INDIAN ECONOMY MCQs

1. Consider the following statements about the 13th finance commission :
     1. It is constituted to give recommendations on specified aspects of centre-state fiscal relations during 2010-2015.
    2. It will give recommendation for the cordial relation between centre & the states
Which of the statements given above is / are correct ?
(A) 1 only
(B) 2 only
(C) Both 1 and 2
(D) Neither 1 nor 2

2. Which among the following is the first commercial bank of limited liability managed by Indians ?
(A) Punjab National Bank
(B) Oudh Commercial Bank
(C) Imperial Bank of India
(D) Bank of Baroda

3. What is International Development Association ?
(A) A voluntary association of developing countries
(B) A federation of International lending agencies
(C) An affiliate of World Bank
(D) An organization of donor countries of European Union

4. Which of the following is not one of the core areas identified under the Bharat Nirman Programme ?
(A) Irrigation
(B) Rural electrification
(C) Drinking water supply
(D) Rural housing
(E) Computer education in schools
5. The Small Industries Development Bank of India (SIDBI) provides refinance facilities under ARS. What is the full form of ARS ?
(A) Automatic Refinance Scheme
(B) Allocation and Refinance Solutions
(C) Automatic Refinance Solution
(D) Allocation and Refinance Scheme
(E) None of these

6. Which one of the following was the chairman of the committee on pricing and taxation of petroleum products ?
(A) Raja J. Chelliah
(B) C. Rangarajan
(C) Y. V. Reddy
(D) Abid Hussain

7. What was the limit of ARS fixed initially by the Small Industries Bank of India (SIDBI) ?
(A) Rs. 10 lakh
(B) Rs. 20 lakh
(C) Rs. 25 lakh
(D) Rs. 35 lakh
(E) Rs. 45 lakh

8. The Small Industries Development Bank of India (SIDBI) has been operating under SWS. What is the full form of SWS ?
(A) Small Welfare Scheme
(B) Single Window Scheme
(C) Small Window Service
(D) Single Window Service
(E) None of these

9. When was the Small Industries Development Bank of India set up ?
(A) 1988
(B) 1990
(C) 1992
(D) 1998
(E) None of these

10. The Small Industries Development Bank of India was established by the Government of India with an authorized capital of—
(A) Rs. 100 crore
(B) Rs. 150 crore
(C) Rs. 200 crore
(D) Rs. 250 crore
(E) Rs. 300 crore

11. The Small Industries Development Bank of India was established as a wholly owned subsidiary of—
(A) ECGC
(B) RBI
(C) NABARD
(D) IDBI

12. One of the objectives of the 11th five year plan is to reduce the poverty ratio by how much percentage points by the year 2012 ?
(A) 2%
(B) 2·5%
(C) 3·5%
(D) 10%
(E) 5·5%

13. Which of the following is the target fixed by the 11th five year plan pertaining to increase in the literacy by the year 2012 ? The level should be increased to—
(A) 50%
(B) 60%
(C) 70%
(D) 85%
(E) 90%

14. The Small Industries Development Bank of India (SIDBI) has taken over the responsibility of administering which of the following funds ?
    (1) Small Industries Development Fund
    (2) National Equity Fund
    (3) National Development Fund
Codes :
(A) Only (1)
(B) Only (2)
(C) Both (1) and (2)
(D) Only (3)
(E) All (1), (2) and (3)

15. Decline in the price of goods and services is technically known as—
(A) Deflation
(B) Inflation
(C) Negative growth
(D) Discount yield
(E) None of these

16. The Union Minister of Commerce and Industry in his announcement of Foreign Trade Policy for 2007-08 set a target to take the Foreign Trade to the level of US$—
(A) 100 billion
(B) 160 billion
(C) 180 billion
(D) 200 billion
(E) 250 billion

17. Match list-I with list-II and select the correct answer using the code given below the lists :
List-I (Company)
(a) Chevron
(b) AT &T
(c) AMD
(d) Enercon GmbH
List-II (Major Area/product)
1. Wind energy
2. Oil
3. Telephone internet
4. Micro processor
Codes :
(a) (b) (c) (d)
(A) 2 1 4 3
(B) 4 3 2 1
(C) 2 3 4 1
(D) 4 1 2 3

18. Level of inflation has been a cause of concern for India in the recent past. Which of the following is/are not important contributory factor(s) in rise of the level of inflation ?
    (1) High rate of taxation.
    (2) Hike in oil prices in international market.
    (3) Policy to announce support prices of major cereals and agro products.
Codes :
(A) Only (1)
(B) Only (2)
(C) Both (1) and (2)
(D) Only (3)
(E) All (1), (2) and (3)

19. Which of the following is/are the component(s) of Gross Domestic Capital Formation (GDCF) ?
    (1) Gross Domestic Savings
    (2) Net Capital Inflow
    (3) Direct Foreign Investment
Codes :
(A) Only (1)
(B) Only (2)
(C) Only (3)
(D) Both (1) and (3)
(E) Both (1) and (2)

20. Small Scale Industry like handicraft and cottage industries account for nearly what per cent of the countrys exports ?
(A) 15%
(B) 20%
(C) 30%
(D) 35%
(E) 50%

21. Normally two types of factors are responsible for industrial sickness extrogenous and endogenous. Which of the following is not and endogenous factor of industrial sickness ?
(A) Shortage of power
(B) Mismanagement
(C) Diversion of funds
(D) Excessive overheads
(E) Overestimation of demand

22. While preparing estimates of savings it is customary to divide the economy in to three sectors. Which of the following is/are considered part(s) of these sectors ?
    (1) The household sector
    (2) Corporate sector
    (3) Government sector
Codes :
(A) Only (1)
(B) Only (2)
(C) Only (3)
(D) Both (1) and (2)
(E) All (1), (2) and (3)

23. Which of the following is an employment generating scheme ?
(A) Ganga Kalyan Yojana
(B) IRDA
(C) Swarnjayanti Shahri Rozgar Yojana
(D) Mid Day Meal Scheme
(E) All of these

24. Which of the following is the ceiling enforced by the European commission on the budget deficit in terms of the percentage of the GDP, on its member countries ?
(A) 1%
(B) 2%
(C) 3%
(D) 5%
(E) None of these

25. VAT is—
(A) Value Added Tax
(B) Value Added Temple
(C) Value Assets Total
(D) None of these

26. Euro is a—
(A) Currency
(B) City
(C) Group
(D) River

27. Govt. of India recently decided to import wheat at a lower rate of custom duty. The effective rate of the duty would be—
(A) 15%
(B) 12%
(C) 10%
(D) 5%
(E) None of these

28. As per the reports published recently in the Newspapers, banks surpassed the target set for farm credit in 2005-2006. How much more credit was given to this sector in terms of percentage ?
(A) 15%
(B) 20%
(C) 26%
(D) 33%
(E) 43%

29. Match list-I with list-II and select the correct answer using the code given below the lists :
List-I (Person)
(a) Mukesh Ambani
(b) Sanjeev Batra
(c) Radhey Shyam Sharma
(d) T. Shankar Lingam
List-II (Company)
1. ONGC
2. NTPC
3. Reliance Industries Ltd.
4. MMTC
Codes :
(a) (b) (c) (d)
(A) 2 4 1 3
(B) 3 1 4 2
(C) 2 1 4 3
(D) 3 4 1 2

30. As per the reports published in the Newspapers the National Housing Bank (NHB) is planing to launch a reverse mortgage scheme specially to help which of the following sections of society ?
(A) People in rural India
(B) Senior citizens
(C) People living in Govt. accommodations
(D) Women who are sole bread winners
(E) None of these

31. Which one of the following is the correct sequence in the decreasing order of contribution of different sectors to the Gross Domestic Product of India ?
(A) Services—Industry—Agriculture
(B) Services—Agriculture—Industry
(C) Industry—Services—Agriculture
(D) Industry—Agriculture—Services

32. Govt. of India recently introduced some measures/incentives to improve tourism in India. Which of the following is one of these measures ?
(A) Issuance of electronic visa
(B) Free stay for three days in Govt. hotels in four metros for business travellers and frequent flyers
(C) Highly subsidized air travel on metro routes for frequent flyers
(D) Free trip to Agra, Delhi and Jaipur to those coming on educational/study tours
(E) None of these

33. Which of the following agencies recently laid down guidelines for foreign companies who wish to raise money from the Indian capital markets ?
(A) RBI
(B) IRDA
(C) Registrar of Companies
(D) SEBI
(E) None of these

34. Consider the following statements—
    1. The repo rate is the rate at which other banks borrow from the Reserve Bank of India.
    2. A value of 1 for Gini co-efficient in country implies that there is perfectly equal income for everyone in its population.
Which of the statements given above is/are correct ?
(A) 1 only
(B) 2 only
(C) Both 1 and 2
(D) Neither 1 nor 2

35. SEBI has decided to give an exemption to some companies from the requirement of the minimum 25 per cent public share holding companies exempted from such requirement should fulfill which of the following norms ?
    1. They should have market capitalization of Rs. 1,000 crore.
    2. They should have 20 million shares listed.
    3. They should have a turnover of Rs. 400 crore per annum.
Codes :
(A) Only 1
(B) Only 2
(C) Only 3
(D) Both 1 and 3
(E) Both 1 and 2

36. Which of the following organizations/agencies has agreed to set up an institute in India to train manpower in commodities ?
(A) World Bank
(B) Asian Development Bank
(C) International Monetary Fund
(D) New York Stock Exchange
(E) None of these

37. More and more banks in India these days are setting up their ATMs and discourage people to visit their branches for transaction which of the following is/are the limitations of the ATMs which force people to go to branch for transactions ?
    1. Lack of human interface.
    2. Communication gap.
    3. Limited cash dispensing ability.
Codes :
(A) Only 1
(B) Only 2
(C) Only 3
(D) Both 1 and 2
(E) 1, 2 and 3 all

38. Tarapore committee was associated with which one of the following ?
(A) Special economic zones
(B) Full capital account convertibility
(C) Foreign exchange reserves
(D) Effect of oil prices on the Indian economy

39. Who among the following served as the chief economist of the International monetary fund ?
(A) Ashok Lahiri
(B) Sumantra Ghoshal
(C) Saumitra Chaudhri
(D) Raghuram Rajan

40. The government of India recently cleared Rs. 1,00,000 crore of investment in Special Economic Zones (SEZs) the investment will be helpful in many ways. Which of the following is/are among such benefits ?
    1. About 40,000 hectares of the land will be converted into SEZs.
    2. About 5,00,000 people will get various types of jobs in those units.
    3. Exports of agro products would get an enormous boost as all such SEZ units are to be established for agro exports only.
Codes :
(A) Both 1 and 2
(B) Only 1
(C) Only 2
(D) Only 3
(E) 1, 2 and 3 all

Answers
1. (A) 2. (B) 3. (C) 4. (E) 5. (A) 6. (B) 7. (A) 8. (D) 9. (B) 10. (D)
11. (D) 12. (D) 13. (D) 14. (C) 15. (A) 16. (B) 17. (C) 18. (B) 19. (E) 20. (B)
21. (A) 22. (E) 23. (C) 24. (C) 25. (A) 26. (A) 27. (D) 28. (E) 29. (D) 30. (B)
31. (A) 32. (A) 33. (D) 34. (C) 35. (B) 36. (D) 37. (C) 38. (B) 39. (D) 40. (C)