Indian Economy MCQs

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Inflation refers to rise in general price level of goods and services, deflation is fall in general price level of goods and services. Deflation is inflation in negative zone, i.e. a decrease in the general price level of goods and services.

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The correct answer is the Finance Commission. The Finance Commission is a constitutional body established under Article 280 of the Indian Constitution. Its primary role is to recommend the distribution of tax revenues between the central and state governments, ensuring fiscal federalism. It also lays down principles for grants-in-aid to states, addressing financial relations between different levels of government. The Finance Commission is constituted every five years, and its recommendations are crucial for maintaining balanced economic development across states.

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The Consolidated Fund of India was created under Article 266 of the Indian Constitution. The government meets all its expenditure from this fund and it needs parliamentary approval to withdraw money from this fund.

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Non-Scheduled Commercial Banks are not required to keep their statutory cash reserves with the RBI. Scheduled Banks maintain the Cash Reserve Ratio (CRR) with the RBI. Non-Scheduled Banks may keep their reserves with themselves. The Banking Regulation Act, 1949, distinguishes Scheduled from Non-Scheduled Banks by inclusion in the Second Schedule of the RBI Act, 1934.

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An unlimited company in India is defined under the Companies Act, 2013 as a company not having any limit on the liability of its members. Members of such a company are fully liable for all debts and liabilities incurred, without restriction. Unlimited companies are recognized under Indian company law but are rare in practice due to full personal liability.

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The Global Innovation Index is published by WIPO with partners, the Global Competitiveness Index by the World Economic Forum, and only the Ease of Doing Business Index is published by the World Bank Group. Thus, among the options, only the third report is published by the World Bank. The other two are not associated with the World Bank.

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The Financial Action Task Force is an intergovernmental body established in 1989 at the G7 Summit in Paris. FATF sets international standards to prevent money laundering and terrorist financing. The organization developed 40 Recommendations as technical standards. It conducts mutual evaluations of members. FATF monitors risks and trends in global money laundering and terrorist financing.

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As per RBI, any non-banking financial company can be registered as an Infrastructure Finance Company, subject to minimum, 75% of the total assets of the company, should be deployed in the infrastructure loans.

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NITI Aayog consists of a number of specialized wings such as the research wing, the consultancy wing, the team India wing. NITI Aayog functions in close cooperation, consultation and coordination with the Ministries of the Central Government, and State Governments of India.

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Dr. Chelliah was one of the top consultants in public finance anywhere in the world. After He served in an advisory capacity with the government of Papa New Guinea and a number of other countries, Chelliah became the father of the direct taxation reforms in early India. He was honored with the Padma Vibushan in 2007 and died in 2009.