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 of the following is NOT related to the World Trade Organization (WTO)?
[A] Multifiber Agreement
[B] General Agreement on Trade and Services
[C] Multilateral Agreement on Investment
[D] Agreement on Agriculture
Show Answer
Correct Answer: C [ Multilateral Agreement on Investment ]
Notes:
The basic functioning of WTO depends upon: 1. Multifiber Agreement (MFA) 2. Agreement on Agriculture (AoA), Trade Related Investment Measures (TRIMS), Trade Related Intellectual Property Right (TRIPS), General Agreement on Trade and Services (GATS). Multilateral Agreement on Investment is among OECD countries.
2. Which among the following is the largest nuclear power station of India by capacity?
[A] Tarapur
[B] Kaiga
[C] Kakrapar
[D] Kudankulam
Show Answer
Correct Answer: D [Kudankulam]
Notes:
Kudankulam Nuclear Power Plant in Tamil Nadu is the highest-capacity nuclear plant in India, with a total of 2,000 MW currently installed with a further 2,000 MW under construction.
3. In which of the following countries, International Rice Research center is Located?
[A] Thailand
[B] Malaysia
[C] Philippines
[D] Indonesia
Show Answer
Correct Answer: C [Philippines]
Notes:
The International Rice Research Institute (IRRI) is headquartered in Philippines and has operating offices in seventeen countries. The Institute was originally established in the yeat 1960. It aims to reduce poverty and hunger, improve the health of rice farmers and consumers.
4. In which of the following actions will be taken by Reserve bank of India, to curb the excess liquidity, when the deficit financing increases?
[A] Increases CRR
[B] Decreases Bank rate
[C] Resorts to open market operations
[D] Raises the Tax rates
Show Answer
Correct Answer: A [Increases CRR]
Notes:
RBI can reduce the excess liquidity by using the liquidity adjustment facility to manage high levels of inflation. This can be done by increasing the repo rate or cash reserve ratio. This will reduce the money supply in India’s economy.
5. Which of the following financial market tactics in India is purposely designed to deceive naive investors by generating enormous counterfeit volumes?
[A] Dividend Stripping
[B] Intra-Day Trading
[C] Forward Trading
[D] Circular Trading
Show Answer
Correct Answer: D [Circular Trading]
Notes:
Circular trading is a fraudulent practice where sell orders are entered by a broker who knows that offsetting buy orders, the same number of shares at the same time and at the same price, have either been or will be entered. Essentially, it is a deceptive practice that creates the illusion of extensive trading activity in a security to attract further investment which often leads to artificially inflated stock prices.
6. ” Income generated from Tourism” can be placed in which among the following?
[A] Invisible Import
[B] Invisible Export
[C] Visible Import
[D] Visible Export
Show Answer
Correct Answer: B [Invisible Export]
Notes:
The correct answer is “Invisible Export.” Income from tourism is classified as an invisible export because it involves services provided to foreign visitors, generating revenue without the physical transfer of goods. This aligns with the economic concept where exports of services (like tourism) contribute to a country’s balance of payments.
7. Which of the following was target in Integrated Action Plan (IAP)?
[A] Drought
[B] Terrorism
[C] Left Wing Extremism
[D] Widespread Poverty
Show Answer
Correct Answer: C [Left Wing Extremism]
Notes:
The Integrated Action Plan (IAP) is aimed at bridging the development deficit in the extremely backward areas that are affected by Left Wing Extremism.
8. Which one of the following is NOT a sign of economic development?
[A] Changing structure of GDP in favour of industry
[B] Larger share of GDP coming from primary sector
[C] Larger capital inflows
[D] Institutional changes in an economy.
Show Answer
Correct Answer: C [ Larger capital inflows ]
Notes:
Larger capital inflows are not always sign of economic development.
9. A person reaches the Bank with a Demand Draft payable to his account. At this situation, the Bank works as which of the following?
[A] Creditor
[B] Debtor
[C] Beneficiary
[D] Trustee
Show Answer
Correct Answer: D [ Trustee ]
Notes:
The bank act as a trustee to the person as the person is withdrawing his own money; he is neither taking loan nor depositing money for fixed duration to bank, for him to be debtor or creditor.
10. In context with the share markets in India, public issue refers to which of the following?
[A] first time issuance of shares of a company via stock exchange
[B] first time issuance of shares of a public company via stock exchange
[C] allotment of shares to 50 or more investors
[D] allotment of shares to public by 50% or more fraction of the total equity
Show Answer
Correct Answer: C [ allotment of shares to 50 or more investors ]
Notes:
The primary market issuance is done either through public issues or private placement. Under Companies Act, 1956, an issue is referred as public if it results in allotment of securities to 50 investors or more. However, when the issuer makes an issue of securities to a select group of persons not exceeding 49 and which is neither a rights issue nor a public issue it is called a private placement.
