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059 Economy Previous Year Questions

Economy Previous Year Questions

Q1. Mixed economy refers to
(a) The coexistence of heavy, small scale and cottage industries
(b) The promotion of agriculture as well as cottage industries
(c) The coexistence of rich as well as poor
(d) Co-existence of public as well as private sector
Ans: (d)

Q2. Which of the following are the public sector undertakings of the Government of India?
1. Balmer Lawrie and Company Ltd.
2. Dredging Corporation of India
3. Educational Consultants of India Ltd.
Select the correct answer using the code given below:
(a) 1 and 2 Only
(b) 2 and 3 Only
(c) 1 and 3 Only
(d) 1, 2 and 3
Ans: (d)

Q3. Which of the following is/are the major Objectives of Deficit financing?
1. Used as an instrument of economic policy
2. It is used as a tool for meeting financial needs of government
3. Used for the mobilization of surplus, non- utilized and idle resources in the economy
(a) 1 only (b) 1 and 2
(c) 3 only (d) 1, 2 and 3
Ans: (d)

Q4. In India, rural incomes are generally lower than the urban incomes, which of the following reasons account for this?
1. A large number of farmers are illiterate and know little about scientific agriculture
2. Prices of primary products are lower than those of manufactured products
3. Investment in agriculture has been low when compared to investment in industry.
(a) 1, 2 and 3 (b) 1 and 2
(c) 1 and 3 (d) 2 and 3
Ans: (a)

Q5. Consider the following areas:
1. Inequality and poverty
2. Export
3. Employment Any change in the fiscal policy of the government would affect which of the above areas?
(a) 1 and 2 only (b) 1 and 3 only
(c) 2 and 3 only (d) 1, 2 and 3
Ans: (d)

Q6. Which of the following countries is/are the member/members in CLMV?
1. Cambodia 2. Lao PDR
3. Maldives 4. Vietnam
Which the correct answer using the code given below.
(a) 1, 3 and 4 only (b) 4 only
(c) 1, 2 and 4 only (d) 1, 2, 3 and 4
Ans: (c)

Q7. Consider the following statements
1. High growth will led to inflation.
2. High growth will lead to deflation.
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: (a)

Q8. Some of the measures of the Fifth Five-Year Plan were :
1. Removal of poverty
2. Economic self-sufficiency
3. Heavy industrialisation
4. Conservation of foreign exchange Of these the strategic objectives of the Plan in priority order were
(a) 1, 2, 3, 4
(b) 2, 1, 3, 4
(c) 1, 2, 4, 3
(d) 2, 1, 4, 3
Ans: (c)

Q9. The functions of commercial banks in India include
1. Purchase and sale of shares and securities on behalf of customers
2. Acting as executors and trustees of wills.
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)

Q10. Which among the following is/are the main objective of Monetary Policy?
1. Maintenance of domestic price level
2. Reducing the impact of business cycles
3. Stability of external value
(a) 1 only (b) 1 and 2
(c) 3 only (d) 1, 2 and 3
Ans: (d)

Q11. What are the features of Indian agriculture?
I. Agriculture is the primary occupation in India as it provides direct livelihood to 70% of its labour force.
II. Agriculture contributes to about 10% of the total value of India’s commodity exports.
III. Almost 30% of tea and 50% of coffee and jute produced in the country are exported.
(a) I,II,III (b) I & II
(c) II & III (d) All the above
Ans: (c)

Q12. Consider the following statements with reference to Sovereign Gold Bond (SGB):
1. The Bond is issued by SBI on behalf of Government of India.
2. Indians and foreigners are eligible to invest in SGB.
3. There is a minimum and maximum limit for investment in SGB.
Which of the above statements is/are correct?
(a) 2 only (b) 1 and 2 only
(c) 3 only (d) 1, 2 and 3
Ans: (c)

Q13. Consider the following statements in regards to ‘Inflation Index bonds’ :
1. Investment in these bonds is more risky as these bonds increase the inflation risk attached to the investment.
2. It is a better financial instrument compared to gold to hedge the risk rising out of volatile economy.
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)

Q14. Classification of an enterprise into public or private sector is based on
(a) number of employees in the enterprise
(b) ownership of assets of the enterprise
(c) employment conditions for workers in the enterprise
(d) nature of products manufactured by the enterprise
Ans: (b)

Q15. Maximum revenue is being earned from
(a) Excise
(b) Non-tax revenue
(c) Customs
(d) Corporation Tax
Ans: (d)

Q16. Consider the following statement:
The price of any currency in international market is decided by the
1. World Bank
2. Demand for goods/services provided by the country concerned
3. Stability of the government of the concerned country
4. Economic potential of the country in question.
Which of the statements given above are correct?
(a) 1, 2, 3 and 4
(b) 2 and 3 only
(c) 3 and 4 only
(d) 1 and 4 only
Ans: (b)

Q17. Which one of the following governmental steps has proved relatively effective in controlling the double digit rate of inflation in the Indian economy during recent years?
(a) enhanced rate of production of all consumer goods
(b) streamlined public distribution system
(c) pursuing an export oriented strategy
(d) containing budgetary deficit and unproductive expenditure Exercise -1
Ans: (d)

Q18. What are the land reforms taken after Independence?
I. Abolition of intermediaries like zamindars, jagirdars, etc., which resulted in several states promulgating laws for putting an end to ‘absentee landlordism’.
II. Imposition of ceiling laws which lay down the maximum land that can be owned by a land holder
III. Consolidation of holding was introduced as a measure of improving farming efficiency
(a) I & II (b) I & III
(c) Only I (d) All the above
Ans: (d)

Q19. Which of the following taxes is not collected by the Central Government?
(a) Income tax (b) Customs duty
(c) Professional tax (d) Excise duty
Ans: (c)

Q20. Which of the following is correct regarding Mahalanobis model?
(a) Investment in agriculture to achieve long term rapid economic growth.
(b) Investment in basic heavy industries to achieve long term rapid economic growth.
(c) Investment in consumer goods industries to achieve long term rapid economic growth.
(d) None of the above.
Ans: (b)

Q21. Private investment in Indian agriculture is mostly on laboursaving mechanization. This could be a response to
(a) rising productivity of agricultural sector
(b) rising inequality in agriculture
(c) rising wages and tighter labour market
(d) debt write-off by the Government
Ans: (c)

Q22. Which of the following countries has highest per capita income
(a) U.S.A.
(b) Saudi Arabia
(c) Denmark
(d) Kuwait
Ans: (b)

Q23. With reference to Balance of Payments, which of the following constitutes/constitute the Current Account?
1. Balance of trade
2. Foreign assets
3. Balance of invisibles
4. Special Drawing Rights
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3
(c) 1 and 3
(d) 1, 2 and 4
Ans: (c)

Q24. From time to time, which among the following body publishes the “Exchange Control Manual” in context with the Foreign Exchange in India?
(a) Foreign Trade Promotion Board
(b) Department of Commerce
(c) Reserve Bank of India
(d) SEBI
Ans: (c)

Q25. Demonetisation affected the Indian economy through three different channels. These are potentially—
J. An aggregate demand shock because it reduced the supply of money and affected private wealth, especially of those holding unaccounted money.
K. An aggregate supply shock to the extent that economic activity relies on cash.
L. An uncertainty shock because economic agents faced imponderables related to the magnitude and duration of the cash shortage and the policy responses.
M. Consumers deferred or reduce discretionary consumption.
N. Firms scaled back investments.
Correct code is—
(a) All are correct
(b) I, K, L are correct
(c) M & N are correct
(d) K, L, M & N are correct
Ans: (a)

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