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Indian Economy MCQ Question and Answer

1.The ARDC is now a branch of the

  • ARBI
  • BNABARD
  • CIDBI
  • DSDBI
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Correct Answer : (B)

NABARD
Explanation:

2.Paper currency first started in India in

  • A1861
  • B1870
  • C1880
  • D1890
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Correct Answer : (A)

1861
Explanation:

3.The budget deficit means

  • Athe excess of total expenditure, including loans, net of lending over revenue receipts
  • Bdifference between revenue receipts and revenue expenditure
  • Cdifference between all receipts and all the expenditure
  • Dfiscal deficit less interest payments
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Correct Answer : (C)

difference between all receipts and all the expenditure
Explanation:

4.Who has formulates the fiscal policy in India?

  • APlanning Commission
  • BMinistry of Finance
  • CFinance Commission
  • DThe Reserve Bank of India
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Correct Answer : (B)

Ministry of Finance
Explanation:

5.Short-term finance is usually for a period ranging up to

  • A5 months
  • B10 months
  • C12 months
  • D15 months
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Correct Answer : (C)

12 months
Explanation:

6.Redistribution polices geared to reduce economic inequalities include

  • Aprogressive tax policies
  • Bland reforms
  • Crural development policies
  • DAll the above
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Correct Answer : (D)

All the above
Explanation:

7.If the RBI adopted an expansionist open market operations policy, this means that it will

  • Abuy securities from non-government holders
  • Bsell securities in the open market
  • Coffer commercial banks more credit in the open market
  • Dopenly announce to the market that it intends to expand credit
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Correct Answer : (C)

offer commercial banks more credit in the open market
Explanation:

8.The banks are required to maintain a certain ratio between their cash in the hand and total assets. This is called

  • AStatutory Bank Ratio (SBR)
  • BStatutory Liquid Ratio (SLR)
  • CCentral Bank Reserve (CBR)
  • DCentral Liquid Reserve (CLR)
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Correct Answer : (B)

Statutory Liquid Ratio (SLR)
Explanation:

9.Devaluation of currency will be more beneficial if

  • Aprices of domestic goods remain constant
  • Bprices of exports remain constant
  • Cprices of imports remains constant
  • Dprices of exports rise proportionately
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Correct Answer : (B)

prices of exports remain constant
Explanation:

10.The apex body for formulating plans and coordinating research work in agriculture and allied fields is

  • AState Trading Corporation
  • BRegional Rural Banks
  • CNational Bank for Agriculture and Rural Development (NABARD)
  • DIndian Council of Agricultural Research
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Correct Answer : (D)

Indian Council of Agricultural Research
Explanation:

11.National expenditure includes

  • Aconsumption expenditure
  • Binvestment expenditure
  • Cgovernment expenditure
  • DAll of the above
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Correct Answer : (D)

All of the above
Explanation:

12.Subsidies mean

  • Apayment by government for purchase of goods and services
  • Bpayment made by business enterprises to factors of production
  • Cpayment made by companies to shareholders
  • Dpayment made by the government to business enterprises, without buying any goods and services
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Correct Answer : (D)

payment made by the government to business enterprises, without buying any goods and services
Explanation:

13.The annual yield from which of the following Union Government taxes is the highest?

  • ACustom duties
  • BCorporation tax and income tax
  • CInheritance tax, wealth tax, interest tax and gift tax
  • DExcise duties
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Correct Answer : (D)

Excise duties
Explanation:

14.Fiscal deficit in the Union Budget means

  • Athe difference between current expenditure and current revenue
  • Bnet increase in Union Governments borrowings from the Reserve Bank of India
  • Cthe sum of budgetary deficit and net increase in internal and external borrowings
  • Dthe sum of monetized deficit and budgetary deficit
Answer / Hint Save Question Comment On Question
Correct Answer : (C)

the sum of budgetary deficit and net increase in internal and external borrowings
Explanation:

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