1. Consider the following statements regarding economic phenomena:
- Twin deficit refers to a situation where a country faces both fiscal deficit and current account deficit at the same time.
- Twin deficit can result in currency depreciation and the outflow of foreign investment.
- Taper tantrum causes currency appreciation and increased inflow of foreign investment in emerging markets.
Which of the above statements is/are correct?
[A] Only 1
[B] Only 2 and 3
[C] Only 1 and 2
[D] 1, 2 and 3
Show Answer
Correct Answer: C [Only 1 and 2]
Notes:
The twin deficit implies a nation experiencing both fiscal deficit (government spending exceeds revenue) and current account deficit (imports exceed exports). Such deficits can cause loss of investor confidence, currency depreciation, and possible capital outflows. The “taper tantrum” of 2013 led to currency depreciation and capital flight from emerging markets, not appreciation or inflows; thus, statement 3 is incorrect.
2. With respect to the recently released Plastic Waste Management (Amendment) Rules, 2022, consider the following statements:
- Plastics have been classified into four categories.
- Provision of sale and purchase of surplus extended producer responsibility certificates.
- Establishment of a centralised online portal by Central Pollution Control Board (CPCB).
Which of the statements given above are correct?
[A] Only 1 & 2
[B] Only 2 & 3
[C] Only 1 & 3
[D] 1, 2 & 3
Show Answer
Correct Answer: D [1, 2 & 3]
Notes:- Recently, the Ministry of Environment, Forest, and Climate Changeannounced the Plastic Waste Management (Amendment) Rules, 2022, which notified the instructions on Extended Producer Responsibility (EPR) for plastic packaging.
- According to the new rules, plastics have been classified into four categories — category one will include rigid plastic packaging; category two will include flexible plastic packaging of single layer or multilayer (more than one layer with different types of plastic), plastic sheets and covers made of plastic sheet, carry bags, plastic sachet or pouches.
- Category three will include multi-layered plastic packaging (at least one layer of plastic and at least one layer of material other than plastic) while plastic sheet or like used for packaging as well as carry bags made of compostable plastics will fall under category four.
- The guidelines allow for sale and purchase of surplus extended producer responsibility certificates.
- The government has called for establishing a centralised online portal by Central Pollution Control Board (CPCB) for the registration as well as filing of annual returns by producers, importers and brand-owners, plastic waste processors of plastic packaging waste.
3. Consider the following statements:
- Yu Shan is the highest mountain on or adjacent to the Tropic of Cancer.
- Milankovitch cycles describe the collective effects of changes in the Earth’s movements on its climate over thousands of years.
- Mahi River is the only river in India which crosses the Tropic of Cancer twice.
- Null Island is located in the Gulf of Guinea.
Which of the statements given above are correct?
[A] Only 1 & 3
[B] 1, 2, 3 & 4
[C] Only 2, 3 & 4
[D] Only 1, 2 & 4
Show Answer
Correct Answer: B [1, 2, 3 & 4]
Notes:
All statements are correct: Yu Shan is indeed the highest summit on or near the Tropic of Cancer in Taiwan. Milankovitch cycles impact Earth’s climate patterns over millennia. The Mahi River uniquely crosses the Tropic of Cancer twice within India. Null Island, an imaginary point at 0°N 0°E, lies in the Gulf of Guinea where prime meridian and equator intersect.
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