Economy Previous Year Questions
Q2. The main source of financing the implementation of development programmes is
(a) Internal resources from taxes and other measures
(b) External finance as borrowings/loans from foreign governments
(c) External finance as loans from international finance agencies
(d) External finance as loans from foreign governments and international finance agencies
Ans: ANSWERS226. (a)
Q3. The Global Infrastructure Facility is a/an
(a) ASEAN initiative to upgrade infrastructure in Asia and financed by credit from the Asian Development Bank.
(b)World Bank collaboration that facilitates the preparation and structuring of complex infrastructure Public-Private Partnerships (PPPs) to enable mobilization of private sector and institutional investor capital.
(c) Collaboration among the major banks of the world working with the OECD and focused on expanding the set of infrastructure projects that have the potential to mobilize private investment.
(d) UNCTAD funded initiative that seeks to finance and facilitate infrastructure development in the world
Q4. Consider the following statements:
1. In Minimum Reserve System, RBI had to keep a minimum reserve of Gold worth ` 115 Crores and rest in Indian Rupees.
2. The Minimum Requirement of Foreign Securities was diluted when Minimum Reserve System was launched.
Which among the above statement is / are correct?
(a) Only 1 is correct
(b) Only 2 is correct
(c) Both of them are correct
(d) Both of them are incorrect
Q5. IMF can grant loan to __________?
(a) Any sovereign country of the World
(b) Any sovereign country of the World and Public Sector companies backed by Sovereign guarantee
(c) Any Member country of IMF
(d) Any Member country of IMF and Public Sector Companies backed by Sovereign guarantee of Member Country ‘
Q6. Consider the following monetary policy tools:
1. Margin requirements
2. Consumer credit regulation
Selective credit control
4. Moral Suasion
5. Rationing of Credit
6. Direct Action
Which of the above monetary policy tools are qualitative measures of RBI?
(a) 1, 2, 3 and 4 only (b) 2, 3, 4 and 5 only
(c) 1, 2, 3, 5 and 6 only (d) 1, 2, 3, 4, 5 and 6
Q7. Special Safeguard Mechanism (SSMs) are associated with which of the following international organization?
(a) IMF (b) World Bank
(c) United Nation (d) WTO
Q8. The earnings of India from diamond export is quite high. Which one of the following factors has contributed to it?
(a) Pre-independence stock-piling of diamonds in the country which are now exported
(b) Large production of industrial diamonds in the country
(c) Expertise available for cutting and polishing of imported diamonds which are then exported.
(d) As in the past, India produces huge quantity of gem diamonds which are exported
Q9. GDP deflator is used to :
(a) measure the relative reduction in GDP growth rate of a country.
(b) measure the inflation in a country.
(c) compare the GDP of a country vis a vis other countries of the world.
(d) estimate the purchasing power of the citizen of a country.
Q10. Which among the followings is the type of inflation?
1. Demand Pull Inflation
2. Cost Push Inflation
Choose the correct type.
(a) 1, 2, 3, 4 (b) 1, 2
(c) 3, 4 (d) 1, 4
Q11. Which of the following would include Foreign Direct Investment in India?
1. By incorporating a wholly owned subsidiary or company anywhere
2. By acquiring shares in an associated enterprise
3. Through a merger or an acquisition of an unrelated enterprise
4. Participating in an equity joint venture with another investor or enterprise
Select the answer using the codes given below.
(a) 1 and 2 (b) 2, 3 and 4
(c) 1, 3 and 4 (d) 1, 2, 3 and 4
Q12. Which of the following countries is not a member of the BASIC group?
(a) Brazil (b) Argentina
(c) China (d) South Africa
Q13. Which of the following depicts the cost of factors of production supplied by the entrepreneur himself?
(a) Implicit Cost (b) Explicit Cost
(c) Variable Cost (d) Fixed Cost
Q14. To prevent recurrence of scams in Indian Capital Market, the Government of India has assigned regulatory powers to
Q15. The following objective helps in the development of India’s economic development since independence.
1. A rapidly and technologically progressive economy by democratic means
2. A social order based on justice, offering equal opportunity to every citizen of the country.
3. Increasing population of the country
Which among the following is/are the objective?
(a) 1 only (b) 1 and 2
(c) 1 and 3 (d) 1, 2 and 3
Q16. With reference to ‘Bitcoins’, sometimes seen in the news, which of the following statements is/are correct?
1. Bitcoins are tracked by the Central Banks of the countries.
2. Anyone with a Bitcoin address can send and receive Bitcoins from anyone else with a Bitcoin address.
3. Online payments can be sent without either side knowing the identity of the other.
Select the correct answer using the code given below.
(a) 1 and 2 only (b) 2 and 3 only
(c) 3 only (d) 1, 2 and 3
Q17. Which statement is correct regarding Export houses?
I. To increases the marketable efficiency of exporters, the Government introduced the concept of export houses, trading houses and star trading houses.
II. Those registered exporters who have shown good export performances over past few years have been given the status of export houses, and trading houses.
III. Units having such classification are required to achieve the prescribed average export performance level and earning of foreign exchange.
(a) Only III (b) I & II
(c) II & III (d) All the above
Q18. Which of the following income taxation acts as ‘automatic stabilizer’?
(a) Progressive (b) Regressive
(c) Proportional (d) None of the above
Q19. Consider the following statements regarding government debt:
1. The clearest sign that a government is on a fiscally sustainable path is declining debt-to-GDP ratio.
2. India’s debt-to-GDP ratio has been on a continuous decline since the last decade.
Which of the above statements is/are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
Q20. Consider the following items imported by India:
1. Capital goods
3. Pearls and precious stones
5. Iron and Steel The correct sequence of the decreasing order of these items (as per 94-95 figures), in terms of value is
(a) 1, 2, 3, 4, 5
(b) 1, 2, 4, 3, 5
(c) 2, 1, 3, 4, 5
(d) 2, 1, 4, 5, 3
Q21. Usual status (US) unemployment is calculated with reference to a period of:
(a) one year (b) indefinite
(c) one month (d) one week
Q22. Consider the following statement.
I. Family owned business includes two or more family members and the majority of ownership lies within the family.
II. Family owned business includes two or more family members and the majority of ownership is divided between the partners.
Which of the following is/are correct?
(a) Only I
(b) Only II
(c) Both I and II
(d) None of the above
Q23. Consider the following statements regarding Participatory Notes in India:
1. Participatory Notes are issued by a registered FII (Foreign Institutional Investor) to investors abroad.
2. Investors in Participatory Notes, do not own the underlying Indian Security.
3. Investors, need to register themselves with the market regulator i.e. SEBI.
Which of the statements given above are correct?
(a) 1 and 2 only (b) 2 and 3 only
(c) 1 and 3 only (d) 1, 2 and 3
Q24. When the Reserve Bank of India buys back bonds, the effects are:
1. Decreases liquidity.
2. Could lower Gsec yields.
3. Tends to reduce interest rates.
4. It may tend to be inflationary.
Which of the effects given above are correct?
(a) 1 and 2 only (b) 2, 3 and 4 only
(c) 1, 3 and 4 only (d) 1, 2, 3 and 4
Q25. What would be the impact on effective revenue deficit in the case of reduced capital creating grants to states?
(a) It will increase (b) It will decrease
(c) It will remain the same (d) None of the above