introduction to indian economy section 1 Practice Questions Answers Test with Solutions & More Shortcuts

Answer: (b)

The Eleventh Finance Commission of India was appointed by the President on July 3, 1998 for the period 2000-05. It was chaired by Prof. A.M. Khusro and its members were Shri N.C Jain, Shri J.C Jetly, Dr. Amaresh Bagchi, and T.N. Srivastava.

Note : The Finance Commission came into existence in 1951. It was established under Article 280 of the Indian Constitution by the President of India. The chairman of 14th and current finance commission is former RBI governor Y.V.Reddy.

Answer: (a)

Geographical Indication (GI) means the name of a region or a locality, a specific place or, in exceptional cases, a country, used to describe a product originating in that region, locality, specific place or country, which possesses a specific quality, reputation or other characteristics attributable to that geographical origin, and the production and/or processing and/or preparation of which take place in the defined geographical area.

Answer: (a)

Gross Domestic Product (GDP) is a measure of the total value of the goods and services produced in a country during one year, excluding income from investment abroad by residents of the country. It is the Gross National Product less net income from property or investment abroad.

Answer: (a)

A mixed economy is an economic system in which both the state and private sector direct the economy, reflecting characteristics of both market economies and planned economies.

The basic idea of the mixed economy is that the means of production are mainly under private ownership; that markets remain the dominant form of economic coordination; and that profit-seeking enterprises and the accumulation of capital remain the fundamental driving force behind economic activity.

However, unlike a free-market economy, the government would wield considerable indirect influence over the economy through fiscal and monetary policies.

Answer: (c)

Credit control is the most important function of the Reserve Bank of India.  By using credit control methods RBI tries to maintain monetary stability.

There are two types of methods:

1. Quantitative control to regulate the volume of total credit; and
2. Qualitative Control to regulate the flow of credit.