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.
11. Which of the following statements is correct about the Countervailing duty?
[A] It is the tariff levied on imported goods to offset subsidies offered by the exporting country to its producers
[B] It is the tariff imposed on exported goods to reduce exports and increase the domestic supply
[C] It is the tax levied on revenues received by a corporation, even if it does not make any profit
[D] It is the tax levied on purchase or sale of various financial products like stocks, derivatives, mutual funds etc
Show Answer
Correct Answer: A [ It is the tariff levied on imported goods to offset subsidies offered by the exporting country to its producers ]
Notes:
First option is the correct answer
Countervailing duty is a tariff imposed on imported goods to offset the subsidies offered by the exporting country to its producers. It is imposed to provide level playing field to domestic producers and foreign producers.
12. The Financial Action Task Force (FATF) mainly combats which activity?
[A] Climate change financing
[B] Money laundering and terrorist financing
[C] Development aid management
[D] Quantum computing in finance
Show Answer
Correct Answer: B [Money laundering and terrorist financing]
Notes:
The Financial Action Task Force is an intergovernmental body established in 1989 at the G7 Summit in Paris. FATF sets international standards to prevent money laundering and terrorist financing. The organization developed 40 Recommendations as technical standards. It conducts mutual evaluations of members. FATF monitors risks and trends in global money laundering and terrorist financing.
13. Which of the following is not included in the calculation of national income?
[A] Value of annual goods production
[B] Value of annual services
[C] Value of old goods sold
[D] Value of new technology
Show Answer
Correct Answer: D [Value of new technology]
Notes:
In the calculation of national income, the value of old goods sold is not included. National income accounting typically focuses on the value of goods and services produced within a specific period, usually a year. It includes the production of new goods and the provision of services. However, the resale of old goods does not contribute to the current production of goods and services and therefore is not counted. Additionally, non-market services such as the services of a housewife, which are not paid for in the market, are also not included in the national income calculations. This exclusion is due to the difficulty in accurately measuring the economic value of such non-market services.
14. Which of these is not a Maharatna company as of 2026?
[A] Coal India Limited
[B] Steel Authority of India Limited
[C] Bharat Electronics Limited
[D] Hindustan Aeronautics Limited
Show Answer
Correct Answer: C [Bharat Electronics Limited]
Notes:
Bharat Electronics Limited is classified as a Navratna company. Maharatna scheme was introduced in 2010. As of 2026, there are 14 Maharatna companies including Coal India Limited, Steel Authority of India Limited, and Hindustan Aeronautics Limited. Hindustan Aeronautics Limited received Maharatna status in October 2024. Bharat Electronics Limited has not been granted Maharatna status.
15. If capital stock is everlasting, what is the depreciation rate? (UPSC Prelims 1991)
[A] Zero
[B] High
[C] Low
[D] Infinite
Show Answer
Correct Answer: A [Zero]
Notes:
Everlasting capital stock does not lose value or efficiency, so the depreciation rate is zero as no part decreases in utility or worth over time.
16. Who authored “The Economics of Imperfect Competition”?
[A] E.H. Chamberlin
[B] J.R. Hicks
[C] Joan Robinson
[D] Dean Baker
Show Answer
Correct Answer: C [Joan Robinson]
Notes:
Joan Robinson, a British economist, published “The Economics of Imperfect Competition” in 1933. The book introduced the concept of imperfect competition and analyzed distribution, allocation, and exploitation, marking a significant contribution to microeconomic theory.
17. Which of the following are the methods of poverty estimation?
[A] Sen Index
[B] Multidimensional poverty index
[C] Poverty gap Index
[D] All of the above
Show Answer
Correct Answer: D [All of the above]
Notes:
Amartya Sen, noted Nobel Laureate, has developed an index known as Sen Index to estimate the poverty.
The Global Multidimensional Poverty Index (MPI) was developed in 2010 by the Oxford Poverty & Human Development Initiative (OPHI) and the United Nations Development Programme and uses health, education, and standard of living indicators to determine the degree of poverty experienced by a population.
The poverty gap index is a measure of the intensity of poverty.
18. Which of the following is not a feature of a mixed economy?
[A] State ownership
[B] Private property
[C] Market forces
[D] Open trade
Show Answer
Correct Answer: D [Open trade]
Notes:
In a mixed economy both private and public sector are the players. The trade in this type is opened only to a certain extent but not completely as trade restrictions exist. This is because the government has the social obligation to fulfil.
19. The Government fixes Minimum support price(MSP) for agricultural goods on the basis of recommendation of which of the following?
[A] Commission for Agricultural Costs and Prices
[B] NITI Aayog
[C] Finance Ministry
[D] Agriculture Ministry
Show Answer
Correct Answer: A [Commission for Agricultural Costs and Prices]
Notes:
The minimum support price is announced by the government of India on the recommendation of the Commission for agricultural costs and prices at the beginning of the sowing season for certain crops.
20. What is growing of trees or shrubs around or among crops known as?
[A] Agro forestry
[B] Ally cropping
[C] Forestry
[D] Multi cropping
Show Answer
Correct Answer: A [Agro forestry]
Notes:
Agroforestry is a land use management system in which trees or shrubs are grown around or among crops or pastureland. This intentional combination of agriculture and forestry has varied benefits, including increased biodiversity and reduced erosion.