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047 Economy Previous Year Questions

Economy Previous Year Questions

Q1. After the deduction of grants for the creation of capital assets from revenue deficit we get:
(a) Fiscal deficit (b) Budget deficit
(c) Primary deficit (d) Effective revenue deficit
Ans: (d)

Q2. Consider the following statements regarding inflation:
1. The real interest rate is the return an investor gets after adjusting for inflation.
2. The Fisher equation estimates the relationship between nominal and real interest rates.
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: (c)

Q3. Which of the following statements is/are correct?
1. If a country is experiencing increase in its per capita GDP, its GDP must necessarily be growing.
2. If a country is experiencing negative inflation its GDP must be decreasing.
Select the correct answer using the codes given below
(a) Only 1 (b) Only 2
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (c)

Q4. Nehru Model of Development laid greater stress on
(a) Collective use of land
(b) Using imported seeds
(c) Agricultural development
(d) Rapid industrialisation with particular emphasis on the development of basic and heavy industries
Ans: (d)

Q5. In India, which of the following is regulated by’ the Forward Markets Commission?
(a) Currency Futures Trading
(b) Commodities Futures Trading
(c) Equity Futures Trading
(d) Both Commodities Futures and Financial Futures Trading
Ans: (b)

Q6. Consider the following statements with regard to Statutory Liquidity Ratio (SLR)
1. To meet SLR, Commercial banks can use cash only.
2. SLR is maintained by the banks with themselves.
3. SLR restricts the banks leverage in pumping more money into the economy.
Which of the statements given above is/are correct?
(a) 1, 2 and 3 (b) 1 and 3
(c) 2 and 3 (d) only 2
Ans: (c)

Q7. Public Distribution System (PDS) is operated under the responsibility of the:
1. Central Government
2. State Governments
(a) Only 1 (b) Only 2
(c) Both 1 and 2 (d) Neither 1 nor 2
Ans: (c)

Q8. The Jal Marg Vikas Project (JMVP) on NW-1 is being implemented with the financial and technical support of the:
(a) United Nations Organizations
(b) International Monetory Fund
(c) World Bank
(d) BRICS Bank
Ans: (c)

Q9. Consider the following statements about Permanent Account Number (PAN):
1. If a person changes his or her surname after marriage or for any other reason, the PAN also changes.
2. Permanent Account Number (PAN) is a ten digit Alphanumeric number issued by the Income Tax department.
3. It is an important mechanism to check tax evasion though it does not broaden the tax base.
Which of the statements given above is/are not correct?
(a) 2 only (b) 1 and 3 only
(c) 2 and 3 only (d) 1 and 2 only
Ans: (b)

Q10. Corporation tax is imposed by
(a) State Government
(b) Central Government
(c) Local Government
(d) State as well as Central Government
Ans: (d)

Q11. In the Sixth Five-Year Plan, indicates allocations were made in descending order for the following sectors:
1. Irrigation and flood control
2. Agriculture and allied programmes
3. Village and small industries
4. Power
Codes :
(a) 4, 2, 1, 3
(b) 3, 4, 1, 3
(c) 2, 4, 1, 3
(d) 1, 3, 4, 2
Ans: (c)

Q12. Which of the following would include Foreign Direct Investment in India?
1. Subsidiaries of foreign companies in India
2. Majority foreign equity holding in Indian companies
3. Companies exclusively financed by foreign companies
4. Portfolio investment
Select the correct answer using the codes given below:
(a) 1, 2 , 3 and 4
(b) 2 and 4 only
(c) 1 and 3 only
(d) 1, 2 and 3 only
Ans: (d)

Q13. According to the Chakravarthy Committee, one of the principal causes affecting price stability in India is:
(a) existence of black money
(b) violent fluctuation in agricultural production
(c) India’s precarious balance of payment position
(d) fiscal deficit
Ans: (b)

Q14. What are the primary defects in the system of agricultural marketing in India?
I. Inadequate warehouses
II. Lack of grading and standardization
III. Inadequate transport facilities
IV. Presence of a large number of middlemen
(a) I & II (b) I, II & III
(c) Only IV (d) All the above
Ans: (d)

Q15. In calculating National Income which of the following is included?
(a) Services of housewives (b) Pensions
(c) Income of smugglers (d) Income of watchmen
Ans: (d)

Q16. Consider the following financial instruments:
1. Treasury Bills
2. Certificate of Deposit
3. Commercial Paper
4. Stocks
Which of the above are parts of money market?
(a) 1 and 4 only
(b) 1, 2 and 3 only
(c) 2, 3 and 4 only
(d) None of the above
Ans: (b)

Q17. Demand for a commodity refers to
(a) Desire for that commodity
(b) Need for that commodity
(c) Quantity demanded of that commodity
(d) Quantity demanded at certain price during any particular period of time
Ans: (d)

Q18. Which of the following is true?
(a) Physical planning is more important than financial planning
(b) Financial planning is more important than physical planning
(c) Physical planning and financial planning are equally important
(d) Physical planning and financial planning are complementary.
Ans: (d)

Q19. With reference to Union Budget, which of the following, is/are covered under Non-Plan Expenditure?
1. Defence expenditure
2. Interest payments
3. Salaries and pensions
4. Subsidies
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 1, 2, 3 and 4
(d) None
Ans: (c)

Q20. Bring out the only incorrect statement:
(a) Reverse Repo operation by RBI aims at injecting/ increasing liquidity
(b) SDR refers to special drawing rights
(c) Rupee appreciation results in decrease in imports
(d) Increase in inflation rate leads to decline in real interest rate
Ans: (c)

Q21. In the transition of Indian economy from ‘cash economy’ to ‘cashless economy’, which of the following is playing a vital role ?
(a) Mobile Phone (b) Plastic money
(c) BHIMApp (d) Online banking
Ans: (a)

Q22. Green Bonds can be issued by:
1. World Bank.
2. Federally qualified organizations.
3. Ministry of Environment and Forests.
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
Ans: (a)

Q23. Consider the following statements in regard to Zero Base Budgeting (ZBB) :
1. Existing government programme can be discarded under ZBB if they are found to be outdated.
2. ZBB is difficult to be applied to Human Development programmes as the outcome of such programme is intangible in nature.
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: (c)

Q24. According to the Classical Theory of Employment, deviations from the state of full employment are
(a) purely temporary in nature
(b) permanent in nature
(c) imaginary situations
(d) normal situations
Ans: (a)

Q25. The Ministry of Industries takes the administrative advice regarding the improvement of the performance of public enterprises from
(a) Bureau of Public Enterprises
(b) MRTP Commission
(c) Estimates Committee
(d) Planning Commission
Ans: (a)

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