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 steel plants was not built during the 2nd Five year plan?
[A] Bhilai plant
[B] Salem plant
[C] Rourkela plant
[D] Durgapur plant
Show Answer
Correct Answer: B [Salem plant]
Notes:
Second Five Year Plan of 1956 to 1961 was given Importance to an establishment of heavy industries only. The main thrust of industrial development was on iron and steel, Heavy engineering and fertilizer industries. Three new iron and steel plants were located in Bhilai, Durgapur, and Rourkela.
12. What do we call the funds that the banks keep with RBI as a portion of their Net Demand and Time Liabilities?
[A] Statutory Liquidity Ratio
[B] Cash Reserve Ratio
[C] Bank Rate
[D] Reverse Repo Rate
Show Answer
Correct Answer: B [Cash Reserve Ratio]
Notes:
The Cash Reserve Ratio is the amount of funds that the banks are bound to keep with Reserve bank of India as a portion of their Net Demand and Time Liabilities (NDTL).
13. Which of the following markets enable new issues of equity and debt to be traded?
[A] Secondary markets
[B] Discount markets
[C] Primary capital markets
[D] Gilt repo market
Show Answer
Correct Answer: C [Primary capital markets]
Notes:
Primary capital markets are Organised markets that enable new issues of equity and debt to be traded.
14. Which of the following targets at individuals and small businesses who lack access to conventional banking and related services?
[A] Asset Finance Company
[B] Investment Company
[C] NBFC Micro Finance Institution
[D] Infrastructure Finance Company
Show Answer
Correct Answer: C [NBFC Micro Finance Institution]
Notes:
A microfinance institution is an organization that offers financial services to low income populations. Almost all give loans to their members, and many offer insurance, deposit and other services. A great scale of organizations is regarded as microfinance institutes.
15. At present which of the following is India’s share of the world exports of tea?
[A] More than 40%.
[B] Between 30% and 35%.
[C] Between 10% and 20%.
[D] About 10% or less.
Show Answer
Correct Answer: A [More than 40%.]
Notes:
At present, India’s share of the world exports of tea is more than 40%.
16. If the capital stock was everlasting, and then which of the following will be the rate of depreciation?
[A] High
[B] Low
[C] Infinite
[D] Zero
Show Answer
Correct Answer: D [Zero]
Notes:
If the capital stock was everlasting, then the rate of depreciation would be Zero.
17. Which of the following is included in market price?
[A] Indirect taxes
[B] Direct taxes
[C] Subsidies
[D] None of the above
Show Answer
Correct Answer: A [Indirect taxes]
Notes:
Market price(MP)refers to the actual transacted price and includes indirect taxes. The market price is the current price at which an asset or service can be bought or sold. The economic theory contends that the market price converges at a point where the forces of Supply and demand meet.
18. What is subtracted from personal income to get personal disposable income?
[A] Indirect taxes
[B] Direct taxes
[C] subsidies
[D] None of the above
Show Answer
Correct Answer: B [Direct taxes]
Notes:
Personal Disposable Income(PDI) is obtained when personal direct taxes are subtracted from personal income.
PDI = Personal Income – Direct Taxes
PDI = Consumption + Saving
19. Which among the following is a feature of Socialist form of Economy?
[A] It is based on the demand and supply of market
[B] Competition exist in the market
[C] Private property is encouraged
[D] None of the above
Show Answer
Correct Answer: D [None of the above]
Notes:
The socialist form of economy is not based on market forces and competition doesn’t exist in the market. The state owns the factors of production and private property is not encouraged.
20. Which is considered as ‘Invisible hand’ in the Market economy?
[A] Trade
[B] Money
[C] Competition
[D] Demand and supply
Show Answer
Correct Answer: C [Competition]
Notes:
Adam Smith described the concept of “the invisible hand“. This “hand” refers to the effects of competition in the market.
