5. The tax on net income of companies is
a. Personal income tax
b. Interest tax
c. Wealth tax
d. Corporation tax
6. Consider the following statements and identify the right ones.
i. Wealth tax is collected from productive as well as unproductive assets
ii. Estate duty was a type of inheritance tax of large estates
a. i only
b. ii only
c. both
d. none
7. Which of the following taxes is/are withdrawn or abolished?
a. Interest tax
b. Estate duty
c. Gift tax
d. All the above
8. The most important source of revenue to the states is
a. Sales tax
b. Service tax
c. Excise duty
d. None of the above
9. The tax levied on the interstate trade of goods is
a. Sales tax
b. Excise tax
c. Service tax
d. Central sales tax
10. Consider the following statements and identify the right ones.
i. The 14th finance commission is headed by C. Rangarajan
ii. The recommendations of the commission will come into effect from April, 1, 2015
a. i only
b. ii only
c. both
d. none
11. The difference between revenue expenditure and revenue receipts is
a. Revenue deficit
b. Fiscal deficit
c. Budget deficit
d. Primary deficit
12. The difference between revenue deficit and grants for creation of capital assets is called
a. Fiscal deficit
b. Budget deficit
c. Effective revenue deficit
d. Primary deficit
13. The difference between total expenditure and total receipts is
a. Fiscal deficit
b. Budget deficit
c. Primary deficit
d. Revenue deficit
14. The difference between total expenditure and total receipts except loans and other liabilities is called
a. Fiscal deficit
b. Budget deficit
c. Primary deficit
d. Revenue deficit
ANSWER: a. Fiscal deficit
Fiscal deficit= total expenditure-total receipts except loans and other liabilities.
Fiscal deficit= total expenditure-total receipts except loans and other liabilities.
15. The difference between fiscal deficit and interest payment during the year is called
a. Fiscal deficit
b. Budget deficit
c. Primary deficit
d. Revenue deficit
ANSWER: c. Primary deficit
Primary deficit= fiscal deficit-interest payments.
Primary deficit= fiscal deficit-interest payments.
1. Which of the following
is a part of capital account?
a. Private capital
b. Banking capital
c. Official capital
d. All the above
a. Private capital
b. Banking capital
c. Official capital
d. All the above
ANSWER: d. All the above
Capital account is classified into 3 parts in India- private, banking and official capital.
Capital account is classified into 3 parts in India- private, banking and official capital.
2. Consider the following statements and identify the right ones.
i. 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
ii. All transactions related to goods, services or income are classified as capital account.
a. i only
b. ii only
c. both
d. none
ANSWER: d. none
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 payments. All transactions related to goods, services or income are classified as current account.
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 payments. All transactions related to goods, services or income are classified as current account.
3. The investment in productive assets and participation in management as stake holders in business enterprises is
a. FDI
b. FII
c. Balance of payment
d. SDR
ANSWER: a. FDI
The investment in productive assets and participation in management as stake holders in business enterprises is foreign direct investment.
The investment in productive assets and participation in management as stake holders in business enterprises is foreign direct investment.
4. The portfolio investment by foreign institutional investors is called
a. FDI
b. FII
c. Balance of payment
d. SDR
ANSWER: b. FII
The portfolio investment by foreign institutional investors is called foreign institutional investment.
The portfolio investment by foreign institutional investors is called foreign institutional investment.
5. Consider the following statements and identify the right ones.
i. India adopted LERMS in 1992
ii. In 1993, dual exchange rate system was replaced by a unified floating exchange rate.
a. i only
b. ii only
c. both
d. none
ANSWER: c. both
Liberalized Exchange Rate Management System was a dual exchange rate system in which 40% of forex earnings were converted at official exchange rate and 60% at market determined exchange rate.
Liberalized Exchange Rate Management System was a dual exchange rate system in which 40% of forex earnings were converted at official exchange rate and 60% at market determined exchange rate.
International organizations and global financial issues - MCQs with
answers
1. Consider the following statements and identify the right ones.
i. IMF came into existence as an outcome on Bretton Woods agreement
ii. France was the 1st country to borrow from IMF
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
IMF oversees the international monetary system.
IMF oversees the international monetary system.
2. Consider the following statements and identify the right ones.
i. The executive board is the highest decision making body of IMF
ii. The Board of Governors meets twice a year.
a. I only
b. ii only
c. both
d. none
ANSWER: d. none
The Board of Governors is the highest decision making body of IMF. The Board of Governors meets once a year.
The Board of Governors is the highest decision making body of IMF. The Board of Governors meets once a year.
3. Consider the following statements and identify the right ones.
i. Executive board conducts the business of the IMF
ii. It meets once in a year
a. i only
b. ii only
c. both
d. none
ANSWER: a. I only
Executive board conducts the business of the IMF. It functions in continuous session and meets several times in a week.
Executive board conducts the business of the IMF. It functions in continuous session and meets several times in a week.
4. Consider the following statements and identify the right ones.
i. The day to day work of IMF is conducted by the board of governors
ii. Selected nations who are members of IMF are given a quota
a. i only
b. ii only
c. both
d. none
ANSWER: b. ii only
The day to day work of IMF is conducted by the executive board. All the nations are assigned a quota.
The day to day work of IMF is conducted by the executive board. All the nations are assigned a quota.
5. Consider the following statements and identify the right ones.
i. The quota does not decide voting power in IMF’s decisions
ii. Quota subscription constitutes most of the financial resources of IMF
a. i only
b. ii only
c. both
d. none
ANSWER: b. ii only
The quota decides voting power in IMF’s decisions. Quota subscription constitutes most of the financial resources of IMF.
The quota decides voting power in IMF’s decisions. Quota subscription constitutes most of the financial resources of IMF.
6. Consider the following statements and identify the right ones.
i. SDRs cannot voluntarily be exchanged among members for currencies
ii. US is the largest member of the IMF
a. I only
b. ii only
c. both
d. none
ANSWER: b. ii only
SDRs can voluntarily be exchanged among members for currencies.
SDRs can voluntarily be exchanged among members for currencies.
ANSWER: d. All the above
World Bank has five institutions- IBRD, IDA, International Finance Corporation, MIGA and ISCID.
World Bank has five institutions- IBRD, IDA, International Finance Corporation, MIGA and ISCID.
8. Consider the following statements and identify the right ones.
i. Low income countries are eligible to receive low interest loans from IDA
ii. India is eligible for a blend of financial assistance from IDA and IBRD
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
IBRD aims at reducing poverty in middle income and credit-worthy poor countries.
IBRD aims at reducing poverty in middle income and credit-worthy poor countries.
9. Which of the following is not an objective of World Bank?
a. To provide guarantee on private loans
b. To develop production facilities in underdeveloped countries
c. To rehabilitate war ruined economies
d. None of the above
ANSWER: d. None of the above
World Bank provides long term capital to member countries for economic reconstruction and development.
World Bank provides long term capital to member countries for economic reconstruction and development.
10. Which of the following is known as soft loan window of the World Bank?
a. IDA
b. IFC
c. IBRD
d. MIGA
ANSWER: a. IDA
IDA was established in 1960. It aims at reducing poverty by providing interest free credits and grants for economic growth.
IDA was established in 1960. It aims at reducing poverty by providing interest free credits and grants for economic growth.
ANSWER: b. IFC
IFC was established in 1956. It is known as the investment arm of the World Bank.
IFC was established in 1956. It is known as the investment arm of the World Bank.
ANSWER: d. MIGA
MIGA is known as the insurance arm of World Bank. It was established in 1988.
MIGA is known as the insurance arm of World Bank. It was established in 1988.
13. Consider the following statements and identify the right ones.
i. MIGA does not offers political risk insurance for projects to developing member countries
ii. MIGA also helps investors and lenders deal with investment risks
a. i only
b. ii only
c. both
d. none
ANSWER: b. ii only
MIGA offers political risk insurance for projects to developing member countries.
MIGA offers political risk insurance for projects to developing member countries.
14. Consider the following statements and identify the right ones.
i. IFC is governed by board of governors
ii. It mobilizes capital in international capital markets
a. i only
b. ii only
c. both
d. none
ANSWER: c. both
International Finance Corporation is governed by board of governors who are represented by member countries.
International Finance Corporation is governed by board of governors who are represented by member countries.
15. Consider the following statements and identify the right ones.
i. ICSID is a multilateral treaty formulated by executive directors of IBRD
ii. All the countries have deposited their instruments of ratification, acceptance of the convention.
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
Not all the countries have deposited their instruments of ratification, acceptance of the convention.
Not all the countries have deposited their instruments of ratification, acceptance of the convention.
16. Consider the following statements and identify the right ones.
i. The head of WTO is known as director general
ii. The WTO summit is held once in very year
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
The WTO summit is held once in two years. The summit is known as Ministerial Conference.
The WTO summit is held once in two years. The summit is known as Ministerial Conference.
1. Consider the following
statements
1. GDR is a certificate issued by a depository bank, which purchases shares of foreign companies and deposits it on the account.
2. GDRs enable a company, the issuer, to access investors in capital markets outside of its home country.
3. Regulatory and other agencies suspect that GDR route is being used for bringing back suspected illicit funds stashed abroad.
Which of the above statements are correct?
a) 1,2
b) 1,2,3
c) 2,3
d) 1,3
1. GDR is a certificate issued by a depository bank, which purchases shares of foreign companies and deposits it on the account.
2. GDRs enable a company, the issuer, to access investors in capital markets outside of its home country.
3. Regulatory and other agencies suspect that GDR route is being used for bringing back suspected illicit funds stashed abroad.
Which of the above statements are correct?
a) 1,2
b) 1,2,3
c) 2,3
d) 1,3
ANSWER: b
Explanation: GDR is a popular financial instrument used by listed companies in India, as also in many other countries, to raise funds denominated mostly in US dollar or euros. GDRs are typically bank certificates issued in more than one country for shares of a company, which are held by a foreign branch of an international bank.
Explanation: GDR is a popular financial instrument used by listed companies in India, as also in many other countries, to raise funds denominated mostly in US dollar or euros. GDRs are typically bank certificates issued in more than one country for shares of a company, which are held by a foreign branch of an international bank.
2. Consider the following statements
1. Project Panchdeep, a unique health-care administration program aimed at automating health-care services to over 6 crore beneficiaries spread across the country.
2. Infosys partnered with government for implementation of this project
Which of the above statements are not true?
a) Only 1
b) Only 2
c) Both
d) Neither
ANSWER: a
Explanation: The Center is implementing a Rs 1,900 crore e-governance project to automate transactions vis-a-vis the Employees State Insurance Corporation (ESIC).Under the project, named 'Panchdeep', a massive Enterprise Resource Planning (ERP) would be installed across the country. Wipro provided IT solution for project Panchdeep.
Explanation: The Center is implementing a Rs 1,900 crore e-governance project to automate transactions vis-a-vis the Employees State Insurance Corporation (ESIC).Under the project, named 'Panchdeep', a massive Enterprise Resource Planning (ERP) would be installed across the country. Wipro provided IT solution for project Panchdeep.
3. Consider the following statements
1. “Dhan Sangam” was seminar for banker was arranged by the Finance Ministry
2. S.S.Mundra Committee was set up for governance in banks.
Which of the above statements are not true?
a) Only 1
b) Only 2
c) Both
d) Neither
ANSWER: c
Explanation: Gyan Sangam was seminar for banker was arranged by the Finance Ministry while P.J.Nayak Commitee was set up for governance in banks.
Explanation: Gyan Sangam was seminar for banker was arranged by the Finance Ministry while P.J.Nayak Commitee was set up for governance in banks.
4. According to P.J.Nayak committee recommendations
1. Transfer of government shares in PSB to to Bank investment Company (BIC) so BIC will become Holding company and PSB banks became BIC’s subsidiary companies.
2. Until BIC is formed Committee recommended formation of Bank Board Bureau
Which of the above statements are true?
a) Only 1
b) Only 2
c) Both
d) Neither
ANSWER: c
5. Which government introduced smart-card for unorganized sector workers?
a) Gujarat
b) Maharashtra
c) Bihar
d) Delhi
ANSWER: a
Explanation: Gujarat government has “U-Win” Smart-card for unorganized sector workers so they can get benefit of all Government schemes. Modi planning to implement same on all India- notification awaited.
Explanation: Gujarat government has “U-Win” Smart-card for unorganized sector workers so they can get benefit of all Government schemes. Modi planning to implement same on all India- notification awaited.
6. Which of the following city is not covered under “Char dham” Project?
a) Kedarnath
b) Badrinath
c) Dwarka
d) Gangotri
ANSWER: c
Explanation: “Char-dham” project to build a New national highways connecting the four shrines of Kedarnath, Badrinath, Gangotri, and Yamunotri in Uttarakhand.
Explanation: “Char-dham” project to build a New national highways connecting the four shrines of Kedarnath, Badrinath, Gangotri, and Yamunotri in Uttarakhand.
7. Under HRIDAY scheme which of the following city is not included?
a) Puri
b) Agra
c) Patana
d) Amravati
ANSWER: c
Explanation: Varanasi , Amritsar, Warangal(Telangana), Ajmer, Gaya, Mathura, Kanchipuram and Vellankini both in Tamil Nadu, Amaravati(AP) Badami, Dwaraka(Gujarat) and Puri are included in HRIDAY Scheme.
Explanation: Varanasi , Amritsar, Warangal(Telangana), Ajmer, Gaya, Mathura, Kanchipuram and Vellankini both in Tamil Nadu, Amaravati(AP) Badami, Dwaraka(Gujarat) and Puri are included in HRIDAY Scheme.
8. Currently base year for calculating GDP has been chaged. What is the new baseline year?
a) 2008-09
b) 2010-11
c) 2011-12
d) 2007-08
ANSWER: c
Explanation: India’s GDP was calculated with base year 2004-05. Base year changed to 2011-12. Subsequently 2012’13’s GDP growth rate is increased from ~4.7%to ~7%.
Explanation: India’s GDP was calculated with base year 2004-05. Base year changed to 2011-12. Subsequently 2012’13’s GDP growth rate is increased from ~4.7%to ~7%.
9. Consider the following statements
1. The Mangala Area is a major oil field located in the Indian State of Rajasthan.
2. Cairn India is the operator of the field, a subsidiary of Cairn Energy.
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) Neither
ANSWER: c
10. Consider the following statements
1. The newly constituted National Highway Infrastructure Development Corporation Limited, which is mandated to develop 10,000 km of roads in the country with a special focus on North-East, will award the first highway project in Meghalaya
2. The company is mandated to build 10,000 km of roads in the North-East (Assam, Meghalaya, Manipur, Nagaland, Mizoram, Tripura and Arunachal Pradesh) and Uttarakhand.
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) Neither
ANSWER: c
11. Consider the following statements
1. The Reserve Bank of India and the European Central Bank have signed a memorandum of understanding for cooperation in the area of central banking.
2. The Reserve Bank of India signed a Memorandum of Understanding (MoU) on “Supervisory Cooperation and Exchange of Supervisory Information” with Banco Central do Brasil (BCB) .
Which of the above statements are true?
a) Only 1
b) Only 2
c) Both
d) Neither
ANSWER: c
1.Consider the following
statements related to GST bill
1. The Centre will have one third weight in the GST Council while the states will have the remaining two-thirds and decisions will have to be passed with 75% vote.
2. Petroleum and Alcohol is excluded from GST
Which of the above statements is/are correct?
a) Only 1
b) Only 2
c) Both
d) None
1. The Centre will have one third weight in the GST Council while the states will have the remaining two-thirds and decisions will have to be passed with 75% vote.
2. Petroleum and Alcohol is excluded from GST
Which of the above statements is/are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
GST is an indirect tax levied on manufacture, sale and consumption of goods as well as services at a national level. The decision to keep petroleum out of GST for the time being will also lower the revenue neutral rate (RNR), at which both the Centre and states will not make a loss. Alcohol will also be excluded from GST,
GST is an indirect tax levied on manufacture, sale and consumption of goods as well as services at a national level. The decision to keep petroleum out of GST for the time being will also lower the revenue neutral rate (RNR), at which both the Centre and states will not make a loss. Alcohol will also be excluded from GST,
2.Consider the following statements related to SEZ
1. It is a duty free enclave to be treated as foreign territory for the purpose of trade operations and duties and tariffs.
2. The corporation in SEZs will not have to pay any income tax on their profits for the first five years and only 50% of the tax for 2 more years thereafter.
3. A SEZ does not require a license for exports.
Which of the above statements are true?
a) 1,2
b) 2,3
c) 1,3
d) All the above
ANSWER: a) 1,2
A SEZ does not require a license for imports.
A SEZ does not require a license for imports.
3. What is MAT?
a) Minimum Alternate Tax
b) Maximum Alternate Tax
c) Multiple Alternate Tax
d) None of the above
ANSWER: a) Minimum Alternate Tax
Minimum Alternate Tax (MAT) is direct tax system levied on companies having large profits and declaring substantial dividends to shareholders but are not paying corporate tax, by taking advantage of the various incentives and exemptions provided in the Income-tax Act.
Minimum Alternate Tax (MAT) is direct tax system levied on companies having large profits and declaring substantial dividends to shareholders but are not paying corporate tax, by taking advantage of the various incentives and exemptions provided in the Income-tax Act.
4.Consider the following statements
1.The Index of Eight Core Industries (ICI) measures performance of eight infrastructure industries, viz Coal, Crude Oil, Natural Gas, Refinery Products, Fertilizers, Steel, Cement and Electricity
2. It has the base year of 2004-05.
3. The Eight Core Industries comprise nearly 38 % of the weight of items included in the Index of Industrial Production (IIP).
Which of the above statements are correct?
a) 1,2
b) 1,3
c) 2,3
d) All
ANSWER: d) All
5. Consider the following statements
1. The Financial Sector Legislative Reforms Commission (FSLRC) is a body set up by Ministry of Finance in 2011, to review and rewrite the legal-institutional architecture of the Indian financial sector.
2. This Commission is chaired by a former Judge of the Supreme Court of India, Justice B. N. Srikrishna
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
6. 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
ANSWER: a) Encourages import
Imports become expensive and results in import substitution. Import substitution industrialization is a trade and economic policy which advocates replacing foreign imports with domestic production.
Imports become expensive and results in import substitution. Import substitution industrialization is a trade and economic policy which advocates replacing foreign imports with domestic production.
7. Financial Sector Legislative Reforms Commission has various working groups dedicated to in depth analysis of different sectors. Match the pairs of different working groups and their chairman.
i. Banking -------------------------------- 1. P.J Nayak
ii. Insurance,Pension, Small saving ------- 2. Dr. Govind Rao
iii. Public debt management --------------- 3. Jayant Verma
iv. Payment-------------------------------- 4. Dhirendra Swarup
v. Securities ----------------------------- 5. K.J.Udshi
a) i-4 ,ii-3, iii-1, iv-2, v-3
b) i-3, ii-4, iii-2, iv-5, v-1
c) i-5, ii-4, iii-2, iv-1, v-3
d) i-5, ii-3, iii-2, iv-4, v-1
ANSWER: c) i-5, ii-4, iii-2, iv-1, v-3
8. Which of the following is part of priority sector lending?
1. Education
2. renewable energy
3. Personal loans
4. social infrastructure
5. Medium enterprises
6. Export Credit
7. Housing
8. Credit cards
a) 1,2,5,7,8
b) 1,2,3,7,8
c) 1,3,4,5,6,7
d) 1,2,3,5,7,8
ANSWER: c) 1,3,4,5,6,7
9. Consider the following statements about priority sector lending
1.All banks have to lend at least 40% of their net credit to the priority sector
2.Foreign banks with less than 20 branches will move to total priority sector target of 40 percent by 2019-20.
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
10. Consider the following statements about GST
1. Both Central and State taxes will be collected at the point of sale.
2. The Central and State GST will be charged on the manufacturing cost.
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
1. Which of the following
is part of priority sector lending?
1. Education
2. renewable energy
3. Personal loans
4. social infrastructure
5. Medium enterprises
6. Export Credit
7. Housing
8. Credit cards
a) 1,2,5,7,8
b) 1,2,3,7,8
c) 1,3,4,5,6,7
d) 1,2,3,5,7,8
1. Education
2. renewable energy
3. Personal loans
4. social infrastructure
5. Medium enterprises
6. Export Credit
7. Housing
8. Credit cards
a) 1,2,5,7,8
b) 1,2,3,7,8
c) 1,3,4,5,6,7
d) 1,2,3,5,7,8
ANSWER: c) 1,3,4,5,6,7
2. Consider the following statements about priority sector lending
1.All banks have to lend at least 40% of their net credit to the priority sector
2.Foreign banks with less than 20 branches will move to total priority sector target of 40 percent by 2019-20.
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
3. Consider the following statements about GST
1. Both Central and State taxes will be collected at the point of sale.
2. The Central and State GST will be charged on the manufacturing cost.
Which of the above statements are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
4.Consider the following statements related to GST bill
1. The Centre will have one third weight in the GST Council while the states will have the remaining two-thirds and decisions will have to be passed with 75% vote.
2. Petroleum and Alcohol os excluded from GST
Which of the above statements is/are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: b) Only 2
GST is an indirect tax levy on manufacture, sale and consumption of goods as well as services at a national level. The decision to keep petroleum out of GST for the time being will also lower the revenue neutral rate (RNR), at which both the Centre and states will not make a loss. Alcohol will also be excluded from GST,
GST is an indirect tax levy on manufacture, sale and consumption of goods as well as services at a national level. The decision to keep petroleum out of GST for the time being will also lower the revenue neutral rate (RNR), at which both the Centre and states will not make a loss. Alcohol will also be excluded from GST,
5.Consider the following statements related to SEZ
1. It is a duty free enclave to be treated as foreign territory for the purpose of trade operations and duties and tariffs.
2. The corporation in SEZs will not have to pay any income tax on their profits for the first five years and only 50% of the tax for 2 more years thereafter.
3. A SEZ does not require a license for exports.
Which of the above statements are true?
a) 1,2
b) 2,3
c) 1,3
d) All the above
ANSWER: a) 1, 2
A SEZ does not require a license for imports.
A SEZ does not require a license for imports.
1. Increase in Bank Rate
a) increases the cost of borrowing by commercial banks
b) declines the supply of money
c) shows tightening of RBI monetary policy
d) all the above
a) increases the cost of borrowing by commercial banks
b) declines the supply of money
c) shows tightening of RBI monetary policy
d) all the above
ANSWER: d) all the above
Bank rate is the rate at which a central bank is ready to buy or rediscount bills of exchange or other commercial papers. It also signals the medium-term stance of monetary policy. When bank rate is raised, it is expected that all interest rates will move together in the same direction.
Bank rate is the rate at which a central bank is ready to buy or rediscount bills of exchange or other commercial papers. It also signals the medium-term stance of monetary policy. When bank rate is raised, it is expected that all interest rates will move together in the same direction.
2. Which of the following are features of amendments to the Companies Act
1. Removed limit for minimum capital required for formation
2. If a firm fails to repay the deposit or any interest it will be punishable with fine
3. All cases under the Companies Act cannot be tried by a special court and that only serious offenses will go to such courts
Which of the above statements is/are incorrect?
a) 1,2
b) 2,3
c) 1,3
d) All
ANSWER: d) All
3. Consider the following statements
1. The Reserve Bank of India has asked all public sector banks, some private sector and foreign banks to appoint an internal ombudsman.
2. The internal ombudsman would be designated Chief Customer Service Officer (CCSO).
3. RBI has also made it clear that the CCSO should not have worked in the bank in which he/she is appointed as CCSO.
Which of the above statements are true?
a) 1,2
b) 2,3
c) 1,3
d) All the above
ANSWER: d) All the above
All public sector banks will have to appoint a Chief Customer Service Officer.
The private sector and foreign banks which have been asked to appoint the CCSO are ICICI Bank, HDFC Bank, Axis Bank, Kotak Mahindra Bank, IndusInd Bank, Standard Chartered Bank, Citi Bank N.A. and HSBC.
The Reserve Bank introduced the Banking Ombudsman Scheme (BOS) in 1995 to provide an expeditious and inexpensive forum to bank customers for resolution of their complaints relating to deficiency in banking services provided by commercial banks, regional rural banks and scheduled primary co-operative banks.
All public sector banks will have to appoint a Chief Customer Service Officer.
The private sector and foreign banks which have been asked to appoint the CCSO are ICICI Bank, HDFC Bank, Axis Bank, Kotak Mahindra Bank, IndusInd Bank, Standard Chartered Bank, Citi Bank N.A. and HSBC.
The Reserve Bank introduced the Banking Ombudsman Scheme (BOS) in 1995 to provide an expeditious and inexpensive forum to bank customers for resolution of their complaints relating to deficiency in banking services provided by commercial banks, regional rural banks and scheduled primary co-operative banks.
4. Which of the following agency is responsible for management of Chit funds?
a) RBI
b) Central government
c) State governments
d) SEBI
ANSWER: c) State governments
Chit funds in India are governed by the Chit Funds Act, 1982. Under this Act, the chit fund businesses can be registered and regulated only by the respective state governments
Chit funds in India are governed by the Chit Funds Act, 1982. Under this Act, the chit fund businesses can be registered and regulated only by the respective state governments
5. Consider the following statements related to Bhartiya Mahila Bank
1. It is the only public sector bank in the country entirely owned by the government
2. This bank works exclusively for women
Which of the above statements is/are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: a) Only 1
Although initially reported as a bank exclusively for women, the bank allows deposits to flow from everyone, but lending will be predominantly for women
Although initially reported as a bank exclusively for women, the bank allows deposits to flow from everyone, but lending will be predominantly for women
6. Consider the following statements related to FDI in retail
1. India allows 100% FDI in single-brand stores but imposed the requirement that the single brand retailer source 30 percent of its goods from India.
2. Government of India allowed 100% FDI in multi-brand retail in India after approval from individual state
Which of the above statements is/are correct?
a) Only 1
b) Only 2
c) Both
d) None
ANSWER: c) Both
Government of India allowed 51% FDI in multi-brand retail in India after approval from individual state
Government of India allowed 51% FDI in multi-brand retail in India after approval from individual state
7. Consider the following statements
1. RBI allowed Infrastructure Debt Fund-Non-Banking Financial Companies to invest in public-private partnerships (PPPs) and infrastructure projects which have completed at least one year of satisfactory commercial operation.
2. The maximum exposure that an IDF-NBFC can take on individual projects will be at 50 per cent of its total capital funds.
3. An additional exposure up to 10 per cent could be taken at the discretion of the board of the IDF-NBFC.
Which of the above statements are correct?
a) 1,2
b) 1,3
c) 2,3
d) All
ANSWER: d) All
The RBI could permit additional exposure up to 15 per cent (over 60 per cent) “subject to such conditions as it may deem fit to impose regarding additional prudential safeguards.â€
The RBI could permit additional exposure up to 15 per cent (over 60 per cent) “subject to such conditions as it may deem fit to impose regarding additional prudential safeguards.â€
ANSWER: b) Borrower
Inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. Inflation redistributes wealth from creditors to debtors so borrower gets benefits from inflation
Inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. Inflation redistributes wealth from creditors to debtors so borrower gets benefits from inflation
1) Who is credited with brining the term
"the invisible hand" in economics?
a) Adam Smith
b) John Maynard Keynes
c) F. Hayek
d) Samuelson
a) Adam Smith
b) John Maynard Keynes
c) F. Hayek
d) Samuelson
ANSWER: a) Adam Smith
"The invisible hand" refers to the market forces that lead to eventual benefit of overall society when individuals are pursuing their goals for their own good alone. The phrase was used in his 1776 book "An Inquiry into the Nature and Causes of the Wealth of Nations"
"The invisible hand" refers to the market forces that lead to eventual benefit of overall society when individuals are pursuing their goals for their own good alone. The phrase was used in his 1776 book "An Inquiry into the Nature and Causes of the Wealth of Nations"
2) Who is called as the 'founding father of modern economics'?
a) Adam Smith
b) John Maynard Keynes
c) F. Hayek
d) Samuelson
ANSWER: a) Adam Smith
Adam Smith's “1776 book "An Inquiry into the Nature and Causes of the Wealth of Nations"†many of the major ideas that we use in economics today
Adam Smith's “1776 book "An Inquiry into the Nature and Causes of the Wealth of Nations"†many of the major ideas that we use in economics today
3) Macroeconomics as a separate branch came to be studied after the contributions of which economist?
a) Adam Smith
b) John Maynard Keynes
c) F. Hayek
d) Samuelson
ANSWER: b) John Maynard Keynes
John Maynard Keynes's 1936 book, 'The General Theory of Employment, Interest, and Money' laid the foundations for Macroeconomics
John Maynard Keynes's 1936 book, 'The General Theory of Employment, Interest, and Money' laid the foundations for Macroeconomics
ANSWER: b) 1929
The economic depression began after the stock market crash of 1929 that eventually led to the loss of over 13-15 million jobs.
The economic depression began after the stock market crash of 1929 that eventually led to the loss of over 13-15 million jobs.
5) Consider the following statements:
1. In a Capitalist economy there is private ownership of means of production
2. In a communist nation, the means of production are owned by the State
3. In a free-market economy there is minimum role of the Government
Which of the above 3 statement is/are true?
a) Only 1 and 3
b) Only 2 and 3
c) Only 3
d) All are true
ANSWER: d) All are true
6) Macroeconomics is a study of economics that deals with which 4 major factors:
a) households, firms, government, and demand-supply
b) households, firms, government and external sector
c) firms, government, free-market, and regulations
d) none of the above
ANSWER: b) households, firms, government
and external sector
7) What are consumption goods?
a) Goods used for consumption in the production process
b) Goods such as tools, machinery, etc which are used to create final consumption goods
c) Goods and services that are consumed fully when purchased by the consumers
d) None of the above
ANSWER: c) Goods and services that are
consumed fully when purchased by the consumers
Examples: Tea in a restaurant, packet of chips, movie at a theater etc
Examples: Tea in a restaurant, packet of chips, movie at a theater etc
8) What are Capital goods?
a) Goods used for consumption in the production process
b) Goods such as tools, machinery, etc which are used to create final consumer goods
c) Goods and services that are consumed fully when purchased by the consumers
d) None of the above
ANSWER: b) Goods such as tools, machinery,
etc which are used to create final consumer goods
9) Intermediate goods are not included to calculate the final output because:
a) they do not have value
b) they have unknown value
c) their value is included in final goods so they are not added to avoid the problem of double counting
d) none of the above
ANSWER: c) their value is included in
final goods so they are not added to avoid the problem of double counting
10) What does the term Gross investment mean while denoting a nation's economy?
a) Gross investment= Net investment + Depreciation
b) Gross investment= Net investment - Depreciation
c) Gross investment= Depreciation - Net investment
d) None of the above
ANSWER: a) Gross investment= Net
investment + Depreciation
1) What does the term
free-market denote in terms of economy?
a) Minimal government intervention in trade and minimum regulations
b) Maximum government intervention in trade and maximum regulations
c) Means of production owned by the state
d) None of the above
a) Minimal government intervention in trade and minimum regulations
b) Maximum government intervention in trade and maximum regulations
c) Means of production owned by the state
d) None of the above
ANSWER: a) Minimal government intervention
in trade and minimum regulations
2) What is the term in economics for the consumption of fixed capital?
a) Investment
b) Value added
c) Production flow
d) Depreciation
ANSWER: d) Depreciation
3) The difference between the Gross value added and Net value added is:
a) Investment
b) Value added
c) Production flow
d) Depreciation
ANSWER: d) Depreciation
4) What is the sum total of gross value added of all the firms in the country?
a) Gross Domestic Product
b) Gross National Product
c) Net Domestic Product
d) Net National product
ANSWER: a) Gross Domestic Product
5) What is the sum total of gross value added of all the firms in the country minus the depreciation?
a) Gross Domestic Product
b) Gross National Product
c) Net Domestic Product
d) Net National product
ANSWER: c) Net Domestic Product
6) What is the sum total of gross value added of all the firms in the country added with the net factor income from abroad?
a) Gross Domestic Product
b) Gross National Product
c) Net Domestic Product
d) Net National product
ANSWER: b) Gross National Product
7) What is the Gross National Product minus the depreciation?
a) Gross Domestic Product
b) Gross National Product
c) Net Domestic Product
d) Net National product
ANSWER: d) Net National product
8) In terms of economics, what is an "externality"?
a) Benefits or harm caused by a firm without payment/penalty
b) Net income from foreign countries
c) Total exports by a country in a given year
d) None of the above
ANSWER: a) Benefits or harm caused by a
firm without payment/penalty
9) What is the correct formula for GDP Deflater?
a) Nominal GDP - (minus) Real GDP
b) Nominal GDP + Real GDP
c) Nominal GDP/ Real GDP
d) Real GDP/ Nominal GDP
ANSWER: c) Nominal GDP/ Real GDP
10) Friedrich Hayek was a proponent of :
a) Keynesian economics
b) Communism
c) Classical Liberalism
d) Socialism
ANSWER: c) Classical Liberalism
1) Which Indian state has
the highest GDP for 2012-13?
a) Gujarat
b) Uttar Pradesh
c) Madhya Pradesh
d) Maharashtra
a) Gujarat
b) Uttar Pradesh
c) Madhya Pradesh
d) Maharashtra
ANSWER: d) Maharashtra
GDP of Maharashtra is around 1,372,644 crore for 2012-2013. Lakshwadeep has the lowest GDP at around 60 million dollars
GDP of Maharashtra is around 1,372,644 crore for 2012-2013. Lakshwadeep has the lowest GDP at around 60 million dollars
ANSWER: c) 10th
USA ranks first in the first in the world in terms of its nominal GDP
USA ranks first in the first in the world in terms of its nominal GDP
3) What is the global rank of India in terms of its Purchasing Power Parity?
a) 3rd
b) 5th
c) 10th
d) 17th
ANSWER: a) 3rd
PPP refers to the relative values of currencies
PPP refers to the relative values of currencies
4) Which Indian city is known as its trade and financial capital?
a) Mumbai
b) Delhi
c) Bangalore
d) Gurgaon
ANSWER: a) Mumbai
ANSWER: d) 4.7 %
6) A market in which there is only one seller of a good is known as:
a) monopoly
b) monopsony
c) duopoly
d) perfectly competitive
ANSWER: a) monopoly
7) A market in which there are only 2 sellers of a good is known as:
a) monopoly
b) monopsony
c) duopoly
d) perfectly competitive
ANSWER: c) duopoly
8) Das Kapital, published in German in 1867, was authored by:
a) Karl Marx
b) John Maynard Keynes
c) F. Hayek
d) Samuelson
ANSWER: a) Karl Marx
9) Which economist is famous for his theory of comparative advantage?
a) Karl Marx
b) John Maynard Keynes
c) F. Hayek
d) David Ricardo
ANSWER: d) David Ricardo
David Ricardo was a British political economist and his most famous theory was that of comparative advantage. Comparative advantage refers to the doctrine that any nation should use its resources solely in industries where it has the most international competitiveness
David Ricardo was a British political economist and his most famous theory was that of comparative advantage. Comparative advantage refers to the doctrine that any nation should use its resources solely in industries where it has the most international competitiveness
10) What is India's rank in ease of doing business index for 2014, as developed by the World Bank Group?
a) 3rd
b) 52nd
c) 134th
d) 178th
ANSWER: c) 134th
A higher rank in 'Ease of doing business index' means a that there are lesser regulations for a company that might hinder its growth and also strong property rights
A higher rank in 'Ease of doing business index' means a that there are lesser regulations for a company that might hinder its growth and also strong property rights
11) Laissez-faire economics refers to:
a) a term denoting economic transactions carried out by the State/government
b) economic transactions in private parties where there is no intervention by the State/government
c) a branch of socialism focusing on welfare economics
d) None of the above
ANSWER: b) economic transactions in
private parties where there is no intervention by the State/government
1) Which among the
following is considered to be the most liquid asset?
a) Gold
b) Money
c) Land
d) Treasury bonds
a) Gold
b) Money
c) Land
d) Treasury bonds
ANSWER: b) Money
Liquid assets are those assets that can be exchanged most readily with minimum number of obstacles and minimum time.
Liquid assets are those assets that can be exchanged most readily with minimum number of obstacles and minimum time.
2) The number of times a unit of money exchanges hands during a unit period of time is known as:
a) velocity of circulation of money
b) speed of circulation of money
c) momentum of circulation of money
d) count of circulation of money
ANSWER: a) velocity of circulation of
money
3) Who is author of the ancient book on economics, Arthashastra?
a) Kautilya
b) Chanakya
c) Sushrut
d) Bhattacharya
ANSWER: b) Chanakya
ANSWER: c) Silver
5) Currency notes and coins are called as:
a) Flat money
b) Legal tenders
c) Fiat money
d) Both b and c
ANSWER: d) Both b and c
6) In the terminology of economics and money demand, the terms M1 and M2 are also known as :
a) Short money
b) Long money
c) Broad money
d) Narrow money
ANSWER: d) Narrow money
M1= Currency notes plus demand deposits, and M2 means M1 plus Savings deposits with post office savings banks
M1= Currency notes plus demand deposits, and M2 means M1 plus Savings deposits with post office savings banks
7) In the terminology of economics and money demand, the terms M3 and M4 are also known as :
a) Short money
b) Long money
c) Broad money
d) Narrow money
ANSWER: c) Broad money
M3 is M1 plus net time deposits of commercial banks. M4 is M3 plus Total deposits with Post Office savings organisation (excluding National Savings certificate)
M3 is M1 plus net time deposits of commercial banks. M4 is M3 plus Total deposits with Post Office savings organisation (excluding National Savings certificate)
8) What is the currency deposit ratio (cdr)?
a) ratio of money held by the public in currency to that of money held in bank deposits
b) ratio of money held by public in bank deposits to that of money held by public in currency
c) ratio of money held in demand drafts to that of money held in treasury bonds
d) none of the above
ANSWER: a) ratio of money held by the
public in currency to that of money held in bank deposits
9) What is the reserve deposit ration (rdr)?
a) the proportion of money RBI lends to commercial banks
b) the proportion of total deposits commercial banks keep as reserves
c) the total proportion of money that commercial banks lend to the customers
d) none of the above
ANSWER: b) the proportion of total
deposits commercial banks keep as reserves
10) What is the Cash Reserve Ratio (CRR)?
a) the fraction of the deposits that commercial banks lend to the customers
b) the fraction of the deposits that RBI must keep with commercial banks
c) the fraction of the deposits that commercial banks must keep with RBI
d) none of the above
ANSWER: c) the fraction of the deposits
that commercial banks must keep with RBI
1) What is 'Bank rate'?
a) The rate at which commercial banks borrow money from RBI
b) The rate at which commercial banks lend money to customers
c) The rate at which commercial banks lend money to RBI
d) none of the above
a) The rate at which commercial banks borrow money from RBI
b) The rate at which commercial banks lend money to customers
c) The rate at which commercial banks lend money to RBI
d) none of the above
ANSWER: a) The rate at which commercial
banks borrow money from RBI
Bank rate is the rate at which commercial banks can borrow money from the RBI. If the rate is higher, then taking money from RBI becomes difficult, so the banks will lend less to public. And vice-versa.
Bank rate is the rate at which commercial banks can borrow money from the RBI. If the rate is higher, then taking money from RBI becomes difficult, so the banks will lend less to public. And vice-versa.
2) In monetary terminology, what is called the 'monetary base' or 'high powered money'?
a) the total assets of RBI
b) the total liability of RBI
c) the total debt of the government
d) the total foreign exchange of RBI
ANSWER: b) the total liability of
RBI
This includes the currency (notes and coins in circulation and vault cash of commercial banks) along with the deposits held by the Government of India ad commercial banks with RBI.
This includes the currency (notes and coins in circulation and vault cash of commercial banks) along with the deposits held by the Government of India ad commercial banks with RBI.
3) 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
ANSWER: b) buying government securities
4) The RBI can decrease 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
ANSWER: a) selling government securities
5) By increasing the 'Bank Rate', the RBI can:
a) provide incentives to commercial banks to lend more to public
b) provide incentives to commercial banks to lend less to public
c) increase the money supply in the market
d) none of the above
ANSWER: b) provide incentives to
commercial banks to lend less to public
Bank rate is the rate at which commercial banks can borrow money from the RBI. If the rate is higher, then taking money from RBI becomes difficult, so the banks will lend less to public. And vice-versa.
Bank rate is the rate at which commercial banks can borrow money from the RBI. If the rate is higher, then taking money from RBI becomes difficult, so the banks will lend less to public. And vice-versa.
6) The process by which RBI or any Central bank protects the economy against adverse economic shocks is known as :
a) protection
b) liberalization
c) stabilization
d) sterilization
ANSWER: d) sterilization
RBI does this by performing a host of operations, for example controlling the Bank Rate, buying or selling government securities, etc
RBI does this by performing a host of operations, for example controlling the Bank Rate, buying or selling government securities, etc
1) What among the following is NOT an
example of 'public goods'?
a) National defense
b) Roads
c) Cars
d) National Forests
a) National defense
b) Roads
c) Cars
d) National Forests
ANSWER: c) Cars
Public goods are those goods that cannot be provided by market mechanisms.
Public goods are those goods that cannot be provided by market mechanisms.
2) What among the following is NOT an example of 'private goods'?
a) Clothes
b) Cars
c) Military
d) Food items
ANSWER: c) Military
3) The function of a government to provide goods that cannot normally be provided by market mechanisms between individual customers and producers, is known as:
a) Distribution function
b) Allocation function
c) Stabilization
d) Protection
ANSWER: b) Allocation function
4) The function of a government to fairly share the public's resources is known as
a) Distribution function
b) Allocation function
c) Stabilization
d) Protection
ANSWER: a) Distribution function
5) The function of a government by which it seeks to seek a balance of employment, demand-supply, and inflation, is known as:
a) Distribution function
b) Allocation function
c) Stabilization
d) Protection
ANSWER: c) Stabilization
6) 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
ANSWER: a) Revenue Budget and Capital Budget
7) Loans raised by the government from the public are known as:
a) Corporate borrowings
b) Common borrowings
c) Market borrowings
d) Private borrowings
ANSWER: c) Market borrowings
8) Whenever the government spends more than it collects through revenue, the resulting imbalance is known as :
a) Public deficit
b) Market deficit
c) Government deficit
d) Budget deficit
ANSWER: d) Budget deficit
9) The idea that government's fiscal policy can be used to stabilize the level of output and employment can be attributed to which of the following economists:
a) Frederich Hayek
b) Ludwig von Mises
c) Frederic Bastiat
d) John Maynard Keynes
ANSWER: d) John Maynard Keynes
John Maynard Keynes's 1936 book, 'The General Theory of Employment, Interest, and Money' laid the foundations for Macroeconomics
John Maynard Keynes's 1936 book, 'The General Theory of Employment, Interest, and Money' laid the foundations for Macroeconomics
10) The deliberate action of the government to stabilize the economy, as opposed to the inherent automatic stabilizing properties of the fiscal system, is known as
a) Forced fiscal policy
b) Manual fiscal policy
c) Discretionary fiscal policy
d) Automatic fiscal policy
ANSWER: c) Discretionary fiscal policy
11) The idea that irrespective of how a government chooses to increase spending, either by debt financing or tax financing, the outcome will be the same and demand will remain unchanged, is popularly known as:
a) Ricardian theory of equivalence
b) Ricardian theory of competitive advantage
c) Ricardian theory of stability
d) None of the above
ANSWER: a) Ricardian theory of
equivalence
David Ricardo was a British political economist and his most famous theory was that of comparative advantage (along with above theory of Ricardian equivalence) . Comparative advantage refers to the doctrine that any nation should use its resources solely in industries where it has the most international competitiveness
The theory of Ricardian equivalence, as stated above in the question, was also further developed by Harvard professor Robert Barro who took it much further
David Ricardo was a British political economist and his most famous theory was that of comparative advantage (along with above theory of Ricardian equivalence) . Comparative advantage refers to the doctrine that any nation should use its resources solely in industries where it has the most international competitiveness
The theory of Ricardian equivalence, as stated above in the question, was also further developed by Harvard professor Robert Barro who took it much further
12) When was the Fiscal Responsibility and Budget Management Act implemented?
a) 1950
b) 1970
c) 1993
d) 2003
ANSWER: d) 2003
It was enacted in August 2003 that made it obligatory for the government to pursue a prudent fiscal policy through the institutional framework. The rules under FRBMA, 2003 were notified with effect from July, 2004
The Act includes several provisions such as ensuring greater transparency in fiscal operations
It was enacted in August 2003 that made it obligatory for the government to pursue a prudent fiscal policy through the institutional framework. The rules under FRBMA, 2003 were notified with effect from July, 2004
The Act includes several provisions such as ensuring greater transparency in fiscal operations
1) Which among the
following could be said to be an 'Open Economy'?
a) A nation that follows the doctrine of Free-market and Laissez-faire economics
b) A nation that trades with other nations in goods and services and financial assets
c) An economy that operates without government intervention
d) None of the above
a) A nation that follows the doctrine of Free-market and Laissez-faire economics
b) A nation that trades with other nations in goods and services and financial assets
c) An economy that operates without government intervention
d) None of the above
ANSWER: b) A nation that trades with other
nations in goods and services and financial assets
2) The records of exports and imports in goods and services and transfer payments is known as
a) Current account
b) Budget surplus
c) Economic leakage
d) degree of openness
ANSWER: a) Current account
3) Exchange rates for one currency against another currency, are known as:
a) Real exchange rate
b) Nominal exchange rate
c) Superfluous exchange rate
d) None of the above
ANSWER: b) Nominal exchange rate
4) The ratio of foreign rates to domestic rates measured in the 'same' currency is known as:
a) Real exchange rate
b) Nominal exchange rate
c) Superfluous exchange rate
d) None of the above
ANSWER: a) Real exchange rate
5) Which among the following 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
ANSWER: a) Real exchange rate
6) When the exchange rate is determined by the market forces of demand and supply, it is known as :
a) Real exchange rate
b) Nominal exchange rate
c) Superfluous exchange rate
d) Floating exchange rate
ANSWER: d) Floating exchange rate
7) The Gold Standard was prevalent in the world from:
a) 15th century to 18th century
b) 9th century to 18th century
c) From 1870 till First World War
d) From 1670 till First World War
ANSWER: c) From 1870 till First World
War
ANSWER: d) 1944
It was set up by the Bretton Woods conference held in 1944
It was set up by the Bretton Woods conference held in 1944
9) An increase in foreign income generally leads to:
a) increased exports, increased domestic output
b) decreased exports, increased domestic output
c) decreased exports, decreased domestic output
d) increased exports, decreased domestic output
ANSWER: a) increased exports, increased
domestic output
Foreign income is brought by exports and leads to further exports in future, and increased exports means increase in domestic output to meet the demand of exports.
Foreign income is brought by exports and leads to further exports in future, and increased exports means increase in domestic output to meet the demand of exports.
10) What records a country's transactions (made by individuals, firms and government bodies.) with the rest of the world?
a) Trade deficit
b) Capital Budget
c) Foreign imports
d) Balance of Payments or BoP
ANSWER: d) Balance of Payments or BoP
1) What does the term
ceteris paribus mean?
a) things are different
b) other things remaining equal
c) with the view that
d) in reference to
a) things are different
b) other things remaining equal
c) with the view that
d) in reference to
ANSWER: b) other things remaining
equal
2) The "planned" value of the variables like consumption, investment, output, etc, is known as:
a) ex post measures
b) ex ante measures
c) ex pre measures
d) none of the above
ANSWER: a) ex post measures
3) The "actual" value of the variables like consumption, investment, output, etc, is known as:
a) ex post measures
b) ex ante measures
c) ex pre measures
d) none of the above
ANSWER: b) ex ante measures
4) What is "mps" or the 'marginal propensity to save'?
a) the proportion of total additional planned savings to total additional income
b) the proportion of total additional income to total additional planned savings
c) the fraction of total additional income that is used for consumption
d) none of the above
ANSWER: a) the proportion of total
additional planned savings to total additional income
5) What is "mpc" or the 'marginal propensity to consume'?
a) the proportion of total additional planned savings to total additional income
b) the proportion of total additional income to total additional planned savings
c) the fraction of total additional income that is used for consumption
d) none of the above
ANSWER: c) the fraction of total
additional income that is used for consumption
6) According to the effective demand principle:
a) at a certain price, the output shall not be determined by any known factor
b) at a certain price, the output will remain unaffected by rise or fall in demand
c) at a certain price, equilibrium output will be solely determined by the aggregate demand
d) none of the above
ANSWER: c) at a certain price, equilibrium
output will be solely determined by the aggregate demand
7) According to the Paradox of Thrift:
a) as people become more thrifty they end up saving more
b) as people become more thrifty they end up saving less or same
c) as people become more thrifty their saving remains unaffected by their thriftiness
d) none of the above
ANSWER: b) as people become more thrifty
they end up saving less or same
1. Which of the following
explains the term economic growth?
a. Increase in per capita production
b. Increase in per capita real income
c. structural change in the economy
d. all the above are right
a. Increase in per capita production
b. Increase in per capita real income
c. structural change in the economy
d. all the above are right
ANSWER: d. all the above are right
There is no single definition that can define the term economic growth. However, there are various indicators that explain the term.
There is no single definition that can define the term economic growth. However, there are various indicators that explain the term.
2. Economic development is characterized by
a. Structural change in the economy
b. Change in the occupational structure
c. Both a and b
d. None of the above
ANSWER: c. Both a and b
The structural change is the shift from primary sector to secondary and tertiary sectors’ contribution to the GDP. Change in occupational structure involves falling share of agriculture in the total employment.
The structural change is the shift from primary sector to secondary and tertiary sectors’ contribution to the GDP. Change in occupational structure involves falling share of agriculture in the total employment.
3. Which of the following explains the term economic development?
a. Improvement in the technology involved
b. Improvement in production
c. Improvement in distribution system
d. All the above
ANSWER: d. All the above
Economic development is a wider concept than growth. There are various parameters used to define and measure it.
Economic development is a wider concept than growth. There are various parameters used to define and measure it.
4. An underdeveloped economy is characterized by
a. High per capita real income
b. Large proportion of labor force in the tertiary sector
c. State of deprivation of large proportion of population
d. All the above
ANSWER: c. State of deprivation of large
proportion of population
Underdeveloped countries face the problem of deprivation of large section of the population, low per capita real income etc.
Underdeveloped countries face the problem of deprivation of large section of the population, low per capita real income etc.
5. Scarcity of capital , technological backwardness and unemployment are generally found in
a. Developed countries
b. Underdeveloped countries
c. Both
d. None of the above
ANSWER: b. Underdeveloped countries
Underdeveloped countries lag behind in various factors like availability of resources, technology etc.
Underdeveloped countries lag behind in various factors like availability of resources, technology etc.
6. Which of the following denotes an underdeveloped economy?
a. High level of inequalities
b. Low level of capital productivity
c. A relatively closed economy
d. All the above
ANSWER: d. All the above
Other than the above features, there is High incidence of poverty, rapid population growth and technological backwardness too.
Other than the above features, there is High incidence of poverty, rapid population growth and technological backwardness too.
7. Capital formation in underdeveloped countries is a major bottleneck. The reason can be
a. Small size of market with no incentive for investment
b. Low level of income
c. Demonstration effect
d. All the above
ANSWER: d. All the above
Capital formation refers to investment in tools, machinery, buildings etc. inequalities in the economy is also a reason behind this.
Capital formation refers to investment in tools, machinery, buildings etc. inequalities in the economy is also a reason behind this.
8. Consider the following statements and identify the right ones.
i. Higher level of capital-output ratio indicates efficient use of capital.
ii. It reflects the productivity of capital in the economy
a. I only
b. ii only
c. both
d. none
ANSWER: b. ii only
COR refers to the number of units of capital required to produce one unit of output. A higher level of it means inefficient use of capital.
COR refers to the number of units of capital required to produce one unit of output. A higher level of it means inefficient use of capital.
9. Consider the following statements and identify the right ones.
i. COR is relatively low in labour intensive sectors.
ii. COR will be high in capital intensive sectors
iii. Both
iv. None
ANSWER: iii. Both
It is high in capital intensive industries because of more use of capital and timelag between investment and production.
It is high in capital intensive industries because of more use of capital and timelag between investment and production.
10. Which of the following about strategy of balanced growth is right?
a. Simultaneous investment in all sectors
b. All sectors are independent.
c. Both
d. None
ANSWER: a. Simultaneous investment in all
sectors
The supporters of this theory argue that simultaneous investment in all the sectors will help in faster growth. It is based on the idea that all sectors are interlinked.
The supporters of this theory argue that simultaneous investment in all the sectors will help in faster growth. It is based on the idea that all sectors are interlinked.
1. Which of the following about strategy
of unbalanced growth is right?
a. Deliberate imbalance in favor of some sectors
b. Simultaneous investment in all sectors
c. Both
d. None
a. Deliberate imbalance in favor of some sectors
b. Simultaneous investment in all sectors
c. Both
d. None
ANSWER: a. Deliberate imbalance in favor
of some sectors
This strategy says that there will be positive impact on the sectors that are lagging behind and they will also try to catch up with it.
This strategy says that there will be positive impact on the sectors that are lagging behind and they will also try to catch up with it.
2. Consider the following statements and identify the right ones.
i. Unbalanced growth strategy is also known as Mahalanobis strategy
ii. This strategy was adopted in India after the 7th five year plans.
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
India adopted this growth strategy after independence itself. The second five year plan emphasized on the development of heavy industries.
India adopted this growth strategy after independence itself. The second five year plan emphasized on the development of heavy industries.
3. The concept of PQLI was developed by
a. Morris D Morris
b. UNO
c. UNDP
d. Oxford Poverty and Human Development Initiative
ANSWER: a. Morris D Morris
Physical Quality of Life Index is one of the indicator to measure human development. It is calculated by using simple average.
Physical Quality of Life Index is one of the indicator to measure human development. It is calculated by using simple average.
4. The parameter/s of the PQLI is/are
a. Life Expectancy Index
b. Standard of living index
c. Infant mortality rate
d. A and C
ANSWER: d. A and C
PQLI has 3 parameters- life expectancy index, infant mortality rate and basic literacy index.
PQLI has 3 parameters- life expectancy index, infant mortality rate and basic literacy index.
5. Consider the following statements and identify the right ones
i. The Oxford PHI publishes Human Development Report
ii. The HDR is published biennially.
a. I only
b. ii only
c. both
d. none
ANSWER: d. none
The United Nations Development Programme (UNDP) published the HDR every year since 1990.
The United Nations Development Programme (UNDP) published the HDR every year since 1990.
6. The concept of HDI was popularized by
a. Morris D Morris
b. Adam Smith
c. Keynes
d. Mahbub Ul Haq
ANSWER: d. Mahbub Ul Haq
The concept developed in the 1990s. It has 3 important parameters- life expectancy, education achievement index and standard of living index.
The concept developed in the 1990s. It has 3 important parameters- life expectancy, education achievement index and standard of living index.
7. The component/s of HDI is/are
a. Life expectancy index
b. Infant mortality rate
c. Population growth rate
d. All the above
ANSWER: a. Life expectancy index
The concept developed in the 1990s. It has 3 important parameters- life expectancy, education achievement index and standard of living index.
The concept developed in the 1990s. It has 3 important parameters- life expectancy, education achievement index and standard of living index.
8. The Multidimensional Poverty Index has been developed by
a. The UNDP
b. Oxford HDI
c. The UNO
d. Morris D Morris
ANSWER: b. Oxford HDI
The MPI concept is developed by the Oxford Human Development Initiative. It has three main dimensions to it.
The MPI concept is developed by the Oxford Human Development Initiative. It has three main dimensions to it.
9. Which of following is not a component of MPI?
a. Health
b. Education
c. Occupation
d. Standard of living
ANSWER: c. Occupation
MPI has 3 important dimensions to it- health, education and standard of living. Based on these , there are ten parameters.
MPI has 3 important dimensions to it- health, education and standard of living. Based on these , there are ten parameters.
10. Consider the following statements and identify the right ones.
i. Each indicator in educational dimesion is equally weighted at 1/6
ii. Each indicator in standard of living is equally weighted at 1/8
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
while education and health dimensions measure each indicators at equal weightage of 1/6, for standard of living it is 1/18
while education and health dimensions measure each indicators at equal weightage of 1/6, for standard of living it is 1/18
1. Which of the following
is not an indicator to measure MPI?
a. Electricity
b. Flooring
c. Cooking fuel
d. Profession
a. Electricity
b. Flooring
c. Cooking fuel
d. Profession
ANSWER: d. Profession
These are the indicators to measure standard of living. Other indicators are drinking water, sanitation etc.
These are the indicators to measure standard of living. Other indicators are drinking water, sanitation etc.
2. Which of the following was the 1st state to bring out state HDR?
a. Rajasthan
b. Karnataka
c. Madhya Pradesh
d. Kerala
ANSWER: c. Madhya Pradesh
The state HDRs document and highlights the disparities within the state, among various districts.
The state HDRs document and highlights the disparities within the state, among various districts.
3. The investment by government to create socio-economic infrastructure is
a. Induced investment
b. Autonomous investment
c. Incremental COR
d. None of the above
ANSWER: b. Autonomous investment
Autonomous investment is made by the government. Welfare rather than profit is the primary objective here.
Autonomous investment is made by the government. Welfare rather than profit is the primary objective here.
4. The additional capital used per unit of additional production is called
a. Induced investment
b. Autonomous investment
c. Incremental COR
d. None of the above
ANSWER: c. Incremental COR
COR refers to the number of units of capital required to produce one unit of output.
COR refers to the number of units of capital required to produce one unit of output.
5. Economic growth in India will happen necessarily if there is
a. Population growth
b. Capital formation
c. Technical progress in the global economy
d. All the above
ANSWER: b. Capital formation
Capital formation refers to investment in tools, machinery, buildings etc.
Capital formation refers to investment in tools, machinery, buildings etc.
6. Inclusive governance includes
a. Allowing NBFCs to do banking
b. Increase government spending on health
c. Strengthening mid-day meals scheme
d. All the above
ANSWER: d. All the above
Inclusive governance denotes inclusion of schemes and other measures for benefit of all the sections of the society.
Inclusive governance denotes inclusion of schemes and other measures for benefit of all the sections of the society.
7. An open economy is one where
a. Deficit financing is absent
b. No export activities
c. No import activities
d. Economy opened to the world
ANSWER: d. Economy opened to the
world
A closed economy is one where there is no exporting or importing activity. it is generally a feature of underdeveloped economies.
A closed economy is one where there is no exporting or importing activity. it is generally a feature of underdeveloped economies.
8. Depression is characterized by
a. unprecedented level of underemployment
b. Drastic fall in income
c. Drastic fall in output and employment
d. All the above
ANSWER: d. All the above
Depression is one of the business cycles. Boom, recession, depression and recovery are the phases of a business cycle.
Depression is one of the business cycles. Boom, recession, depression and recovery are the phases of a business cycle.
9. Which of the following denotes business activity at high level with increasing output and income?
a. Boom
b. Recession
c. Depression
d. Recovery
ANSWER: a. Boom
Boom, recession, depression and recovery are the phases of a business cycle.
Boom, recession, depression and recovery are the phases of a business cycle.
10. The phase of gradual fall in income, output and employment is
a. Boom
b. Recession
c. Depression
d. Recovery
ANSWER: b. Recession
Boom, recession, depression and recovery are the phases of a business cycle. In this phase, business activity is in low gear.
Boom, recession, depression and recovery are the phases of a business cycle. In this phase, business activity is in low gear.
11. A successful inclusive growth strategy includes
a. Equal opportunities
b. Financial inclusion
c. equity
d. all the above
ANSWER: d. all the above
Inclusive growth strategy involves all the sections of the society.
Inclusive growth strategy involves all the sections of the society.
1. The author of the book Poverty and Un
British Rule in India is
a. R C Dutt
b. W C Banerjee
c. Dadabai Nauroji
d. Keynes
a. R C Dutt
b. W C Banerjee
c. Dadabai Nauroji
d. Keynes
ANSWER: c. Dadabai Nauroji
Before independence, many of them tried to provide the national income estimates. One such attempt was this book.
Before independence, many of them tried to provide the national income estimates. One such attempt was this book.
2. Consider the following statements and identify the right ones.
i. During independence, Indian economy was heavily dependent on the tertiary sector
ii. Development of industrial and services sector was not limited.
a. I only
b. ii only
c. both
d. none
ANSWER: d. none
During independence, Indian economy was heavily dependent on the agricultural sector and Development of industrial and services sector was limited.
During independence, Indian economy was heavily dependent on the agricultural sector and Development of industrial and services sector was limited.
3. Consider the following statements and identify the right ones.
i. The share of agriculture to the GDP today is less than 5% today
ii. The tertiary sector contributes about 55%of the occupational structure.
a. I only
b. ii only
c. both
d. none
ANSWER: d. none
The share of agriculture to the GDP today is around 14%, but still the agriculture sector contributes about 5o%of the occupational structure.
The share of agriculture to the GDP today is around 14%, but still the agriculture sector contributes about 5o%of the occupational structure.
4. Dual economy refers to existence of
a. Imports and export activities
b. Bilateral ties
c. Traditional and modern aspects in the economy
d. Both a and b
ANSWER: c. Traditional and modern aspects
in the economy
Dual economy is a feature of developing countries. Here one can find both usage of traditional methods and modern methods, both capital and labor intensive sectors.
Dual economy is a feature of developing countries. Here one can find both usage of traditional methods and modern methods, both capital and labor intensive sectors.
5. Mixed economy means an economy where there is
a. Existence of capitalism
b. Privatization, liberalization and globalization
c. Existence of both public and private sectors
d. Growing crops along with rearing animals
ANSWER: c. Existence of both public and
private sectors
In India, there is existence of both public and private sectors working together. There is a blend of socialism and capitalism
In India, there is existence of both public and private sectors working together. There is a blend of socialism and capitalism
6. Consider the following statements and identify the right ones.
i. As per the S&P classification, India is one of the emerging markets.
ii. India is included in the Big Emerging market(BEM) economies
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
As per the S&P classification, India is one of the 19 emerging markets. India is included in the Big Emerging market(BEM) economies which are 22 in number.
As per the S&P classification, India is one of the 19 emerging markets. India is included in the Big Emerging market(BEM) economies which are 22 in number.
7. India according to the World Bank classification falls in the category of
a. Low-income economies
b. Lower-middle income economies
c. Upper-middle income economies
d. High-income economies
ANSWER: b. Lower-middle income
economies
The World Bank classifies countries on the basis of lending, income and region.
The World Bank classifies countries on the basis of lending, income and region.
8. Indian economy today is a
i. Developing economy
ii. Emerging economy
iii. Dual economy
iv. Non-agricultural economy
a. I and ii only
b. I, ii and iii
c. I, ii, iii, iv
d. iii and iv
ANSWER: b. I, ii and iii
Indian economy is one of the fastest growing economies of the world today. It is a dual economy too.
Indian economy is one of the fastest growing economies of the world today. It is a dual economy too.
9. Low-income countries according to the World Bank classification have income of
a. $1000 or below
b. $987 or below
c. $1035 or below
d. $1023 or below
ANSWER: c. $1035 or below
According to the World Bank classification, low income economies have $1035 or less than that. There are 36 such countries.
According to the World Bank classification, low income economies have $1035 or less than that. There are 36 such countries.
10. Consider the following statements and consider the right ones.
i. In India, structure of economy and occupational structure are very similar.
ii. Today, Tertiary sector contributes the highest to the GDP.
a. I only
b. ii only
c. both
d. none
ANSWER: b. ii only
Generally, the structure of economy and occupational structure is very similar in developed countries. In India, it is not so.
Generally, the structure of economy and occupational structure is very similar in developed countries. In India, it is not so.
11. Arrange in the right order the contribution of sectors to the GDP from highest to lowest.
a. Agriculture, manufacturing, tertiary
b. Agriculture, tertiary, manufacturing
c. Tertiary, manufacturing, agriculture
d. Manufacturing, tertiary, agriculture
ANSWER: c. Tertiary, manufacturing,
agriculture
Earlier, agricultural sector occupied the greatest share in the GDP but today it is replaced by the services sector.
Earlier, agricultural sector occupied the greatest share in the GDP but today it is replaced by the services sector.
1. The financial year in
India is
a. April 1 to March 31
b. January 1 to December 31
c. March 1 to April 30
d. March 16 to March 15
a. April 1 to March 31
b. January 1 to December 31
c. March 1 to April 30
d. March 16 to March 15
ANSWER: a. April 1 to March 31
National income is calculated for a specific period of time. In India, it is calculated for April 1 to March 31.
National income is calculated for a specific period of time. In India, it is calculated for April 1 to March 31.
2. Consider the following statements and identify the right ones.
i. National income is the monetary value of all final goods and services produced.
ii. Depreciation is deducted from gross value to get the net value
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
National Income is the monetary value of all final goods and services that are produced by the residents of the country.
National Income is the monetary value of all final goods and services that are produced by the residents of the country.
3. Consider the following statements and identify the right ones.
i. While calculating GDP, income generated by foreigners in a country is taken into consideration
ii. While calculating GDP, income generated by nationals of a country outside the country is taken into account
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
While calculating GDP, income generated by nationals of a country outside the country is not taken into account.
While calculating GDP, income generated by nationals of a country outside the country is not taken into account.
4. The net value of GDP after deducting depreciation from GDP is
a. Net national product
b. Net domestic product
c. Gross national product
d. Disposable income
ANSWER: b. Net domestic product
After deducting the depreciation charges of plant and machinery from GDP, we get net value of GDP which is called NDP.
After deducting the depreciation charges of plant and machinery from GDP, we get net value of GDP which is called NDP.
5. Consider the following statements and identify the right ones.
i. While calculating GNP, income generated by foreigners in a country is taken into consideration
ii. While calculating GNP, income generated by nationals of a country outside the country is taken into account
a. I only
b. ii only
c. both
d. none
ANSWER: b. ii only
While calculating GNP, income generated by foreigners in a country is not taken into consideration.
While calculating GNP, income generated by foreigners in a country is not taken into consideration.
6. When depreciation is deducted from GNP, the net value is
a. Net national product
b. Net domestic product
c. Gross national product
d. Disposable income
ANSWER: a. Net national product
NNP is the net value of GNP after the depreciation of plant and machinery is deducted.
NNP is the net value of GNP after the depreciation of plant and machinery is deducted.
7. The value of NNP at consumer point is
a. NNP at factor cost
b. NNP at market price
c. GNP at market price
d. GNP at factor cost
ANSWER: b. NNP at market price
NNP at market price is calculated by deducting indirect taxes and subsidies from NNP at factor cost.
NNP at market price is calculated by deducting indirect taxes and subsidies from NNP at factor cost.
8. The value of NNP at production point is called
a. NNP at factor cost
b. NNP at market price
c. GNP at market price
d. GNP at factor cost
ANSWER: b. NNP at market price
NNP at factor cost is the value of the NNP when the value of goods and services are taken at the production point.
NNP at factor cost is the value of the NNP when the value of goods and services are taken at the production point.
9. The value of national income adjusted for inflation is called
a. Per capita income
b. Disposable income
c. Inflation rate
d. Real national income
ANSWER: d. Real national income
It is adjusted for inflation that is calculated from a reference point which is a base year.
It is adjusted for inflation that is calculated from a reference point which is a base year.
10. The average income of the country is
a. Per capita income
b. Disposable income
c. Inflation rate
d. Real national income
ANSWER: a. Per capita income
Per capita income is calculated by dividing the total national income by the total population of the year.
Per capita income is calculated by dividing the total national income by the total population of the year.
1. Consider the following
statements and identify the right ones.
i. Personal income refers to the income of individuals of a country.
ii. The income at their disposal after paying direct taxes is called disposable income
a. I only
b. ii only
c. both
d. none
i. Personal income refers to the income of individuals of a country.
ii. The income at their disposal after paying direct taxes is called disposable income
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
The income of the individuals at their disposal after paying direct taxes like income tax is called disposable income.
The income of the individuals at their disposal after paying direct taxes like income tax is called disposable income.
2. Which of the following is added to national income while calculating personal income?
a. Transfer payments to individuals
b. Social security contributions
c. Corporate taxes
d. Undistributed profits
ANSWER: a. Transfer payments to
individuals
Personal income refers to the income of the individuals of a country. While transfer payments are added, the other three are subtracted.
Personal income refers to the income of the individuals of a country. While transfer payments are added, the other three are subtracted.
3. Which of the following method/s is/are used to calculate national income in India?
a. Production method
b. Expenditure method
c. Income method
d. All the above
ANSWER: d. All the above
Due to non-availability of the data, no single method can solely be used in India. We use a mixture of all the three.
Due to non-availability of the data, no single method can solely be used in India. We use a mixture of all the three.
4. The national income estimation is the responsibility of
a. NSSO
b. CSO
c. Finance Ministry
d. National Income Committee
ANSWER: b. CSO
5. Consider the following statements and identify the right ones.
i. CSO is a premier statistical institution for collecting data in India
ii. It presents the national income estimates twice a year.
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
Central Statistical Organization was established in 1950 and is vested with the responsibility of national income estimation. It presents the estimates once in a year.
Central Statistical Organization was established in 1950 and is vested with the responsibility of national income estimation. It presents the estimates once in a year.
6. As per the CSO classification, which of the following does not fall under the industrial sector?
a. Construction
b. Manufacturing
c. Fisheries
d. Mining
ANSWER: c. Fisheries
As per the CSO classification, fisheries fall under the category of agriculture sector.
As per the CSO classification, fisheries fall under the category of agriculture sector.
7. As per the CSO classification, which of the following does not fall under finance and real estate category?
a. Banking
b. Construction
c. Insurance
d. Real estate
ANSWER: b. Construction
As per the CSO classification, construction falls under the category of industrial sector.
As per the CSO classification, construction falls under the category of industrial sector.
8. As per the CSO classification, which of the following does not fall under industrial sector?
a. Electricity
b. gas and water supply
c. transport and communication
d. manufacturing
ANSWER: c. transport and
communication
As per the CSO classification, transport and communication falls under transport, communication and trade category.
As per the CSO classification, transport and communication falls under transport, communication and trade category.
9. Consider the following statements and identify the right ones.
i. The data for NI and PCI are collected at current prices.
ii. They are deflated using the deflator index to get value at constant prices.
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
This is done so because the national income can increase either due to increase in production of goods and services or in prices.
This is done so because the national income can increase either due to increase in production of goods and services or in prices.
10. The most appropriate measure of a country's economic growth is
a. GDP
b. NDP
c. Per capita real income
d. GNP
ANSWER: c. Per capita real income
Per capita income is the average income of the country. Per capita real income takes inflation into consideration.
Per capita income is the average income of the country. Per capita real income takes inflation into consideration.
1. The Gandhian plan was
presented by
a. M N Roy
b. Nehru
c. Shriman Narayan
d. 8 leading economists
a. M N Roy
b. Nehru
c. Shriman Narayan
d. 8 leading economists
ANSWER: c. Shriman Narayan
Various plans were presented before the establishment of the Planning Commission.
Various plans were presented before the establishment of the Planning Commission.
ANSWER: a. M N Roy
M N Roy presented Peoples Plan.
M N Roy presented Peoples Plan.
3. Consider the following statements and identify the right ones.
i. The National Planning Committee was set up in 1938
ii. It laid that all key industries that are likely to become monopolistic should be under the government control.
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
The NPC was set up in 1938 by the INC.
The NPC was set up in 1938 by the INC.
4. Consider the following statements and identify the right ones.
i. The Planning Commission was set up by the Government resolution.
ii. It formulates plans for effective utilization of resources.
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
The Planning Commission was set up in 1950 with the resolution passed by the Government.
The Planning Commission was set up in 1950 with the resolution passed by the Government.
5. Consider the following statements and identify the right ones.
i. The NDC came into existence before the Planning Commission
ii. The NDC consists of representatives of both central and state governments.
a. I only
b. ii only
c. both
d. none
ANSWER: b. ii only
The National Development Council was created much later in 1956.
The National Development Council was created much later in 1956.
6. Match the following.
i. 7th FYP --------- a. modernization, growth
ii. 8th FYP -------- b. human resource development
iii. 9th FYP-------- c. equitable distribution and growth with equality
iv. 10th FYP-------- d. growth with emphasis on human development
a. ia, iib, iiic, ivd
b. ic, iib, iiia, ivd
c. ib, iic, iiia, ivd
d. ia, iic, iiid, ivb
ANSWER: a. ia, iib, iiic, ivd
Self reliance and social justice, modernization and growth were the objectives of the 7th five year plan.
Self reliance and social justice, modernization and growth were the objectives of the 7th five year plan.
7. Which of the following is not a feature of Indian planning?
a. Physical planning
b. Indicative economic planning
c. Decentralized planning
d. None of the above
ANSWER: d. None of the above
Indian planning is a physical planning i e fixes the target as well as financial planning.
Indian planning is a physical planning i e fixes the target as well as financial planning.
8. Consider the following statements and identify the right ones.
i. NDC comprises PM, all union cabinet members, all CMs, reps from UTs and members of the commissions.
ii. On some occasions, RBI governor can address the meetings.
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
There are occasions where the RBI governor and some other experts were allowed to address the meetings.
There are occasions where the RBI governor and some other experts were allowed to address the meetings.
9. Consider the following statements and identify the right ones.
i. The 1st FYP was based on the Harrad Domar model
ii. The main objective was the development of industrial sector.
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
The main objective was the development of agricultural sector and the plan succeeded well.
The main objective was the development of agricultural sector and the plan succeeded well.
10. Consider the following statements and identify the right ones.
i. The 2nd FYP followed the balanced growth model of P C Mahalanobis
ii. It aimed at rapid industrialization.
a. I only
b. ii only
c. both
d. none
ANSWER: b. ii only
The 2nd FYP followed the unbalanced growth model of P C Mahalanobis that gave favor to some key industries.
The 2nd FYP followed the unbalanced growth model of P C Mahalanobis that gave favor to some key industries.
1. Match the following.
i. 3rd FYP ---------- a. John Sandy and Chakravarty
ii. 4th FYP --------- b. Allen Manne and Ashok Rudra
iii. 5th FYP -------- c. Planning Commission
iv. 6th FYP --------- d. Planning Commission with emphasis on Structural change
a. ia, iib, iiic, ivd
b. ic, iib, iiia, ivd
c. ib, iic, iiia, ivd
d. ia, iic, iiid, ivb
i. 3rd FYP ---------- a. John Sandy and Chakravarty
ii. 4th FYP --------- b. Allen Manne and Ashok Rudra
iii. 5th FYP -------- c. Planning Commission
iv. 6th FYP --------- d. Planning Commission with emphasis on Structural change
a. ia, iib, iiic, ivd
b. ic, iib, iiia, ivd
c. ib, iic, iiia, ivd
d. ia, iic, iiid, ivb
ANSWER: a. ia, iib, iiic, ivd
The 3rd Five Year Plan failed to achieve the target for various internal and external reasons.
The 3rd Five Year Plan failed to achieve the target for various internal and external reasons.
2. Match the following.
i. 3rd FYP ------- a. self-reliant and self-sustained economy
ii. 4th FYP ------ b. self-reliance and growth with stability
iii. 5th FYP ----- c. self-reliance and poverty eradication
iv. 6th FYP ------ d. employment generation
a. ia, iib, iiic, ivd
b. ic, iib, iiia, ivd
c. ib, iic, iiia, ivd
d. ia, iic, iiid, ivb
ANSWER: a. ia, iib, iiic, ivd
The 6th FYP gave emphasis on creating more job opportunities while the 5th plan targeted poverty.
The 6th FYP gave emphasis on creating more job opportunities while the 5th plan targeted poverty.
3. Consider the following statements and identify the right ones.
i. The 7th FYP was based on John Miller’s model suitable for liberalized economy
ii. The 8th FYP was based on Planning Commission model that gave emphasis on human resource development.
a. I only
b. ii only
c. both
d. none
ANSWER: d. none
The 7th FYP was based on planning commission model suitable for liberalized economy. The 8th FYP was based on John Miller model that gave emphasis on human resource development.
The 7th FYP was based on planning commission model suitable for liberalized economy. The 8th FYP was based on John Miller model that gave emphasis on human resource development.
4. Consider the following statements and identify the right ones.
i. The 11th FYP was based on the Planning Commission model
ii. The plan main objective was faster and inclusive growth.
a. I only
b. ii only
c. both
d. none
ANSWER: c. both
The 11th FYP was for the period 2007-12 and achieved the growth rate of 8.1%
The 11th FYP was for the period 2007-12 and achieved the growth rate of 8.1%
5. Consider the following statements and identify the right ones.
i. The 12th FYP targeted the real GDP growth rate of 8%
ii. The plan aimed at generating 50 million new work opportunities in agricultural sector during the plan period.
a. I only
b. ii only
c. both
d. none
ANSWER: a. I only
The 12th FYP covering 2012-17 has the main objective of faster, more inclusive and sustainable growth.
The 12th FYP covering 2012-17 has the main objective of faster, more inclusive and sustainable growth.
6. What is the main objective of the 12th FYP?
a. Faster and inclusive growth
b. Faster and sustainable growth
c. Inclusive and sustainable growth
d. Faster, sustainable and more inclusive growth
ANSWER: d. Faster, sustainable and more
inclusive growth
The 12th FYP covering 2012-17 has the main objective of faster, more inclusive and sustainable growth.
The 12th FYP covering 2012-17 has the main objective of faster, more inclusive and sustainable growth.
7. Which of the following plans laid the foundation for industrialization?
a. Ist FYP
b. 2nd FYP
c. 3rd FYP
d. 7th FYP
ANSWER: b. 2nd FYP
The 2nd FYP followed the unbalanced growth model of P C Mahalanobis that gave favor to some key industries.
The 2nd FYP followed the unbalanced growth model of P C Mahalanobis that gave favor to some key industries.
8. Which of the following plans was officially announced as a failed plan?
a. Ist FYP
b. 2nd FYP
c. 3rd FYP
d. 7th FYP
ANSWER: c. 3rd FYP
The 3rd Five Year Plan failed to achieve the target for various internal and external reasons.
The 3rd Five Year Plan failed to achieve the target for various internal and external reasons.
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