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. 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.
2. Which is NOT a source of government tax revenue?
[A] Excise taxes on gasoline and cigarettes
[B] Property taxes
[C] Customs duties and tariffs
[D] Fees and charges for government services
Show Answer
Correct Answer: D [Fees and charges for government services]
Notes:
Fees and charges for government services refer to user charges for specific services like public utilities, hospital fees, and tolls. These are not taxes, which are compulsory payments. Tax revenue sources include excise taxes, property taxes, and customs duties. User charges represent voluntary payments for direct services and are classified as non-tax revenue.
3. Which group is classified as a ‘shadow banking system’?
[A] Scheduled Commercial Banks, NBFCs, Hedge Funds
[B] NBFCs, Investment Banks, Hedge Funds
[C] Scheduled Commercial Banks, Private Banks, NBFCs
[D] Scheduled Commercial Banks, Cooperative Banks, Investment Banks
Show Answer
Correct Answer: B [NBFCs, Investment Banks, Hedge Funds]
Notes:
The shadow banking system comprises non-banking financial companies, investment banks, and hedge funds. These entities conduct credit intermediation and liquidity services outside traditional, regulated banking channels. Shadow banking entities do not have access to central bank liquidity or deposit insurance. The Financial Stability Board monitors shadow banking to assess systemic risk. Scheduled commercial banks are not part of the shadow banking system, as they operate under stricter regulation.
4. During which five year plan The Khadi and Village Industries Commission was established ?
[A] First Five year Plan
[B] Second Five year Plan
[C] Third Five year Plan
[D] Fourth Five Year Plan
Show Answer
Correct Answer: B [Second Five year Plan]
Notes:
The Khadi and Village Industries Commission is a statutory body formed in April 1957 by the Government of India, under the Act of Parliament, ‘Khadi and Village Industries Commission Act of 1956’. It was second five year plan period then.
5. Consider the following:
- Minor Irrigation Scheme: CCA less than 2000 Hectares
- Medium Irrigation Scheme : CCA more than 2000 Hectares but less than 10000 Hectares
- Major Irrigation Scheme : CCA more than 10000 Hectares
Which among the above statements is / are correct?
[A] Only 1 and 2 are correct
[B] Only 2 and 3 are correct
[C] all are correct
[D] all are incorrect
Show Answer
Correct Answer: C [all are correct]
Notes:
Various irrigation schemes in India were classified by the erstwhile planning commission into three parts viz. Minor, Medium and Major Irrigation schemes.
- Major irrigation Scheme: Major irrigation schemes are those schemes which have a Culturable Command Areas of More than 10,000 hectares.
- Medium irrigation Schemes: The Medium Irrigation Schemes have a CCA of 2,000-10,000 hectares.
- Minor Schemes: Those with Culturable command areas up to 2000 hectares.
Cultural command area is the basis for the design of water course and basis for the design of an irrigation project. It is the proportion of the Gross Command Area which is Culturable and cultivable.
6. Which among the following is the chief characteristic of the primary industry of the developed countries?
[A] Larger farm size and increasing corporate ownership of farms
[B] Larger farm size and more government ownership of farms
[C] Smaller farm size and a diversity of crops on each farm
[D] Smaller farm size and fewer family-owned farms
Show Answer
Correct Answer: A [Larger farm size and increasing corporate ownership of farms]
Notes:
Consider agriculture in the developed countries such as United States and Canada. There, the small family farms are not able to earn a profit and are being replaced by large corporate farms.
7. The expenditure done by the government on the MGNREGA scheme comes under the:
1. Revenue expenditure
2. Capital Expenditure
3. Planned Expenditure
4. Non Planned expenditure
Choose the correct option from the codes given below:
[A] Only 1 & 3
[B] Only 1, 2 & 3
[C] Only 1 & 4
[D] Only 1, 2 & 4
Show Answer
Correct Answer: B [ Only 1, 2 & 3 ]
Notes:
There are two different sets of classifications ‘revenue vs capital expenditure’ and ‘ plan vs non-plan.’
In general, expenditure used to create assets (building a road for instance) is capital expenditure while revenue expenditure consists of expenses such as salaries and other administrative costs. Plan expenditure covers money spent on schemes or projects run by different ministries under the five-year plans.
Schemes Such as the MG National Rural Employment Guarantee Scheme can have both revenue and capital components. For instance, the administrative costs of a plan scheme could be classified as revenue expenditure while the expenditure on the scheme itself (e.g. building a village road) might be capital expenditure. Non-plan expenditure consists of any expenditure by the government not covered by the five year plans. These include interest payments on government debt and expenditure on organs of the state such as the judiciary and the police.
8. Which of the following is India’s first payments bank?
[A] Jio Payments Bank Ltd
[B] Paytm Payments Bank
[C] India Post Payments Bank
[D] Airtel Payments Bank
Show Answer
Correct Answer: D [ Airtel Payments Bank ]
Notes:
Fourth option is the correct answer. Airtel Payments Bank is India’s first payments bank.
9. Which organization publishes the Inclusive Growth and Development Report?
[A] World Bank
[B] International Monetary Fund
[C] World Economic Forum
[D] Organisation for Economic Cooperation and Development
Show Answer
Correct Answer: C [World Economic Forum]
Notes:
The World Economic Forum publishes the Inclusive Growth and Development Report. The Inclusive Development Index was introduced with this report in 2017. The report evaluates economies using parameters like education, employment, labor compensation, and social protection. The World Economic Forum is headquartered in Geneva, Switzerland, and began the series under its System Initiative on Economic Growth and Social Inclusion.
10. Which of the following is / are correct statements about “Adopt a Heritage Scheme”?
- It is an initiative under Ministry of Culture
- Under this scheme, government has appointed private as well as public companies as “Monument Mitras” to boost heritage tourism in the country
Select the correct option from the codes given below:
[A] Only 1
[B] Only 2
[C] Both 1 & 2
[D] Neither 1 nor 2
Show Answer
Correct Answer: B [Only 2 ]
Notes:
First statement is incorrect. The “Adopt a Heritage Scheme” is an initiative under Ministry of Tourism. Second statement is correct. Under this scheme, the government has appointed private as well as public companies as “Monument Mitras” for making heritage tourism more sustainable through conservation and development. The short-listed companies, to be called Monument Mitras, are from various sectors such as hospitality, travel, and banking.
