introduction to indian economy section 8 MCQ Questions & Answers Detailed Explanation

Answer: (a)

A merchant bank is a financial institution which provides capital to companies in the form of share ownership instead of loans. It is a bank that deals mostly in (but is not limited to) international finance, long-term loans for companies and underwriting. Merchant banks do not provide regular banking services to the general public.

Answer: (a)

India Brand Equity Foundation is a Trust established by the Ministry of Commerce with the Confederation of Indian Industry (CII) as its associate.

IBEF’s primary objective is to promote and create international awareness of the Made in India label in markets overseas and to facilitate the dissemination of knowledge of Indian products and services.

Towards this objective IBEF works closely with stakeholders across government and industry. IBEF works with a network of stakeholders – domestic and international – to promote Brand India.

Answer: (b)

The economic liberalisation in India refers to ongoing economic reforms in India that started on 24 July 1991.

In 1991, the government of P. V. Narasimha Rao and his finance minister Manmohan Singh (currently the Prime Minister of India) started breakthrough reforms which included opening for international trade and investment, deregulation, initiation of privatization, tax reforms, and inflation controlling measures.

Answer: (c)

Navratna was the title given originally to nine Public Sector Enterprises (PSEs) identified by the Government of India in 1997 as “public sector companies that have comparative advantages”, giving them greater autonomy to compete in the global market so as to “support [them] in their drive to become global giants”.

The number of PSEs having Navratna status has been raised to 16, the most recent addition being Oil India Limited.

The list of such companies is:

1. Bharat Heavy Electricals Limited;
2. Bharat Electronics Limited;
3. Bharat Petroleum Corporation Limited;
4. Hindustan Aeronautics Limited;
5. Hindustan Petroleum Corporation Limited;
6. Mahanagar Telephone Nigam Limited;
7. National Aluminium Company Limited;
8. National Mineral Development Corporation Limited;
9. Neyveli Lignite Corporation Limited;
10. Oil India Limited;
11. Power Finance Corporation Limited;
12. Power Grid Corporation of India Limited;
13. Rashtriya Ispat Nigam Limited;
14. Rural Electrification Corporation Limited;
15. Shipping Corporation of India Limited;
16. GAIL (India) Limited.

Answer: (d)

GDP at factor cost is GDP at market price minus indirect taxes plus subsidies. GDP at factor cost measure the value of output in terms of what it really costs to produce.

However, adjustments have to be made for government subsidies to firms that make up market prices purchasers pay so price plus subsidy represent the true income to the factor of production.

Therefore, We can value domestic output at prices received by producers after indirect taxes and subsidies have been taken into account.

Answer: (b)

Mumbai is the commercial capital of India. It is one of the world's top 10 centres of commerce in terms of global financial flow, generating 5% of India's GDP, and accounting for 25% of industrial output, 70% of maritime trade in India (Mumbai Port Trust & JNPT), and 70% of capital transactions to India's economy.

The city houses important financial institutions such as the Reserve Bank of India, the Bombay Stock Exchange, the National Stock Exchange of India, the SEBI and the corporate headquarters of numerous Indian companies and multinational corporations.