Indian Economy MCQs

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.

Notes:
The Competition Commission of India (CCI) was set up to replace the anachronistic Monopolies and Restrictive Trade Practices Commission (MRTPC). It was established to eliminate practices that adversely affect competition in different industries/areas and protect interests of consumers and ensure freedom of trade. The Competition Act of 2002 called for the creation of CCI. However, it was established in 2003 and became fully functional only by 2009. The CCI is a quasi-judicial body which gives opinions to statutory authorities and also deals with other cases. It has one chairman and six members. It is the youngest and the only cross-sector regulator in India.

Notes:
Prasantha Chandra Mahalanobis or P. C. Mahalanobis (1893-1972) was the first Indian statistician to receive world recognition. In 1933, Mahalanobis founded the first Indian statistical journal Sankhya, along the lines of Biometrika, which had inspired him greatly. He was architect of India’s second five year plan and due to this second plan is known as Mahalanobis model.

Notes:
The International trade of Nylon Fibers in India falls under the Ministry of Chemicals and Fertilizers. This ministry oversees the production and regulation of chemical products, including synthetic fibers like nylon, which is a polymer made from petrochemicals. Nylon was first introduced in 1935 by DuPont and is widely used in textiles, automotive, and industrial applications.

Notes:
The correct answer is “Non Banking Finance Companies, Investment banks, Hedge Funds.” Shadow banking refers to financial intermediaries that operate outside traditional banking regulations. Non-Banking Finance Companies (NBFCs) provide credit and financial services without being classified as banks. Investment banks engage in activities like underwriting and trading, while hedge funds pool capital to invest in various assets, often using leverage. Together, they form a system that can create credit and liquidity similar to traditional banks but without the same regulatory oversight, which can lead to systemic risks.

Notes:
The tourist attractions mentioned, including the Chatham Saw Mill, which is one of the oldest and largest saw mills in Asia, and the scenic Wandoor Beach, along with Mount Harriet, the third highest peak in the Andamans offering stunning views, and the intrigue-filled Limestone Caves are all located in the beautiful Andaman and Nicobar Islands. This Indian Union Territory in the Bay of Bengal is rich in natural beauty and historical significance.

Notes:
The correct agency to approach for FDI approval in ‘Single Brand’ retailing in India is the Department of Industrial Policy and Promotion (DIPP), now part of the Ministry of Commerce and Industry. This department is responsible for formulating and implementing policies related to foreign direct investment, including approvals for single brand retail, which allows foreign companies to operate retail stores in India under a single brand. The DIPP ensures compliance with the Foreign Exchange Management Act (FEMA) and other regulations.

Notes:
The quantitative instruments are Open Market Operations, Liquidity Adjustment Facility (Repo and Reverse Repo), Marginal Standing Facility, SLR, CRR, Bank Rate, Credit Ceiling etc.
On the other hand, qualitative instruments are: credit rationing, moral suasion and direct action (by RBI on banks).

Notes:
Indirect tax is essentially a tax on expenditure. Levies such as customs, excise and service tax / GST are examples of indirect taxes. They are considered regressive as they do not distinguish between the rich and the poor. So, most governments prefer to raise their revenues through direct taxes.

Notes:
Bangladesh is the main competitor for jute industry in India. Bangladesh produces the finest quality natural jute fibre. As such Bangladeshi jute product manufacturer or exporter has an extra advantage in manufacturing top grade jute products by using best quality natural fiber.