Indian Economy MCQs

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Money market securities are debt issues with maturities of one year or less. Treasury Bills, Certificate of Deposit as well as Commercial papers are money market instruments.

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India’s First Five-year Plan was implemented from the year 1951 till 1956. It mainly focused on the development of primary sector. The Plan was based on the Harrod–Domar model implemented with some modifications.

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David Ricardo, an English classical economist, developed the law of rent in 1809. He presented the law in his book On the Principles of Political Economy and Taxation in 1821.
Ricardo’s theory defined rent as the portion of the earth’s produce that is paid to the landlord for the original and indestructible powers of the soil. In other words, rent is the price paid for the use of land.
Ricardo developed his theory to explain the origin and nature of economic rent. He used the economy and rent to analyze the large rise in corn and land prices during the Napoleonic wars (1805-1815).
The term “Ricardian rent” comes from Ricardo’s theory.

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The term “Bretton Woods Twins” refers to the two institutions created at the Bretton Woods Conference in 1944: the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD). The IMF was set up to promote global monetary cooperation and stability, while the IBRD was established to help finance post-war reconstruction and development. The IBRD later became part of the World Bank Group.

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The Liquidity Adjustment Facility (LAF) was introduced by RBI in June 2000. RBI uses LAF to manage liquidity by allowing banks to borrow money through repurchase agreements (repos) or lend money to RBI through reverse repo. The facility assists banks with short-term liquidity mismatches and enables RBI to maintain monetary stability. LAF operates daily and is managed via electronic bids on the CBS platform.

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The global total fertility rate is about 2.25 births per woman. Replacement-level fertility is generally taken as about 2.1 births per woman, which is the level needed for a population to replace itself in the long run in countries with low mortality. Since 2.25 is higher than 2.1, the global fertility rate remains above replacement level, though it has been declining over time across the world.

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The Mumbai-Ahmedabad High-Speed Rail corridor is a 508-kilometer project using Japan’s Shinkansen technology, featuring 12 stations across Maharashtra, Gujarat, and Dadra and Nagar Haveli. The National High Speed Rail Corporation Ltd. manages the project. As per official schedules, phased operations begin in 2027, with full end-to-end corridor operations targeted for 2029.

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The World Bank Group consists of five institutions: IBRD, IDA, IFC, MIGA and ICSID. These bodies work on development finance, private-sector investment, investment guarantees and dispute settlement. UNCTAD, on the other hand, is a United Nations body that deals with trade, investment and development issues. Hence, UNCTAD is not included in the World Bank Group.

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Quantitative Easing is a monetary policy used by central banks to buy government securities or other securities from the market to increase money supply and encourage lending and investment. This policy is usually deployed when interest rates are close to zero and conventional monetary policy becomes ineffective. Quantitative Easing was used by the US Federal Reserve in 2008 and by the European Central Bank in 2015.

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The Ministry of Tourism recognizes infrastructure inadequacy as a major barrier to tourist arrivals. India’s tourist accommodation density and quality lag behind global averages. Major cities and remote tourist destinations face deficits in hotels, transportation, and sanitation. Government schemes like Swadesh Darshan and PRASHAD launched in 2014 and 2015 target these infrastructural gaps. Despite natural and cultural attractions, visitor growth remains below international benchmarks due to these limitations.