introduction to indian economy section 9 MCQ Questions & Answers Detailed Explanation

Answer: (a)

Inflation redistributes wealth from creditors to debtors i.e., lenders suffer and borrowers benefit out of inflation.

Bondholders = this person has lent money (to debtors) and received a bond in return.

So he is a lender, he suffers, by the way, they haven’t specifically used the word – “inflation-indexed bonds”, hence we cannot say inflation benefits the bond-holders.

Answer: (c)

Prime Minister Narendra Modi launched the Pradhan Mantri Fasal Bima Yojana (PMFBY) on 13 January 2016. The Prime Minister unveiled the detailed guidelines for implementing the Fasal Bima Yojana at a farmers’ convention in Madhya Pradesh on 18 February 2016.

PMFBY aims to provide more efficient insurance support to the farmers of the country in the event of crops being destroyed by heavy rain, other natural calamities, pests or diseases.

Answer: (c)

Industrial and Commercial Bank of China (ICBC) tops the list of global banks, with a market capitalisation of $285 billion, over seven times that of HDFC Bank.

Answer: (d)

The labour force of an economy is known as the activity rate (also called the participation rate). It is shown in per cent and always as a proportion of an economy.

The concept of the ‘demographic dividend’ is related to this rate.

Answer: (c)

Fiscal policy is the use of government revenue collection (mainly taxes) and expenditure (spending) to influence the economy. In India, the fiscal policy is formulated by the Union Ministry of Finance.

Fiscal policy is distinguished from monetary policy that deals with the money supply, lending rates and interest rates and is formulated by the Reserve Bank of India.

Answer: (a)

Central Value Added Tax (CENVAT), popularly known as Central Excise Duty, is a duty on the manufacture/ production of goods in India. It is an adaptation of VAT, which came into force in the country in 1986 in the form of MODVAT (Modified Value Added Tax).

MODVAT was re-named as CENVAT on 1 April 2000.