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028 Economy Previous Year Questions

Economy Previous Year Questions

Q1. Which of the following should be considered for ‘Pigovian taxation’?
1. Consumption of Cigarettes
2. Research for new technology
3. Burning of fossil fuels
4. Restoration of lost cultural heritage
Choose the correct answer using the codes given below:
(a) 1 and 3 only (b) 2, 3 and 4 only
(c) 1, 2 and 3 only (d) 2 and 4 only
Ans: (a)

Q2. Which of the following releases the World Economic Freedom Index?
(a) World Bank
(b) International Monetary Fund (IMF)
(c) World Economic Forum (WEF)
(d) Centre for Civil Society
Ans: (d)

Q3. Gilt-edged market means
(a) bullion market
(b) market of Government securities
(c) market of guns
(d) market of pure metals
Ans: (b)

Q4. Consider the following statements about the LPG model of economic development process in India?
(1) Disinvestment of profit making public sector Enterprises.
(2) Permitting private sectors to establish Industrial Units without taking a licence.
(3) Chronically sick industries were referred to BIFR for the formulation of revival or rehabilitation plan.
Which of the processes given above is/are taken after adoption of LPG model?
(a) 1, 2 and 3 (b) 1 and 3
(c) 2 and 3 (d) only 2
Ans: (a)

Q5. Consider the following liquid assets:
1. Demand deposits with the banks
2. Time deposits with the banks
3. Saving deposits with the banks
4. Currency The correct sequence of these assets in the decreasing order of liquidity is
(a) 1-4-3-2 (b) 4-3-2-1
(c) 2-3-1-4 (d) 4-1-3-2
Ans: (d)

Q6. Which of the following statements is not correct about the Arun Maira committee?
(a) It recommends giving more teeth to the Competition Commission of India (CCI) in allowing mergers and acquisitions in the pharma sector.
(b) It recommends changing the FDI rules in pharma sector.
(c) Its main objective was to promote fresh investments in the pharma sector.
(d) None of these.
Ans: (b)

Q7. MIBOR (Mumbai Inter-Bank Offer Rate) provides:
(a) Benchmark rate for the call money market.
(b) Benchmark rate for the capital market.
(c) Benchmark rate for the corporate bond market.
(d) Benchmark rate for the infrastructure bond market.
Ans: (a)

Q8. According to NITI Ayog’s Ease of Doing Business report consider the following statements:
1. States need to enhance awareness of the steps being undertaken by them
2. Newer and younger firms reported a more favorable business environment
3. Labor regulations are a bigger constraint for labor intensive firms
Which of the statements given above is/are correct?
(a) 1 only (b) 2 and 3 only
(c) 1, 2 and 3 (d) 1 and 2 only
Ans: (c)

Q9. Consider the following financial institution of India:
1. Industrial Finance Corporation of India (IFCI)
2. Industrial Credit and Investment Corporation of India (ICICI)
3. Industrial Development Bank of India (IDBI)
4. National Bank for Agriculture and Rural Development (NABARD) The correct chronological sequence of the establishment of these institutions is
(a) 1, 2, 3, 4
(b) 2, 3, 4, 1
(c) 3, 4, 1, 2
(d) 4, 1, 2, 3
Ans: (a)

Q10. Fiscal deficit means:
(a) Total receipts minus expenditure
(b) Total receipts minus interest payments on external debt
(c) Revenue receipts minus ex-penditure
(d) Revenue receipts minus defense expenditure
Ans: (c)

Q11. Match the following power with their share of percentage:
Column I Column II
I. Thermal A. 3%
II. Hydro B. 5%
III. Renewable energy C. 66%
IV. Nuclear D. 26%
(a) I – a, II – d, III – b, IV – c
(b) I – c, II – d, III – b, IV – a
(c) I – c, II – d, III – a, IV – b
(d) I – b, II – c, III – d, IV – a
Ans: (b)

Q12. Which one of the following is responsible for the preparation of Economic Survey?
(a) Department of Revenue
(b) Department of Economic Affairs
(c) Department of Financial Services
(d) NITI Aayog
Ans: (b)

Q13. How is the base rate for lending by banks calculated?
(a) It is based on the average rate of outstanding deposits.
(b) It is based on marginal cost of funding every month.
(c) It is based on the average of lending rates of all banks.
(d) It is notified by the Reserve Bank of India.
Ans: (b)

Q14. Engel’s Law states the relationship between
(a) quantity demanded and price of a commodity
(b) quantity demanded and price of substitutes
(c) quantity demanded and tastes of the consumers
(d) quantity demended and income of the consumers
Ans: (d)

Q15. Which of the following fertiliser plants is not in the public sector?
(a) Gorakhpur
(b) Nangal
(c) Kota
(d) Bhatinda
Ans: (c)

Q16. Consider the following organizations:
1. International Bank for Reconstruction and Development
2. International Finance Corporation
3. International Fund for Agricultural Development
4. International Monetary Fund
Which of these are agencies of the United Nations?
(a) 1 and 2
(b) 2 and 3
(c) 3 and 4
(d) 1, 2, 3 and 4
Ans: (d)

Q17. Consider the following statements Full convertibility of the rupee may mean
1. Its free float with the international currencies.
2. Its direct exchange with any other international currency at any prescribed place inside and outside the country.
3. It acts just like any other international currency.
Which of these statements are correct?
(a) 1 and 2 (b) 1 and 3
(c) 2 and 3 (d) 1, 2 and 3
Ans: (d)

Q18. Green Revolution has led to:
1. Spurt in production of all food grains.
2. Greater regional inequalities
3. reduction in inter-personal inequalities.
4. Increase in production of wheat.
(a) 1 and 3 (b) 1, 2 and 3
(c) 2, 3 and 4 (d) 2 and 4
Ans: (d)

Q19. An incident when low / zero interest rates fail to stimulate consumer spending and monetary policy becomes ineffective is known as:
(a) Liquidity Gap (b) Liquidity Trap
(c) Liquidity Risk (d) None of the above
Ans: (b)

Q20. Consider the following statements regarding the India International Stock Exchange (India INX):
1. It is India’s first international stock exchange inaugurated at the International Financial Service Centre (IFSC) of GIFT City Gandhinagar, Gujarat.
2. India INX is a wholly-owned subsidiary of the National Stock Exchange (NSE).
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)

Q21. Consider the following statements about Sinking Fund
1. It is a method of repayment of public debt.
2. It is created by the government out of budgetary revenues every year.
Winch of the statements given above is/are contact?
(a) Oniy 1 (b) Only 2
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (c)

Q22. Which tax is not levied by the Central Government?
(a) Wealth tax
(b) Profession tax
(c) Income tax
(d) Excise duty
Ans: (b)

Q23. Which of the following is/are treated as artificial currency?
(a) ADR
(b) GDR
(c) SDR
(d) Both ADR and SDR
Ans: (c)

Q24. Regressive tax can be defined as
1. The one by which the revenue collected rises proportionally with income
2. The rates of tax increase for increasing values or volumes on which the tax is levied
3. The one where the proportion of tax paid falls as income rises
(a) 1 only (b) 2 only
(c) 3 only (d) 1, 2 and 3
Ans: (c)

Q25. Public Distribution System (PDS) means distribution of essential commodities to a large number of people through a network of Fair Price Shops on a recurring basis. The Commodities distributed under PDS are:
(1) Wheat (2) Rice
(3) Sugar (4) Pulses
(5) Kerosene
Select the correct option:
(a) 1,2 and 4 (b) 1, 2, 3 and 4
(c) 1, 2, 3 and 5 (d) All of the above
Ans: (c)

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