introduction to indian economy section 7 MCQ Questions & Answers Detailed Explanation
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The following question based on Introduction to Indian Economy topic of indian economy mcq
- the difference between current expenditure and current revenue
- net increase in Union Governments borrowings from the Reserve Bank of India.
- the sum of budgetary deficit and net increase in internal and external borrowings
- the sum of monetised deficit and budgetary deficit
(a) 2 and 4 only
(b) All of the above
(c) 3 only
(d) 2 only
The correct answers to the above question in:
Answer: (c)
When a government’s total expenditure exceeds the revenue that it generates (excluding money from borrowings).
Deficit differs from debt, which is an accumulation of yearly deficits. A fiscal deficit is regarded by some as a positive economic event.
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Read more introduction Based Indian Economy Questions and Answers
Question : 1
The type of note issue system followed in India is :
a) Minimum reserve system
b) Maximum fiduciary system
c) Proportional fiduciary system
d) Fixed fiduciary system
Answer »Answer: (a)
In terms of Section 22 of the Reserve Bank of India Act, the RBI has been given the statutory function of note issue on a monopoly basis. The note issue in India was originally based upon the “Proportional Reserve System”. When it became difficult to maintain the re-serve proportionately, it was replaced by the “Minimum Reserve System “.
According to the RBI Amendment Act of 1957, the bank should now maintain a minimum reserve of Rs.200 crore worth of gold coins, gold bullion and foreign securities of which the value of gold coin and bullion should be not less than Rs.115 crore.
Question : 2
Consider the following statements
- The current Economic Census is the seventh in the series so far conducted in India.
- The Economic Census in India is undertaken by the Department of Economic Affairs (Union Ministry of Finance).
a) Only 2
b) Both l and 2
c) Only 1
d) Neither 1 nor 2
Answer »Answer: (d)
In 1976, Government of India launched a plan scheme called “Economic Census and Surveys”. In 1977 Central Statistical Organisation conducted First economic census in collaboration with the Directorate of Economics & Statistics (DES) in the States/Union Territories. Current Economic Census is Sixth Economic Census held in 2013.
The Central Statistics Office (CSO) in the Ministry of Statistics and Programme Implementation (MOSPI) conducted the Sixth Economic Census during January, 2013 to April, 2014 in collaboration with Directorates of Economics and Statistics in all the States and Union Territories.
Question : 3
As per newspapers report what percent of Government stake will be disinvested in Rashtriya Ispat Nigam Ltd. (RINL) ?
a) 50%
b) 5%
c) 10%
d) 12%
Answer »Answer: (c)
Rashtriya Ispat Nigam Ltd (RINL), on 23 September 2014, filed a draft prospectus with market regulator SEBI for an initial public offering (IPO) through which the government will sell 10 per cent of its stake in the company.
The government proposes to raise Rs 43,425 crore through disinvestment in PSUs.
Question : 4
If all the banks in an economy are nationalized and converted into a monopoly bank, the total deposits
a) will increase
b) will neither increase nor decrease
c) will decrease
d) None of the above
Answer »Answer: (b)
It will remain the same, because banks do not increase the national income. So it remains the same immaterial whether banks are there or not.
Question : 5
“Himayat” is a training cumplacement programme for unemployed youth in the State of
a) Punjab
b) Haryana
c) Jammu and Kashmir
d) Himachal Pradesh
Answer »Answer: (c)
Himayat is a training-cum-placement programme for unemployed youth in Jammu and Kashmir. Under the program, the youth of the state will be provided short-term training for at least 3 months, in a range of skills for which there is good market demand.
The scheme aims to train 1,00,000 youth in 5 years and provide at least 75% of them with jobs.
Question : 6
Which one of the following is not included while estimating national income through income method?
a) Mixed incomes
b) Rent
c) Pension
d) Undistributed profits
Answer »Answer: (d)
The income approach equates the total output of a nation to the total factor income received by residents or citizens of the nation.
The main types of factor income are:
- Employee compensation (cost of fringe benefits, including unemployment, health, and retirement benefits);
- Interest received net of interest paid;
- Rental income (mainly for the use of real estate) net of expenses of landlords; and
- Royalties paid for the use of intellectual property and extractable natural resources.
All remaining value-added generated by firms is called the residual or profit. If a firm has stockholders, they own the residual, some of which they receive as dividends.
Profit includes the income of the entrepreneur - the businessman who combines factor inputs to produce a good or service.
GET Introduction to Indian Economy PRACTICE TEST EXERCISES
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introduction to indian economy section 7
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introduction to indian economy section 12
introduction to indian economy section 13
introduction to indian economy section 14
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