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. In which five year plan self-reliance as an object of planning was emphasized?
[A] First Five Year Plan
[B] Second Five Year Plan
[C] Third Five Year Plan
[D] Fourth Five Year Plan
Show Answer
Correct Answer: D [Fourth Five Year Plan]
Notes:
The Fourth Five-year plan was implemented during 1969 to 1974 in India. The plan has twin objectives of “Growth with stability” and “progressive achievement of self-reliance”. It focused on the growth rate of Agriculture.
2. In which year, the practice of presenting the railway budget separate from the general budget (or vice versa in true sense) started in India?
[A] 1920
[B] 1924
[C] 1925
[D] 1930
Show Answer
Correct Answer: B [1924]
Notes:
In the year 1924, the practice of presenting the railway budget separately from the general budget (or vice versa in true sense) started in India.
3. Which of the following is not a part of Broad Money in India?
[A] Demand Deposits with Banks
[B] Currency with the Public
[C] Time Deposits with Banks
[D] Banks’ deposits with RBI
Show Answer
Correct Answer: D [ Banks’ deposits with RBI ]
Notes:
Narrow money is the most liquid part of the money supply because the demand deposits can be withdrawn anytime during the banking hours. Time deposits on the other hand have a fixed maturity period and hence can not be withdrawn before expiry of this period. When we add the time despots into the narrow money, we get the broad money, which is denoted by M3. M3 = Narrow money + Time Deposits of public with banks Here, you must note that Broad money does not include the interbank deposits such as deposits of banks with RBI or other banks. At the same time, time deposits of public with all banks including the cooperative banks are included in the Broad Money. When you add the Post Office Savings money also into the M3, it becomes M4.
4. With reference to the World Trade Organization, the principle of reciprocity within WTO framework envisages?
[A] Lowering of trade barriers by a State to be matched in return.
[B] Creation of trade barriers on uniform basis
[C] Protection of intellectual property rights.
[D] Enhanced role for State controls on trade
Show Answer
Correct Answer: A [ Lowering of trade barriers by a State to be matched in return. ]
Notes:
The principle of reciprocity in the WTO framework means that when one member lowers trade barriers, other members are expected to do the same in return. This mutual concession promotes fair trade practices and encourages countries to engage in negotiations. Reciprocity is fundamental to the WTO’s goal of reducing trade barriers globally, fostering a more open and equitable trading system.
5. Which state has been placed at top spot by World Bank for ease of doing business in India?
[A] Gujarat
[B] Andhra Pradesh
[C] Maharashtra
[D] Tamil Nadu
Show Answer
Correct Answer: A [ Gujarat ]
Notes:
Gujarat ranked first among Indian states in ease of doing business rankings by World Bank. Andhra Pradesh ranked second.
6. Which of the following are used as tool for the Liquidity adjustment facility (LAF)?
- Repo Rate
- Reverse Repo Rate
- Cash Reserve Ratio
- Statutory liquidity ratio
Select the correct option from codes given below:
[A] 1 & 2 Only
[B] 3 & 4 Only
[C] 1, 2 & 3 Only
[D] 1, 2, 3 & 4
Show Answer
Correct Answer: A [ 1 & 2 Only ]
Notes:
Liquidity adjustment facility (LAF) is a monetary policy tool which allows banks to borrow money through repurchase agreements. It consists of Rep and Reverse Repo Rate.
7. Micro or Small Enterprise (as defined in the MSMED Act 2006) may be said to have become Sick, if?
[A] Any of the borrowal account of the enterprise remains NPA for ten months or more
[B] Any of the borrowal account of the enterprise remains NPA for eight months or more
[C] Any of the borrowal account of the enterprise remains NPA for five months or more
[D] Any of the borrowal account of the enterprise remains NPA for three months or more
Show Answer
Correct Answer: D [Any of the borrowal account of the enterprise remains NPA for three months or more]
Notes:
Micro or Small Enterprise (as defined in the MSMED Act 2006) may be said to have become Sick, if any of the borrowal account of the enterprise remains NPA for three months or more.
8. After which five year plan, ‘The Rolling plan’ was implemented?
[A] Third Plan
[B] Seventh plan
[C] Fifth plan
[D] Ninth Plan
Show Answer
Correct Answer: C [Fifth plan]
Notes:
Rolling Plan (1979–1980) The Janata Party government rejected the Fifth Five-Year Plan and introduced a new Sixth Five-Year Plan (1978–1980).
9. Which among the following is/are correct regarding Call Money?
[A] No Collateral is required in Call Money transaction
[B] It is the money lent/borrowed for maximum period of 30 days
[C] It is the money lent/borrowed for maximum period of 45 days
[D] Banks borrow primarily from customers
Show Answer
Correct Answer: A [ No Collateral is required in Call Money transaction ]
Notes:
Call money is the money lent/borrowed for maximum period of 14 days. No Collateral is required in Call Money transaction. Banks borrow primarily from the inter-bank (call money) market.
10. Persons below the poverty line in India are classified as such based on whether?
[A] they are entitled to a minimum prescribed food basket
[B] they get work for a prescribed minimum number of days in a year
[C] they belong to agricultural labourer household and the scheduled caste/tribe social group
[D] their daily wages fall below the prescribed minimum wages
Show Answer
Correct Answer: A [they are entitled to a minimum prescribed food basket]
Notes:
Poverty line in India is classified on the basis of calories per day available to a person. It is a simple average and does not show the actual availability to a person or a household.
