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Economy Test

The document contains 20 multiple choice questions related to Indian economy and finance. The questions cover topics like taxes, GDP, inflation, monetary policy, fiscal policy, banking regulations and more. Overall, the document tests the reader's understanding of key economic concepts and India's financial system.

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0% found this document useful (0 votes)
73 views16 pages

Economy Test

The document contains 20 multiple choice questions related to Indian economy and finance. The questions cover topics like taxes, GDP, inflation, monetary policy, fiscal policy, banking regulations and more. Overall, the document tests the reader's understanding of key economic concepts and India's financial system.

Uploaded by

renukaramsajja99
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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INDIAN CIVIL SERVICES TRAINING ACADEMY

Kuvempunagar, Mysore Time-


100- 2hrs
Economy Test
Marks

1.Match the following 1. 1 only


List I List II 2. 2 only
A. Direct tax 1. Excise duty 3. Both 1 and 2
B. Indirect tax 2. Interest receipt
4. Neither 1 nor 2
C. Non-tax receipts 3. Income tax
5. Consider the following statements
Mark the correct response:
1. A - 1, B - 2, C - 3 regarding Non Scheduled banks
2. A - 2, B - 3, C - 1 1.They are subject to Cash reserve
3. A - 3, B - 1, C - 2 requirement
4. A - 3, B - 2, C – 1 2.They are not entitled to borrow from the
RBI for normal banking purposes
2. Which among the following factor can
Select the correct answer using the code
contribute to the appreciation of the
given below.
rupee?
1. Only 1
1. Strong foreign capital outflows
2. Lower current account deficit 2. Only 2
3. High inflation compared to other 3. All of the above
countries 4. None of the above
4. Expansionary monetary policy

6. Logistics Performance Index (LPI) report


3. Which Five Year Plan had the primary
is published by:
goal to establish India as a self-reliant and
[A] World Bank
self-generating economy?
1. First five year plan [B] World Trade Organisation (WTO)
2. Second five year plan [C] World Economic Forum (WEF)
3. Third five year plan [D] Organisation for Economic Co-
4. Fourth five year plan
operation and Development (OECD)

4. Consider the following statements about


Inflation: 7. Consider the following statements:
1. Headline Inflation measures the price rise 1. The Gross Domestic Product (GDP)
in food, fuel and all other commodities. provides a picture of the economy from the
2. Core Inflation does not measure the price demand side.
rise in fuel and food articles. 2. The Gross Value Added (GVA) provides a
Which of the above statements are correct?
picture of economy from the supply side.
Which of the statements given above is/are 2. Primary deficit is derived by deducting
capital expenditure from fiscal deficits.
correct?
Which of the statements given above
A. 1 only B. 2 only is/are correct?
C. Both 1 and 2 D. Neither 1 nor 2 A. 1 only B. 2 only
C. Both 1 and 2 D. Neither 1 nor 2
8. Consider the following statements:
11. Consider the following statements:
1. The bad bank is involved in lending and 1. Cess is a form of tax levied over and
taking deposits, it also helps commercial above the base tax liability of a taxpayer.
banks clean up their balance sheets and 2. Cess is a permanent source of revenue
resolve bad loans. for the government.
Which of the statements given above is/are
2. The takeover of bad loans by the bad
correct?
bank is normally below the book value of A. 1 only B. 2 only
the loan. C. Both 1 and 2 D. Neither 1 nor 2
Which of the statements given above is/are
12. With reference to Monetary Policy
correct?
Committee (MPC), consider the following
A. 1 only statements:
B. 2 only 1. It is a statutory and institutionalized
C. Both 1 and 2 framework established under the RBI Act,
D. Neither 1 nor 2 1934.
2. The Governor of RBI is ex-officio
Chairman of the MPC.
9. Consider the following statements Which of the statements given above is/are
with reference to Special Drawing Rights: correct?
1. It is an international reserve asset, A. 1 only B. 2 only
C. Both 1 and 2 D. Neither 1 nor 2
created by the International Monetary
Fund (IMF). 13. Consider the following statements
2. The value of an SDR is based only on regarding Gig workers:
the US Dollar,Euro and British Poun D. 1. The Code on Social Security, 2020,
recognises gig workers as an occupational
Which of the statements given above
category.
is/are correct? 2. The Gig workers are also known as Grey-
A. 1 only B. 2 only collar workers.
C. Both 1 and 2 D. Neither 1 nor 2 Which of the statements given above is/are
correct?
10. Consider the following statements: A. 1 only B. 2 only
1. Fiscal deficit is the difference between C. Both 1and 2 D. Neither 1 nor 2
total expenditure and the sum of revenue
receipts and non-debt receipts. 14. Which of the following is/are the
consequences of depreciation of Rupee?
1. Increase in imported inflation. 18. With reference to Cryptocurrency,
2. Difficulty in maintaining low interest consider the following statements:
rates. 1. Cryptocurrency is a specific type of virtual
3. Products and services of India will currency, which is decentralized and
become costlier to buy. protected by cryptographic encryption
Select the correct answer using the code techniques.
given below: 2. Recently, India has enacted a law to bring
A. 1 and 2 only B. 2 and 3 only crypto currency under regulation.
C. 1 and 3 only D. 1, 2 and 3 Which of the statements given above is/are
correct?
15. Consider the following statements: A. 1 only B. 2 only
1. The SARFAESI Act, 2002 provides the C. Both 1 and 2 D. Neither 1 nor 2
legal basis for the setting up of Asset
Reconstruction Companies (ARCs) in India. 19. Consider the following statements
2. The ARCs are regulated by the Reserve regarding the Sovereign Gold Bonds (SGB)
Bank of India (RBI). scheme:
Which of the statements given above is/are 1. The SGB scheme was launched with an
correct? objective to reduce the demand for physical
gold and shift a part of the domestic savings
A. 1 only B. 2 only 2. The bonds issued by the Reserve Bank of
C. Both 1 and 2 D. Neither 1 nor 2 India on behalf of the Government of India.
3. The bonds are sold through National
16. Which of the following can be termed as Stock Exchange of India Limited and
the components of Balance of payments: Bombay Stock Exchange.
1. Current Account Which of the statements given above is/are
2. Capital Account correct?
3. Errors and Omissions A. 1 only B. 1 and 3 only
4. Foreign Exchange Reserves C. 2 only D. 1, 2 and 3
Select the correct code from the following
options: 20. With reference to Geographical
A. 1, 2 and 4 only B. 2, 3 and 4 only Indication (GI) Tag Certification, consider
C. 1 and 2 only D. 1, 2, 3 and 4 the following statements:
1. It is used to identify goods having special
17. Which of the following is/are the features originating from a definite
objectives of Disinvestment in India? geographical territory.
1. Reducing the fiscal burden on the 2. It is covered under the World Trade
exchequer Organisation’s agreements.
2. Encouraging private ownership 3. It is administered by the Controller
3. Maintaining and promoting competition General of Patents, Designs and Trademarks
in the market in India.
Select the correct answer using the code Which of the above statements is/are
given below: correct?
A. 1 only B. 2 and 3 only A. 1 only B. 2 only
C. 1 and 3 only D. 1, 2 and 3 C. 1 and 3 only D. 1, 2 and 3
21. The ‘Basel III norms’ is associated with 25. Consider the following statements
which of the following? regarding the Digital Payment Systems:
A. Banking Sector 1. UPI is an advanced version of Bharat Bill
B. Transfer of Hazardous Waste Payment System (BBPS).
C. Cybercrime 2. There is no minimum or maximum limit
D. Administration of Criminal Justice on the amount of funds that could be
transferred using National Electronic Funds
22. Which of the following components Transfer (NEFT).
is/are used to measure Gross Domestic 3. RuPay is an NPCI operated payment card
Product (GDP)? which also has its validity in Singapore,
1. Personal consumption Bhutan and UAE.
2. Business investment Which of the statements given above is/are
3. Government spending correct?
4. Net exports A. 1 and 2 only B. 2 only
Select the correct answer using the code C. 2 and 3 only D. 1, 2 and 3
given below:
A. 1 and 2 only B. 2 and 3 only 26. Which of the following statements
C. 1 only D. 1, 2, 3 and 4 is/are correct regarding ‘e-RUPI’?
1. It is a type of virtual currency launched by
23. Consider the following statements: the Government of India.
1. Additional Tier 1 (AT1) bonds are 2. It can be used for delivering services
regulated by the Reserve Bank of India. under Ayushman Bharat Pradhan Mantri
2. Banks issue AT1 bonds to shore up their Jan Arogya Yojana.
core capital base to meet the Basel-III 3. The private sector can leverage it as part
norms. of their Corporate Social Responsibility
3. Banks issuing AT-1 bonds can skip (CSR) programs.
interest payouts for a particular year or Select the correct answer using the code
even reduce the bonds’ face value. given below:
Which of the statements given above is/are A. 1 and 2 only B. 2 and 3 only
correct? C. 3 only D. 1, 2 and 3
A. 1 and 2 only B. 2 only
C. 3 only D. 1, 2 and 3 27. Consider the following statements
regarding Scheduled Banks:
24. Consider the following: 1. They are listed in the 2nd schedule of the
1. Lifestyle Material Footprint Banking regulation Act, 1949.
2. Food Wastage 2. The bank's paid-up capital and raised
3. Plastic Waste funds must be at least Rs. 5 lakh to qualify
4. Sustainable Tourism as a scheduled bank.
The above-mentioned targets describe 3. All the regional and cooperative banks
which of the following Sustainable fall under Scheduled Banks.
Development Goals (SDG)? Which of the statements given above is/are
correct?
A. SDG 16 B. SDG 12 A. 1 only B. 2 and 3 only
C. SDG 8 D. SDG 4 C. 1 and 3 only D. 1, 2 and 3
28. Consider the following statements: C. Open Market Operations
1. If the government earned more from D. Imposing Margin Requirements on
taxes than what it spent on subsidies, Gross Secured Loans
Value Added (GVA) will be higher than
Gross Domestic Product (GDP). 32. With reference to Non-Fungible Tokens
2. GDP is derived by taking the GVA data (NFTs), consider the following statements
and adding the taxes on different products 1. They enable the digital representation
and then subtracting all the subsidies on of physical assets.
products. 2. They are unique cryptographic tokens
Which of the statements given above is/are that exist on a blockchain.
correct? 3. They can be traded or exchanged at
A. 1 only B. 2 only equivalency and therefore can be
C. Both 1 and 2 D. Neither 1 nor 2 used as a medium of commercial
transactions.
29. The Securities and Exchange Board of Which of the statements given above are
India (SEBI) can be described as which of correct?
the following bodies: (a) 1 and 2 only
1. Statutory Body (b) 2 and 3 only
2. Quasi-legislative Body (c) 1 and 3 only
3. Quasi-judicial Body (d) 1, 2 and 3
Select the correct answer using the code
given below: 33. Which one of the following best
A. 1 and 2 only B. 1 and 3 only describes term "Merchant Discount Rate"?
C. 1 only D. 1, 2 and 3 (a) The incentive given by a bank to a
merchant for accepting payments through
30. With reference to the ‘Capital Gain Tax’, debit cards pertaining to that bank.
consider the following statements: (b) The amount paid back by banks to their
1. It will be required to be paid for that customers when they use debit cards for
amount in the year in which the transfer of financial transactions for purchasing
the capital asset takes place. goods or services.
2. It can be reduced by deducting the (c) The charge to a merchant by a bank for
capital losses that occur when a taxable accepting payments from his customers
asset is sold for less than the original through the bank's debit cards.
purchase price. (d) The incentive given by the Government,
Which of the statements given above is/are to merchants for promoting digital
correct? payments by their customers through
A. 1 only B. 2 only Point of Sale machines and debit cards.
C. Both 1 and 2 D. Neither 1 nor 2
34. Which one of the following activities of
31. Which of the following is not a the Reserve Bank of India is considered to
quantitative instrument of monetary policy be part of sterilization?
of the RBI? (a) Conducting "Open Market Operations'
A. Bank Rate (b) Oversight of settlement and payment
B. Cash Reserve Ratio systems
(c) Debt and cash management for the (c) Increase in the banking habit of the
Central and State Governments people
(d) Regulating the functions of Non-banking (d) Increase in the population of the country
Financial Institutions
38. Which of the following is/are the impact
35. With reference to the Central Bank of increased US Federal Reserve interest
digital currencies, consider the following rates on the Indian economy?
statements: 1. Bond yields will rise.
1. It is possible to make payments in a 2. Expensive imports of crude oil.
digital currency without using US dollar 3. Loss in export of IT & IT-enabled services.
or SWIFT system. Select the correct answer using the code
2. A digital currency can be distributed given below:
with a condition programmed into it A. 1 and 2 only B. 2 and 3 only
such as time-frame for spending it. C. 1 only D. 1, 2 and 3
Which of the statements given above is/are
correct? 39. If the RBI decides to adopt an
(a) 1 only expansionist monetary policy, which of the
(b) 2 only following it would not do?
(c) Both 1 and 2 1. Cut and optimize the Statutory Liquidity
(d) Neither 1 nor 2 Ratio
2. Increase the Marginal Standing Facility
36. With reference to the Indian economy, Rate
consider the following statements: 3. Cut the Bank Rate and Repo Rate
1. If the inflation is too high, the Reserve Select the correct answer using the code
Bank of India (RBI) is likely to buy given below:
government securities. (a) 1 and 2 only
2. If the rupee is rapidly depreciating, RBI (b) 2 only
is likely to sell dollars in the market. (c) 1 and 3 only
3. If interest rates in the USA or European (d) 1, 2 and 3
Union were to fall, that is likely to induce
RBI to buy dollars. 40. When the Reserve Bank of India reduces
Which of the statements given above are the Statutory Liquidity by 50 basis points,
correct? which of the following is likely to happen?
(a) 1 and 2 only
(b) 2 and 3 only (a) India’s GDP growth rate increases
(c) 1 and 3 only drastically
(d) 1, 2 and 3 (b) Foreign Institutional Investors may bring
more capital into our country
37. The money multiplier in an economy (c) Scheduled Commercial Banks may cut
increases with which one of the following? their lending rates
(a) Increase in the Cash Reserve Ratio in (d) It may drastically reduce the liquidity to
the banks the banking system.
(b) Increase in the Statutory Liquidity Ratio
in the banks
41. With reference to India economy, 1. The short-term G-Sec is called dated
consider the following:
securities whereas the long-term G-Sec is
1. Bank rate
2. Open market operations called treasury bills.
3. Public debt 2. In India, only the Central Government
4. Public revenue issues both treasury bills and dated
Which of the above is/are component/ securities.
components of Monetary Policy?
(a) 1 only Which of the statements given above is/are
(b) 2, 3 and 4 only correct?
(c) 1 and 2 only A. 1 only B. 2 only
(d) 1, 3 and 4 only C. Both 1 and 2 D. Neither 1 nor 2

42. Consider the following liquid assets:


45. Consider the following statements:
1. Demand deposits with the banks
1. The Monetary Policy Committee (MPC)
2. Time deposits with the banks
has adopted the Consumer Price Index
3. Savings deposits with the banks
(CPI) to control inflation.
4. Currency
2. The CPI is released by the Office of
The correct sequence of these assets in
Economic Adviser, Ministry of Commerce
the decreasing order of liquidity is
and Industry.
(a) 1-4-3-2
Which of the statements given above
(b) 4-3-2-1
is/are correct?
(c) 2-3-1-4
A. 1 only B. 2 only
(d) 4-1-3-2
C. Both 1 and 2 D. Neither 1 nor 2
43. Consider the following statements:
46. Consider the following statements
1. A debt is classified as non-performing,
regarding Special
when the loan payments have not been
Economic Zones (SEZs):
made for a minimum period of 90 days.
1. SEZs are exempted from the Income Tax
2. Capital Adequacy Ratio is the ratio of a
and Minimum Alternate Tax.
bank’s capital in relation to its risk weighted
2. SEZs were established in India in 2000
assets and current liabilities.
under its Foreign Trade Policy.
Which of the statements given above is/are
3. Asia’s first Export Processing Zone (EPZ)
correct?
was established in Gujarat.
A. 1 only B. 2 only
Which of the statements given above
C. Both 1 and 2 D. Neither 1 nor 2
is/are correct?
A. 1 and 2 only B. 2 only
C. 3 only D. 1, 2 and 3
44. Consider the following statements
regarding Government Security (G-Sec): 47. Consider the following statements:
1. Marginal Cost of Lending Rate (MCLR) is
the minimum interest rate at which
commercial banks can lend.
2. In the event of a rise in deposit rates, Which of the statements given above is/are
the banks reduce the lending rates. correct?
Which of the statements given above A. 1 only B. 2 only
is/are correct? C. 2 and 3 only D. 1, 2 and 3
A. 1 only B. 2 only
C. Both 1 and 2 D. Neither 1 nor 2 51. Consider the following statements
1. The National Small Savings Fund (NSSF)
was established within the Consolidated
48. Consider the following statements Fund of India.
regarding the Corporation Tax: 2. The rules to administer NSSF are framed
1. It is a direct tax imposed on the gross by the President of India under Article 283
(1) of the Indian Constitution.
income of the enterprises.
2. The public companies registered in India Which of the statements given above is/are
under the Companies Act, 1956 are liable to correct?
A. 1 only B. 2 only
pay corporation tax. C. Both 1 and 2 D. Neither 1 nor 2
3. The tax is levied as per the provisions of
Income Tax Act, 1961. 52. Consider the following statements
regarding Insurance Regulatory and
Which of the statements given above are Development Authority of India (IRDAI):
correct? 1. It was constituted upon the
A. 1 and 2 only B. 2 and 3 only recommendations of the Malhotra
Committee in 1999.
C. 1 and 3 only D. 1, 2 and 3 2. It is a statutory body.
3. It is headquartered in Hyderabad.
49. With reference to the 'Goods And
Services Tax (GST)', consider the following Which of the statements given above is/are
statements: correct?
1. GST is based on the principle of A. 1 and 2 only B. 2 and 3 only
destination-based consumption taxation. C. 3 only D. 1, 2 and 3
2. The rate of GST is decided by the Union
Government. 53. Consider the following statements:
Which of the statements given above is/are 1. The inflation in India is primarily
correct? measured by using Wholesale Price Index
A. 1 only B. 2 only (WPI) and Consumer Price Index (CPI).
C. Both 1 and 2 D. Neither 1 nor 2 2. The measurement of core inflation does
not include the rising prices of the food and
50. Consider the following statements energy sector.
regarding the Asian Development Bank
(ADB): Which of the statements given above is/are
1. India is a founding member of ADB. correct?
2. India is the largest shareholder of ADB. A. 1 only B. 2 only
3. ADB is headquartered in Thailand. C. Both 1 and 2 D. Neither 1 nor 2
1. The RBI mandates only scheduled
commercial banks and Regional rural banks
to lend under PSL.
54. Consider the following statements: 2. The Regional rural banks have to allocate
1. Balance of Payment comprises 100 % of their Adjusted Net Bank Credit
transactions made under Current Account (ANDC) to PSL.
and Capital Account only. Which of the statements given above is/are
2. Current Account shows export and correct?
import of visibles (also called merchandise A. 1 only B. 2 only
or goods - represent trade balance) and C. Both 1 and 2 D. Neither 1 nor 2
invisibles (also called non-merchandise).
Which of the statements given above is/are 58. With reference to the Minimum
correct? Alternate Tax (MAT),
A. 1 only B. 2 only consider the following statements:
C. Both 1 and 2 D. Neither 1 nor 2 1. The MAT was introduced due to an
increase in the number of zero tax paying
55. With reference to Current Account companies.
Deficit (CAD), consider the following 2. Only domestic companies in India are
statements: covered under the provision of MAT.
1. Current account records exports and Which of the statements given above is/are
imports in goods and services only. correct?
2. CAD can be reduced by curbing non- A. 1 only B. 2 only
essential imports such as gold, mobiles, and C. Both 1 and 2 D. Neither 1 nor 2.
electronics.
Which of the statements given above is/are 59. Consider the following statements
correct? regarding the currency depreciation in
A. 1 only B. 2 only India:
C. Both 1 and 2 D. Neither 1 nor 2 1. Currency depreciation increases the
country’s export activity.
56. Consider the following statements: 2. Travel to India gets costly.
1. India’s Forex Reserves include the 3. People receiving remittances from
Foreign Currency Assets (FCA) and Gold abroad are gainers.
reserves only. Which of the statements given above is/are
2. The Foreign Currency Assets are correct?
expressed in dollar terms. A. 2 and 3 only B. 1 and 2 only
Which of the statements given above is/are C. 1 and 3 only D. 1, 2 and 3
correct?
A. 1 only B. 2 only 60. Consider the following statements
C. Both 1 and 2 D. Neither 1 nor 2 regarding Asset Reconstruction Companies
(ARCs):
57. With reference to the Priority Sector 1. These are specialized financial
Lending (PSL), consider the following institutions that buy the Non-Performing
statements: Assets (NPAs) from banks.
2. The Reserve Bank of India (RBI) Act, 1934 3. His jurisdiction covers the deficiencies in
provides the legal basis for the setting up of service on the part of insurers, agents,
ARCs in India. brokers and other intermediaries.
3. The ARCs are regulated by the Reserve Which of the statements given above is/are
Bank of India (RBI). correct?
Which of the statements given above are A. 1 only B. 2 only
correct? C. 1 and 3 only D. 1, 2 and 3
A. 1 and 2 only B. 2 and 3 only
C. 1 and 3 only D. 1, 2 and 3 64. Consider the following statements:
1. National Payments Corporation of India
61. With reference to Corporate Social (NPCI) is an umbrella organisation for
Responsibility, operating retail payments and settlement
consider the following statements: systems in India.
1. The concept of CSR is governed by 2. It is an initiative of Reserve Bank of India
Corporate Social Responsibility Act, 2013. (RBI) and Indian Banks’ Association (IBA).
2. The CSR provisions are applicable to 3. NPCI is a “Not for Profit” Company under
companies with an annual turnover of 1,000 the Section 8 of Companies Act 2013.
crore. Which of the statements given above is/are
Which of the statements given above is/are correct?
correct? A. 1 only B. 2 and 3 only
A. 1 only B. 2 only C. 2 only D. 1, 2 and 3
C. Both 1 and 2 D. Neither 1 nor 2
65. Consider the following statements:
62. With reference to the Consolidated 1. Open Market Operations (OMOs) is the
Sinking Fund (CSF), buying and selling of bonds issued by the
consider the following statements: Government in the open market.
1. It was set up by the RBI to meet 2. OMOs is the one of the qualitative tools
redemption of market loans of the States. used by RBI to minimise the impact of
2. The fund should be maintained outside liquidity condition on the interest rate and
the consolidated fund of the States and the inflation rate levels.
public account. Which of the statements given above is/are
Which of the statements given above is/are correct?
correct? A. 1 only B. 2 only
A. 1 only B. 2 only C. Both 1 and 2 D. Neither 1 nor 2
C. Both 1 and 2 D. Neither 1 nor 2
66. Which of the following committees are
63. With reference to Insurance related to reforms in Banking sectors?
Ombudsman in India, 1. Narasimham Committee
consider the following statements: 2. P J Nayak Committee
1. It derives its powers from the Insurance 3. Abhijit Sen Committee
Regulatory and Development Authority Act, Select the correct answer using the code
1999. given below:
2. He serves his office for the term of five
years and is not eligible for reappointment. A. 1 and 2 only B. 2 and 3 only
C. 1 only D. 1, 2 and 3 1. The World Economic Outlook Report is
released by the International Monetary
Fund (IMF).
2. The IMF was set up after the Second
67. Consider the following statements: World War to assist in the reconstruction of
1. Foreign Portfolio Investment (FPI) is often war-ravaged countries.
referred to as hot money. Which of the statements given above is/are
2. FPI does not provide the investor with correct?
direct ownership of financial assets. A. 1 only B. 2 only
3. FPI is part of a country’s capital account C. Both 1 and 2 D. Neither 1 nor 2
and is shown on its Balance of Payments.
Which of the statements given above is/are 71. Which of the following statements is not
correct? correct regarding the different shapes of
A. 1 and 2 only B. 2 only economic recovery?
C. 3 only D. 1, 2 and 3 A. In Z-shaped the economic disruption lasts
for a small period wherein more than
68. With reference to the Blue economy, people’s incomes, it is their ability to spend
consider the following statements: is restricted.
1. The concept was introduced by Gunter B. In V-shaped the incomes and jobs are
Pauli. permanently lost, and the economic growth
2. It advocates the greening of ocean recovers gradually.
development strategies for higher C. In U-shaped the economy after falling,
productivity and conservation struggles around a low growth rate for
of ocean's health. some time, before rising gradually to usual
Which of the statements given above is/are levels.
correct? D. In K-Shaped after a recession, different
A. 1 only B. 2 only parts of the economy recover at different
C. Both 1 and 2 D. Neither 1 nor 2 rates, times, or magnitudes.

69. With reference to digital service tax 72. Consider the following statements:
(DST), consider the following statements: 1. The Reserve Bank of India (RBI) adopts
1. India is the only country that imposes loose monetary policy to boost economic
digital service tax. activities in the economy.
2. In India 2% digital service tax is levied on 2. The loose monetary policy involves
trade and services by non-resident e- raising interest rates and sucking liquidity
commerce operators. out of the economy by selling bonds by the
Which of the statements given above is/are RBI.
correct? Which of the statements given above is/are
A. 1 only B. 2 only correct?
C. Both 1 and 2 D. Neither 1 nor 2 A. 1 only B. 2 only
C. Both 1 and 2 D. Neither 1 nor 2
70. Consider the following statements:
73. With reference to the ‘Banks Board given to inexperienced entrepreneurs to
Bureau (BBB)’, which of the following set up manufacturing or export units.
statements are correct? Which of the statements given above is/are
1. The Governor of RBI is the Chairman of correct?
BBB. (a) 1 only
2. BBB recommends for the selection of (b) 2 only
heads for Public Sector Banks. (c) Both 1 and 2
(d) Neither 1 nor 2
3. BBB helps the Public Sector Banks in 76. With reference to the Indian economy,
developing strategies and capital raising what are the advantages of “Inflation
plans. Indexed Bonds (IIBs)”?
Select the correct answer using the code 1. Government can reduce the coupon
given below: rates on its borrowing by way of IIBs.
(a) 1 and 2 only 2. IIBs provide protection to the investors
(b) 2 and 3 only from uncertainty regarding inflation.
(c) 1 and 3 only 3. The interest received as well as capital
(d) 1, 2 and 3 gains on IIBs are not taxable.
Which of the statements given above are
74. What is the importance of the term correct?
“Interest Coverage Ratio” of a firm in India? (a) 1 and 2 only
1. It helps in understanding the present (b) 2 and 3 only
risk of a firm that a bank is going to give (c) 1 and 3 only
loan to. (d) 1, 2 and 3
2. It helps in evaluating the emerging risk
of a firm that a bank is going to give 77. With reference to the Indian Economy,
loan to. consider the following statements:
3. The higher a borrowing firm’s level of 1. ’Commercial Paper’ is a short term
Interest Coverage Ratio, the worse is its unsecured promissory note.
ability to service its debt. 2. ‘Certificate of Deposit’ is a long-term
Select the correct answer using the code instrument issued by the Reserve Bank
given below: of India to a corporation.
(a) 1 and 2 only 3. ‘Call Money’ is a short-term finance
(b) 2 only used for interbank transactions.
(c) 1 and 3 only 4. ‘Zero-Coupon Bonds’ are the interest-
(d) 1, 2 and 3 bearing short-term bonds issued by
the Scheduled Commercial Banks to
75. Why is offering of “teaser loans” by corporations.
commercial banks a cause of economic Which of the statements given above is/are
concern? correct?
1. The teaser loans are considered to be (a) 1 and 2 only
an aspect of subprime lending and (b) 4 only
banks may be exposed to the risk of (c) 1 and 3 only
defaulters in future. (d) 2, 3 and 4 only
2. In India, the teaser loans are mostly
78. What does venture capital mean? many of the above as criteria other than
(a) Short-term capital provided to industries population area and income distance?
(b) A long-term start-up capital provided (a) Only two
to new entrepreneurs (b) Only three
(c) Funds provided to industries at times of (c) Only four
incurring losses (d) All five
(d) Funds provided for replacement and
renovation of industries 82. With reference to the Indian economy,
79. Which one of the following is 82. Consider the following statements:
responsible for the preparation and 1. An increase in Nominal Effective
presentation of Union Budget to the Exchange Rate (NEER) indicates the
Parliament? appreciation of rupee.
(a) Department of Revenue 2. An increase in the Real Effective
(b) Department of Economic Affairs Exchange Rate (REER) indicates an
(c) Department of Financial Services improvement in trade competitiveness.
(d) Department of Expenditure 3. An increasing trend in domestic inflation
relative to inflation in other countries is
80. What is/are the most likely advantages likely to cause an increasing divergence
of implementing 'Goods and Services Tax between NEER and REER.
(GST)'? Which of the above statements are correct?
1. It will replace multiple taxes collected (a) 1 and 2 only
by multiple authorities and will thus (b) 2 and 3 only
create a single market in India. (c) 1 and 3 only
2. It will drastically reduce the 'Current (d) 1, 2 and 3
Account Deficit' of India and will enable
it to increase its foreign exchange reserves. 83. Consider the following statements:
3. It will enormously increase the growth 1. Tight monetary policy of the US Federal
and size of the economy of India and will Reserve could lead to capital flight.
enable it to overtake China in near future. 2. Capital flight may increase the interest
Select the correct answer using the code cost of firms with existing External
given below: Commercial Borrowings (ECBs).
(a) 1 only 3. Devaluation of domestic currency
(b) 2 and 3 only decreases the currency risk associated
(c) 1 and 3 only with ECBs.
(d) 1, 2 and 3 Which of the statements are correct?
(a) 1 and 2 only
81. Consider the following: (b) 2 and 3 only
1. Demographic performance (c) 1 and 3 only
2. Forest and ecology (d) 1, 2 and 3
3. Governance reforms
4. Stable government 84. Consider the following:
5. Tax and fiscal efforts 1. Foreign currency convertible bonds
For the horizontal tax devolution, the 2. Foreign institutional investment with
Fifteenth Finance Commission used how certain conditions
3. Global depository receipts government of one country to another
4. Non-resident external deposits (d) capital movements from one country to
Which of the above can be included in another
Foreign Direct Investments?
(a) 1, 2 and 3 88. Which one of the following groups of
(b) 3 only items is included in India’s foreign –
(c) 2 and 4 exchange reserves?
(d) 1 and 4
85. Which one of the following is not the (a) Foreign – currency assets, Special
most likely measure the Government/RBI Drawing Rights (SDRs) and loans from
takes to stop the slide of the Indian rupee? foreign countries.
(a) Curbing imports of non-essential goods (b) Foreign – currency assets, gold holdings
and promoting exports. of the RBI and SDRs.
(b) Encouraging Indian borrowers to issue (c) Foreign – currency assets, loans from
rupee denominated Masala Bonds. the World Bank and SDRs.
(c) Easing conditions relating to external (d) Foreign – currency assets, gold holdings
commercial borrowing. of the RBI and loans from the World
(d) Following an expansionary monetary Bank.
policy.
89. With reference to the "Tea Board" in
86. Which of the following is/are included in India,
the capital budget of the Government of consider the following statements:
India? 1. The Tea Board is a statutory body.
1. Expenditure on acquisition of assets 2. It is a regulatory body attached to the
like roads, buildings, machinery, etc. Minister of Agriculture and Farmers
2. Loans received from foreign Welfare.
Governments. 3. The Tea Board's Head Office is situated
3. Loans and advances granted to the in Bengaluru.
States and Union Territories. 4. The Board has overseas offices at Dubai
Select the correct answer using the code and Moscow.
given below. Which of the statements given above are
(a) 1 only correct?
(b) 2 and 3 only (a) 1 and 3
(c) 1 and 3 only (b) 2 and 4
(d) 1, 2 and 3 (c) 3 and 4
(d) 1 and 4
87. The Balance of Payments of a country is
a systematic record of 90. With reference to the "G20 Common
(a) all import and export transactions of a Framework", consider the following
country during a given period of time, statements:
normally a year 1. It is an initiative endorsed by the G20
(b) goods exported from a country during a together with the Paris Club.
year 2. It is an initiative to support Low Income
(c) economic transaction between the Countries with unsustainable debt.
Which of the statements given above is/are (c) Borrowing from the banks to finance a
correct? budget deficit
(d) Creation of new money to finance a
(a) 1 only budget deficit
(b) 2 only
(c) Both 1 and 2 95. Consider the following statements:
(d) Neither 1 nor 2 1. The weightage of food in Consumer
Price Index (CPI) is higher than that in
91. Disguised unemployment generally Wholesale Price Index (WPI).
means: 2. The WPI does not capture changes in
(a) large number of people remain the prices of services, which CPI does.
unemployed 3. The Reserve Bank of India has now
(b) alternative employment is not available adopted WPI as its key measure of
(c) marginal productivity of labour is zero inflation and to decide on changing the
(d) productivity of workers is low key policy rates.
Which of the statements given above is/are
92. A decrease in the tax to GDP ratio of a correct?
country indicates which of the following? (a) 1 and 2 only
1. Slowing economic growth rates (b) 2 only
2. Less equitable distribution of national (c) 3 only
income (d) 1, 2 and 3
Select the correct answer using the code
given below. 96. India is regarded as a country with a
(a) 1 only “Demographic Dividend”. This is due to
(b) 2 only (a) Its high population in the age group
(c) Both 1 and 2 below 15 years.
(d) Neither 1 nor 2 (b) Its high population in the age group of
15-64 years.
93. The National Income of a country for a (c) Its high population in the age group
given period is equal to the: above 65 years.
(a) Total value of goods and services (d) Its high total population.
produced by the nationals.
(b) Sum of total consumption and 97. Consider the following statements
investment expenditure. about particularly Vulnerable Tribal Groups
(c) Sum of personal income of all (PVTGs) in India:
individuals. 1. PVTGs reside in 18 states and one union
(d) Money value of final goods and services Territory.
produced. 2. A stagnant or declining population is
one of the criteria for determining PVTG
94. Which one of the following is likely to be status.
the most inflationary in its effects? 3. There are 92 PVTGs officially notified in
(a) Repayment of public debt the country so far.
(b) Borrowing from the public to finance a 4. Irular and Konda Reddi tribes are
budget deficit included in the list of PVTGs.
Which of the statements given above are
correct?

(a) 1,2 and 3


(b) 2,3 and 4
(c) 1, 2 and 4
(d) 1,3 and 4

98. Consider the following statements:


Other things remaining unchanged,
market demand for a good might
increase if
1. price of its substitute increases
2. price of its complement increases
3. the good is an inferior good and income
of the consumers increases
4. its price falls
Which of the above statements are
correct?
(a) 1 and 4 only
(b) 2, 3 and 4
(c) 1, 3 and 4
(d) 1, 2 and 3

99. Which of the following factors impact


Rupee-Dollar exchange rate?
1.Inflation
2.Political instability on economy
3.Current Account Deficit
4.External Debt
Select the correct code:

A. 1 and 2 only
B. 2, 3 and 4 only
C. 1, 3 and 4 only
D. 1, 2, 3 and 4

100. The largest contributor to the gross


domestic savings of India is

a. the public sector


b. the foreign sector
c. the household sector
d. the private corporate sector

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