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. The minimum support prices (MSP) for major agricultural products are fixed by the government, each year, after taking into account the recommendations of which of the following organizations?
[A] Planning Commission of India
[B] Finance Commission of India
[C] Farmer’s Commission of India
[D] Commission for Agricultural Costs and Prices
Show Answer
Correct Answer: D [Commission for Agricultural Costs and Prices]
Notes:
The Commission for Agricultural Costs and Prices (CACP) is a body set up by the Government of India to recommend the minimum support prices (MSPs) for various agricultural commodities. The CACP takes into account a number of factors, including the cost of production, changes in input prices, and demand and supply conditions in the market, in order to arrive at its recommendations for MSPs. These recommendations are then used by the government to set the MSPs for various crops.
3. Which among the following has been adopted by the Tendulakar committee for measuring poverty?
[A] Welfare measures
[B] Cost of Living
[C] Inequality & growth
[D] mobility/vulnerability analyses
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Correct Answer: B [Cost of Living]
Notes:
The Tendulkar Committee, established in 2005, adopted the “Cost of Living” approach for measuring poverty in India. This method considers the consumption patterns of the poor and adjusts poverty lines based on regional price variations. The committee aimed to provide a more accurate reflection of poverty by incorporating essential goods and services into the poverty measurement framework. This approach led to a revised poverty line that recognized the changing economic conditions and living standards in India.
4. Which among the following does not go with Progressive taxation?
[A] ability to pay
[B] administrative convenience
[C] in built stabilizer
[D] will to work and save
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Correct Answer: D [will to work and save]
Notes:
Progressive taxation is based on the principle that those with a higher ability to pay should contribute a larger percentage of their income. It emphasizes administrative convenience and acts as an in-built stabilizer by reducing income inequality. However, it can discourage the will to work and save, as higher earners may feel penalized by increased tax rates. Thus, “will to work and save” does not align with the principles of progressive taxation.
5. Which among the following is a major qualitative control measure in India ?
[A] Bank Rate Policy
[B] Open market Operations
[C] ways and means advances
[D] Margin Requirements
Show Answer
Correct Answer: D [Margin Requirements]
Notes:
Qualitative or selective methods of credit control refers to those methods which limit the nature or variety of money supply rather than its quantity. Such methods include regulation of margin requirement, credit rationing, regulation of consumer credit and direct action.
6. Which among the following is the Biggest Borrower in India?
[A] Indian Government
[B] Reserve Bank of India
[C] Indian Railways
[D] State Governments
Show Answer
Correct Answer: A [Indian Government]
Notes:
The Indian government is the biggest borrower in India. This is due to the government’s extensive expenditure requirements, fiscal deficit, development programs, debt servicing, infrastructure projects, subsidies, welfare schemes, and revenue shortfalls.
7. What was the name of the world currency that John Maynard Keynes conceptualized in the years 1940-42 and proposed at the Bretton Woods Conference?
[A] Whuffie
[B] Bancor
[C] Wocu
[D] Terra
Show Answer
Correct Answer: B [Bancor]
Notes:
John Maynard Keynes proposed the “Bancor” as a world currency during the Bretton Woods Conference in 1944. The Bancor was intended to facilitate international trade and stabilize exchange rates. Keynes envisioned it as a unit of account to address imbalances in global trade. Although the Bancor was not adopted, the conference led to the establishment of the International Monetary Fund (IMF) and the World Bank, shaping the post-World War II economic order.
8. Economic Planning comes under which of the following lists ?
[A] Union List
[B] Concurrent list
[C] State List
[D] None of them
Show Answer
Correct Answer: B [Concurrent list]
Notes:
Economic planning is listed in the Concurrent List, or List III, of the Seventh Schedule of the Constitution of India. The Concurrent List is a list of 52 items that both the central and state governments can make laws on. The Concurrent List includes topics such as criminal law, marriage and divorce, bankruptcy, and economic and social planning.
9. From which of the following financial years, Seed Crop Insurance began in India?
[A] 1999-2000
[B] 2000-2001
[C] 2001-2002
[D] 2002-2003
Show Answer
Correct Answer: A [1999-2000]
Notes:
The Seed Crop Insurance (PSSCI) scheme was introduced in India in 2000. The scheme was a pilot program that provided financial security and income stability to seed growers in the event of crop failure. The scheme was introduced in 11 states.
10. Which among the following agency is responsible for enforcement of Foreign Exchange Management Act 1999 and Prevention of money Laundering Act 2002 in India?
[A] Reserve Bank of India
[B] Department of Revenue
[C] Enforcement Directorate
[D] Income Tax Department
Show Answer
Correct Answer: C [Enforcement Directorate]