Indian Economy MCQs

Notes:
The guiding principle of the Most Favoured Nation (MFN) concept is “non-discrimination among trading partners.” This principle, established in international trade agreements, ensures that any favorable trading terms offered by one country to another must be extended to all other trading partners. This concept is a cornerstone of the World Trade Organization (WTO) framework, promoting equality and preventing trade discrimination. The MFN principle aims to create a level playing field in international trade, fostering global economic cooperation.

Notes:
First statement is correct because the proposed Wholesale & Long-Term Finance Bank (WLTF) banks cannot accept the saving deposits and can accept only current account and term deposits of at least Rs 10 crore. Second statement is again correct because these banks are allowed to raise money through rupee denominated bonds issued locally as well as abroad. Third statement is incorrect. These banks will be exempted from opening branches in rural and semi-urban areas and will not be forced to lend to agriculture and weaker sections of the society. The Wholesale and Long-Term Finance (WLTF) banks, as proposed in the paper, will focus primarily on lending to infrastructure sector and small, medium and corporate businesses. The eligibility criteria of promoters for a Wholesale and Long-term Finance Bank (WLTFB) will be the same as that for universal banking licence. Raising funds from selling rupee denominated bonds locally or abroad will be a major source of funds for WLTFBs. WLTFBs will also have to maintain cash reserve ratio (CRR) like other commercial banks but do not require to maintain statutory liquidity ratio (SLR).

Notes:
The finished products of Iron and steel industries are used as raw material for other industries such as automobile and manufacturing industries. Iron and steel industry is called the mother of all industries because they need steel and iron for production, for machinery and for infrastructure.

Notes:
The cash balance that is to be maintained by scheduled banks with the RBI should not be less than 4% of the total NDTL, which is the Net Demand and Time Liabilities.

Notes:
Hindustan Zinc Limited (HZL) is an integrated mining and resources producer of zinc, lead, … Chanderiya (Chittorgarh), Debari (Udaipur) & Dariba (Rajsamand) in Rajasthan with total zinc and lead production capacity of 1.0 million tonnes.

Notes:
When prices rise, the value of money falls. Though debtors return the same amount of money, but they pay less in terms of goods and services. This is because the value of money is less than when they borrowed the money. Thus the burden of the debt is reduced and debtors gain.

Notes:
Corporate income tax is the largest source of revenue for the central exchequer in India. Despite being applicable only to profit-making businesses, it brings in the most revenue because of high corporate profitability rates and numerous profitable businesses in India. These businesses contribute a significant share to the overall economy of the country thereby being the major contributor to the central exchequer.

Notes:
Abhijit Banerjee is the author of “Volatility and Growth”. It has long been recognized that productivity growth and the business cycle are closely interrelated.

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The Unorganised sector is marked by low incomes, unstable and irregular employment, and lack of protection either from legislation or trade unions. They use mainly labor-intensive technology. The workers in the unorganized sector, are so scattered that the implementation of the Legislation is very inadequate and ineffective.

Notes:
Eight Core Industries are Electricity, steel, refinery products, crude oil, coal, cement, natural gas, and fertilizers.
The Index of Eight Core Industries is compiled based on the monthly production information received from the Source Agencies. It is a lead indicator of the monthly industrial performance.