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. Who publishes the annual Global Systemically Important Banks (G-SIBs) list?
[A] World Bank
[B] International Monetary Fund
[C] European Central Bank
[D] Financial Stability Board with Basel Committee
Show Answer
Correct Answer: D [Financial Stability Board with Basel Committee]
Notes:
The Financial Stability Board (FSB), in consultation with the Basel Committee on Banking Supervision (BCBS), publishes the annual list of Global Systemically Important Banks (G-SIBs). The publication is typically released each November. The FSB was established in 2009 as an international body. The BCBS was founded in 1974 to strengthen banking supervision worldwide.
12. Open market operations (OMO):
- act as a monetary tool of RBI
- are conducted for the sale or purchase of government securities
Which of the above statements is/are correct?
[A] 1 Only
[B] 2 Only
[C] Both 1 & 2
[D] Neither 1 nor 2
Show Answer
Correct Answer: C [Both 1 & 2]
Notes:
Both are correct statementsRBI conducts open market operations by selling government securities in order to maintain ample liquidity in the system.
13. Micro or Small Enterprise (as defined in the MSMED Act 2006) may be said to have become Sick, if?
[A] Any of the borrowal account of the enterprise remains NPA for ten months or more
[B] Any of the borrowal account of the enterprise remains NPA for eight months or more
[C] Any of the borrowal account of the enterprise remains NPA for five months or more
[D] Any of the borrowal account of the enterprise remains NPA for three months or more
Show Answer
Correct Answer: D [Any of the borrowal account of the enterprise remains NPA for three months or more]
Notes:
Micro or Small Enterprise (as defined in the MSMED Act 2006) may be said to have become Sick, if any of the borrowal account of the enterprise remains NPA for three months or more.
14. Who among the following is a banking corresponding agent?
[A] An authorized representative of bank who offer banking services in unbanked areas
[B] Any person who offer banking services in unbanked areas
[C] An authorized representative of bank who makes profits for banks
[D] None of the above
Show Answer
Correct Answer: A [An authorized representative of bank who offer banking services in unbanked areas]
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.
15. Political stability is primarily related to which type of risk?
[A] Exchange risk
[B] Systematic risk
[C] Non-systematic risk
[D] Country risk
Show Answer
Correct Answer: D [Country risk]
Notes:
Country risk includes political stability, government stability, and political change affecting investments in a nation. International Country Risk Guide measures country risk through government stability and internal/external conflicts. Country risk can reduce or impair returns for foreign investors due to political events. Country risk is distinct from exchange risk, systematic risk, and non-systematic risk, which involve currency, market-wide, or company-specific factors.
16. Which trade agreement has India finalized with the European Union recently?
[A] Rupee trade
[B] Free Trade Agreement (FTA)
[C] Barter trade
[D] Unilateral trade
Show Answer
Correct Answer: B [Free Trade Agreement (FTA)]
Notes:
India and the European Union concluded a Free Trade Agreement in 2024. The agreement includes gradual reduction of tariffs and covers approximately $33 billion of Indian exports. The FTA provides deeper access to 144 EU services sub-sectors. The EU is India’s largest trading partner, with bilateral trade reaching $136 billion in 2024-25. The EU represents around 25% of global GDP.
17. Which of the following define Deficit Financing?
[A] Difference of total expenditure and income by revenue from all sources
[B] Government spends in excess of revenues so that a budget deficit is incurred which is financed by the borrowings
[C] Difference in borrowing and external and internal resources
[D] Capital expenditure on items of public construction, public enterprises and public borrowings
Show Answer
Correct Answer: B [Government spends in excess of revenues so that a budget deficit is incurred which is financed by the borrowings]
Notes:
Deficit financing is the budgetary situation where expenditure is higher than the revenue. It is a practice adopted for financing the excess expenditure with outside resources. The expenditure revenue gap is financed by either printing of currency or through borrowing.
18. In which of the following circumstances, the total utility is maximum?
[A] Marginal utility is maximum
[B] Marginal utility = 0
[C] Marginal utility is minimum
[D] None of the above
Show Answer
Correct Answer: B [Marginal utility = 0]
Notes:
Total Utility is the sum of all the utilities derived from the consumption of all the units of a particular commodity. So when the marginal utility decreases total utility increases and is maximum when marginal utility is 0.
19. Who is the author of “End of history and the last man”?
[A] Karl Marx
[B] J.S.Mill
[C] Francis Fukuyama
[D] None of the above
Show Answer
Correct Answer: C [Francis Fukuyama]
Notes:
Francis Fukuyama is a political economist who tracks how economic, technological, and social forces facilitate as well as undercut liberal democracy. He published this in 1992. The end of history and last man is a book of political philosophy which is a satire on the events that occurred after the Cold War and fall of the soviet union in 1991.
20. What is the major challenge hindering India’s economic development in 2026?
[A] High population
[B] Poor infrastructure
[C] Less exports
[D] Market imperfections
Show Answer
Correct Answer: B [Poor infrastructure]
Notes:
Poor infrastructure is the main hindrance to India’s economic growth in 2026, affecting manufacturing (12.5% of GDP), FDI inflow, labor reforms, and land acquisition reforms. Despite growth in GDP and services exports, infrastructure deficits persist as the primary barrier over high population or export volumes.
