UPSC Indian Economy Test 3 (Old Year Questions)
UPSC Indian Economy Test 3
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20 questions based on Indian Economy.
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Question 1 of 20
1. Question
1 pointsConsider the following:
1. Hotels and restaurants
2. Motor transport undertakings
3. Newspaper establishments
4. Private medical institutions
The employees of which of the above can have the ‘Social Security’ coverage under Employees’ State Insurance Scheme?Correct
Ans a
Incorrect
Ans a
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Question 2 of 20
2. Question
1 pointsHow do District Rural Development Agencies (DRDAs) help in the reduction of rural poverty in India?
- DRDAs act as Panchayati Raj Institutions in certain specified backward regions of the country.
- DRDAs undertake area-specific scientific study of the causes of poverty and malnutrition and prepare detailed remedial measures.
- DRDAs secure inter-sectoral and inter-departmental coordination and cooperation for effective implementation of anti-poverty programmes.
- DRDAs watch over and ensure effective utilization of the funds intended for anti-poverty programmes.
Which of the statements given above is/are correct?
Correct
Ans b
Incorrect
Ans b
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Question 3 of 20
3. Question
1 pointsThe Reserve Bank of India (RBI) acts as a bankers” bank. This would imply which of the following?
- Other banks retain their deposits with the RBI.
- The RBI lends funds to the commercial banks in times of need.
- The RBI advises the commercial banks on monetary matters.
Select the correct answer using the codes given below.
Correct
Ans d
Incorrect
Ans d
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Question 4 of 20
4. Question
1 pointsUnder which of the following circumstances may ‘capital gains’ arise?
1. When there is an increase in the sales of a product.
2. When there is a natural increase in the value of the property owned.
3. When you purchase a painting and there is a growth in its value due to increase in its popularity.
Select the correct answer using the codes given below:Correct
Ans B
Capital Gains – This term is used in Newspapers and also in Constitution An increase in the value of a capital asset (investment or real estate) that gives it a higher worth than the purchase price. The gain is not realized until the asset is sold. A capital gain may be short term (one year or less) or long term (more than one year) and must be claimed on income taxes. Read more: http://www.investopedia.com/terms/c/capitalgain.asp#ixzz1vXiO4Mrh Pasted fromIncorrect
Ans B
Capital Gains – This term is used in Newspapers and also in Constitution An increase in the value of a capital asset (investment or real estate) that gives it a higher worth than the purchase price. The gain is not realized until the asset is sold. A capital gain may be short term (one year or less) or long term (more than one year) and must be claimed on income taxes. Read more: http://www.investopedia.com/terms/c/capitalgain.asp#ixzz1vXiO4Mrh Pasted from -
Question 5 of 20
5. Question
1 pointsWhich of the following measures would result in an increase in the money supply in the economy?
Purchase of government securities from the public by the Central Bank.
Deposit of currency in commercial banks by the public.
Borrowing by the government from the Central Bank.
Sale of government securities to the public by the Central Bank.
Select the correct answer using the codes given below.Correct
Anc c
Incorrect
Anc c
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Question 6 of 20
6. Question
1 pointsWhich of the following would include Foreign Direct Investment in India?
- Subsidiaries of foreign companies in India.
- Majority foreign equity holding in Indian companies.
- Companies exclusively financed by foreign companies.
Portfolio investment.
Select the correct answer using the codes given below.
Correct
Ans d
New FDI rules to bring in more dollars The entirety of investment in a company by an entity that is majority owned/controlled by foreign investors would be treated as foreign investment.Incorrect
Ans d
New FDI rules to bring in more dollars The entirety of investment in a company by an entity that is majority owned/controlled by foreign investors would be treated as foreign investment. -
Question 7 of 20
7. Question
1 pointsConsider the following statements: The price of any currency in international market is decided by the-
1. World Bank
2. Demand for good/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?Correct
Ans b
Incorrect
Ans b
-
Question 8 of 20
8. Question
1 pointsThe basic aim of Lead Bank Scheme is that
Correct
Ans c
Incorrect
Ans c
-
Question 9 of 20
9. Question
1 pointsDespite having large reserves of coal, why does India import millions of tonnes of coal?
1. It is the policy of India to save its own coal reserves for future, and import it from other countries for the present use.
2. Most of the power plants in India are coal-based and they are not able to get sufficient supplies of coal from within the country.
3. Steel companies need large quantity of coking coal which has to be imported.
Which of the statements given above is/are correct?Correct
Ans b
Incorrect
Ans b
-
Question 10 of 20
10. Question
1 pointsWhy is the offering of “teaser loans” by commercial banks a cause of economic concern?
1. The teaser loans are considered to be an aspect of sub-prime lending and banks may be exposed to the risk of defaulters in future.
2. In India, the teaser loans are mostly given to inexperienced entrepreneurs to set up manufacturing or export units.
Which of the statements given above is/are correct?Correct
Ans a
Incorrect
Ans a
-
Question 11 of 20
11. Question
1 pointsIn the context of Indian economy, consider the following statements:
1. The growth rate of GDP has steadily increased in the last five years.
2. The growth rate in per capita income has steadily increased in the last five years.
Which of the statements given above is/are correct?Correct
Ans d
Incorrect
Ans d
-
Question 12 of 20
12. Question
1 pointsIn India, which of the following have the highest share in the disbursement of credit to agriculture and allied activities?
Correct
Ans b
This required just the basic knowledge of what is inclusive growthIncorrect
Ans b
This required just the basic knowledge of what is inclusive growth -
Question 13 of 20
13. Question
1 pointsWhich of the following can aid in furthering the Government’s objective of inclusive growth?
1. Promoting Self-Help Groups.
2. Promoting Micro, Small and Medium Enterprises.
3. Implementing the Right to Education Act.
Select the correct answer using the codes given below :Correct
And d
Incorrect
And d
-
Question 14 of 20
14. Question
1 pointsWhy is the Government of India disinvesting its equity in the Central Public Sector Enterprises (CPSEs)?
The Government intends to use the revenue earned from the disinvestment mainly to pay back the external debt.
The Government no longer intends to retain the management control of the CPSEs.
Which of the statements given above is/are correct?Correct
And d
Incorrect
And d
-
Question 15 of 20
15. Question
1 pointsEconomic growth is usually coupled with:
Correct
And d
Incorrect
And d
-
Question 16 of 20
16. Question
1 pointsThe lowering of Bank Rate by the Reserve Bank of India leads to
Correct
Ans a
Incorrect
Ans a
-
Question 17 of 20
17. Question
1 pointsIndia has experienced persistent and high food inflation in the recent past. What could be the reasons?
1. Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%.
2. As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change.
3. The food supply chain has structural constraints.
Which of the statements given above are correct?Correct
Ans b
Incorrect
Ans b
-
Question 18 of 20
18. Question
1 pointsIn terms of economy, the visit by foreign nationals to witness the XIX common Wealth Games in India amounted to
Correct
Ans a
Incorrect
Ans a
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Question 19 of 20
19. Question
1 pointsWhich one of the following statements appropriately describes the “fiscal stimulus”?
Correct
Ans b
Incorrect
Ans b
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Question 20 of 20
20. Question
1 pointsWhich of the following is/are treated as artificial currency ?
Correct
Ans c
Special Drawing Rights (SDRs) are costless assets that increase a nation’s foreign exchange reserves without the need for an actual transfer of funds. SDRs are an artificial currency used by the IMF and defined as a “basket of national currencies”. The IMF uses SDRs for internal accounting purposes. SDRs are allocated by the IMF to its member countries and are backed by the full faith and credit of the member countries’ governments. While ADR and GDR are financial instruments.Incorrect
Ans c
Special Drawing Rights (SDRs) are costless assets that increase a nation’s foreign exchange reserves without the need for an actual transfer of funds. SDRs are an artificial currency used by the IMF and defined as a “basket of national currencies”. The IMF uses SDRs for internal accounting purposes. SDRs are allocated by the IMF to its member countries and are backed by the full faith and credit of the member countries’ governments. While ADR and GDR are financial instruments.