Practice Macro fundamentals gdp investment growth - indian economy mcq Online Quiz (set-1) For All Competitive Exams

Q-1)   Yellow Revolution is concerned with the production of

(a)

(b)

(c)

(d)


Q-2)   Concept of ‘Joint Sector’ for industrial development of India was envisaged in Industrial Policy Resolution of

(a)

(b)

(c)

(d)


Q-3)   Green revolution had the greatest impact on

(a)

(b)

(c)

(d)


Q-4)   Why is the Government of India disinvesting its equity in the Central Public Sector Enterprises (CPSEs)?
  1. Government intends to use the revenue earned from the disinvestment mainly to pay back the external debt.
  2. The government no longer intends to retain the managements control of the CPSEs.
Which of the statement(s) given above is/are correct?

(a)

(b)

(c)

(d)


Q-5)   Consider the following statements.
  1. Regarding the procurement of food grains, Government of India following a procurement target rather than open-ended procurement policy.
  2. Government of India announces minimum support prices only for cereals.
  3. For distribution under Targeted Public Distribution System (TPDS), Wheat and rice are issued by the government of India at uniform central issue prices to the State/Union Territories.
Which of the statement(s) given above is/are correct?

(a)

(b)

(c)

(d)


Q-6)   Indian Green Revolution started from

(a)

(b)

(c)

(d)

Explanation:


Q-7)   Which one of the following is not the problem of Small Scale Industries (SSIS)?

(a)

(b)

(c)

(d)

Explanation:


Q-8)   Indian agriculture has the following features.
  1. Dependence of agriculture on the monsoons
  2. Abolition of zamindari
  3. Absence of trade unions in the agricultural sector
  4. Heavy pressure of population on land
Which of the above is responsible for disguised unemployment in agriculture?

(a)

(b)

(c)

(d)


Q-9)   Capital formation in a country will necessarily lead to which of the following:
  1. Increase in ICOR
  2. Decrease in ICOR
  3. Economic growth
Select the correct answer using the code given below:

(a)

(b)

(c)

(d)

Explanation:

Capital formation means the production of capital goods. Production of capital goods leads to the future production of goods and services and hence economic growth. So, statement (iii) is true

Production of capital goods increases the capital stock in the economy but does not tell whether there is an increase in efficiency of that capital.

Efficiency is measured as how much output is produced from how much of inputs. So, we can’t say that ICOR will increase or decrease with capital formation.

Basically, if you increase the number of hours you study, still you cannot say that the “number of pages per hour” that you study will increase or decrease.


Q-10)   Micro-finance is the provision services to people of low-income groups. This includes both the consumers and the self-employed. The service/services rendered under micro-finance is/are
  1. Credit-facilities
  2. Saving facilities
  3. Insurance facilities
  4. Fund transfer facilities
Select the correct answer using the codes given below.

(a)

(b)

(c)

(d)


Q-11)   The prices at which the government purchases grains for maintaining public distribution system and for building up buffer-stock is known as

(a)

(b)

(c)

(d)


Q-12)   Which one of the following committees recommended the abolition of reservation of items for the Small Scale Sectors in industry?

(a)

(b)

(c)

(d)


Q-13)   Reason for low-productivity in Indian agriculture is

(a)

(b)

(c)

(d)


Q-14)   ‘Operation Flood’ is associated with

(a)

(b)

(c)

(d)

Explanation:


Q-15)   NAFED is connected with

(a)

(b)

(c)

(d)


Q-16)   Consider the following statements:
  1. Decrease in investments will lead to depletion of capital stock in the economy
  2. A decrease in investments will lead to an increase in the incremental capital-output ratio
  3. A decrease in investments will lead to a decrease in the production of goods and services
Select the correct answer using the code given below:

(a)

(b)

(c)

(d)

Explanation:

If investments are decreasing that means there is less production of capital goods in the economy but that does not mean that the existing capital stock will decrease. The existing capital stock will keep on increasing even if investments are decreasing. So, (i) statement is false.

And since existing capital stock will keep on increasing, therefore production of goods and services i.e. GDP will keep on increasing. So, (iii) statement is false.

If investments are decreasing, that means the production of capital goods is decreasing. Then you can’t say anything about the productivity of capital i.e. ICOR.

So, (ii) stamen is also false.


Q-17)   India is planning to become a $5 Trillion economy by 2024-25. Consider the following statements.
  1. It is in nominal terms
  2. It is in PPP terms
  3. It will require compounded annual real growth of around 8%, with 4% inflation
Select the correct answer using the code given below:

(a)

(b)

(c)

(d)

Explanation:

2018-19 2024-25 USD 2.7 Trillion USD 5 Trillion (nominal GDP) (Nominal GDP)

So, it requires 85% growth in six years, which comes down to around 12% compounded annual growth. This 12% is nominal growth which can be achieved with real growth of around 8% and inflation of around 4%.


Q-18)   Consider the following statements regarding Capital formation:
  1. Gold and valuable metals are part of Fixed Capital Formation
  2. Intellectual properties are part of Fixed capital formation
  3. Construction of buildings and other structures are part of Capital Formation
Select the correct answer using the code given below:

(a)

(b)

(c)

(d)

Explanation:

Gross Capital Formation = Gross Fixed Capital Formation (machinery + equipment + building + cultivated biological resources + intellectual property) + Valuable Metals + Change in stock/inventory

Gross fixed capital formation is around 30% and valuable metals and change in the stock is one per cent each.

So Gross Capital Formation or Gross Investment is around 32%. Mostly we use the gross fixed investment for all calculations and growth purposes.


Q-19)   Which of the following statements are correct about CPI rural, CPI urban and CPI combined index?
  1. Inflation data is published by NSO
  2. The base year is 2011-12
  3. It is released for all India and for states and UTs separately on a monthly basis
Select the correct answer using the code given below:

(a)

(b)

(c)

(d)

Explanation:


Q-20)   Which of the following statements are true regarding Gross National Income:
  1. It is the income earned by a country's Residents
  2. It is the income earned by a country's residents and nonresidents both
  3. It is calculated at market price by NSO
  4. It is equal to GDP plus exports minus imports
Select the correct answer using the code given below:

(a)

(b)

(c)

(d)

Explanation:

Gross National Income (GNI) is the income earned by Indian residents only whether in India or abroad.

(If an Indian has gone abroad for less than 6 months then also, he is an Indian resident only).

GNI does not include the income earned by Non-Resident Indians (NRIs). And it is equal to GDP plus net factor income from abroad (NFIA).

GNI = GNP = GDP + NFIA