Indian Economy MCQs

Notes:
Reserve money is also called High Powered Money / central bank money. It is the Currency in Circulation plus Deposits of Commercial Banks with RBI.

Notes:
Market-wide circuit breakers in the United States are triggered if the S&P 500 Index falls by 7%, 13%, or 20% from the previous day’s closing value. Level 1 and Level 2 trigger 15-minute trading halts if before 3:25 p.m. A Level 3 decline causes trading to be halted for the remainder of the day. Circuit breakers were introduced in 1988 after the 1987 Black Monday crash.

Notes:
Non-Plan Expenditure covers routine government expenses such as interest payments, defense costs, and pensions. Central Assistance to States for developmental projects is categorized as Plan Expenditure, intended for developmental activities as per the Planning Commission guidelines before 2017. After 2017, India merged Plan and Non-Plan expenditure in Union Budget, but the classification in this question refers to the pre-2017 structure.

Notes:
The correct answer is “Private Banks.” In India, “Other Scheduled Commercial Banks” referred to banks that did not fall into the categories of National Banks or Foreign Banks. Private Banks, which are owned by private entities, were classified under this term before the regulatory framework evolved. As of now, the Reserve Bank of India (RBI) categorizes banks into various groups, including Public Sector Banks, Private Sector Banks, Foreign Banks, and Scheduled Cooperative Banks. Notably, the first private bank in India was the “Oudh Commercial Bank,” established in 1881.

Notes:
Buddhavanam Project is a tourism project of Telangana state government. It is located in Nagarjunasagar dam region of Nalgonda district in Telangana. It is a Buddhist heritage theme park of the Telangana State Tourism Development Corporation. The project was recently in news when Queen Mother of Bhutan and president of Tarayana Foundation Ashi Dorji Wangmo Wangchuck and Princess Sonam Dechan Wangchuck, along with a seven-member delegation, visited the Buddhavanam project.

Notes:
A Goldilocks economy signifies a balance of low inflation and steady growth, avoiding extremes. The term is widely used in macroeconomics to represent optimal conditions for policy makers. It is named after the fairy tale character Goldilocks, indicating “just right” economic conditions.

Notes:
Regional Rural Banks are mandated to allocate 75% of their Adjusted Net Bank Credit to priority sectors as per the latest guidelines for 2026. Small Finance Banks’ requirement was reduced to 60% in 2026. Domestic Scheduled Commercial Banks are set at 40%. Urban Co-operative Banks have a 60% requirement. These are specified under Reserve Bank of India regulations.

Notes:
The Engine Division of Hindustan Aeronautics Limited at Sunabeda, near Koraput, Odisha, was established in 1964. It manufactures engines for MiG fighter aircraft, including R11, R25, R29B, and RD-33 series. Since 2007, the facility has produced RD-33 engines for MiG-29 aircraft under license from Russia. Over 1,300 engines have been manufactured at this division.

Notes:
Banaras Locomotive Works (BLW), formerly known as Diesel Locomotive Works, is located in Varanasi, Uttar Pradesh. BLW was established in 1956. It is the largest locomotive manufacturing facility in India. The unit was renamed BLW in October 2020. BLW manufactures electric locomotives including WAP-7 and WAG-9 models. The factory exports locomotives to countries like Sri Lanka, Myanmar, and Mozambique.

Notes:
The SARFAESI Act allowed the creation of asset reconstruction companies (ARC) and allowed banks to sell their non-performing assets to ARCs.