Indian Economy MCQs
Indian Economy Multiple Choice Questions (MCQs) for SSC, State and all One Day Examinations of India. Objective Questions on Indian Economy for competitive examinations.
1. A systematic record of all economic transactions completed between residents of a country and the rest of the world in a year is known as..?
[A] Net Capital Flow
[B] Balance of Payment
[C] Balance of Trade
[D] Absolute Flow
Show Answer
Correct Answer: B [Balance of Payment]
Notes:
The Balance of International payments or Balance of Payments refers to the systematic and summary record of a country’s economic and financial transactions with the rest of the world, over a period of time.
The three main components of BoP are Current Account, Capital Account and Official Reserve Transactions
2. National Rural Credit Stabilization Fund is a Institution of purpose-specific funds in which of the following?
[A] IDBI
[B] SIDBI
[C] IFCI
[D] NABARD
Show Answer
Correct Answer: D [NABARD]
Notes:
The National Rural Credit stabilization fund is a sector specific finds maintained with National Bank for Agriculture and Rural Development. This fund includes contributions from Central and State Governments, sums contributed by RBI and the sums contributed by NABARD’s board every year.
3. Which approach did the Tendulkar Committee use to measure poverty in India?
[A] Calorie-based model only
[B] Comprehensive Poverty Line Basket including health and education
[C] Inequality and growth measures
[D] Vulnerability and mobility analyses
Show Answer
Correct Answer: B [Comprehensive Poverty Line Basket including health and education]
Notes:
The Tendulkar Committee was formed in 2005 and submitted its report in 2009. It shifted poverty measurement from a calorie-based model to a broader Poverty Line Basket approach. This included private expenditure on health and education alongside food and other needs. The committee recommended separate monetary values for rural and urban areas, utilized the Mixed Reference Period data, and made adjustments for price changes based on consumption patterns.
4. The government has responsibility to ensure availability of which among the following to all consumers regardless of their ability to pay price?
[A] Giffen Goods
[B] Supplementary Goods
[C] Merit Goods
[D] Complementary Goods
Show Answer
Correct Answer: C [Merit Goods]
Notes:
The correct answer is Merit Goods. Merit goods are products or services that the government believes are beneficial for individuals and society, and thus should be available to all, regardless of their ability to pay. Examples include education and healthcare. Governments often subsidize these goods to ensure equitable access, as they can lead to positive externalities, such as a more educated workforce and improved public health.
5. What was the nationality of Mahbub ul Haq, one of the pioneers of Human development theory and co-founder of the Human Development Report?
[A] Uk
[B] USA
[C] Pakistan
[D] India
Show Answer
Correct Answer: C [Pakistan]
Notes:
Human Development Report was first launched in 1990 by the Pakistani Economist Mahbub ul Haq and Indian Nobel laureate Amartya Sen.
6. In which year RBI was empowered to regulate money, forex, G-sec and gold related securities market?
[A] 2004
[B] 2006
[C] 2008
[D] 2010
Show Answer
Correct Answer: B [2006]
Notes:
The Reserve Bank of India (RBI) was empowered to regulate the money, foreign exchange, government securities, and gold-related securities markets in 2006. This was part of the amendments made to the Reserve Bank of India Act, 1934, which aimed to enhance the regulatory framework and improve market efficiency. The move was important in promoting financial stability and transparency in India’s financial markets.
7. Consider the following:
- Short Term Funds
- Medium Term Funds
- Long Term Funds
Which among the above is/ are dealt in the Indian Capital Market?
[A] 1 & 2
[B] 2 & 3
[C] 1 & 3
[D] 1, 2 & 3
Show Answer
Correct Answer: B [2 & 3]
Notes:
Short Term Funds – Indian Money Market,
Medium and Long Term Funds- Indian Capital Market
8. The Public Debt Office acts as investment banker to which entity?
[A] Public
[B] Commercial Banks
[C] Central Bank
[D] Government
Show Answer
Correct Answer: D [Government]
Notes:
The Public Debt Office was established in 1946 as a part of the Reserve Bank of India. It manages government securities and public debt on behalf of the Government of India. The office handles the issue, interest payment, repayment, and transfer of government securities. The PDO operates in major RBI regional offices to support central and state governments in debt management operations.
9. Who are eligible beneficiaries of the Reverse Mortgage Scheme?
[A] Government Employees
[B] Senior Citizens aged 60 years and above
[C] Unemployed Persons
[D] Working Professionals below 55 years
Show Answer
Correct Answer: B [Senior Citizens aged 60 years and above]
Notes:
The Reverse Mortgage Scheme in India was launched in 2007. The scheme targets senior citizens aged 60 years and above as beneficiaries. Joint borrowers may apply if at least one applicant is aged 60 years and the other not below 55 years. The scheme allows senior homeowners to mortgage property for regular payments from lenders. Ownership remains with the borrower during the loan tenure.
10. A transfer payment is a payment that is __:
[A] made by the government to its current workers
[B] made to people who are needy
[C] For in-kind services provided to the government
[D] For which no services or goods are rendered
Show Answer
Correct Answer: D [ For which no services or goods are rendered ]
Notes:
Transfer Payment is the payment exchanged for return of no goods or services. It generally describes the welfare expenditure of the government such as subsidies, pensions, grants etc.
