introduction to indian economy section 4 Practice Questions Answers Test with Solutions & More Shortcuts

Answer: (a)

India borrowed features of fundamental duties and planning mechanisms from the former Soviet Union. India opted for a planned economic growth model as resources were scarce at the time of independence.

So it was imperative for the leaders to move along planned model so as to achieve optimum utilization of resources development and meeting the aim of social justice simultaneously.

Answer: (c)

Qualitative credit (used by the RBI for selective purposes) are:

1. Margin requirements,
2. Consumer Credit Regulation,
3. RBI Guidelines,
4. Rationing of credit,
5. Moral Suasion and
6. Direct Action.

The Quantitative Credit measures which control the total quantity of credit are:

1. Bank Rate policy,
2. Open Market Operations,
3. Cash Reserve Ratio and
4. Statutory Liquidity Ratio.

Answer: (a)

National income is the sum total of wages, rent, interest, and profit earned by the factors of production of a country in a year.

Thus it is the aggregate values of goods and services rendered during a given period counted without duplication.

Answer: (d)

Austerity describes policies used by governments to reduce budget deficits during adverse economic conditions. These policies may include spending cuts, tax increases.

This is done in an economic crisis situation to improve the credit rating of the countries going through adverse economic conditions.

Answer: (c)

NABARD provides its refinance for the promotion of agriculture in India.