Indian Economy MCQs

Notes:
The taxing powers of the central government encompass taxes on income (except agricultural income), excise on goods produced (other than alcohol), customs duties, and inter-state sale of goods.
The state governments are vested with the power to tax agricultural income, land and buildings, sale of goods (other than inter-state), and excise on alcohol. Local authorities such as Panchayat and Municipality also have power to levy some minor taxes.

Notes:
A commercial bank’s liabilities include deposits received from customers, such as demand deposits and time deposits, as well as borrowings from other banks or institutions. Security holdings are not liabilities; they appear on the asset side of the bank’s balance sheet because they represent investments made by the bank. Therefore, among the given options, security holdings is the item that is not treated as a liability of a commercial bank.

Notes:
Demand-pull inflation refers to the inflation from rapid growth in aggregate demand and when excess demand causes ‘too much money chasing too few goods.’ This generally happens when an economy is growing at a faster rate.

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Keynes and E. F. Schumacher proposed the Bancor as a supranational currency between 1940–1942. The International Clearing Union was suggested to manage its use in global trade. The Bancor proposal was presented by the United Kingdom at the Bretton Woods Conference in 1944. The concept was intended to prevent persistent surpluses or deficits among countries. The Bancor was not adopted; instead, the U.S. dollar was chosen as the main reserve currency.

Notes:
The Index of Industrial Production is compiled and published monthly by the National Statistics Office. The National Statistics Office operates under the Ministry of Statistics and Programme Implementation. The responsibility for IIP preparation was transferred from the Central Statistical Office to the NSO. The IIP covers mining, manufacturing, and electricity sectors and is released six weeks after each reference month.

Notes:
The Foreign Trade Policy is notified by the Central Government, while the Directorate General of Foreign Trade is responsible for carrying out and implementing it. DGFT also helps in the administration of the Foreign Trade (Development and Regulation) Act, 1992 and related procedures. Hence, among the given options, DGFT is the correct authority for implementation of India’s Foreign Trade Policy.

Notes:
The World Economic Forum publishes the Inclusive Growth and Development Report. The Inclusive Development Index was introduced with this report in 2017. The report evaluates economies using parameters like education, employment, labor compensation, and social protection. The World Economic Forum is headquartered in Geneva, Switzerland, and began the series under its System Initiative on Economic Growth and Social Inclusion.

Notes:
Under FERA, foreign exchange was not limited to foreign currency notes alone. It also covered financial instruments such as traveler’s cheques, letters of credit and bills of exchange when these were expressed or drawn in Indian currency but made payable in a foreign currency. Since each of the listed instruments fits that description, all three are included. Therefore, the correct answer is all of the above.

Notes:
Business Correspondents are retail agents engaged by banks for providing banking services at locations other than a bank branch/ATM. BCs enable a bank to provide its limited range of banking services at low cost.

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The World Bank provides financing to developing countries for development projects including poverty reduction, infrastructure, health, education, and sustainable growth. It offers low-interest loans and grants through institutions like IDA and IBRD. Its projects focus on increasing access to basic services, clean water, sanitation, and improving living conditions. The institution has funded thousands of development projects since its inception in 1944.