introduction to indian economy section 1 MCQ Questions & Answers Detailed Explanation

Answer: (b)

Imperial Chemical Industries (ICI) was a British chemical company, taken over by a number of chemical companies, including Huntsman Corporation, a United States-based company, and AkzoNobel, a Dutch conglomerate, two of the largest chemical producers in the world.

In its heyday, ICI was the largest manufacturing company in the British Empire, and commonly regarded as a “bellwether of the British economy. It produced paints and speciality products (including ingredients for foods, speciality polymers, electronic materials, fragrances and flavours).

Answer: (b)

Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation’s economy. It is used to stabilize the economy over the course of the business cycle.

Fiscal policy is the sister strategy to monetary policy through which a central bank influences a nation’s money supply.

Answer: (b)

Bank Rate refers to the official interest rate at which RBI will provide loans to the banking system which includes commercial/cooperative banks, development banks etc.

Such loans are given out either by direct lending or by rediscounting (buying back) the bills of commercial banks and treasury bills. Thus, the bank rate is also known as the discount rate.

Answer: (a)

Structural unemployment is a form of unemployment resulting from a mismatch between demand in the labour market and the skills and locations of the workers seeking employment.

Structural unemployment is a result of the dynamics of the labour market, such as agricultural workers being displaced by mechanized agriculture, unskilled labourers displaced by both mechanization and automation, or industries with declining employment.

Many of these displaced workers are “left behind” due to costs of training and moving (e.g., the cost of selling one’s house in a depressed local economy), inefficiencies in the labour markets, such as discrimination or monopoly power, or because they are unsuited for work in growing sectors such as health care or high technology.

Answer: (c)

Answer: (a)

In free economy, inequalities in income is due to private property and inheritance.