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The following question based on Introduction to Indian Economy topic of indian economy mcq
- Economics is an area where people, society and government prioritize their choices in the process of using the infrequent reserves to satisfy the various needs and wants of life.
- Economics is considered an exercise in the spacetime continuum.
- Economics is considered an exercise in the time continuum.
(a) 1 and 2
(b) 3 only
(c) 1 only
(d) 1, 2 and 3
The correct answers to the above question in:
Answer: (a)
Economics takes care of various needs and wants of life.
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Read more introduction Based Indian Economy Questions and Answers
Question : 1
Which of the following are the roles of government in the economy:
- Provision of public goods
- Provision of merit goods
- Poverty reduction
a) 2 only
b) 3 only
c) 1 only
d) 1, 2 and 3
Answer »Answer: (d)
Provision of public goods like a defence which no private agency can be entrusted with.
Provision of merit goods - goods like education and housing - through policies that encourage the consumption of such goods and discourage the use of non-merit goods like cigarettes.
Poverty reduction is considered a prime responsibility of all modern governments, as the market caters to the needs of only those who can afford to pay, not of the poor.
Question : 2
What are “Open Market Operations”?
a) Selling of currency by the RBI
b) Activities of SEBI registered brokers
c) Selling of gilt-edged securities by the Government
d) Sale of shares by FIIs
Answer »Answer: (c)
An open market operation (also known as OMO) is an activity by a central bank to buy or sell government bonds on the open market. A central bank uses them as the primary means of implementing monetary policy.
The usual aim of open market operations is to control the short term interest rate and the supply of base money in an economy and thus indirectly control the total money supply.
This involves meeting the demand of base money at the target interest rate by buying and selling government securities, or other financial instruments.
Monetary targets, such as inflation, interest rates, or exchange rates, are used to guide this implementation.
Question : 3
Tarapore committee was associated with which one of the following?
a) Fully Capital Account Convertibility
b) Foreign Exchange Reserve
c) Effect of Oil-prices on the Indian economy
d) Special Economic Zone
Answer »Answer: (a)
Current account convertibility was first coined as a theory by the Reserve Bank of India in 1997 by the Tarapore Committee. Full capital account convertibility allows local currency to be exchanged for foreign currency without any restriction on the amount.
Question : 4
National Social Assistance Programme is aimed at providing
a) All of the above
b) old age pension to very poor
c) insurance for the poor
d) financial support to Scheduled Castes and Scheduled Tribes
Answer »Answer: (b)
The National Social Assistance Scheme (NSAS) or National Social Assistance Programme (NSAP) is a flagship welfare programme of the Government of India initiated on 15 August 1995. It provides a pension for the elderly who live below the poverty line.
Article 41 of the Indian Constitution directs the State to provide public assistance to its citizens in case of unemployment, old age, sickness and disablement and in other cases of undeserved want within the limit of its economic capacity and development. The scheme is a “giant step” towards achieving the directive principle in the Constitution.
Question : 5
The theory of economic drain of India during British period was propounded by
a) Jawaharlal Nehru
b) R. C. Dutta
c) Dadabhai Naoroji
d) M. K. Gandhi
Answer »Answer: (c)
Dadabhai Naroji propounded the drain theory. The drain, he declared, was the basic cause of India’s poverty and a fundamental evil of British rule in India. Thus, he argued in 1880 that it is not pitiless operations of economic laws but it is the thoughtless hand, pitiless actions of the British policy.
Question : 6
Which among the following has the least possibility of globalisation ?
a) increase in infrastructure
b) location of capital works
c) to manage resources for investment
d) selection of labour force
Answer »Answer: (b)
Globalization can affect the labour market by increasing the capacity of developing countries to create new opportunities for work and production following the alleviation of price distortions with respect to both labour and capital. Globalization on business management is the interconnection of international markets and managing businesses in a global industry.
This includes the management of resources for foreign investments whereby a company expands its business and invests in foreign countries. Globalization means inter-linkage among the countries of the globe. This can only happen when infrastructure is in proper shape.
A well-developed infrastructure is an indispensable condition for faster globalization.
GET Introduction to Indian Economy PRACTICE TEST EXERCISES
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introduction to indian economy section 10
introduction to indian economy section 11
introduction to indian economy section 12
introduction to indian economy section 13
introduction to indian economy section 14
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