Indian Economy MCQs

Notes:
Loan syndication is the process which involves a group of lenders to fund various portions of a loan for a single borrower. Loan syndication most often used when a borrower requires a large quantum of funds which generally cannot be lent by a single lender.

Notes:
The correct answer is “Broad Money.” M3 is a measure of the total money supply in an economy, including cash, demand deposits, and easily convertible near money. It encompasses all liquid and near-liquid assets, making it a comprehensive indicator of money available for spending and investment. M3 is often used by central banks to gauge economic health and inform monetary policy.

Notes:
The correct answer is “Lowering reserve requirements / increasing volume of reserves”, because lowering reserve requirements allows banks to lend a larger proportion of their deposits, thereby increasing the money multiplier, while increasing the volume of reserves gives banks more funds to create loans and deposits; together, these actions expand the deposit component of the money supply.

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The correct answer is “State Government 100%.” In India, stamp duty on promissory notes is governed by the Stamp Act of 1899, which allows state governments to levy stamp duty. Each state has the authority to set its own rates, and the revenue collected from stamp duty is retained entirely by the state government. This is a important source of revenue for states, contributing to their financial resources for development and public services.

Notes:
James Tobin proposed the Tobin tax in 1972 as a tax on international foreign exchange transactions. The proposal followed the end of dollar convertibility to gold and adoption of floating exchange rates. Tobin suggested tax rates between 0.1% and 1% on currency conversions. The original focus was specifically on foreign exchange markets to curb currency speculation and exchange-rate volatility.

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The correct answer is “Invisible Export.” Income from tourism is classified as an invisible export because it involves services provided to foreign visitors, generating revenue without the physical transfer of goods. This aligns with the economic concept where exports of services (like tourism) contribute to a country’s balance of payments.

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Authorized capital is the maximum share capital stated in a company’s Memorandum of Association. Registered capital and nominal capital are alternate terms for authorized capital. This ceiling cannot be exceeded without shareholder approval and modification in company documents as per the Companies Act, 2013.

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The Tank irrigation is more in the rocky plateau area of the county, where the rainfall is uneven and highly seasonal. The Eastern Madhya Pradesh, Chhattisgarh, Orissa, Interiors of Tamil Nadu and some parts of Andhra Pradesh have more land under tank irrigation.

Notes:
The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 by the Member of G7. The FATF has developed a series of Recommendations that are recognised as the international standard for combating of money laundering and the financing of terrorism and proliferation of weapons of mass destruction. Group of 7 (G7) is a group consisting of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.