Indian Economy MCQs
Indian Economy Multiple Choice Questions (MCQs) for SSC, State and all One Day Examinations of India. Objective Questions on Indian Economy for competitive examinations.
1. Which among the following is First Indian Special Economic Zone(SEZ)?
[A] Visakhapatnam SEZ
[B] Kandla SEZ
[C] Noida Special Economic Zone
[D] Cochin SEZ
Show Answer
Correct Answer: B [Kandla SEZ]
Notes:
The Kandla Special Economic Zone (KASEZ) was established in the year 1965 as the first Export Processing Zone in India. It is also the first special economic zone in India and in Asia. It is located in Kutch District of Gujarat.
2. Which term refers to high inflation, slow growth, and high unemployment occurring together?
[A] Depression
[B] Stagflation
[C] Recession
[D] Reflation
Show Answer
Correct Answer: B [Stagflation]
Notes:
Stagflation refers to an economic situation where high inflation, stagnant economic growth, and elevated unemployment occur simultaneously. The term was coined in the 1960s. A notable period of stagflation happened during the 1970s oil crisis when global oil prices rose sharply. Policymakers find stagflation challenging because inflation and unemployment move in opposite directions to typical business cycles.
3. Which among the following is an essential feature of a commercial bank?
[A] providing Locker facilities
[B] dealing with credit
[C] providing business information and data
[D] Sale of securities
Show Answer
Correct Answer: B [dealing with credit]
Notes:
Section 5 of Banking Regulation Act 1949 defines Banking as the act of accepting deposits for the purpose of lending. Commercial banks deal with money, accepts deposits and advance short-term loans / credits.
4. Which best defines Gross Budgetary Support?
[A] Value of gross revenue receipts by the government
[B] Fraction of total expenditure on Central sectors, ministries, and State/UT plans
[C] Value of total plan expenditure
[D] Fraction of expenditure on different Central sectors plans
Show Answer
Correct Answer: B [Fraction of total expenditure on Central sectors, ministries, and State/UT plans]
Notes:
Gross Budgetary Support is the portion of the government budget allocated to central sectors, ministries, departments, and as support to State/UT plans. It forms a part of the total expenditure in India’s Union Budget. GBS funds plan expenditures and is used for the implementation of schemes and programs under different government ministries and departments. It is released annually by the Government of India.
5. Which among the following is the main motive of the Reserve Bank of India behind it’s mechanism known as Devolvement ?
[A] To counter the problem of low capital in the scheduled banks
[B] To counter the volatility in the price of Government Securities
[C] To handle the problem of discrepancy in accounting systems in banks
[D] To control the scheduled banks’ assets and liabilities
Show Answer
Correct Answer: B [To counter the volatility in the price of Government Securities]
Notes:
The main motive of the Reserve Bank of India (RBI) behind the mechanism known as devolvement is to counter the volatility in the price of Government Securities. Devolvement occurs when underwriters fail to fully subscribe to a government bond auction, leading the RBI to purchase the unsold portion. This helps stabilize the market by ensuring liquidity and maintaining orderly pricing of government securities, which are crucial for fiscal policy and economic stability. The RBI’s role in this process is vital for managing interest rates and ensuring confidence in government debt instruments.
6. Which term is not formally linked with Indian government budgets?
[A] Outcome Budget
[B] Gender Budget
[C] Austerity Budget
[D] Performance Budget
Show Answer
Correct Answer: C [Austerity Budget]
Notes:
Austerity Budget is not an official budget type in India. Outcome Budget was introduced in 2005 to link allocations with measurable results. Gender Budget was initiated in 2005-06 for women’s development. Performance Budget allocates funds based on achievements. The Indian Union Budget officially includes Outcome, Gender, and Performance Budgets, but not Austerity Budget.
7. Who among these is thought of as a Pioneer of Economic Nationalism?
[A] Madan Mohan Malviya
[B] R.C. Dutt
[C] Bipin Chandra Pal
[D] G.K. Gokhale
Show Answer
Correct Answer: B [R.C. Dutt]
Notes:
Romesh Chunder Dutt was an Indian civil servant and a famous economic historian of the nineteenth century. He entered the Indian Civil Service in the year 1871. He is also called as the Pioneer of Economic Nationalism.
8. UDYAMI helpline is for?
[A] Large capital Industries
[B] Female entrepreneur
[C] Farmers introducing technology in Farming
[D] Micro, small & medium size enterprises
Show Answer
Correct Answer: D [Micro, small & medium size enterprises]
Notes:
Udyami Helpline with number 1800 180 6763 is a Call Centre of Ministry of Micro, Small and Medium Enterprises (MSME), Government of India. It was launched in 2010 to work as a single point facility for MSMEs needing different kinds of information and accessibility of Banks and other MSME-related organisations.
9. What is the short name of India’s top authority for Indirect Taxes?
[A] CBDT
[B] CBEC
[C] CBIT
[D] CBIC
Show Answer
Correct Answer: D [CBIC]
Notes:
The Central Board of Indirect Taxes and Customs (CBIC) was renamed in 2018 from CBEC. CBIC is a statutory body under the Department of Revenue, Ministry of Finance. It is responsible for administration of GST, customs, excise and service tax in India. The board was originally established in 1964 by the Central Boards of Revenue Act, 1963.
10. Which mineral is India the largest producer and exporter of?
[A] Cotton
[B] Mica
[C] Tea
[D] Copper
Show Answer
Correct Answer: B [Mica]
Notes:
India accounts for about 60% of global mica production. Major mica mines are located in Andhra Pradesh, Rajasthan, and Jharkhand. India exported $38.2 million worth of mica in 2024, ranking second globally after China. Vast high-quality mica reserves contribute to India’s leading role in the mica market worldwide.
