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 author was an investment banker before becoming a writer?
[A] Arvind Adiga
[B] Chetan Bhagat
[C] Jhumpa Lahiri
[D] Kiran Desai
Show Answer
Correct Answer: B [Chetan Bhagat]
Notes:
Chetan Bhagat worked as an investment banker at Goldman Sachs and Deutsche Bank in Hong Kong for about 11 years. He graduated from IIT Delhi in 1995 and IIM Ahmedabad in 1997. Bhagat wrote his first novel, Five Point Someone, while still an investment banker. He left banking after publishing his third novel in 2008.
12. Which group is most adversely affected by competitive currency devaluation?
[A] Exporters
[B] Importers
[C] Traders
[D] Service Providers
Show Answer
Correct Answer: A [Exporters]
Notes:
Competitive devaluation refers to countries deliberately reducing their currency value to make exports cheaper. When multiple countries do this, the benefit to any one country’s exporters is reduced, harming their export competitiveness. In recent years, central banks have intervened to devalue currencies, impacting exporters most. Exporters lose price advantage if other nations devalue simultaneously. The phenomenon is termed a currency war.
13. What is the short name of India’s top authority for Indirect Taxes?
[A] CBDT
[B] CBEC
[C] CBIT
[D] CBIC
Show Answer
Correct Answer: D [CBIC]
Notes:
The Central Board of Indirect Taxes and Customs (CBIC) was renamed in 2018 from CBEC. CBIC is a statutory body under the Department of Revenue, Ministry of Finance. It is responsible for administration of GST, customs, excise and service tax in India. The board was originally established in 1964 by the Central Boards of Revenue Act, 1963.
14. 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.
15. In context with banking in India, a Custodial Account is created for __:
[A] Illiterates
[B] Women
[C] Minor persons
[D] Senior Citizens
Show Answer
Correct Answer: C [ Minor persons ]
Notes:
A Custodial Account in India is specifically designed for minor persons, allowing adults to manage assets on behalf of minors until they reach the age of majority, which is 18 years. This type of account ensures that minors can benefit from investments and savings while being protected under legal guardianship. Custodial accounts are commonly used for educational savings and other financial planning purposes for children.
16. The SPS Agreement under the WTO is most concerned with which among the following?
[A] Trade of plant genetic materials
[B] Phytosanitary Measures
[C] Technical Barriers to Trade
[D] Trade in Fertilizers
Show Answer
Correct Answer: B [ Phytosanitary Measures ]
Notes:
The Agreement on the Application of Sanitary and Phytosanitary Measures – also known as the SPS Agreement is an international treaty of the World Trade Organization. It was negotiated during the Uruguay Round of the General Agreement on Tariffs and Trade, and entered into force with the establishment of the WTO at the beginning of 1995. Under the SPS agreement, the WTO sets constraints on member-states’ policies relating to food safety (bacterial contaminants, pesticides, inspection and labeling) as well as animal and plant health (phytosanitation) with respect to imported pests and diseases. The SPS agreement is closely linked to the Agreement on Technical Barriers to Trade, which was signed in the same year and has similar goals.
17. Measuring of core inflation rate, excludes commodities like:
- Food
- Crude Oil
- Precious metals
- Livestock and meat
Select the correct option from codes given below:
[A] 1 & 2 Only
[B] 1, 2 & 3 Only
[C] 3 & 4 Only
[D] 1, 2 & 4 Only
Show Answer
Correct Answer: A [ 1 & 2 Only ]
Notes:
Core inflation is a measure of inflation that excludes certain items that face volatile price movements. It excludes transitory or temporary price volatility as in the case of some commodities such as food items, energy products etc.
18. Which institution has the highest Priority Sector Lending norm in India as of 2026?
[A] Small Finance Banks
[B] Regional Rural Banks
[C] Domestic Scheduled Commercial Banks
[D] Urban Co-operative Banks
Show Answer
Correct Answer: B [Regional Rural Banks]
Notes:
Regional Rural Banks are mandated to allocate 75% of their Adjusted Net Bank Credit to priority sectors as per the latest guidelines for 2026. Small Finance Banks’ requirement was reduced to 60% in 2026. Domestic Scheduled Commercial Banks are set at 40%. Urban Co-operative Banks have a 60% requirement. These are specified under Reserve Bank of India regulations.
19. Consider the following statements regarding the Rashtriya Arogya Nidhi (RAN) Scheme:
- The scheme provides one-time financial assistance up to Rs. 15 lakh to patients living below the poverty line and suffering from life-threatening diseases.
- Financial assistance under the scheme is available only for treatment at government hospitals.
- Individuals working in Central Government, State Government, or Public Sector Units (PSUs) are eligible for assistance under the scheme.
Which of the above statements is/are correct?
[A] Only 1
[B] 1 and 2 only
[C] Only 3
[D] None of the above
Show Answer
Correct Answer: B [1 and 2 only]
Notes:
Statements 1 and 2 are correct: Rashtriya Arogya Nidhi offers up to Rs. 15 lakh for poor patients with life-threatening diseases, provided treatment is availed in government hospitals only. Statement 3 is incorrect; individuals working in Central/State Government or PSUs are not eligible for assistance under this scheme, as per official guidelines.
20. What does a decreasing agricultural sector share in GDP indicate for a country?
[A] The country is heading toward developed nation status
[B] The country is becoming a developing nation
[C] The country is becoming less developed
[D] Agricultural production has completely stopped
Show Answer
Correct Answer: A [The country is heading toward developed nation status]
Notes:
The agricultural sector’s GDP share typically declines as countries industrialize and modernize. In 2023, developed economies like the United States had agriculture contributing less than 1% to GDP. In developing nations, the sector’s share is higher—such as Kenya at around 33%. A falling agricultural share indicates structural transformation toward an industrial and service-based economy.
