introduction to indian economy section 7 MCQ Questions & Answers Detailed Explanation

Answer: (c)

An important function of the Reserve Bank of India is to act as a Government banker, agent and adviser. The Reserve Bank is an agent of Central Government and of all State Governments in India except that of Jammu and Kashmir.

State Government transactions are carried out by RBI in terms of the agreement entered into with the State Governments in terms of section 21 A of the Reserve Bank of India Act, 1934.

Answer: (b)

The Minimum Wages Act, 1948 was enacted to safeguard the interests of workers, mostly in the unorganised sector by providing for the fixation of minimum wages in certain specified employments. It binds the employers to pay their workers the minimum wages fixed under the Act from time to time.

Under the Act, both the Central Government and the State Governments are the appropriate Governments to fix, revise, review and enforce the payment of minimum wages to workers in respect of ‘scheduled employments under their respective jurisdictions.

Answer: (c)

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is an Indian job guarantee scheme, enacted by legislation on August 25, 2005.

It aims at enhancing the livelihood security of people in rural areas by guaranteeing hundred days of wage employment in a financial year to a rural household whose adult members volunteer to do unskilled manual work.

The law was initially called the National Rural Employment Guarantee Act (NREGA) but was renamed on 2 October 2009.

Answer: (d)

The Insurance Regulatory and Development Authority of India (IRDAI) is an autonomous, statutory agency tasked with regulating and promoting the insurance and re-insurance industries in India. It was constituted by the Insurance Regulatory and Development Authority Act, 1999.

Answer: (c)

National Income is one of the basic concepts in macroeconomics. National Income means the total income of the nation. The aggregate economic performance of the whole economy is measured by the national income data.

National Income refers to the money value of all final goods and services produced by the normal residents of a country while working both within and outside the domestic territory of a country in an accounting year. National Income also includes net factor income from abroad.

Symbolically, Y = PG + PS,

where, Y = National Income;
P = Price;
G = Goods; and
S = Service.

Answer: (c)

Inflation increased steadily during 2008, reaching 8.75% by the end of May and in June when this jumped to 11% then there was an alarming increase in the prices.

There were many reasons for it but one of the main driving forces was a reduction in government fuel subsidies, which lifted gasoline prices by an average of 10%.In July 2008, the key Indian Inflation Rate

i.e. the Wholesale Price Index touched the mark of 12.6%, the highest rate in the past 16 years of Indian history. This was almost three times the RBI‘s target of 4.1% and almost doubled as compared to 2007.

This continuous rise slipped back to 12.4% by mid-August in 2008.