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. What is the main activity of Infrastructure Finance Companies?
[A] Providing direct loans for infrastructure projects and refinancing
[B] Marketing services for construction firms
[C] Real estate sales and property management
[D] Retail banking and consumer lending
Show Answer
Correct Answer: A [Providing direct loans for infrastructure projects and refinancing]
Notes:
Infrastructure Finance Companies in India are registered with the Reserve Bank of India. They primarily provide long-term financial assistance for infrastructure projects. Their main activities include lending for infrastructure development, refinancing, and offering subordinated loans. They also facilitate equity participation and consulting services for large-scale infrastructure projects across sectors such as energy, transportation, and telecommunications. They do not engage in retail banking or property management.
12. Using iron instead of wooden ploughs is an example of which technology? (UPSC Prelims 1983)
[A] Obsolete technology
[B] Appropriate technology
[C] Redundant technology
[D] Ultimate technology
Show Answer
Correct Answer: B [Appropriate technology]
Notes:
Appropriate technology refers to methods or tools that are affordable, locally adaptable, and suited to the community’s needs. Iron ploughs replace less durable wooden ones, improving productivity and lifespan without requiring advanced infrastructure. The shift increases agricultural efficiency in areas with limited resources. This practice matches the concept of appropriate technology in rural agricultural settings.
13. Which focus marked the Seventh Five-Year Plan’s long-term fiscal policy? (UPSC Prelims 1987)
[A] Capital formation by increasing money income
[B] Reforming the taxing system
[C] Making tax laws easily comprehensible
[D] Tackling deep-seated poverty and unemployment
Show Answer
Correct Answer: D [Tackling deep-seated poverty and unemployment]
Notes:
The Seventh Five-Year Plan emphasized reducing poverty and unemployment, aiming to improve quality of life and create productive rural employment opportunities. The policy focused on social objectives alongside economic growth, prioritizing poverty alleviation over tax reforms or comprehension.
14. 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
15. In which system of economy is the “participation of the workers in the collective bargaining” is a feature?
[A] Socialist economy
[B] Mixed economy
[C] Market Economy
[D] Traditional Economy
Show Answer
Correct Answer: A [Socialist economy]
Notes:
The socialist model of the economy is based on the Marx Model of communism where the state owns the factors of production. The capital cannot be privately held and there is communal ownership or what is known as “Communism”. The workers are paid uniform wages and what Marx called the “participation of the workers in the collective bargaining” is a feature of the system.
16. Which among the following Economic system have Barter system?
[A] Socialist
[B] Traditional
[C] Capitalist
[D] Mixed
Show Answer
Correct Answer: B [Traditional]
Notes:
Traditional economies tend to focus primarily on agriculture, cattle herding, fishing etc. A traditional economy will use the barter system and has no concept of currency or money. Their economies center around their tribes or families.
17. Which of the economic system have the shortcoming of overproduction and over-exploitation of workers?
[A] Socialist system
[B] Mixed system
[C] Market system
[D] Traditional system
Show Answer
Correct Answer: C [Market system]
Notes:
In the market system or the capitalist system, there is always a risk of overexploitation of workers for the profits of the companies. A profit is the main motive of this type of economy. It also may lead to the overproduction of goods since there are no regulations. This can also be attributed to the fact that the workers have low wages and hence cannot afford to consume all the products that are being manufactured.
18. Which sector comprises of the activities like exploitation of natural resources?
[A] Secondary
[B] Tertiary
[C] Primary
[D] Unorganised
Show Answer
Correct Answer: C [Primary]
Notes:
The exploitation of natural resources is part of the primary sector. The primary sector includes activities that are directly dependent on nature.
19. What was the target of the first five-year plan?
[A] Development of agriculture
[B] Development of textile industry
[C] Develpoemnt of manufacturing
[D] Removal of poverty
Show Answer
Correct Answer: A [Development of agriculture]
Notes:
After Independence Indian economy was in a dismal state. The main focus of the first five-year plan was kept on the agricultural development as it is still the backbone of the Indian economy in terms of employment generation.
20. Which country exports the most palm oil to India?
[A] Malaysia
[B] Indonesia
[C] Thailand
[D] Papua New Guinea
Show Answer
Correct Answer: B [Indonesia]
Notes:
Indonesia exported approximately 4.86 billion worth of palm oil to India in 2023. Indonesia accounted for about 59% of India’s total palm oil imports that year. Malaysia was the second-largest supplier at 2.63 billion, representing 32%. Thailand supplied 784 million and Papua New Guinea 265 million worth of palm oil to India in 2023.
