Infant Mortality Rate (IMR)

As per latest data, IMR has reduced by 58% in India during the period of 1990-2015 which is more than to Global decline of 49% during the same period. The full immunization coverage also improved from 43.5% in 2005 to 62.0% in 2015 and mortality due to Tuberculosis has reduced from 76 per 1,00,000 in 1990 to 32 per 1,00,000 in 2015.

The steps being taken by the government to further combat infant mortality and increase vaccine coverage under the National Health Mission are as under:

(1) Promotion of Institutional deliveries through cash incentive under Janani Suraksha Yojana (JSY) and Janani Shishu Suraksha Karyakaram (JSSK) which entitles all pregnant women delivering in public health institutions to absolutely free ante-natal check-ups, delivery including Caesarean section, post-natal care and treatment of sick infants till one year of age.

(2) Strengthening of delivery points for providing comprehensive and quality Reproductive, Maternal, Newborn, Child and Adolescent Health (RMNCH+A) Services, ensuring essential newborn care at all delivery points, establishment of Special Newborn Care Units (SNCU),

Newborn Stabilization Units (NBSU) and Kangaroo Mother Care (KMC) units for care of sick and small babies. Home Based Newborn Care (HBNC) is being provided by ASHAs to improve child rearing practices. India Newborn Action Plan (INAP) was launched in 2014 to make concerted efforts towards attainment of the goals of “Single Digit Neonatal Mortality Rate” and “Single Digit Stillbirth Rate”, by 2030.

(3) Early initiation and exclusive breastfeeding for first six months and appropriate Infant and Young Child Feeding (IYCF) practices are promoted in convergence with Ministry of Women and Child Development. Village Health and Nutrition Days (VHNDs) are observed for provision of maternal and child health services and creating awareness on maternal and child care including health and nutrition education. Ministry of Health and Family Welfare launched MAA-Mothers’ Absolute Affection programme in August 2016 for improving breastfeeding practices (Initial Breastfeeding within one hour, Exclusive Breastfeeding up to six months and complementary Breastfeeding up to two years) through mass media and capacity building of health care providers in health facilities as well as in communities.

(4) Universal Immunization Programme (UIP) is being supported to provide vaccination to children against many life threatening diseases such as Tuberculosis, Diphtheria, Pertussis, Polio, Tetanus, Hepatitis B and Measles. Pentavalent vaccine has been introduced all across the country and “Mission Indradhanush” has been launched to fully immunize children who are either unvaccinated or partially vaccinated; those that have not been covered during the rounds of routine immunization for various reasons.Measles Rubella Campaign is being undertaken in select States for children from 9 months to 15 years of age with the aim of eliminating Measles by 2020.

(5) Name based tracking of mothers and children till two years of age (Mother and Child Tracking System) is done to ensure complete antenatal, intranatal, postnatal care and complete immunization as per schedule.

(6) Rashtriya Bal Swasthya Karyakram (RBSK) for health screening, early detection of birth defects, diseases, deficiencies, development delays including disability and early intervention services has been Operationalized to provide comprehensive care to all the children in the age group of 0-18 years in the community.

(7) Some other important interventions are Iron and folic acid (IFA) supplementation for the prevention of anaemia among the vulnerable age groups, home visits by ASHAs to promote exclusive breast feeding and promote use of ORS and Zinc for management of diarrhoea in children.

(8) Capacity building of health care providers: Various trainings are being conducted under National Health Mission (NHM) to build and upgrade the skills of health care providers in basic and comprehensive obstetric care of mother during pregnancy, delivery and essential newborn care.

(9) Low performing districts have been identified as High Priority Districts (HPDs) which entitles them to receive high per capita funding, relaxed norms, enhanced monitoring and focused supportive supervisions and encouragement to adopt innovative approaches to address their peculiar health challenges.

Goods and Services Tax (GST)

GST is a unified taxation system which would end multiple taxation across the states and create a level playing field for businesses throughout the country, much like the developed nations. It is a multi-stage destination-based tax which will be collected at every stage, starting from procuring the raw material to selling the final product. The credit of taxes paid at the previous stage(s) will be available for set-off at the next stage of supply. Being destination or a consumption based, the GST will also end multiple taxes levied by Centre and the State Governments like Central Excise, Service Tax, VAT, Central Sales Tax, Octroi, Entry Tax, Luxury Tax and Entertainment Tax etc.  This will lower the overall tax burden on the consumer and will benefit the industry through better cash flows and working capital management. Currently, 17 State and Central levies are being applied on goods as they move from one State to the other.

BENEFITS

Different estimates peg the net advantage to the Gross Domestic Product, up to two percentage points.  The GST regime is also expected to result in better tax compliance, thereby increasing its revenue and narrowing the Budget deficit. All the imported goods will be charged Integrated Goods & Services Tax (IGST) which is equivalent to the Central GST + State GST. This will bring equality with taxation on local products.

Mainly, there will be three types of taxes under the GST regime: Central Goods and Services Tax (CGST), State (or Union Territory) Goods and Services Tax (SGST) and Integrated Goods and Services Tax (IGST). Tax levied by the Centre on intra-State supply of goods or services would be called the CGST and that to be levied by the States and Union Territories(UTs) would be called the SGST respectively. The IGST would be levied and collected by the Centre on inter-State supply of goods and services. Four supplementary legislations approving these taxes, namely the Central GST Bill, the Integrated GST Bill, The GST (Compensation to States) Bill, and the Union Territory GST Bill were passed by the Lok Sabha in May this year, making the realisation of 1^st July, 2017 deadline a reality.

All the matters related to the GST are dealt upon by the GST Council headed by the Union Finance Minister while all the State Finance Ministers are its Members. The GST Council also has a provision to adjudicate disputes arising out of its recommendation or implementation thereof.

TAX RATES

The GST Council has fixed four broad tax slabs under the new GST system - 5 per cent, 12 per cent, 18 per cent and 28 per cent. On top of the highest slab, there is a cess on luxury and demerit goods to compensate the States for revenue loss in the first five years of GST implementation. Most of the goods and services have been listed under the four slabs, but a few like gold and rough diamonds have exclusive tax rates. Also, some items have been exempted from taxation. The essential items have been kept in the lowest tax bracket, whereas luxury goods and tobacco products will invite higher tax.

17-YEAR-LONG WAIT

Many countries in the world switched to a unified taxation system very early. France was the first country to do so in 1954 and many others followed, some by implementing GST and others by using a different form of Value Added Tax (VAT). In India, the discussion on GST started in the year 2000, in the NDA Government led by the former Prime Minister, Shri Atal Bihari Vajpayee. Finally, after 17 years of consensus building, 101^st Constitution Amendment Bill was passed by Parliament in 2016. The States had apprehension of reduction in their revenue and their desire to keep some lucrative goods out of the GST baskets like alcohol, petroleum and real estate among others.

IMPACT ON CONSUMERS

From agarbattis (incense sticks) to luxury cars - all these goods will be taxed under different slabs. Movie tickets costing less than Rs 100 have been kept in the 18% GST slab while those over Rs 100 will attract 28% tax under GST. Tobacco products have been kept under a higher tax bracket. Industries such as textiles and, gems and jewellery are subject to a GST rate of 5%

The Government has shown its strong determination and stuck to implementing the GST with effect from 1^st July, 2017. The road ahead would require a lot of resolve by the implementing agencies like the Goods and Services Network, states and the industry.    To sail through initial hiccups and successfully steer the ship of the economy, the Government needs to show the same determination and courage. A bold initiative like GST taken for the welfare of the country must lead to a grand success.

Union Budget 2017-18 Highlights

The 2017 Union Budget, presented by Finance Minister Arun Jaitley on 01st February 2017, was broadly focused on 10 issues farming sector, rural population, youth, poor and health care for the underprivileged, infrastructure, financial sector for stronger institutions, speedy accountability, public services, prudent fiscal management and tax administration for the honest.

Following are the highlights of his speech on various issues:

                                                         Demonetisation

1. Demonetisation is expected to have a transient impact on the economy.

2. It will have a great impact on the economy and lives of people .

3. Demonetisation is a bold and decisive measure that will lead to higher GDP growth.

4. The effects of demonetisation will not spillover to the next fiscal.

Agriculture sector

1. Sowing farmers should feel secure against natural calamities.

2. A sum of Rs. 10 lakh crore is allocated as credit to farmers, with 60 days interest waiver.

3. NABARD fund will be increased to Rs. 40,000 crore. 

4. Government will set up mini labs in Krishi Vigyan Kendras for soil testing.

5. A dedicated micro irrigation fund will be set up for NABARD with Rs 5,000 crore initial corpus.

6. Irrigation corpus increased from Rs 20,000 crore to Rs 40,000 crore.

7. Dairy processing infrastructure fund wlll be initially created with a corpus of Rs. 2000 crore.

8. Issuance of soil cards has gained momentum.

9. A model law on contract farming will be prepared and shared with the States.

Rural population

1. The government targets to bring 1 crore households out of poverty by 2019.

2. During 2017-18, five lakh farm ponds will be be taken up under the MGNREGA.

3. Over Rs 3 lakh crore will be spent for rural India. MGNREGA to double farmers' income.

4. Will take steps to ensure participation of women in MGNREGA up to 55%.

5. Space technology will be used in a big way to ensure MGNREGA works.

6. The government proposes to complete 1 crore houses for those without homes.

7. Will allocate Rs. 19,000 crore for Pradhan Mantri Gram Sadak Yojana in 2017-18.

8. The country well on way to achieve 100% rural electrification by March 2018.

9. Swachh Bharat mission has made tremendous progress; sanitation coverage has gone up from 42% in Oct 13 to 60% now.

 youth

1. Will introduce a system of measuring annual learning outcomes and come out with an innovation fund for secondary education.

2. Focus will be on 3,479 educationally-backward blocks.

3. Colleges will be identified based on accreditation.

4. Skill India mission was launched to maximise potential. Will set up 100 India International centres across the country.

5. Courses on foreign languages will be introduced.

6. Will take steps to create 5000 PG seats per annum.

For the poor and health care

1. Rs. 500 crore allocated for Mahila Shakthi Kendras.

2. Under a nationwide scheme for pregnant women, Rs. 6000 will be transferred to each person.

3. A sum of Rs. 1,84,632  crore allocated for women and children.

4. Affordable housing will be given infrastructure status.

5. Owing to surplus liquidity, banks have started reducing lending rates for housing.

6. Elimination of tuberculosis by 2025 targeted.

7. Health sub centres, numbering 1.5 lakh, willl be transformed into health wellness centres.

8. Two AIIMS will be set up in Jharkhand and Gujarat.

9. Will undertake structural transformation of the regulator framework for medical education.

10. Allocation for Scheduled Castes  is Rs. 52,393  crore

11. Aadhaar-based smartcards will be issued to senior citizens to monitor health.

Infrastructure; Railways

1. A total allocation of Rs. 39,61,354 crore has been made.

2. Total allocation for Railways is Rs. 1,31,000 crore.

3. No service charge on tickets booked through IRCTC.

4. Raksha coach with a corpus of Rs. 1 lakh crore for five years (for passenger safety).

5. Unmanned level crossings will be eliminated by 2020.

6. 3,500 km of railway lines to be commissioned this year up from 2,800 km last year.

7. SMS-based ''clean my coach service'' is put in place.

8. Coach mitra facility will be introduced to register all coach related complaints.

9. By 2019 all trains will have bio-toilets.

10. Five-hundred stations will be made differently-abled friendly.

11. Railways to partner with logistics players for front-end and back-end solutions for select commodities.

12. Railways will offer competitive ticket booking facility

13. Rs. 64,000 crore allocated for highways. 

14. High speed Internet to be allocated to 1,50,000 gram panchayats

15. New Metro rail policy will be announced with new modes of financing

Energy Sector

1. A strategic policy for crude reserves will be set up

2. Rs. 1.26,000 cr for energy production-based investments received

3. Trade infra export scheme will be launched 2017-18.

Financial Sector

1. FDI policy reforms - more than 90% of FDI inflows are now automated.

2. Shares of Railway PSE like IRCTC would be listed on stock exchanges. 

3. Bill on resolution of financial firms to be introduced in this session of parliament.

4. Decided to abolish FIPB in 2017-18.

5. Foreign Investment Promotion Board to be abolished.

6. Revised mechanism to ensure time bound listing of CPSEs

7. Computer emergency response team for financial sector to be formed.

8. Pradhan Mantri Mudra Yojana lending target at Rs 2.44 lakh crore for 2017-18

9. Digital India - Bhim app will unleash mobile phone revolution - two new schemes to promote the app.

10. Govt to introduce two new schemes to promote BHIM App - referral bonus for users and cash back for traders: FM.

11. Negotiable Instruments Act might be amended.

12. DBT to LPG consumers , Chandigarh is kerosene free, 84 govt schemes are on the DBT platform.

13. Head post office as the central office for rendering passport services

14. Easy online booking system for Army, defence personnel

15. For big-time offences - including economic offenders fleeing India, the govt. will introduce a legislative change or new law to confiscate the assets of these people within the country.

Fiscal Situation

1. Total expenditure - Rs. 21, 47,000 crore

2. Abolition on plan, non-plan expenditure, focus on capital expenditure ( Capital expenditure will be 25.4 per cent)

3. Rs. 3,000 crore under Dept of Economic Affairs for implementing Budget announcements.

4. Defence expenditure, excluding pension, at Rs 2,74,114  crore

5. Expenditure in science and technology —  Rs. 37,435 crore

6. Total resources transferred to States and UTs is Rs 4.11 lakh crore

7. Recommended 3% fiscal deficit for three years with deviation of 0.5% of GDP.

8. Revenue deficit - 1.9 %

9. Pegged fiscal deficit of 2017-18 at 3.2% of GDP and remain committed to achieving 3% in the next year.

On funding of political parties

1. Maximum amount of cash donation for political parties will be Rs 2,000 from any one source from Rs 20,000

2. Political parties will be entitled to receive donations by cheque or digital mode from donors.

3. Amendment is being proposed to RBI Act to enable issuance of electoral bonds that government will scheme. Donor can 4. purchase these bonds from banks or post office via cheque or digital transactions. They can be redeemed only by registered political parties.

Tax proposals

1. Proportion of direct tax to indirect tax is not optimal.

2. 1.95 crore individuals showed income between Rs 2.5 lakh to Rs 5 lakh.

3. Out of 76 lakh individual assessees declaring income more than Rs 5 lakh, 56 lakh are salaried.

4. Only 1.72 lakh people showed income of more than Rs 50 lakh a year.

5. Between Nov 8 to Dec 30: Deposits between Rs 2 lakh and Rs 80 lakh was made in 1.09 crore accounts.

6. Net tax revenue of 2013-14 was Rs 11.38 lakh crore.

7. Out of 76 lakh individual assessees declaring income more than Rs 5 lakh, 56 lakh are salaried.

8. 1.95 crore individuals showed income between Rs 2.5 lakh to Rs 5 lakh.

9. Rate of growth of advance tax in Personal I-T is 34.8% in last three quarters of this financial year.

10. Holding period for long term capital gain lowered to 2 years

11. Propose to have carry-forward of MAT for 15 years.

12. Capital gains tax to be exempted for persons holding land from which land was pooled for creation of state capital of Telangana.

13. Corporate tax: In order to make MSME companies more viable, propose to reduce tax for small companies of turnover of up to 16. Rs 50 crore to 25%. About 67 lakh companies fall in this category. 96% of companies to get this benefit.

14. Propose to reduce basic customs duty for LNG to 2.5% from 5%

15. SIT on black money suggested no cash transactions of more than Rs 3 lakh. Govt has accepted this proposal.

16. Income Tax Act to be amended.  No transaction above Rs 3 lakh to be permitted in cash.

17. Limit of cash donation by charitable trust reduced to Rs 2,000 from Rs 10,000.

18. Net revenue loss in direct tax could be Rs. 20,000 crore.

19. India’s tax to GDP ratio is not favourable.

20. Out of 13.14 lakh registered companies, only 5.97 lakh companies have filed returns for 2016-17.

Personal income tax

1. Existing rate of tax for individuals between Rs.  2.5- Rs 5 lakh reduced to 5% from 10%

2. All other categories of tax payers in subsequent brackets will get benefit of Rs 12,500.

3. Simple one page return for people with annual income of Rs. 5 lakh other than business income.

4. People filing I-T returns for the first time will not come under govt. scrutiny5. 

5. 10% surcharge on individual income above Rs. 50 lakh and up to Rs 1 crore to make up for Rs 15,000 crore loss due to  cut in personal I-T rate. 15 surcharge on individual income above Rs. 1 crore to remain.

Indian Economy Practice Questions for All Competitive Exams

1.    Which of the following factor forms the invisible account of the Balance of Payments of a country?

(a)    International trade in services.
(b)    Income associated with non resident assets and liabilities.
(c)    Remittance of worker income.
(d)    All the above.

Answer: (d)

Explanation: Balance of payment broadly comprises of current and capital accounts. Current account records export and import of goods (visible items),   export and import of services (invisible items) and unilateral transfers from one country to another.

2.    Which of the following is part of capital account of a country?

(a)    Export and import of goods.
(b)    Export and import of services.
(c)    Unilateral transfers from one country to another.
(d)    NRI deposits.

Answer: (d)

Explanation: Capital account of a country includes foreign direct investment, portfolio investment, external commercial borrowings, NRI deposits among others.

3.    What is Greenfield investment?

(a)    A form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities.
(b)    A form of foreign direct investment where a company purchases or leases existing production facilities to launch a new production activity.
(c)    Investment by non resident Indians.
(d)    Investment in shares and debts.

Answer: (a)

Explanation: A form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities is called Greenfield Investment. A form of foreign direct investment where a company purchases or leases an existing production facility to launch a new production activity is called Brownfield Investment.

4.    Which of the following is not a feature of Pradhan Mantri Jan Dhan Yojana?

(a)    Providing universal access to banking facilities.
(b)    Providing Basic Banking Accounts with overdraft facility of Rs.5000 after six months and RuPay Debit card with inbuilt accident insurance cover of Rs. 1 lakh and RuPay Kisan Card
(c)      Financial Literacy Programme
(d)    Issuance of credit cards.

Answer: (d)

Explanation: The PMJDY has been conceived as a national mission on financial inclusion with the objective of covering all households in the country with banking facilities and having a bank account for each household. Financial inclusion or inclusive financing is the delivery of financial services at affordable costs to sections of disadvantaged and low-income segments of society.
Phase I (15th August ,2014-14th August,2015)-
 
•    Universal access to banking facilities
•    Providing Basic Banking Accounts with overdraft facility of Rs.5000 after six months and RuPay Debit card with inbuilt accident insurance cover of Rs. 1 lakh and RuPay Kisan Card.
•    Financial Literacy Programme
Phase II (15th August 2015-15th August,2018)-
•    Creation of Credit  Guarantee Fund   for coverage of defaults in overdraft  A/Cs   
•    Micro Insurance     
•    Unorganized sector Pension schemes like  Swavlamban

5.    Which of the following is not a function of Reserve Bank of India?

(a)    Regulation of credit.
(b)    Regulation of foreign exchange.
(c)    Management of fiscal deficit.
(d)    Banker to the government and commercial banks.

Answer: (c)

Explanation: Set up in 1935, RBI’s main functions include regulation of credit, regulation of foreign exchange, banker to the government and commercial banks, issue of notes and coins and lender of last resort.

6.    Which of the following is a qualitative credit control tool used by RBI?

(a)    Moral suasion.
(b)    Open market operations.
(c)    Repo rate.
(d)    Cash reserve requirement.
 
Answer: (a)

Explanation: Moral suasion is application of pressure but not force to get members to adhere to a policy or advice that RBI gives. Other qualitative credit control tool includes margin requirements, consumer credit regulations, RBI guidelines, rationing of credit.

7.    Consider the following statements.

1.    Bharat Bill payment System is a proposed centralized bill payments infrastructure which will enable customers to pay a variety of bills anytime anywhere.
2.    It has been proposed by RBI.
3.    The National Payments Corporation of India (NPCI) has been designated as the authorized Bharat Bill Payment Central Unit.

Which of the above statements are correct?

(a)    1 and 2.
(b)    1 and3.
(c)    2 and 3.
(d)    1, 2 and 3.

Answer: (d)

Explanation: The Reserve Bank of India (RBI) proposes to set up anytime anywhere bill payment system under Bharat Bill Payment System (BBPS). The BBPS is designed to function as a tiered structure for operating the bill payment system in the country with a single brand image providing convenience of ‘anytime anywhere’ bill payment to customers. The National Payments Corporation of India (NPCI) has been designated as the authorized Bharat Bill Payment Central Unit (BBPCU) to set the standards for BBPS processes which need to be adhered to by all authorized operating units under the system.

8.    Consider the following statements about ‘Swachh Bharat Kosh’.

1. Funds will be used for improving cleanliness levels in rural and urban areas, including in schools.
2. It will be under the Ministry of Tourism.
3. Its functioning will be monitored on quarterly basis by the Finance Minister and by the Prime Minister from time-to-time.
4. Projects under it will be implemented and carried out by the existing institutions at the state, district, and sub district level and no new institutions would be created.
  
Which of the above statements are correct?

(a)    1, 2, 3 and 4.
(b)    1, 2 and 3.
(c)    1, 3 and 4.
(d)    2, 3 and 4.

Answer: (c)

Explanation:  Government recently launched a fund Swachh Bharat kosh that will be used be used for improving cleanliness levels in rural and urban areas, including in schools. As a top priority, funds will be used to bring out innovative projects and girl toilets. It will be under the Ministry of Finance and will be managed by a Governing Council headed by Expenditure Secretary. Its functioning will be monitored on quarterly basis by the Finance Minister and by the Prime Minister from time-to-time. Projects under it will be implemented and carried out by the existing institutions at the state, district, and sub district level and no new institutions would be created. These funds will finance activities such as construction of new toilets as well as repair and renovation of dysfunctional toilets in rural areas, urban areas, elementary, secondary and senior secondary government schools, aanganwaadis. It will be also used for constructing water lines to the toilets, training and skill development to maintain hygiene in the toilets as well as other activities to improve sanitation.

9.    What is the full form of NITI Aayog?

(a)    National Institute to Transform India.
(b)    National Institute for Transforming India.
(c)    National Institution to Transform India.
(d)    National Institution for Transforming India.

Answer: (d)

10.    Swabhiman is a:

(a)    Financial inclusion initiative.
(b)    Pension initiative for BPL families.
(c)    Insurance policy for women.
(d)    Rural infrastructure project.

Answer:  (a)

Explanation:  Swabhiman aims at providing branchless banking through the services of banking correspondents (Bank Sathi).

11.  According to Suresh Tendulkar Report, What percentage of population was under the poverty Line in 2004-05?

A.36 %
B.37.2 %
C.40.2%
D.33 %

Answer: B

12.  Which of following statement is true about the Primary deficit?

A.    It is difference between Revenue receipts and Revenue Expenditure
B.    It is difference between capital receipts and Interest Payment    
C.    It is difference between the Fiscal Deficit and Interest Payment
D.    It is addition of Fiscal Deficit and Interest Payment

Answer: C

13.  Who introduced Zamindari system in India?

A. Lord Carnwallis 
B. Lord Wlliam Bentinck
C. Lord Dalhousie 
D. Lord Canning

Answer:  A

14.  Base Effect remains in news, which of following statement is true about Base Effect:

A. It is Change in numbers of items for which price quotations are taken
B. It measures Impact of fuel items on inflation 
C. Impact of the rise in price level in the previous year over the rise in price level in the current year
D. Problem due to miscalculation

Answer: C

15.  What percent branches are to be established in unbanked areas under the provision of  new Banking licensing schemes

A.20%
B.40%
C.22%
D.25%

Answer: D

16.  What does the tax haven mean?

A. Important source of tax revenue for government 
B. Countries or states which impose no tax or very low tax that attract wealth from all over the world. 
C. Rich class of society that pays the tax
D. Particular section of society that does not pay the tax

Answer: B

17. Our first five year plan primary focused on

A. Agricultural Sector
B. Manufacturing Sector
C. Defense up gradation 
D. Service sector

Answer: A

18.  Which of following statement is true about charged expenditure?

A. Expenditure which requires voting of parliament 
B. Expenditure which does not require voting of parliament 
C. Expenditure which is incurred on productive activities 
D. Expenditure which is incurred on social welfare schemes

Answer: B

19.  Which sector constitutes the maximum share in GDP of India

A. Primary Sector
B. Secondary Sector
C. Tertiary Sector
D. None of above

Answer: C

20. Who operates the monetary policy in India?
A. Ministry of Finance
B. Reserve Bank of India (RBI)
C. Security and Exchange Board of India
D. All of above

Answer: B

21.Which of following statement is true about the Economic Growth 

a. It refers to increase in Gross Domestic Product ( GDP)

b. It refers to the long and sustained rise in real  Gross Domestic Product  (GDP) 

c. It is characterized by fall in unemployment rate

d. Rise in GDP on monetary term

Answer:  b  

Explanation : Economic growth implies change or an increase in the real output of country. Such changes should not be momentarily. Such growth should be maintained for certain period of time. Increase in GDP owing to increase in prices cannot be termed as Economic Growth.  

22.Market Based economy means

a. All economic decision are taken based on the demand and supply forces

b. Some economic decision are taken by government and other are left to market forces

c. Government has full control over the private sector

d. Economic decisions are taken after keeping in view the social welfare 

Answer:  a 

Explanation :Market based economy refers to the economic system where all economic decisions are taken based on the demand and supply conditions prevailing in the market. Government has minimal interference in economic activities. Private players are free to produce the goods and services based on the demand and supply signals in the market.

23.Quaternary  sector implies 

a. Activities related to mining and quarrying 

b. Activities related  to manufacturing 

c. Fishing activities 

d. Research and developmental  activities

Answer: d

Explanation :Quaternary sector is characterized by the intellectual persons or individuals or group of individual. It includes the research and development activities. Mining and quarrying and fishing are concerned with primary sector activities 

24.Sustainable Development implies 

a. Sustained rise in real GDP

b. Long lasting development without negatively impacting the environment 

c. Full exploitation of natural resources 

d. Reduction in unemployment and poverty 

Answer: b

Explanation :Brundtland commission in Our Common Future, also known as the Brundtland Report defined sustainable development:

"Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

25.  Mixed Economy Implies

a. Absence of Public Sector

b. Absence of private sector

c. Co-existence of public and private sector

d. All economic activities are motivated by social welfare 

Answer:   c

Explanation :Mixed Economy is characterized by the co-existence of private and public sectors. Generally public sector is motivated by the general welfare while private sector perform economic activities out of profit motive 

26.Sustainable economic growth depends upon

  a. Investment, not saving

  b. Saving, not investment

  c. Both saving and investment

  d. Neither saving nor investment

Answer: c

Explanation :Saving makes the availability of fund for carrying out the investment activities. Investment cannot be carried out without saving. Further, saving is of no use until it is channelized into different investment activities. 

27.  Which of the following are not third-world regions? 

a. Latin America.

b. Asia.

c. Africa.

d. Australia

Answer: d

Explanation :Various terms has been used to developing countries such as the underdeveloped countries, less developed countries, Third world countries or region etc. developing countries exhibit some common features based on which one can differentiate these countries from developed countries. These regions are characterized by low growth rate, low saving and investment rates, low capital formation, high population growth, and lack of technological development. 

28. Economic development means 

a. Economic growth.

b. Economic growth plus structural and qualitative changes. 

c. Improvement in the living standard of the urban population.

d. Sustainable increases in Gross National Product (GDP).

Answer:  b

Explanation :Economic development means the change in growth along with progressive changes in socio-economic conditions of country. While Economic growth implies change or an increase in the real output of country.Growth must be accompanied by the progressive reduction in the inequalities and social vagaries for being called economic development. Economic growth does not take into account the social implications in form of reduction in inequalities. Change or increase in one component such as consumption or investment may be regarded as the economic growth. 

29. Who operates the monetary policy in India?

a. Ministry of Finance

b. Reserve Bank of India (RBI)

c. Security and Exchange Board of India

d. All of above

Answer: b

Explanation :Central Bank, The Reserve Bank of India is responsible for implementing the monetary policy in India. RBI uses the monetary policy for controlling the inflation and getting high rate of growth. Ministry of Finance and SEBI are not concerned with monetary policy. 

30. Consider the following statements:

I) Government disinvesting its share in various public sector undertakings

II) Process of disinvestment is very fast

III) Process of disinvestment is very slow and government always falls short of target

Which of above statements is/ are true about government policy of disinvestment

a. Only I

b. I and III

c. I and II

d. I, II and III

Answer: b

Explanation :Government of India is divesting its share from public sector undertakings,. Most of government undertakings were incurring losses during the pre liberalization period. Hence, after the introduction of new economic policy in 1991, government started downsizing its share in PSU. But the process of disinvestment is very slow due to host of legal and political hurdles. 

31.    Consider the following statements 
I.    Multidimensional poverty index was introduced in 2010
II.    It uses different factors to determine poverty beyond income-based lists
III.    It has replaced Human Poverty Index
IV.    It reflects deprivations in very rudimentary services and core human functioning for people.
Which of above statement is/are correct?
a.    I and II
b.    all are correct 
c.    only III
d.    II and IV
Answer: b

32.    Amartya Sen is known for 
a.    Welfare Economics
b.    Money and Banking 
c.    Industrial Economics 
d.    Behavioral Economics
Answer:  a 

33.  Liquidity refers to:
a.  Wealth available with investors
b.  Ease with which assets can be converted into the money
c.  Currency convertibility 
d.  All of above

Answer: b

34.  Which of following statement is true about the Primary deficit?
a.    It is difference between Revenue receipts and Revenue  Expenditure
b.    It is difference between capital receipts and Interest Payment    
c.    It is difference between the Fiscal Deficit and Interest Payment
d.    It is addition of Fiscal Deficit and Interest Payment
Answer: c

35. Base Effect always remains in news, which of following statement is true about Base Effect:
a.    It is Change in numbers of items for which price quotations are taken
b.    It measures Impact of fuel items on inflation 
c.    It is related to Impact of the rise in price level  in the previous year over the rise in price levels in the current year
d.    It is related Problems which arises due to miscalculation 
Answer: c 


36.  What percent branches are to be established in unbanked areas under the provision of new Banking licensing scheme?
a.    20%
b.    40%
c.    22%
d.    25%
Answer: d

37. What does the tax heaven mean?
a. Important source of tax revenue for government 
b. countries or states which impose no tax or very low tax that attract wealth from all over the world. 
c. Rich class of society that pays the tax
d. Particular section of society that does not pay the tax
Answer: b


38. Our first five year plan primary focused on 
a. Agricultural Sector
b. Manufacturing Sector
c. Defense up gradation 
d. Service sector
Answer: a


39. Consider the following statements 
I) Recession reduces the demands for goods and services
II) Recession leads to unemployment 
III) Government interference is desirable to reverse the recessionary trends
Which of above statements is/ are true about Recession 
a.    Only I
b.    Only II
c.    I,II,III
d.    None of above 
Answer: c


40.  Consider the following statement:
I) Government disinvesting its share in various public sector undertakings
II) Process of disinvestment is very fast
III) Process of disinvestment is very slow and government always falls short of target
Which of above statements is/ are true about government policy of disinvestment
a.    Only I
b.    I and III
c.    I and II
d.    I, II and III
Answer: b