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 among the following is First Indian Special Economic Zone(SEZ)?
[A] Visakhapatnam SEZ
[B] Kandla SEZ
[C] Noida Special Economic Zone
[D] Cochin SEZ
Show Answer
Correct Answer: B [Kandla SEZ]
Notes:
The Kandla Special Economic Zone (KASEZ) was established in the year 1965 as the first Export Processing Zone in India. It is also the first special economic zone in India and in Asia. It is located in Kutch District of Gujarat.
2. 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
3. Which among the following revolutions is related to ‘fertilizers’?
[A] Silver Revolution
[B] Grey Revolution
[C] Golden Revolution
[D] Pink Revolution
Show Answer
Correct Answer: B [Grey Revolution]
Notes:
Green Revolution- Food grains,
White Revolution Milk,
Yellow Revolution-Oil seeds,
Blue Revolution-Fisheries
Golden Revolution-Fruits;
Silver Revolution-Eggs,
Round Revolution Potato,
Pink Revolution-Meat,
Grey Revolution (Fertilizers)
4. In which of the following countries, International Rice Research center is Located?
[A] Thailand
[B] Malaysia
[C] Philippines
[D] Indonesia
Show Answer
Correct Answer: C [Philippines]
Notes:
The International Rice Research Institute (IRRI) is headquartered in Philippines and has operating offices in seventeen countries. The Institute was originally established in the yeat 1960. It aims to reduce poverty and hunger, improve the health of rice farmers and consumers.
5. Approval of which among the following is needed to draw funds from Consolidated Fund of India?
[A] President
[B] Parliament
[C] Council of Ministers
[D] All the above
Show Answer
Correct Answer: B [Parliament]
Notes:
The Consolidated Fund of India was created under Article 266 of the Indian Constitution. The government meets all its expenditure from this fund and it needs parliamentary approval to withdraw money from this fund.
6. Which among the following was the main objective of the Fiscal Responsibility and Budget Management Act, 2003?
[A] Achieve Fiscal Surplus
[B] Eliminate Revenue deficit
[C] Eliminate Fiscal Deficit
[D] Stop Money Laundering
Show Answer
Correct Answer: B [Eliminate Revenue deficit]
Notes:
The main objective of the Fiscal Responsibility and Budget Management (FRBM) Act, 2003, was to eliminate the revenue deficit. This act aimed to ensure fiscal discipline by setting targets for the government to reduce its fiscal deficit and improve the overall financial health of the economy. The act mandates the government to present a medium-term fiscal policy and aims to enhance transparency in fiscal operations. It was introduced in response to rising fiscal deficits in the late 1990s and early 2000s, which posed risks to economic stability.
7. If the Reserve Bank of India wants to increase the Cash Reserves commercial Banks, which among the following would be the most probable step taken by it ?
[A] Release Gold from its reserves
[B] Buy bonds in the open market
[C] Prohibit the transactions that involve bill of exchange
[D] Increase the tranche reserves with the IMF
Show Answer
Correct Answer: B [Buy bonds in the open market]
Notes:
When RBI buys bonds in the open market, Banks get money and Cash Reserves would increase.
8. Which of the following decides the allocation of the shares in tax proceeds?
[A] Parliament
[B] Finance Commission
[C] Ministry of Finance
[D] Public Accounts Committee
Show Answer
Correct Answer: A [ Parliament ]
Notes:
There are central Taxes on the income and Union excise duties are levied by the Union but are allotted to the states in a prescribed manner. The question is who determines which share is to get how much? This is done by the Parliament. Parliament may take into considerations the recommendations of finance commission.
9. The basic WTO principle with reference to trade barriers is that:
[A] Trade barriers can be imposed by any country that believes it will benefit from such trade barriers
[B] Trade Barriers should be lowered equally and without discrimination for all member countries
[C] Trade Barriers can be imposed if a majority of the members of the WTO agree
[D] Trade Barriers should be the same in all member countries so that the result is equivalent to free trade
Show Answer
Correct Answer: B [ Trade Barriers should be lowered equally and without discrimination for all member countries ]
Notes:
The correct answer is that trade barriers should be lowered equally and without discrimination for all member countries. This principle is rooted in the Most-Favored-Nation (MFN) clause of the World Trade Organization (WTO), which mandates that any favorable trading terms offered to one member must be extended to all members. This aims to promote fair competition and prevent trade discrimination, fostering a more open and equitable global trading system. The WTO, established in 1995, has 164 member countries, emphasizing the importance of non-discriminatory trade practices.
10. What do we call the banks that undertakes commercial banking, investment banking, mutual funds and merchant banking?
[A] Mixed Banking
[B] Retail Banking
[C] Universal Banking
[D] Narrow Banking
Show Answer
Correct Answer: C [Universal Banking]
Notes:
Universal banking is a system of banking under which big banks undertake a variety of banking services like commercial banking, investment banking, mutual funds, merchant banking, insurance etc.
