introduction to indian economy section 12 MCQ Questions & Answers Detailed Explanation

Answer: (b)

All expenditures that promote economic growth and development are termed development expenditure.

Expenditure on infrastructure development, public enterprises or the development of agriculture increase productive capacity in the economy and bring income to the government.

Expenditures in the nature of consumption such as Defence, interest payments, expenditure on law and order, public administration, do not create any productive asset which can bring income or returns to the government are non-development expenditures.

Answer: (d)

For calculating national income, the Indian economy is divided into 14 broad sectors, which are then grouped into three main categories A, B and C.

In India, agriculture, forestry and logging, fishing, mining and quarrying, registered manufacturing and construction units are included in category A. The output method is applied to category A.

The value added by this category is found by subtracting the value of raw materials and other inputs from the aggregate of commodity-wise output.

Answer: (c)

Rajiv Awas Yojana (RAY) envisages a “Slum Free India" with inclusive and equitable cities in which every citizen has access to basic civic infrastructure and social amenities and decent shelter.

It aims to make India slum-free by 2022 by providing people with shelter or housing, free of cost. It was introduced by the Union Ministry of Housing and Alleviation.

Answer: (c)

The term was coined by Indian economist Raj Krishna. The Hindu rate of growth is a derogatory term referring to the low annual growth rate of the socialist economy of India before 1991, which stagnated around 3.5% from the 1950s to the 1980s.

The word “Hindu” implies that the Hindu outlook of fatalism and contentedness was responsible for the slow growth.

Answer: (c)

The poverty line is a minimum level of income deemed adequate in a particular country. The common international poverty line has in the past been roughly $1 a day.

In 2008, the World Bank came out with a revised figure of $1.25 at 2005 purchasing power parity.

In India, the poverty line is identified in monetary units as the level of income or consumption expenditure required in order to avoid poverty.

Answer: (d)

The problem of over population can be solved by two ways

An effective employment policy, which can absorb the growing number of workers and promote economic growth.

An imaginative family planning programme to encourage families to adopt the small family norm.