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041 Economy Previous Year Questions

Economy Previous Year Questions

Q1. Consider the following statements
1. In India the minimum denomination coin acceptable for transaction is 50 paise.
2. Coins below 50 praise is not a legal tender for payment.
Which of the statements given above is/are correct?
(a) Only 1 (b) Only 2
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (c)

Q2. Main source of India’s national income is from
(a) Agriculture
(b) Industry
(c) Forestry
(d) None of these
Ans: (d)

Q3. Consider the following actions by the Government:
1. Cutting the tax rates
2. Increasing the government spending
3. Abolishing the subsidies In the context of economic recession, which of the above actions can be considered a part of the “fiscal stimulus” package?
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3
Ans: (a)

Q4. Annual financial statement has to be placed before parliament for every financial year i.e.
1. January 1 to December 31
2. March 31 to April 1
3. April 1 to March 31
(a) 1 only (b) 2 only
(c) 3 only (d) None of the above
Ans: (c)

Q5. Consider the following statements:
1. All kinds of Development Banks in India appeared Post-Independence
2. NABARD is the only agricultural Development Bank in India
Which among the above statements is / are correct?
(a) Only 1 is correct
(b) Only 2 is correct
(c) Both 1 and 2 are correct
(d) Neither 1 nor 2 is correct
Ans: (d)

Q6. If a country faces consistent inflation what could be the impact on the exchange rate?
(a) The exchange rate of the country appreciates with respect to other countries
(b) The exchange rate of the country depreciates with respect to other countries
(c) The exchange rate of the country is not affected
(d) None of the above
Ans: (b)

Q7. What has been one of the reasons for India’s occupational structure remaining more or less the same over the years?
(a) Investment pattern has been directed towards capital intensive industries.
(b) Productivity in agriculture has been high enough to induce people to stay with agriculture.
(c) Ceiling on land holdings have enabled more people to own land and hence their preference to stay with agriculture.
(d) People are largely unaware of the significance of transition from agriculture to industry for economic development.
Ans: (a)

Q8. The main functioning of the banking system is to
(a) accept deposits and provide credit
(b) accept deposits and subsidies
(c) provide credit and subsidies
(d) accept deposits, provide credit and subsidies
Ans: (a)

Q9. The major source of revenue for executing Five-Year Plans is
(a) Direct taxes
(b) Indirect taxes
(c) Foreign loans
(d) Interest on investments
Ans: (b)

Q10. Microfinance is the provision of financial services to people of low-income groups. This includes both the consumers and the self-employed. The service/ services rendered under micro- finance is/are:
1. Credit facilities
2. Savings faculties.
3. Insurance facilities.
4. Fund transfer faculties.
Select the correct answer using the codes given the lists :
(a) 1 only
(b) 1 and 4 only
(c) 2 and 3 only
(d) 1,2 ,3 and 4
Ans: (d)

Q11. Bank rate refers to:
(a) the rate at which banks lend to its prime borrowers
(b) the maximum rate that banks can pay for deposit
(c) the rate at which banks rediscount bills with RBI
(d) the rate of interest charged on inter-bank transactions
Ans: (c)

Q12. What are the functions of NABARD?
I. It is associated with policy, planning, operation and even monitoring levels for providing agricultural credit.
II. Its primary task is to function as refinancing institution for all types of lending for agricultural and rural development.
III. In addition to this, it provides term credit to state co-operative banks, regional rural banks, land development banks and state governments (only for share capital contribution to co-operative credit societies).
(a) Only I (b) I & II
(c) II & III (d) All the above
Ans: (d)

Q13. Rate of interest is determined by
(a) The rate of return on the capital invested
(b) Central Governement
(c) Liquidity preference
(d) Commercial Banks
Ans: (c)

Q14. Consider the following statements regarding recent trends in employment in India:
1. Labour Force Participation Rate (LFPR) for rural areas is greater than the urban areas.
2. Labour Force Participation Rate (LFPR) for women is greater than men.
Which of the above statements is/are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (a)

Q15. The value of all final goods and services produced by the normal residents of a country and their property, whether operating within the domestic territory of the country or outside in a year is termed as
(a) Gross National Income (b) Net National Income
(c) Gross Domestic Product (d) Net Domestic Product
Ans: (a)

Q16. Deficit Financing means
(a) Difference of total expenditure and income by revenue from all sources.
(b) Government spends in excess of revenues so that a budget deficit is incurred which is financed by the borrowings.
(c) Difference in borrowing and external and internal resources.
(d) Capital expenditure on items of public construction, public enterprises and public borrowings.
Ans: (b)

Q17. Which of the following grants/ grant direct credit assistance to rural households?
1. Regional Rural Banks
2. Bank for Agriculture and Rural Development
3. Land Development Banks
Select the correct answer using the codes given below:
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3
Ans: (c)

Q18. Which among 1the following is considered to be a part of Shadow Banking in India?
(a) Business Correspondents
(b) Bankassurance Providers
(c) Non-Banking Financial Companies
(d) Private Banks
Ans: (c)

Q19. The Andhra Pradesh government has signed MoU with which payment network company to transform Vishakhapatnam into India’s first ‘less cash’ city?
(a) MasterCard
(b) National Payments Corporation of India (NPCI)
(c) American Express
(d) Visa
Ans: (d)

Q20. Consider the following statements about labor force participation rate:
1. It is usually more than worker-population ratio.
2. If it is more, then it will necessarily mean more unemployment.
Which of the statements given above is/are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1nor 2
Ans: (a)

Q21. Consider the following statements regarding the Finance Commission:
1. The Finance Commission submits his report to the Parliament.
2. The report of the Finance Commission is advisory in nature; therefore it is described as balancing wheel of fiscal federalism.
Which of the above following statements is/are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (b)

Q22. Which one of the following statements is correct with respect to the composition of national income in India?
(a) The share of manufacturing sector has declined.
(b) The share of services sector has increased sharply.
(c) The share of agriculture has remained static.
(d) The share of services sector has declined.
Ans: (b)

Q23. The beginning of urbanisation of the Ganges from the 6th century was mainly attributed to
(a) Fertility of soil
(b) Trade improvement
(c) Population growth
(d) None of the above
Ans: (a)

Q24. Which one of the following issues the “Global Economic Prospects” report periodically?
(a) The Asian Development Bank
(b) The European Bank for Reconstruction and Development
(c) The US Federal Reserve Bank
(d) The World Bank
Ans: (d)

Q25. What does venture capital mean?
(a) A short-term capital provided to industries
(b) A long-term start-up capital provided to new entrepreneurs
(c) Funds provided to industries at times of incurring losses
(d) Funds provided for replacement and renovation of industries Statement Based MCQ
Ans: (b)

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