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001 Economy Previous Year Questions

Economy Previous Year Questions

Q1. Fiscal Policy in India is formulated by
(a) the Reserve Bank of India
(b) the Planning Commission
(c) the Finance Ministry
(d) the Securities and Exchange Board of India
Ans: (c)

Q2. What will be the ultimate impact on the poor and landless farmers if all of a sudden, government decides to raise the Minimum Support Prices of rice & foodgrains inexorably or excessively?
(a) The poor farmers will become rich
(b) The markets will crash
(c) The poor farmers will get poorer
(d) This will encourage the exports of rice and food grains
Ans: (c)

Q3. Which of the following is correct regarding countervailing duty?
(a) It is imposed on imports in case of dumping of goods by a foreign country.
(b) It is imposed on imports to neutralize the negative effects of subsidies.
(c) It is part of the usual tariff barrier.
(d) It is also called anti-dumping duty.
Ans: (b)

Q4. The New Development Bank has been created by which of the following organizations?
(a) BIMSTEC (b) SAARC
(c) BRICS (d) NAFTA
Ans: (c)

Q5. Distribution of food rains operates under a two tier system with the introduction of
(a) Targeted Public Distribution System
(b) The Consumers Cooperatives
(c) The Cooperative Marketing Societies
(d) The Service Cooperatives
Ans: (a)

Q6. Which of the following was not a factor for retardation of industrial growth last year?
(a) Energy crisis
(b) Non availability of raw materials
(c) Labour disturbances
(d) Non-availability of funds
Ans: (c)

Q7. Consider the following statements:
1. The Commission for Agricultural Costs and Prices recommends the Minimum Support Prices for 32 crops.
2. The Union Ministry of Consumer Affairs Food and Public Distribution have launched the National Food Security Mission.
Which of the statements given above is/ are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Ans: (d)

Q8. Which of the following is the process of bridging the gap between the revenue and expenditure?
1. Multiple financing 2. Bridge financing
3. Accurate financing 4. Deficit financing
(a) 1 only (b) 2 only
(c) 3 only (d) 4 only
Ans: (d)

Q9. Which among the following statements is/are true with regard to WTO membership?
1. All WTO members automatically receive the ‘most favoured nation’ status.
2. Over 75% of WTO members are from developing countries, WTO membership allows them access to developed markets at the lower tariff.
Select the correct answer using the codes given below.
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (b)

Q10. Which of the following publishes the Global Hunger Index?
(a) United Nations Development Programme
(b) Food and Agriculture Organization (FAO)
(c) International Food Policy Research Institute (IFPRI)
(d) Oxfam International
Ans: (c)

Q11. The Union Cabinet has approved India’s membership for European Bank for Reconstruction & Development (EBRD). Which of the following is/are the benefit/benefits in getting membership in EBRD?
1. India’s investment opportunities would get a boost.
2. It would enable Indian nationals to get the employment opportunity in the Bank.
3. It would help India leverage the technical assistance and sectoral knowledge of the bank for the benefit of development of private sector.
Which the correct answer using the code given below:
(a) 3 only (b) 1 and 2 only
(c) 2 and 3 only (d) 1, 2 and 3
Ans: (d)

Q12. In the parlance of financial investment, the term bear denotes
(a) an investor, who feels that the price of a particular security is going to fall
(b) an investor, who expects the price of a particular share to rise
(c) a shareholder, who has an interest in a company, financially or otherwise
(d) any lender, whether by making a loan or buying a bond
Ans: (a)

Q13. ‘TRYSEM’ is concerned with
(a) A new system of semester examinations in universities
(b) Training the rural youth for self-employment
(c) A training programme for students in educational psychology
(d) A training course for farmers in dryland farming
Ans: (b)

Q14. Consider the following actions which the Government can take
1. Devaluing the domestic currency
2. Reduction in the export subsidy
3. Adopting suitable policies which attract greater FDI and more funds from FIIs
Which of the above action/actions can help in reducing the current account deficit?
(a) 1 and 2
(b) 2 and 3
(c) 3 only
(d) 1 and 3
Ans: (a)

Q15. Which of the following statements is/are correct as per Article 114(3) of the Constitution?
1. No money can be taken out of consolidated fund without the approval of the Rajya Sabha
2. No money can be taken out of consolidated fund without the approval of the Lok Sabha
3. Money can be taken out of consolidated fund without any approval
Select the correct answer using the code given below:
(a) 1 only (b) 2 only
(c) 3 only (d) 1, 2 and 3
Ans: (b)

Q16. Which of the following statement is correct according to Zamindari System?
I. The Zamindari System prevailed in Bengal, Bihar, Orissa.
II. It was introduced by the East India Company and under it a class of revenue collectors, called zamindars, was created.
III. Revenue was ‘settled’ by the government with zamindars, either permanently or temporarily.
IV. Revenue was ‘settled’ by the.
(a) I, II & IV (b) I & II
(c) I & III (d) I, II & III
Ans: (d)

Q17. Which of the following loans are kept out from the preview of the Base rate system?
1. Agricultural loans.
2. Loans given to own employees of bank.
3. Loans against deposit.
4. Export credit.
Select the correct answer using the codes given below:
(a) 1, 2, 3 and 4 (b) 2, 3 and 4 only
(c) 1, 3 and 4 only (d) 1, 2 and 3 only
Ans: (a)

Q18. Corporation tax in India is levied on income of a company.
Which one of the following does not include Corporation tax?
(a) Profit from business (b) Capital gain
(c) Interest on securities (d) Sale proceed of assets
Ans: (d)

Q19. Standard of living of a nation can be judged by
(a) Increase in GNP at factor cost
(b) Increase in GNP at cost including taxes and duties
(c) Increase in NNP at factor cost
(d) None of the above
Ans: (d)

Q20. In India, deficit financing is used for raising resources for
(a) economic development
(b) redemption of public debt
(c) adjusting the balance of payments
(d) reducing the foreign debt
Ans: (a)

Q21. How do we define the terms bull and bear with regard to stock markets?
(a) A bull is an optimistic operator who first buys and then sells shares in expectation of the price going up; a bear is a pessimistic market operator who sells the shares in expectation of buying them back at a lower price.
(b) There is nothing significantly different as both operate in the capital market.
(c) Bull is one who first sells a share and then buys it at a lower price; bear means one who first buys and then sells it in expectation of prices going up.
(d) A bull is ready to buy any share; a bear only deals in government securities.
Ans: (a)

Q22. Personal disposable income is
(a) always equal to personal income
(b) always more than personal income
(c) equal to personal income minus indirect taxes
(d) equal to personal income minus direct taxes
Ans: (c)

Q23. Consider the following statements regarding cess and surcharges in India:
1. Surcharges go to Consolidated Fund of India and can be used for any purpose.
2. Both cess and surcharges can be used for a particular purpose only.
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Ans: (a)

Q24. Which one of the following represents a progressive tax structure?
(a) Tax rate is the same across all incomes
(b) Tax rate increases as income increases
(c) Tax rate decreases as income increases
(d) Each household pays equal amount of tax
Ans: (b)

Q25. An ad valorem duty is a tax on the basis of
(a) The price of a commodity
(b) The value added
(c) The advertisement expenditure
(d) The unit of the commodity
Ans: (b)

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