Indian Economy MCQs

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London is the world’s largest foreign exchange trading centre. In the Bank for International Settlements’ latest Triennial Central Bank Survey, it accounted for the biggest share of global FX turnover, ahead of New York, Singapore and Tokyo. The city’s dominance is supported by its strong financial infrastructure, concentration of major banks, and time-zone advantage, which allows trading overlap with both Asian and American markets.

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Milton Friedman published “The Case for Flexible Exchange Rates” in 1953. Friedman’s essay advocated flexible exchange rates to provide monetary policy independence. The paper provided the foundational arguments and theory supporting flexible exchange rate systems over fixed ones. Friedman’s analysis influenced international monetary economics from the 1950s onward.

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Targets for the first three plans were set with respect to National Income. Fourth Plan it was Net Domestic Product. In all Plans thereafter it has been Gross Domestic Product at factor cost.

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SIDBI was established on April 2, 1990, as a wholly owned subsidiary of the Industrial Development Bank of India (IDBI) under an Act of Parliament. SIDBI acts as the principal financial institution for promoting, financing, and developing the Micro, Small, and Medium Enterprises (MSME) sector in India. SIDBI’s headquarters are in Lucknow, Uttar Pradesh.

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The Commission for Agricultural Costs and Prices (CACP) was established in January 1965 as the Agricultural Prices Commission and renamed CACP in 1985. CACP functions as an attached office under the Ministry of Agriculture and Farmers Welfare. CACP annually recommends MSPs for 22-23 crops to the government. Its recommendations consider factors such as production costs, market prices, and inter-crop price parity.

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All three statements are correct. Before 2017-18, the government’s non-plan expenditure included subsidies, interest payments and debt servicing, and defence expenditures. Non-plan expenditures covered routine and obligatory expenses such as salaries, pensions, subsidies, interest, defence outlays, and grants. From 2017-18 onward, the classification was replaced by Revenue and Capital expenditure categories.

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Traditional film photography was popular throughout the 20th century before digital photography emerged. Digital cameras became widely available in the late 1990s. Global sales of film cameras dropped substantially after 2000. Companies like Kodak, once leading film producers, filed for bankruptcy in 2012. The industry decline is linked to the mass adoption of digital imaging technology worldwide.

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National income measures the value of current production of final goods and services in a given period. The resale of old goods is not counted because it does not represent current production. Annual goods production and services are included, while “new technology” is too vague and not the standard exclusion tested here.

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The Finance Commission, constituted under Article 280 of the Indian Constitution, recommends the distribution of net tax proceeds between the Centre and States and suggests principles for grants-in-aid. It is constituted every five years or earlier as deemed necessary by the President.

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Structural change in exports refers to long-term changes in the types and categories of goods and services a country exports. It involves shifts in the relative share of sectors such as agriculture, manufacturing, and services in total exports. Such changes occur due to productivity growth, varying international prices, and evolving global demand.