Untitled spreadsheet - Sheet4 Flashcards
40,2001,”The term National Income represents:”,(a) gross national product at market prices minus depreciation,(b) gross national product at market prices minus depreciation plus net factor income from abroad,(c) gross national product at market prices minus depreciation and indirect taxes plus subsidies,(d) gross national product at market prices minus net factor income from abroad
40,(c) The option (c) gross national product at market price minus depreciation minus indirect tax plus subsidies.
41,2001,”Assertion (A) : Ceiling on foreign exchange for a host of current account transaction heads was lowered in the year 2000. Reason (R) : There was a fall in foreign currency assets also.”,(a) Both A and R are individually true and R is the correct explanation of A,(b) Both A and R are individually true but R is not the correct explanation of A,(c) A is true but R is false,(d) A is false but R is true
41,(c) A is true but R is false.
42,2001,”The prices at which the government purchases food grains for maintaining the public distribution system and for building up buffer-stock is known as:”,(a) minimum support prices,(b) procurement prices,(c) issue prices,(d) ceiling prices
42,(b) Procurement price is the support price at which the government will buy whatever quantum farmers want to sell to the government in the event of private traders not buying the product. This is done to give a fair price to the farmer and to create a buffer stock of food grains to meet public distribution system requirements.
43,2002,”With reference to Power Sector in India, consider the following statements:
1. Rural electrification has been treated as a Basic Minimum Service under the Prime Minister’s Gramodaya Yojana
2. 2. 100 percent Foreign Direct Investment in power is allowed without upper limit
3. 3. The Union Ministry of Power has signed a Memoranda of Understanding with 14 States Which of these statements is/are correct?”,(a) 1 only,(b) 1 and 2,(c) 2 and 3,(d) 3 only
43,(b) Pradhan Mantri Gramodaya Yojana was launched in order to achieve the objective of sustainable human development at the village level. It has 6 components viz., primary health, Primary education, rural shelter, rural drinking water, nutrition and Rural electrification. Upto 100% FDI is allowed in respect of projects relating to electricity generation, transmission and distribution, other than atomic reactor power plants.
44,2002,”With reference to the Indian Public Finance, consider the following statements:
1. External liabilities reported in the Union Budget are based on historical exchange rates
2. 2. The continued high borrowing has kept the real interest rates high in the economy
3. 3. The upward trend in the ratio of Fiscal Deficit of GDP a recent years has an adverse effect on private investment
4. 4. Interest payments is the single largest component of the non-plan revenue expenditure of the Union Government Which of these statements are correct?”,(a) 1, 2 and 3,(b) 1 and 4,(c) 2, 3 and 4,(d) 1, 2, 3 and 4
44,(c) Public Finance in India also comes under the purview of a branch of economics which determines and assesses the policies of the Indian government stipulated in the annual finance budget. It identifies that types and consequences of tax measures and expenditure on citizens, institutions, and the entire economy. The upward trend in the ratio of Fiscal Deficit of GDP a recent years has an adverse effect on private investment. The continued high borrowing has kept the real interest rates high in the economy. Public finance identifies that types and consequences of tax measures and expenditure on citizens, institutions, and the entire economy.
45,2002,”Consider the following statements: Full convertibility of the rupee may mean: 1. Its free float with the international currencies 2. Its direct exchange with any other international currency at any prescribed place inside and outside the country 3. It acts just like any other international currency Which of these statements are correct?”,(a) 1 and 2,(b) 1 and 3,(c) 2 and 3,(d) 1, 2 and 3
45,(d) Capital account convertibility means free conversion of cross-border capital flows, implying that anybody can convert domestic currency into hard currency at the market rate and take the hard currency out of the country.
46,2003,”Consider the following statements: In India, stamp duties on financial transactions are: 1. levied and collected by the State Government 2. appropriated by the Union Government Which of these statements is/are correct?”,(a) Only 1,(b) Only 2,(c) Both 1 and 2,(d) Neither 1 nor 2
46,(d) Stamp duty is a form of tax that is levied on documents. It is levied by the union or the central government and collected and appropriated by the state governments. (Entry 91 in the union list; entry 63 in the state list of Seventh Schedule of Constitution of India)
47,2003,”Which one among the following States has the highest female literacy rate as per the Census 2001?”,(a) Chhattisgarh,(b) Madhya Pradesh,(c) Orissa,(d) Rajasthan
47,(a) As per the census of 2001, Chhattisgarh has the highest female literacy of 51.85, Orissa has 50.51%, Madhya Pradesh - 50.29 and Rajasthan has 43.85%.
48,2004,”Which of the following is not a recommendation of the task force on direct taxes under the chairmanship of Dr. Vijay L. Kelkar in the year 2002?”,(a) Abolition of Wealth Tax,(b) Increase in the exemption limit of personal income to Rs. 1.20 lakh for widows,(c) Elimination of standard deduction,(d) Exemption from tax on dividends and capital gains from the listed equity
48,(b) Increase in exemption limit to Rs 1 lakh to for the general categories of taxpayers. A higher exemption limit of Rs 1.50 lakh for widows and senior citizens was one of the recommendation of the task, force on direct taxes under the chairmanship of Dr. Vijay. Kelkar in the year 2002.
49,2004,”As per 1991 Census, which one of the following groups of Union Territories had the highest literacy rate?”,(a) Chandigarh and Dadra & Nagar Haveli,(b) Delhi and Andaman & Nicobar Islands,(c) Andaman & Nicobar Islands and Pondichery,(d) Pondicherry and Delhi
49,(d) As per 1991 census, Pondicherry and Delhi had the literacy rates of 75.3 and 74.7 respectively.
50,2004,”Consider the following statements: As per 2001 Census 1. the two States with the lowest sex ratio are Haryana and Punjab 2. the two States with the lowest population per sq. km. of area are Meghalaya and Mizoram 3. Kerala has both the highest literacy rate and sex ratio Which of the statements given above is/are correct?”,(a) 3 only,(b) 2 and 3,(c) 1 and 2,(d) 1 and 3
50,(d) As per census 2001, child sex ratio in Haryana was 861, in Punjab 876 and in Sikkim 875. Hence, Haryana and Sikkim were the two states with the lowest sex ratios. The population per sq. km. of area in Arunachal Pradesh was 13, in Meghalaya was 103 and in Mizoram was 42. Hence, the two states with the lowest population per sq. km of area are Arunachal Pradesh and Mizoram. Kerala has both the highest literacy rate and sex ratio.
51,2005,”Consider the following statements:
1. Poverty Reduction and Growth Facility (PRGF) has been established by the International Development Association (IDA) to provide further assistance to low income countries facing high level of indebtedness.
2. 2. Singapore regional Training Institute (STI) is one of the institutes that provides training in macroeconomic analysis and policy and related subject as a part of programme of the IMF institute.
3. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
51,(b) In 1999, the IMF established the Poverty Reduction and Growth Facility (PRGF) to make the objectives of poverty reduction and growth more central to lending operations in its poorest member countries.
52,2006,”Which one of the following statements is correct? Fiscal Responsibility and Budget Management Act (FRBMA) concerns:”,(a) Fiscal Deficit only,(b) Revenue deficit only,(c) Both fiscal deficit and revenue deficit,(d) Neither fiscal deficit nor revenue deficit
52,(c) Fiscal responsibility and budget management act aims to bring down Fiscal deficit to 3% by 2008 and the revenue deficit to zero by 2008.
53,2007,”Which one of the following is the correct sequence in the decreasing order of contribution of different sectors to the Gross Domestic Product of India?”,(a) Services - Industry - Agriculture,(b) Services - Agriculture - Industry,(c) Industry - Services - Agriculture,(d) Industry - Agriculture - Services
53,(a) Contribution of different sectors to national income. Services – 55.1%, Industry – 26.4%, Agriculture – 18.5%
54,2007,”Participatory Notes (PNs) are associated with which one of the following?”,(a) Consolidated Fund of India,(b) Foreign Institutional Investors,(c) United Nations Development Programme,(d) Kyoto Protocol
54,(b) Participatory Notes (PNs / P-Notes) are instruments used by investors or hedge funds that are not registered with the SEBI (Securities and Exchange Board of India) to invest in Indian securities. Participatory notes are instruments that derive their value from an underlying financial instrument such as an equity share and, hence, the word, ‘derivative instruments’. SEBI permitted FIIs to register and participate in the Indian stock market in 1992.
- Which of the following pairs about India’s economic
indicator and agricultural production (all in rounded figures)
are correctly matched? [2008] - GDP per capita (current prices): ` 37,000
- Rice : 180 million tons
- Wheat : 75 million tons
Select the correct answer using the code given below:
Codes:
(a) 1, 2 and 3 (b) 1 and 2 only
(c) 2 and 3 only (d) 1 and 3 only
55,(d) Rice production was 96.69 Million tonnes in 2007-08.
56,2008,”Consider the following statements with reference to Indira Gandhi National Old Age Pension Scheme (IGNOAPS):
1. All persons of 60 years or above belonging to the households below poverty line in rural areas are eligible.
2. 2. The Central Assistance under this Scheme is at the rate of ` 300 per month per beneficiary. Under the Scheme, States have been urged to give matching amounts. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
56,(a Ministry of Rural Development of India has introduced Indira Gandhi National Old Age Pension Scheme (IGNOAPS) under National Social Assistance Programme (NSAP) in the year 2007. IGNOAPS also called as National Old Age Pension Scheme (NOAPS). The old age pension scheme aims to provide social protection to the eligible beneficiaries. In this article, we look at the Indira Gandhi National Old Age Pension Scheme in detail.
57,2009,”Consider the following: 1. Fringe Benefit Tax 2. Interest Tax 3. Securities Transaction Tax Which of the above is/are Direct Tax/Taxes?”,(a) 1 only,(b) 1 and 3 only,(c) 2 and 3 only,(d) 1, 2 and 3
57,(d) Fringe Benefits Tax (FBT) was the tax applied to most, although not all, fringe benefits. A new tax was imposed on employers by India’s Finance Act 2005 and was introduced for the financial year commencing April 1, 2005. The Fringe Benefit Tax was abolished in the Finance Bill of 2009. Securities Transaction Tax (STT) is the tax payable on the value of taxable securities transaction. STT was introduced in India by the 2004 budget and is applicable with effect from 1st October 2004. Interest tax is imposed as a special tax on interest accrued in specified cases. The Interest Tax Act of 1974 governs the tax process associated with the imposition and collection of interest tax. The Act applies to all scheduled Banks that are required to pay tax on the chargeable interest amounts they have on their deposits. The act is no longer applicable with regard to chargeable interest accruing after 31 March 2000.
58,2010,”Which one of the following statements is an appropriate description of deflation?”,(a) It is a sudden fall in the value of a currency against other currencies,(b) It is a persistent recession in both the financial and real sectors of economy,(c) It is a persistent fall in the general price level of goods and services,(d) It is a fall in the rate of inflation over a period of time
58,(c) Deflation is a decrease in the prices of goods and services. It occurs when the annual inflation rate falls below 0% which is a negative inflation rate. This is different from Disinflation which is a slow-down in the inflation rate. This is a situation when inflation declines to lower levels but prices continue to rise.
59,2010,”Which of the following is/are treated as artificial currency?”,(a) ADR,(b) GDR,(c) SDR,(d) Both ADR and SDR
59,(c) ADR is an American Depositary Receipt which represents ownership in the shares of a non-US company that trades in U. S. financial markets. GDR is Global Depositary Receipt is a bank certificate issued in more than one country for shares in a foreign company. A GDR is very similar to ADR. SDR is special Drawing Rights. It is an international type of monetary reserve currency, created by the IMF in 1969. SDR can be thought as an artificial currency used by the IMF and defined as a basket of national currencies.
60,2010,”When the Reserve Bank of India announces an increase of the Cash Reserve Rate, what does it mean?”,(a) The commercial banks will have less money to lend,(b) The Reserve Bank of India will have less money to lend,(c) The Union Government will have less money to lend,(d) The commercial banks will have more money to lend
60,(a) CRR or the Cash Reserve Ratio is that ratio of the total deposits held by a bank which it has to keep with the central bank of country.
61,2010,”With reference to India, consider the following statements: 1. The Wholesale Price Index (WPI) in India is available on a monthly basis only. 2. As compared to Consumer Price Index for Industrial Workers (CPIIW), the WPI gives less weight to food articles. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
61,(b) Alter the Abhijit Sen committee’s proposals in 2004-05, the government had approved the proposal to release or wholesale price based inflation data on a monthly basis, instead of every week. The base year was changed to 2004-05 from 1993-94. However data on primary and fuel items was continued to release on a weekly basis. Consumer Price Index food group has a weight of 39.1 percent as compared to the combined weight of 24.4 percent (food articles and Manufactured food products) in wholesale Price Index food basket.
62,2010,”In the context of Indian economy, consider the following pairs:
Term Most Appropriate description 1. Melt down Fall in stock prices
2. Recession Fall in growth rate
3. 3. Slow down Fall in GDP Which of the pairs given above is/are correctly matched?”,(a) 1 only,(b) 2 and 3 only,(c) 1 and 3 only,(d) 1, 2 and 3
62,a Recession is negative growth rate that is fall in GDP. so 2 and 3 are interchanged answer 1 only
Learning – recession v/s depression v/s double dip recession v/s slow down, Disinflation v/s deflation
63,2010,”In the context of governance, consider the following: 1. Encouraging Foreign Direct Investment inflows 2. Privatization of higher educational Institutions 3. Down-sizing of bureaucracy 4. Selling/offloading the shares of Public Sector Undertakings Which of the above can be used as measures to control the fiscal deficit in India?”,(a) 1, 2 and 3,(b) 2, 3 and 4,(c) 1, 2 and 4,(d) 3 and 4 only
63,(d) Over the past few decades, it has been the private sector that has really driven capacity-creation in Indian higher education. Serious thinking on downsizing bureaucracy had begun in the early 1990s. A sub-group set up by the Planning Commission had suggested in 1993 that the Union government should weed out at least 2,000 senior-level positions in various ministries.
64,2010,”With reference to’ Indian economy, consider the following statements: 1. The Gross Domestic Product (GDP) has increased by four times in the last 10 years. 2. The percentage share of Public Sector in GDP has declined in the last 10 years. Which of the statements, given above is/ are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
64,(b) The correct answer is (b).
65,2011 - I,”India is regarded as a country with “Demographic Dividend’’. This is due to”,(a) Its high population in the age group below 15 years.,(b) Its high population in the age group of 15–64 years.,(c) Its high population in the age group above 65 years.,(d) Its high total population.
65,(b) The demographic dividend is a rise in the rate of economic growth due to a rising share of working age people in a population. This usually occurs late in the demographic transition when the fertility rate falls and the youth dependency rate declines.
66,2011 - I,”Which one of the following is not a feature of “Value Added Tax” ?”,(a) It is multi-point destination-based system of taxation.,(b) It is a tax levied on value addition at each stage of transaction in the production distribution chain.,(c) It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer.,(d) It is basically a subject of the central government and the state governments are only a facilitator for its successful implementation.
66,(d) VAT, being a ‘tax on sale or purchase of goods within a State’ is a State Subject by virtue of Entry 54 of State List of the Seventh Schedule of the Constitution of India. Since VAT/Sales tax is a State subject, the Central Government has been playing the role of a facilitator for successful implementation of VAT.
67,2011 - I,”Karl Marx explained the process of class struggle with the help of which one of the following theories?”,(a) Empirical liberalism,(b) Existentialism,(c) Darwin’s theory of evolution,(d) Dialectical materialism
67,(d) Darwin’s “struggle for existence” in natural history is analogous to the class struggle in “human History”. So option (c) stands incorrect. The sketch of dialectical materialism given by Karl Marx explains that Dialectical principle is of universal application and all the development is “struggle of opposites” or “conflict of opposites”. Thus option d stands correct in this question.
68,2011 - I,”All revenues received by the Union Government by way of taxes and other receipts for the conduct of Government business are credited to the ?”,(a) Contingency Fund of India,(b) Public Account,(c) Consolidated Fund of India,(d) Deposits and Advances Fund
68,(c) Under Article 266 (1) of the Constitution of India, all revenues ( example tax revenue from personal income tax, corporate income tax, customs and excise duties as well as non-tax revenue such as licence fees, dividends and profits from public sector undertakings etc.) received by the Union government as well as all loans raised by issue of treasury bills, internal and external loans and all moneys received by the Union Government in repayment of loans shall form a consolidated fund.
69,2011 - I,”A rapid increase in the rate of inflation is sometimes attributed to the “base effect”. What is “base effect”?”,(a) It is the impact of drastic deficiency in supply due to failure of crops,(b) It is the impact of the surge in demand due to rapid economic growth,(c) It is the impact of the price levels of previous year on the calculation of inflation rate,(d) None of the statements (a), (b) and (c) given above is correct in this context
69,(c) The Base effect refers to the tendency of a small change from a low initial amount to the current amount which is translated into a large percentage and appears as large. It is usually used in context of inflation. It indicates the change in the inflation rate in the current period with respect to the base period.
70,2011 - I,”In the context of Indian economy, consider the following statements: 1. The growth rate of GDP has steadily increased in the last five years. 2. The growth rate in per capita income has steadily increased in the last five years. Which of the statements given above is/are correct ?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
70,(d) Data categories and components Units 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 GDP and Related indicators GDP (Current market Prices) ` crore 3692485 4293672 4986426 5582623PE 6550271QE 7877947AE Growth Rate % 13.9 16.3 16.1 12 17.3 20.3 GDP (factor cost 2004-05 prices) Growth Rate Saving Rate ` crore % % of GDP 3254216 9.5 33.5 3566011 9.6 34.6 3898958 9.3 36.9 4162509PE 6.8 32.2 4493743QE 8.0 33.7 4879232AE 8.6 na Capital Formation (Rate) % of GDP 34.7 36.7 38.1 34.5 36.5 na Per Cap. Net National Income (Factor cost at current prices) ` 27123 31198 35820 40605 46492 54527
71,2011 - I,”In India, which of the following have the highest share in the disbursement of credit to agriculture and allied activities?”,(a) Commercial Banks,(b) Cooperative Banks,(c) Regional Rural Banks,(d) Microfinance Institutions
71,(a) Commercial Banks – 60% Co-operative Banks – 30% RRB and others – 10%
72,2012 - I,”Which of the following are the methods of Parliamentary control over public finance in India? 1. Placing Annual Financial Statement before the Parliament 2. Withdrawal of moneys from Consolidated Fund of India only after passing the Appropriation Bill 3. Provisions of supplementary grants and vote-on-account 4. A periodic or at least a mid-year review of programme of the Government against macroeconomic forecasts and expenditure by a Parliamentary Budget Office 5. Introducing Finance Bill in the Parliament Select the correct answer using the codes given below:”,(a) 1, 2, 3 and 5 only,(b) 1, 2 and 4 only,(c) 3, 4 and 5 only,(d) 1, 2, 3, 4 and 5
72,(a) 1. Placing Annual Financial Statement before the Parliament 2. Withdrawal of moneys from Consolidated Fund of India only after passing the Appropriation Bill 3. Provisions of supplementary grants and vote-on-account 5. Introducing Finance Bill in the Parliament
73,2012 - I,”The Reserve Bank of India (RBI) acts as a bankers’ bank. This would imply which of the following? 1. Other banks retain their deposits with the RBI. 2. The RBI lends funds to the commercial banks in times of need. 3. The RBI advises the commercial banks on monetary matters. Select the correct answer using the codes given below:”,(a) 2 and 3 only,(b) 1 and 2 only,(c) 1 and 3 only,(d) 1, 2 and 3
73,(d) All the statements are correct.
74,2013 - I,”In India, deficit financing is used for raising resources for”,(a) economic development,(b) redemption of public debt,(c) adjusting the balance of payments,(d) reducing the foreign debt
74,(a) Deficit financing refers to the difference between expenditure and receipts. In public finance, it means the govt. is spending more than what it is earning. Deficit financing is a necessary evil in a welfare state as the states often fail to generate tax revenue which is sufficient enough to take care of the expenditure of the state. The basic intention behind deficit financing is to provide the necessary impetus to economic growth by artificial means.
75,2013 - I,”Priority Sector Lending by banks in India constitutes the lending to”,(a) agriculture,(b) micro and small enterprises,(c) weaker sections,(d) All of the above
75,(d) Priority sector lending constitutes the lending to– agriculture, micro and small enterprises, micro credit, education, housing and weaker sections.
76,2013 - I,”Which one of the following groups of items is included in India’s foreign-exchange reserves?”,(a) Foreign-currency assets, Special Drawing Rights (SDRs) and loans from foreign countries,(b) Foreign-currency assets, gold holdings of the RBI and SDR’s,(c) Foreign-currency assets, loans from the World Bank and SDRs,(d) Foreign-currency assets, gold holdings of the RBI and loans from the World Bank
76,(b) In India’s foreign exchange reserve, it includes foreign currency deposits, bonds, gold reserves, SDRs and IMF reserve position. Foreign exchange reserves are an important part of the international investment position of a country.
77,2013 - I,”The national income of a country for a given period is equal to the”,(a) total value of goods and services produced by the nationals,(b) sum of total consumption and investment expenditure,(c) sum of personal income of all individuals,(d) money value of final goods and services produced
77,(d) National Income is the money value of all the final goods and services produced by a country during a period of one year. National Income consists of a collection of different types of goods and services of different types.
78,2013 - I,”Which of the following constitute Capital Account? 1. Foreign Loans 2. Foreign Direct Investment 3. Private Remittances 4. Portfolio Investment Select the correct answer using the codes given below.”,(a) 1, 2 and 3,(b) 1, 2 and 4,(c) 2, 3 and 4,(d) 1, 3 and 4
78,(b) Capital Account comprises of Foreign loans, Foreign Direct Investment and Portfolio Investment. Capital Account is the net result of public and private international investments flowing in and out of a country. Portfolio investment is the buying of shares and bonds. FDI is the investments by foreigners in a country or the citizens investing in foreign countries.
79,2013 - I,”In the context of Indian economy, ‘Open Market Operations’ refers to”,(a) borrowing by scheduled banks from the RBI,(b) lending by commercial banks to industry and trade,(c) purchase and sale of government securities by the RBI,(d) None of the above
79,c,”It is an activity by a central bank(RBI) to buy or sell government securities. The aim of open market operations is to manipulate the short term interest rate and the supply of base money in an economy, and indirectly control the total money supply.”,c
80,2014 - I,”The main objective of the 12th Five-Year Plan is”,(a) inclusive growth and poverty reduction,(b) inclusive and sustainable growth,(c) sustainable and inclusive growth to reduce unemployment,(d) faster, sustainable and more inclusive growth
80,d,”12th Five Year Plan of the Government of India (2012-17) aims at faster, sustainable and more inclusive growth.”,d
81,2014 - I,”The terms ‘Marginal Standing Facility Rate’ and ‘Net Demand and Time Liabilities’, sometimes appearing in news, are used in relation to”,(a) banking operations,(b) communication networking,(c) military strategies,(d) supply and demand of agricultural products
81,a,”Marginal Standing Facility rate is the rate at which banks borrow funds overnight from the Reserve Bank of India (RBI) against approved government securities. Net Demand and time liability is the sum of demand and time liability of Banks with public and other banks wherein assets with other banks is subtracted to get net liability of other bank.”,a
82,2015-I,”With reference to Indian economy, consider the following statements: 1. The rate of growth of Real Gross Domestic Product has steadily increased in the last decade. 2. The Gross Domestic Product at market prices (in rupees) has steadily increased in the last decade. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
82,b,”Due to recession in 2008, the growth rate of the Indian economy had declined for the next few years from 8-9% to 5-6%. Even though the growth rate had declined, it never became negative. So, the GDP at market prices has always increased year on year since last one decade”,b
83,2018 - I,”Which one of the following best describes the term ““Merchant Discount Rate”” sometimes seen in news?”,(a) The incentive given by a bank to a merchant for accepting payments through debit cards pertaining to that bank.,(b) The amount paid back by banks to their customers when they use debit cards for financial transactions for purchasing goods or services.,(c) The charge to a merchant by a bank for accepting payments from his customers through the bank’s debit cards.,(d) The incentive given by the Government, to merchants for promoting digital payments by their customers through Point of Sale (PoS) machines and debit cards.
83,c,”Merchant Discount Rate (MDR) is the fee borne by the merchant for using credit and debit card payment system. To encourage digital transactions, Ministry of Electronics and information technology (MEITY) had announced that from 1 January 2018 for the next two years, it’ll bear the MDR fees of merchants, for payments up-to Rs.2,000/- IF such payment is made via debit card, BHIM or Aadhar enabled payment system.”,c
84,2018-I,”With reference to digital payments, consider the following statements: 1. BHIM app allows the user to transfer money to anyone with a UPI-enabled bank account. 2. While a chip-pin debit card has four factors of authentication, BHIM app has only two factors of authentication. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
84,a,”BHIM App was launched in 2016, it allows money transfer to UPI-enabled bank accounts so #1 is right. The BHIM apps has three levels of authentication. For one, the app binds with a device’s ID and mobile number, second a user needs to sync whichever bank account (UPI or non-UPI enabled) in order to the conduct transaction. Third, when a user sets up the app they are asked to create a pin which is needed to log into the app. Hence #2 is wrong.”,a
85,2018-I,”Which one of the following links all the ATMs in India ?”,(a) Indian banks’ Association,(b) National Securities Depository Limited,(c) National Payments Corporation of India,(d) Reserve Bank of India
85,c,”Till 2009, RBI’s Institute for Development and Research in Banking Technology (IDRBT) provided the linkages to ATM network in India but afterwards, it was taken over by NPCi’s National Financial Switch (NFS).”,c
86,2018-I,”Consider the following statements: 1. Capital Adequacy Ratio (CAR) is the amount that banks have to maintain in the form of their own funds to offset any loss that banks incur if the account-holders fail to repay dues. 2. CAR is decided by each individual bank. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
86,a,”CAR is decided by the benchmarks set by BASEL-III Committee on Banking supervision and implemented by the central bank of individual country. So, #2 is right, whereas #1 is correct.”,a
87,2018-I,”Consider the following statements 1. The Fiscal Responsibility and Budget Management ( FRBM) Review Committee Report has recommended a debt to GDP ratio of 60% for the general (combined) government by 2023, comprising 40% for the Central Government and 20% for the State Governments. 2. The Central Government has domestic liabilities of 21% of GDP as compared to that of 49% of GDP of the State Governments. 3. As per the Constitution of India, it is mandatory for a State to take the Central Government’s consent for raising any loan if the former owes any outstanding liabilities to the latter. Which of the statements given above is/are correct?”,(a) 1 only,(b) 2 and 3 only,(c) 1 and 3 only,(d) 1, 2 and 3
87,c,”As per Economic Survey, first statement is right but Central Government’s domestic liability is ~46% so #2 is wrong. By elimination, we get (C)”,c
88,2018-I,”Consider the following items: 1. Cereal grains hulled 2. Chicken eggs cooked 3. Fish processed and canned 4. Newspaper containing advertising material Which of the above items is/are exempted under GST (Goods and Services Tax)?”,(a) 1 only,(b) 2 and 3 only,(c) 1, 2 and 4 only,(d) 1, 2, 3 and 4
88,c,”When client books add in newspaper, he has to pay 18% GST to newspaper owner who deposits it to Government. But when such newspaper is sold to public, they are not required to pay newspaper price + GST. So #4 is exempted from GST. Processed / Canned food (#3) is subject to GST. So, by elimination, we get correct answer C. Some experts were divided that if eggs are cooked in a 5-star hotel, it’ll be subjected to GST however UPSC’s official Answer key has kept C is the correct option.”,c
89,2018-I,”With reference to India’s decision to levy an equalization tax of 6% on online advertisement services offered by non-resident entities, which of the following statements is/are correct?
1. It is introduced as a part of the Income Tax Act
2. . 2. Non-resident entities that offer advertisement services in India can claim a tax credit in their home country under the ““Double Taxation Avoidance Agreements””. Select the correct answer using the code given below:”,(a) 1 only,(b) 2 only,(c) Both 1 and 2,(d) Neither 1 nor 2
89,d,”This was introduced in 2016, as a separate legislation under Finance Bill, and it doesn’t provide tax credit in home country so both wrong.”,d
90,2018-I,”Despite being a high saving economy, capital formation may not result in significant increase in output due to”,(a) weak administrative machinery,(b) illiteracy,(c) high population density,(d) high capital-output ratio
90,d,”Capital Output Ratio (ICOR) measures the percentage increase in capital formation required obtaining a percentage increase in GDP. Entrepreneurs, by investing their own savings and informally mobilizing the savings of their friends and relatives contribute to the process of capital formation. These informal funding supplements the funds made available by the formal means of raising resources from banks, financial institutions and capital markets. So, ““D”” is the fitting option- if capital to output ratio is high then capital formation may not result in significant increase in the output.”,d
91,2019-I,”Which of the following is not included in the assets of a commercial bank in India?”,(a) Advances,(b) Deposits,(c) Investments,(d) Money at call and short notice
91,b,”NCERT Macroeconomics Class12, page 40: observe the table 3.1: Deposits are plotted on the liability side of a commercial bank’s balance sheet.”,b
92,2019-I,”In the context of India, which of the following factors is/are contributor/contributors to reducing the risk of a currency crisis? 1. The foreign currency earnings of India’s IT sector. 2. Increasing the government expenditure. 3. Remittances from Indians abroad. Select the correct answer using the code given below.”,(a) 1 only,(b) 1 and 3 only,(c) 2 only,(d) 1, 2 and 3 only
92,b,”Currency crisis usually denotes that Indian Rupee is weakening and dollar is strengthening at a rapid level. In ordinary circumstances, rupee dollar exchange rate is determined by the market forces of supply and demand. Therefore we have to encourage the inflow of dollars to reduce the risk of currency crisis. #1 and #3 can help in this regard, #2 is irrelevant. Infact #2 can backfire if raising Government Expenditure results in excessive printing of Rupee currency. Thus, by elimination answer is b: 1 and 3.”,b
93,2019-I,”The Chairman of public sector banks are selected by the”,(a) Banks Board Bureau,(b) Reserve Bank of India,(c) Union Ministry of Finance,(d) Management of concerned bank
93,a,”Bank Board Bureau (BBB) was setup in 2016, BBB selects top officials (MD, CEO, Chairman and full-time Directors) for PSBs, LIC and other public sector financial institutions.”,a
94,2019-I,”Consider the following statements : 1. Petroleum and Natural Gas Regulatory Board (PNGRB) is the first regulatory body set up by the Government of India. 2. One of the tasks of PNGRB is to ensure competitive markets for gas. 3. Appeals against the decisions of PNGRB go before the Appellate Tribunals of Electricity. Which of the statements given above is/are correct?”,(a) 1 and 2 only,(b) 2 and 3 only,(c) 1 and 3 only,(d) 1, 2 and 3
94,b,”PNGRB was constituted under The Petroleum and Natural Gas Regulatory Board Act, 2006. SEBI was formed in 1988 by an executive order, given statutory status in 1992. Besides, IRDAI and many other regulatory bodies were setup before 2006. So, PNGRB is certainly not the first body to be setup by Govt of India. #1 is wrong, by elimination we are left with answer b.”,b
95,2019-I,”The Reserve Bank of India’s recent directives relating to ‘Storage of Payment System Data’, popularly known as data diktat command the payment system providers that : 1. They shall ensure that entire data relating to payment systems operated by them are stored in a system only in India. 2. They shall ensure that the systems are owned and operated by public sector enterprises. 3. They shall submit the consolidated system audit report to the comptroller and Auditor General of India by the end of the calendar year. Which of the statements given above is/are correct”,(a) 1 only,(b) 1 and 2 only,(c) 3 only,(d) 1, 2 and 3 only
95,a,”As per RBI’s directive, payment system providers are required to store the data in India only. Other features are not required by RBI.”,a
96,2020-I,”What is the importance of the term “Interest Coverage Ratio” of a firm in India? 1. It helps in understanding the present risk of a firm that a bank is going to give a loan to. 2. It helps in evaluating the emerging risk of a firm that a bank is going to give a loan to. 3. The higher a borrowing firm’s level of Interest Coverage Ratio, the worse is its ability to service its debt. Select the correct answer using the code given below:”,(a) 1 and 2 only,(b) 2 only,(c) 1 and 3 only,(d) 1, 2 and 3
96,a,”NCERT class 12 Accountancy book also confirms, “A higher Interest coverage ratio ensures safety of interest on debts.” Third statement is wrong. Statement 1 is correct, By looking at the interest coverage ratio we can identify the present risk of a firm (That it is not generating good revenue). There is only “A” option where statement#1 is present.”,a
97,2020-I,”With reference to the Indian economy, consider the following statements : 1. ‘Commercial Paper’ is a short-term unsecured promissory note. 2. ‘Certificate of Deposit’ is a long-term instrument issued by the Reserve Bank of India to a corporation. 3. ‘Call Money’ is a short-term finance used for interbank transactions. 4. ‘Zero-Coupon Bonds’ are the interest bearing shortterm bonds issued by the Scheduled Commercial Banks to corporations. Which of the statements given above is/are correct”,(a) 1 and 2 only,(b) 4 only,(c) 1 and 3 only,(d) 2, 3 and 4 only
- (c) • Certificate of deposit is a short term debt instrument. #2 is wrong since it says ‘long term instrument’. This eliminates a and d. • #3: Call money is a short term finance for interbank transactions that is correct. So, Answer is (c).
98,2020-I,”In the context of the Indian economy, non-financial debt includes which of the following ? 1. Housing loans owed by households 2. Amounts outstanding on credit cards 3. Treasury bills Select the correct answer using the code given below :”,(a) 1 only,(b) 1 and 2 only,(c) 3 only,(d) 1, 2 and 3
- (d) • “Non-Financial debt” excludes the debt of Financial Institutions i.e. those institutions that borrow solely to re-lend and the money. [In other words if, NABARD, ILFS etc had borrowed money to re-lend it, then it’d be financial debt. And all other type of debt will be “nonFinancial debt”] • So, In above options, all three loans are taken by persons or entities who’ll not ‘re-lend’ it, but They will use the funds for their own purpose. Therefore, Answer should be “(d)”
Note Number,Note Content
Question,Answer,Explanation
1,Which one of the following Five Year Plans recognised human development as the core of all development efforts? [1995] (a) The Third Five Year Plan (b) The Fifth Five Year Plan (c) The Sixth Five Year Plan (d) The Eighth Five Year Plan
1,d,In the eight five year plan (1992-1997), the top priority was given to the development of the human resources i.e., employment, education, and public health.
2,Which of the following are among the non-plan expenditures of the Government of India? [1995, 1997] 1. Defence expenditure 2. Subsidies 3. All expenditures linked with the previous plan periods 4. Interest payment Codes: (a) 1 and 2 (b) 1 and 3 (c) 2 and 4 (d) 1, 2, 3 and 4
2,d,Non-plan expenditures include non-developmental expenditure (interest payment, subsidies, defence).
3,What is the annual rate aimed in the Eighth Five Year Plan [1995] (a) 5.6% (b) 6% (c) 6.5% (d) 7%
3,a,The targeted annual growth rate was 5.6% but the actual growth rate was 6.7%.
4,The largest source of financing the public sector outlay of the Eighth Five Year Plan comes from: [1995] (a) balance from current revenue (b) contribution of public enterprises (c) government borrowings (d) deficit financing
4,d,Financing of Eighth five year plan outlay In the Public sector (Rupees in crores) Capital Receipts revenues Budgetory Source: GOI., Planning Commission, various plan documents. Economic survey GOI, 1999-2000.
5,The New Exim Policy announced in 1992, is for period of : [1995] (a) 3 years (b) 4 years (c) 7 years (d) 5 years
5,d,The New Exim Policy was for five years (April 1, 1992 – March 31, 1997).
6,Given below are two statements, one labelled as Assertion (A) and the other labelled as Reason (R). Assertion (A) : An important policy instrument of economic liberalization is reduction in import duties on capital goods. Reason (R) : Reduction in import duties would help the local entrepreneurs to improve technology to face the global markets. In the context of the above two statements, which one of the following is correct? [1996] (a) Both A and R are true and R is the correct explanation (b) Both A and R are true R is not a correct explanation (c) A is true but R is false (d) A is false but R is true
6,a,Both statements are correct and explain one of the instruments to liberalise the Indian economy.
7,The Eighth Five Year Plan is different from the earliest ones. The critical difference lies in the fact that: [1996] (a) it has a considerably larger outlay compared to the earlier plans (b) it has a major thrust on agricultural and rural development (c) considerable emphasis is placed on infrastructure growth (d) industrial licensing has been abolished
7,d,Eighth Five Year Plan (1992-97) had a bigger outlay with energy being given 26.6% of total outlay to a cheque a targeted growth rate of 6.78% per annum.
8,Consider the following statements : Most international agencies which find Development Programme in India on intergovernmental bilateral agreements, mainly provide: [1996] 1. Technical assistance 2. Soft loans which are required to be paid back with interest 3. Grants, not required to be paid back 4. Food assistance to be paid back (a) 2 and 4 are correct (b) 1, 2 and 3 are correct (c) 1, 2 and 4 are correct (d) 3 and 4 are correct
8,b,A soft loan is a loan with a below market rate of interest. It also includes concessions to borrowers such as long repayment periods or interest holidays. Technical assistance is aid involving highly educated or trained personnel, such as doctors, who are moved into a developing country to assist with a program of development. Food assistance is given to countries in urgent need of food supplies, especially if they have just experienced a natural disaster. Grant is usually given to governments through individual countries, international aid agencies and through multilateral institutions such as the world Bank and by through development charities.
9,Consider the following items imported by India: [1996] 1. Capital goods 2. Petroleum 3. Pearls and precious stones 4. Chemicals 5. Iron and Steel The correct sequence of the decreasing order of these items (as per 94-95 figures), in terms of value is: (a) 1, 2, 3, 4, 5 (b) 1, 2, 4, 3, 5 (c) 2, 1, 3, 4, 5 (d) 2, 1, 4, 5, 3
9,c,Value of import in India as per 94-95 figures: 1. Petroleum oils and oils - US$ 3,285,560.58 million obtained from bituminou 2. Petroleum oils oils, etc.-US $ 2,642,351.87 millions (excl. crude), Preparation 3. Diamonds non-industrial-US $ 1,500, 668.80 million unworked or simply swan.
10,The Sixth and the Eighth Five Year Plans covered the period 1980-1985 and 1992-1997 respectively. The Seventh Five Year Plan covered the period: [1997] (a) 1987-1992 (b) 1986 -1991 (c) 1985-1990 (d) 1988 -1994
10,c.Period between 1990-92 was second plan holiday. The first plan holiday was between 1966-69.
11,Economic Survey in India is published officially, every year by the: [1998] (a) Reserve Bank of India (b) Planning Commission of India (c) Ministry of Finance, Govt. of India (d) Ministry of Industries, Govt. of India
11,c,Economy Survey in India is published officially, every year by the Ministry of Finance, Govt. of India. and issued before the annual budget. It reviews the development in the Indian economy over the previous 12 months.
12,Which one of the following regions of the world supplies the maximum of our imported commodities (in terms of rupee value)? [1998] (a) Africa (b) America (c) Asia and Oceania (d) Europe
12,a,India imported most of their commodities from Asia and Oceania.
13,The planning process is the industries sector in India has assumed a relatively less important position in the nineties as compared to that in the earlier period. Which one of the following is not true in this regard? [1999]
(a) With the advent of liberalisation, industrial investment development have largely been placed within the domain of private and multinational sectors
(b) With market assuming a central place, the role of central planning in many sectors has been rendered redundant
(c) The focus of planning has shifted to sectors like human resource
(d) The nation’s priorities have shifted away from industrial development to rural development
13,d,Statement (a), (b) and (c) are true which explain the declining important position of industries sector after nineties in the planning process.
14,Which one of the following is the objective of National Renewal Fund? [1999] (a) To safeguard the interests of workers who may be affected by technological upgradation of industry or closure of sick units (b) To develop the core sector of the economy (c) For the development of infrastructure such as energy, transport communications and irrigation (d) For human resource development such as full literacy, employment population control, housing and drinking water
14,c,The concept of the National Renewal Fund was announced by the Government as a part of the New Industrial Policy, 1991. The Government established the National Renewal Fund (NRF) by a Government of India resolution on 3rd February , 1992.
15,The Employment Assurance Scheme envisages financial assistance to rural areas for guaranteeing employment to at least: [1999] (a) 50 percent of the men and women seeking jobs in rural areas (b) 50 percent of the men seeking jobs in rural areas (c) one man and one woman in a rural family living below the poverty line (d) one person in a rural landless household living below the poverty line
15,a,Employment Assurance scheme was launched on 2nd October, 1993. It is open to all adult rural poor who are in need of wage employment. A maximum of two adults per family would be provided wage employment, when there is demand during lean agricultural season, subject to availability of funds.
16,A rise in ‘SENSEX’ means: [2000] (a) a rise in prices of shares of all companies registered with Bombay Stock Exchange (b) a rise in prices of shares of all companies registered with National Stock Exchange (c) an overall rise in prices of shares of group up companies registered with Bombay Stock Exchange (d) a rise in prices of shares of all companies belonging to a group of companies registered with Bombay Stock Exchange
16,c,Increase in SENSEX reflects the overall mood of the economy. A rise in it means that investors and FIIs are positive about the growth of Indian economy and expect that it will be sustained in future.
17,Assertion (A) : The rate of growth of India’s exports has shown an appreciable increase after 1991. [2000] Reason (R) : The Govt. of India has resorted to devaluation. (a) Both A and R are true and R is the correct explanation of A (b) Both A and R are true but R is not a correct explanation of A (c) A is true but R is false (d) A is false but R is true
17,a,Devaluation of currency is conscious decision taken by Central bank of country to lower the external value of domestic currency. As a result of this Indian goods become cheaper for Foreigners. Import decrease and exports increases.
18,Match List I with List II and select the correct answer using the codes given below the lists: [2000] List-I List-II
A. UN Development 1. UN India Human Programme Development Report
B. National Council 2. India Development of Applied Economic Report Research
C. Indira Gandhi 3. World Development Institute of Research Development Research
D. World Bank 4. Human Development Report Codes: (a) A-1; B-2; C-3; D-4 (b) A-4; B-2; C-1; D-3 (c) A-2; B-3; C-4; D-1 (d) A-2; B-1; C-4; D-3
18,b,UN Development programme brings out UN India Human Development Report. National council of Applied Economic Research brings out India Development Report. Human Development Report is bring out by world Bank. World Development Research is carried out by Indira Gandhi Institute of Development Research.
19,“…instil into the vast millions of workers, men and women, who actually do the job, a sense of partnership and of cooperative performance…” The above passage relates to: [2000] (a) Planned Development (b) Community Development (c) Panchayati Raj System (d) Integrated Development Programme
19,c,Community Development is a process where community members come together to take collective action and generate solutions to common problems. It seeks to empower individuals and groups of people with expenditure, civil administration), developmental expenditure and expenditure incurred on projects which remained unfinished in the earlier plans.
20,Economic liberalisation in India started with: [2000] (a) substantial changes in industrial licensing policy (b) the convertibility of Indian rupee (c) doing away with procedural formalities for foreign direct investment (d) significant reduction in tax rates
20,a,Economic liberalization in India started with industrial de-licensing.
21,Consider the following statements: [2000] The Indian rupee is fully convertible: 1. in respect of Current Account of Balance of payment 2. in respect of Capital Account of Balance of payment 3. into gold Which of these statements is/are correct ? (a) 1 alone (b) 3 alone (c) 1 and 2 (d) 1, 2 and 3
21,a,In respect of capital account of balance of payment, the Indian rupee is partially convertible after 1991.
22,The growth rate of per capita income at current prices is higher than that of per capita income at constant prices, because the latter takes into account the rate of : [2000] (a) growth of population (b) increase in price level (c) growth of money supply (d) increase in the wage rate
22,b,The growth rate of per capita income at current prices is higher than that of per capita income at constant prices, because current prices are influenced by the effect of price inflation.
23,Consider the following: [2001] 1. Market borrowing 2. Treasury bills 3. Special securities issued to RBI Which of these is/are components(s) of internal debt? (a) 1 only (b) 1 and 2 (c) 2 only (d) 1, 2 and 3
23,d,Internal debt is that part of the total debt that is owed to lenders within the country. Market borrowings, Treasury bills and special securities issued to RBI are all sources of internal borrowings.
24,Global capital flows to developing countries increased significantly during the nineties. In view of the East Asian financial crisis and Latin American experience, which type of inflow is good for the host country? [2002] (a) Commercial loans (b) Foreign Direct Investment (c) Foreign Portfolio Investment (d) External Commercial borrowings
24,b,FDI is defined as investment by a foreign multinational or its subsidiary or a foreign company in terms of setting up a project in another country either by way of a 100% subsidiary or by way of a joint venture. Thus, FDI investment is long term in nature. Thus, it can not be pulled out of the country at short notice. It is also non-debt creating.
25,Five Year Plan in India is finally approved by: [2002] (a) Union Cabinet (b) President on the advice of Prime Minister (c) Planning Commission (d) National Development Council
25,d,In India, plans are formulated by the Planning Commission and are finally approved by the National Development Council. All state chief ministers are members of NDC. The NDC is headed by the Prime Minister of India.
26,A country is said to be a debt trap if : [2002] (a) it has to borrow to make interest payments on outstanding loans (b) It has to abide by the conditionalities imposed by the International Monetary fund. (c) it has been refused loans or aid by creditors abroad (d) the World Bank charges a very high rate of interest on outstanding as well as new loans
26,a,Debt Trap is a situation where you add on a new debt in order to repay an existing debt.
27,Which one of the following is the correct statement? Service tax is a/an: [2006] (a) direct tax levied by the Central Government. (b) indirect tax levied by the Central Government. (c) direct tax levied by the State Government. (d) indirect tax levied by the State Government.
27,b,All taxes which are the personal liability of an assessee come under direct taxes. They include income tax, professional tax, wealth tax, securities transaction tax, commodity transaction tax and the like. On the other hand, the taxes which a person can recover from some other person but the liability of which remains of the person collecting such taxes are indirect taxes. These are custom duty, excise, service tax, VAT, CST and the like.
28,During which Five Year Plan was the Emergency clamped, new elections took place and the Janata Party was elected? [2009] (a) Third (b) Fourth (c) Fifth (d) Sixth
28,c,This all happened from 1975-78 during the fifth five-year plan, the period of which is (1974-78).
29,Consider the following statements regarding Indian Planning: [2009] 1. The Second Five-Year Plan emphasized on the establishment of heavy industries. 2. The Third Five-Year Plan introduced the concept of import substitution as a strategy for industrialization. Which of the statements given above is/are correct? (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2
29,a,The second five-year plan emphasized on the development of the public sector and “rapid industrialization. The third five-year plan stressed on agriculture and improvement in the production of food grains with long-term development.
30,Which one of the following brings out the publication called “Energy Statistics” from time to time? [2009] (a) Central Power Research Institute (b) Planning Commission (c) Power Finance Corporation Ltd. (d) Central Statistical Organization
30,d,It is published by the Ministry of Statistics and Programme Implementation, Central Statistical Organization.
31,In the context of independent India’s economy, which one of the following was the earliest event to take place? [2009] (a) Nationalization of Insurance companies (b) Nationalization of State Bank of India (c) Enactment of Banking Regulation Act (d) Introduction of First Five-Year Plan
31,c,Nationalization of State Bank of India – 1955; Introduction of First Five-Year Plan – 1951; Enactment of Banking Regulation Act – 1949; Nationalization of Insurance Companies – 1955-56.
32,The SEZ Act, 2005 which came, into effect in February 2006 has certain objectives. In this context, consider the following: [2010] 1. Development of infrastructure facilities. 2. Promotion of investment from foreign sources. 3. Promotion of exports of services only. Which of the above are the objectives of this Act? (a) 1 and 2 only (b) 3 only (c) 2 and 3 only (d) 1, 2 and 3
32,a,The objectives of establishing SEZs (Special Economic Zones) include making available goods and services free of taxes and duties supported by an integrated infrastructure for export production, and single window approval mechanism and a package of incentives to attract foreign and domestic investments for promoting export-led growth.
33,A great deal of Foreign Direct Investment (FDI) to India comes from Mauritius than from many major and mature economies like UK and France. Why? [2010] (a) India has preference for certain countries as regards receiving FDI (b) India has double taxation avoidance agreement with Mauritius (c) Most citizens of Mauritius have ethnic identity with India and so they feel secure to invest in India (d) Impending dangers of global climatic change prompt Mauritius to make huge investments in India
33,b,India has comprehensive Double Taxation Avoidance Agreements (DTAA) with 23 countries. This means that there are agreed rates of tax and jurisdiction on specified types of income arising in a country to a tax resident of another country. Under the Income Tax Act 1961 of India, there are two specific provisions, Section 90 and Section 91, which provide specific relief to taxpayers to save them from DTAA. Section 90 is for taxpayers who have paid the tax in a country with which India has signed DTAA, while Section 91 provides relief to taxpayers who have paid tax to a country with which India has not signed a DTAA. Thus, India gives relief to both kinds of taxpayers. Mauritius by itself is a low tax country.
34,India-based Neutrino Observatory is included by the Planning Commission as a mega science project under the 11th Five-Year Plan. In this context, consider the following statements: [2010] 1. Neutrinos are chargeless elementary particles that travel close to the speed of light. 2. Neutrinos are created, in nuclear reactions of beta decay. 3. Neutrinos have a negligible, but non-zero mass 4. Trillions of Neutrinos pass through human body every second. Which of the statements given above are correct? (a) 1 and 3 only (b) 1, 2 and 3 only (c) 2, 3 and 4 (d) 1, 2, 3 and 4
34,d,A neutrino is an elementary particle that usually travels close to the speed of light, is electrically neutral, and is able to pass through ordinary matter almost undisturbed. This makes neutrinos extremely difficult to detect. Neutrinos have a very small, but nonzero rest mass. Neutrinos are affected only by a ‘weak’ sub-atomic force of much shorter range than electromagnetism, and are therefore able to pass through great distances in matter without being affected by it.
35,Inclusive growth as enunciated in the Eleventh Five Year Plan does not include one of the following: [2010] (a) Reduction of poverty (b) Extension of employment opportunities (c) Strengthening of capital market (d) Reduction of gender inequality
35,c,Inclusive growth is ‘broad-based growth’, ‘shared growth’, and ‘pro-poor growth’. It excludes the capital markets which is left to operate by itself in the open market.
36,Who of the following shall cause every recommendation made by the finance Commission to be laid before each House of Parliament? [2010] (a) The President of India (b) The Speaker of Lok Sabha (c) The Prime Minister of India (d) The Union Finance Minister
36,a,As per provisions given under Article 281 of the Indian Constitution, the recommendations of the finance commission go to the president who is constitutionally bound to place it before the two houses of the parliament.
37,Which one of the following is responsible for the preparation and presentation of Union Budget to the Parliament? [2010] (a) Department of Revenue (b) Department of Economic Affairs (c) Department of Financial Services (d) Department of Expenditure
37,b,The DEA or the Department of Economic Affairs is responsible for preparation and presentation to the Parliament of Central Budget and the Budgets for the State Governments under President’s Rule and Union Territory Administration.
38,Consider the following actions by the Government: [2010] 1. Cutting the tax rates 2. Increasing the government spending 3. Abolishing the subsidies in the context of economic recession Which of the above actions can be considered a part of the “fiscal stimulus” package? (a) 1 and 2 only (b) 2 only (c) 1 and 3 only (d) 1, 2 and 3
38,a,Abolishing the subsidies will lead to higher prices of goods and services which are subsidized. A reduction in the tax rate would be a stimulus. While an increase in government expenditure would increase the level of demand in the economy.
39,In the context of India’s Five Year Plans, a shift in the pattern of industrialization, with lower emphasis on heavy industries and more on infrastructure begins in [2010] (a) Fourth Plan (b) Sixth Plan (c) Eighth Plan (d) Tenth Plan
39,c,It was during the eighth plan period (1992-97) that emphasis was put on infrastructure development.
40,With reference to the Nationa1 Investment Fund to which the disinvestment proceeds are routed, consider the following statements: [2010] 1. The assets in the National Investment Fund are managed by the Union Ministry of Finance. 2. The National Investment Fund is to be maintained within the Consolidated Fund of India. 3. Certain Asset Management companies are appointed as the fund managers. 4. A certain proportion of annual income is used for financing select social sectors. Which of the statements given above is/are correct ? (a) 1 and 2 (b) 2 only (c) 3 and 4 (d) 3 only
40,c,On 27 January 2005, the Government had decided to constitute a ‘National Investment Fund’ (NIF) into which realization from sale of minority shareholding of the Government in CPSEs would be channelized. This fund is managed by professionals and a part of it is used for use in social sector – like education, health care, and employment.
41,In India, the tax proceeds of which one of the following as a percentage of gross tax revenue has significantly declined in the last five years? [2010] (a) Service tax (b) Personal income tax (c) Excise duty (d) Corporation tax
41,c,The excise duty’s share in the total tax revenue, which was 41.3 percent in 1992-93, declined to 25.1 percent in 2006-07. The customs duty’s share in the total tax revenue, which was 31.9 percent in 1992-93, fell to 17.5 percent in 2006-07, as a result of massive structuring on excise and customs.
42,Which one of the following authorities makes recommendation to the Governor of a State as to the principles for determining the taxes and duties which may be appropriated by the Panchayats in that particular State? [2010] (a) District Planning Committees (b) State Finance Commission (c) Finance ministry of that State (d) Panchayati Raj Ministry of that State
42,b,State Finance Commission governs the distribution between the State and the Panchayats of the net proceeds of the taxes, duties, tolls, and fees leviable by the State, which may be divided between them under this Part and the allocation between the Panchayats at all levels of their respective shares of such proceeds; the determination of the taxes, duties, tolls, and fees which may be assigned as, or appropriated by, the Panchayats; the grants-in-aid to the Panchayats from the Consolidated Fund of the State.
43,Consider the following statements: In India, taxes on transactions in Stock Exchanges and Futures Markets are [2010] 1. levied by the Union 2. collected by the States Which of the statements given above is/are correct? (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2
43,a,In India, taxes on transactions in Stock Exchange and Future Markets are levied and collected by the Union Govt.
44,India has experienced persistent and high food inflation in the recent past. What could be the reasons? 1. Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%. 2. As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change. 3. The food supply chain has structural constraints. [2011 - I] Which of the statements given above are correct ? (a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3
44,b,Notwithstanding some moderation, food price inflation has remained persistently elevated for over a year now, reflecting in part the structural demand-supply mismatches in several commodities. The trend of food inflation was pointing at not only structural demand-supply mismatches in commodities comprising the essential consumption basket but also at changing consumption patterns.
Question Number,Question,Option A,Option B,Option C,Option D
Question,Answer,Explanation
45,”In terms of economy, the visit by foreign nationals to witness the XIX commonwealth games in India amounted to”,Export,Import,Production,Consumption
45,a,Income from “tourism” is an invisible export and brings foreign exchange into the country.
46,”Which one of the following statements appropriately describes the “fiscal stimulus” ?”,It is a massive investment by the government in manufacturing sector to ensure the supply of goods to meet the demand surge caused by rapid economic growth.,It is an intense affirmative action of the government to boost economic activity in the country.,It is government’s intensive action on financial institutions to ensure disbursement of loans to agriculture and allied sectors to promote greater food production and contain food inflation.,It is an extreme affirmative action by the government to pursue its policy of financial inclusion.
46,b,Governments use fiscal policy to influence the level of aggregate demand in the economy. It is an effort to achieve economic objectives of price stability, full employment, and economic growth.
- Consider the following actions which the government can
take : [2011 - I] - Devaluing the domestic currency.
- Reduction in the export subsidy.
- Adopting suitable policies which attract greater FDI
and more funds from FIIs.
Which of the above action/actions can help in reducing the
current account deficit ?
(a) 1 and 2 (b) 2 and 3
(c) 3 only (d) 1 and 3
47,d,Current Account deficit is the excess of imports over exports. After devaluation of domestic currency, domestic goods would become cheaper which will create additional demand for the country’s products in the world markets. Rising capital inflow through FDI and FII may appreciate the domestic currency and can worsen a country’s current account by increasing more imports and reducing exports. FDI and FII represent non-debt liabilities.
- Both Foreign Direct Investment (FDI) and Foreign
Institutional Investor (FII) are related to investment in a
country. Which one of the following statements best
represents an important difference between the two ?
[2011 - I]
(a) FII helps bring better management skills and
technology, while FDI only brings in capital.
(b) FII helps in increasing capital availability in general,
while FDI only targets specific sectors.
(c) FDI flows only into the secondary market while FII
targets primary market
(d) FII is considered to be more stable than FDI.
48,b,Foreign Direct Investment (FDI) targets a specific enterprise to increase its capacity, productivity, or change its management control. FII investment flows only into the secondary market, increasing capital availability in general rather than enhancing the capital of a specific enterprise. FDI is considered more stable than Foreign Institutional Investor (FII) as it brings in capital, helps in good governance practices, better management skills, and technology transfer.
- With reference to “Aam Admi Bima Yojana’’, consider the
following statements ? - The member insured under the scheme must be the
head of the family or an earning member of the family
in a rural landless house-hold. - The member insured must be in the age group of 30 to
65 years. - There is a provision for free scholarship for up to two
children of the insured who are studying between
classes 9 and 12. [2011 - I]
Which of the statements given above is/are correct?
(a) 1 only (b) 2 and 3 only
(c) 1 and 3 only (d) 1, 2 and 3
49,c,The first and third statements are correct, but the second statement is wrong because the member should be aged between 18 and 59 years, not 30 and 65 years.
- Microfinance is the provision of financial services to people
of low-income groups. This includes both the consumers
and the self-employed. The service/services rendered under
microfinance is/are : [2011 - I] - Credit facilities 2. Savings facilities
- Insurance facilities 4. Fund Transfer facilities
Select the correct answer using the codes given below the
lists ?
(a) 1 only (b) 1 and 4 only
(c) 2 and 3 only (d) 1, 2, 3 and 4
50,d,Microfinance aims for a world where as many poor and near-poor households as possible have permanent access to a range of high-quality financial services, including credit, savings, insurance, and fund transfers.
51,”Among the following who are eligible to benefit from the “Mahatma Gandhi National Rural Employment Guarantee Act”?”,Adult members of only the scheduled caste and scheduled tribe households,Adult members of below poverty line (BPL) households,Adult members of households of all backward communities,Adult members of any household
51,d,All adult members of the household who register can apply for work, provided they are local residents.
- With reference to the Finance Commission of India, which
of the following statements is correct ? [2011 - I]
(a) It encourages the inflow of foreign capital for
infrastructure development
(b) It facilitates the proper distribution of finances among
the Public Sector Undertakings
(c) It ensures transparency in financial administration
(d) None of the statements (a), (b) and (c) given above is
correct in his context
52,d,The Finance Commission makes recommendations regarding the distribution of net proceeds of taxes between the Union and the States, principles governing grants-in-aid of State revenues, and measures to augment the Consolidated Fund of a State to supplement resources of Panchayats and Municipalities.
- What is the difference between “vote-on-account” and
“interim budget” ? [2011 - I] - The provision of a “vote-on-account’’ is used by a
regular Government, while an “interim budget’’ is a
provision used by a caretaker Government - A “vote-on-account’’ only deals with the expenditure
in Government budget, while an “interim budget’’
includes both expenditure and receipts
Which of the statements given above is/are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
53,b,The caretaker government does not present the Interim Budget; it is presented by the incoming or new government with different fiscal and revenue plans from the outgoing government. The Interim Budget includes both expenditures and receipts of the government’s budget and is presented for one year.
- Why is the offering of “teaser loans’’ by commercial banks
a cause of economic concern ? - The teaser loans are considered to be an aspect of
sub-prime lending and banks may be exposed to the
risk of defaulters in future. - In India, the teaser loans are mostly given to
inexperienced entrepreneurs to set up manufacturing
or export units. [2011 - I]
Which of the statements given above is/are correct?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
54,a,Teaser loans are provided to home buyers in India, not for setting up manufacturing or export units.
- Which of the following can aid in furthering the
Government’s objective of inclusive growth ? [2011 - I] - Promoting Self-Help Groups.
- Promoting Micro Small and Medium Enterprises.
- Implementing the Right to Education Act.
Select the correct answer using the codes given below:
(a) 1 only (b) 1 and 2 only
(c) 2 and 3 only (d) 1,2 and 3 only
55,d,Inclusive growth aims at both economic and social empowerment of ordinary and underprivileged individuals.
- Why is the Government of India disinvesting its equity in
the Central Public Sector Enterprises (CPSEs) ? - The Government intends to use the revenue earned
from the disinvestment mainly to pay back the external
debt. - The Government no longer intends to retain the
management control of the
Poverty, Planning, Finance and Economic/Social Development D 17
Which the correct statements given above is/are correct ?
(a) 1 only (b) 2 only
(c) Both 1 and 2 (d) Neither 1 nor 2
56,d,While the government may intend to retain management control, fiscal constraints often lead to disinvestment. Therefore, both statements are incorrect.
57,”Economic growth is usually coupled with”,A. Deflation,B. Inflation,C. Stagflation,D. Hyperinflation
57,b,Inflation and economic growth are not compatible; inflation reduces the value of money and affects all sectors, as indicated by the Consumer Price Index (CPI).
58,”The lowering of Bank Rate by the Reserve Bank of India leads to”,A. more liquidity in the market,B. less liquidity in the market,C. no change in the liquidity in the market,D. mobilization of more deposits by commercial banks
58,a,The bank rate is the official interest rate at which the RBI provides loans to the banking system. Lowering the bank rate decreases the cost of borrowing for banks and increases credit volume, leading to more liquidity in the market.
- How do District Rural Development Agencies (DRDAs) help
in the reduction of rural poverty in India? [2012 - I] - DRDAs act as Panchayati Raj Institutions in certain
specified backward regions of the country. - DRDAs undertake area-specific scientific study of the
causes of poverty and malnutrition and prepare
detailed remedial measures. - DRDAs secure inter-sectoral and inter-departmental
coordination and cooperation for effective
implementation of anti-poverty programmes. - DRDAs watch over and ensure effective utilization of
the funds intended for anti-poverty programmes.
Which of the statements given above is/are correct?
(a) 1, 2 and 3 only (b) 3 and 4 only
(c) 4 only (d) 1, 2, 3 and 4
59,b,The DRDA oversees the implementation of anti-poverty programs but does not act as Panchayati Raj Institutions.
60,”The Multi-dimensional Poverty Index developed by Oxford Poverty and Human Development Initiative with UNDP support covers which of the following?”,A. Deprivation of education, health, assets and services at household level,B. Purchasing power parity at national level,C. Extent of budget deficit and GDP growth rate at national level,D. Both A and B
60,a,Deprivation in terms of education, health, assets, and services occurs at the household level.
61,”Which of the following is /are among the noticeable features of the recommendations of the Thirteenth Finance Commission?”,
A. A design for the Goods and Services Tax, and a compensation package linked to adherence to the proposed design,
B. A design for the creation of lakhs of jobs in the next ten years in consonance with India’s demographic dividend,
C. Devolution of a specified share of central taxes to local bodies as grants
,D. Both A and C
61,a,The 13th Finance Commission proposed an elaborate design for the Goods and Services Tax (GST), focusing on improved implementation of existing schemes and recommending a percentage of divisible pool taxes to be transferred to local bodies.
62,”Consider the following specific stages of demographic transition associated with economic development :”,A. Low birthrate with low death rate,B. High birthrate with high death rate,C. High birthrate with low death rate,D. Both A and C
62,c,Demographic Transition refers to the transition from high birth and death rates to lower rates as a country develops from a pre-industrial to an industrialized economic system.
63,”Under which of the following circumstances may ‘capital gains’ arise?”,A. When there is an increase in the sales of a product,B. When there is a natural increase in the value of the property owned,C. When you purchase a painting and there is a growth in its value due to increase in its popularity,D. All of the above
63,b,Increase in the sales of a product does not necessarily mean an increase in the selling price.
- Which of the following measures would result in an increase
in the money supply in the economy? [2012 - I] - Purchase of government securities from the public by
the Central Bank - Deposit of currency in commercial banks by the public
- Borrowing by the government from the Central Bank
- Sale of government securities to the public by the
Central Bank
Select the correct answer using the codes given below:
(a) 1 only (b) 2 and 4 only
(c) 1 and 3 (d) 2, 3 and 4
64,c,Purchase of government securities from the public and borrowing by the government from the Central Bank are both ways of financing the fiscal deficit.
65,”Which of the following would include Foreign Direct Investment in India?”,A. Subsidiaries of foreign companies in India,B. Majority foreign equity holding in Indian companies,C. Companies exclusively financed by foreign companies,D. Portfolio investment
65,d,Foreign Direct Investment (FDI) involves establishing a direct business interest in a foreign country, while Foreign Portfolio Investment (FPI) refers to investing in financial assets such as stocks or bonds in a foreign country.
\66. Who among the following constitute the National
Development Council? [2013 - I]
1. The Prime Minister
2. The Chairman, Finance Commission
3. Ministers of the Union Cabinet
4. Chief Ministers of the States
Select the correct answer using the codes given below.
(a) 1, 2 and 3 only (b) 1, 3 and 4 only
(c) 2 and 4 only (d) 1, 2, 3 and 4
66,b,The National Development Council includes the Prime Minister, Union ministers, Chief Ministers of all states, administrative heads of Union Territories, and members of the Planning Commission.
