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. Consider the following reports:
Global Innovation Index
Global Competitiveness Index
Ease of Doing Business Index
Which of the above is/are currently published by the World Bank?
[A] Only 1 and 2
[B] Only 2 and 3
[C] Only 3
[D] None
Show Answer
Correct Answer: D [None]
Notes:
The Global Innovation Index is published by WIPO, while the Global Competitiveness Index is associated with the World Economic Forum. The World Bank Group discontinued the Doing Business report on 16 September 2021, and it is no longer a current World Bank publication. Therefore, none of the listed reports is presently published by the World Bank. This makes option 4 the correct answer.
12. In which of the following sessions of Indian National Congress, it was stated by Congress that the object of the planning in the country has to be “Socialist Pattern” and not absolute “Socialism”, thus paving the way for a mixed economy in India?
[A] 1953 Hyderabad Session
[B] 1954 Kalyani Session
[C] 1955 Avadi Session
[D] 1956 Amritsar Session
Show Answer
Correct Answer: C [1955 Avadi Session]
Notes:
In the Avadi session of Indian National Congress in 1955 the Congress stated that object of the planning has to be “Socialist Pattern” and not absolute “Socialism”. The Socialist pattern meant that India has to be a mixed economy where private & public sector would coexist. In the same year, Imperial Bank of India, which came into being in 1921, came under the public sector and became “State Bank of India” in 1955.
13. Which of the following clearly define Stagflation? (UPSC Prelims 1984)
[A] Constant rate of inflation
[B] Low inflation with high recession
[C] High inflation with low recession
[D] Stagnation and inflation
Show Answer
Correct Answer: D [Stagnation and inflation]
Notes:
Stagflation is a condition of slow economic growth and relatively high unemployment, or economic stagnation, accompanied by rising prices, or inflation. It can also be defined as inflation and a decline in gross domestic product (GDP).
14. Which one of the following is a mixed fertilizer? (UPSC Prelims 1995)
[A] CAM
[B] Urea
[C] Ammonium Sulphate
[D] NPK
Show Answer
Correct Answer: D [NPK]
Notes:
NPK fertilizer is a complex fertilizer comprised primarily of the three primary nutrients required for healthy plant growth. NPK stands for “nitrogen, phosphorus, and potassium,” the three nutrients that compose complete fertilizers. The higher the number, the more concentrated the nutrient is in the fertilizer. You may encounter these letters when reading the contents printed on bags of fertilizer.
15. What restricts the spending of a person in a market?
[A] Marginal Utility
[B] Purchasing power
[C] Demand curve
[D] None of the above
Show Answer
Correct Answer: B [Purchasing power]
Notes:
The purchasing power of a person is the reason for his limited spending. He has budget constraints which inturn affect the market as a whole. The budget constraint is used to analyze consumers choices.
16. What is a free good?
[A] Opportunity cost = Maximum
[B] Opportunity cost = Negative
[C] Opportunity cost = 0
[D] A good which is freely available to all
Show Answer
Correct Answer: C [Opportunity cost = 0]
Notes:
A free good is a good with zero opportunity cost. This means it can be consumed in as much quantity as needed without reducing its availability to others. For Example sunlight, ideas, music or air.
17. Which of the following is correct for economic efficiency?
[A] Increase in economic acitivty in an economy
[B] Use of resources to maximize the production of goods and services
[C] Distribution of economic resources in fair and equitable manner
[D] Maximum usage of resources for maximum production of goods
Show Answer
Correct Answer: B [Use of resources to maximize the production of goods and services]
Notes:
Economic Efficiency is the use of resources so as to maximize the production of goods and services. Resources are scarce and there are unlimited wants so economic efficiency is key in development.
18. Which economist is infamous for the series of economic shocks that rocked America and the world during his tenure as Chairman of the Federal Reserve?
[A] Alan Greenspan
[B] Jerome Powell
[C] Paul Volcker
[D] Roy A. Young
Show Answer
Correct Answer: A [Alan Greenspan]
Notes:
Alan Greenspan served as Chairman of the U.S. Federal Reserve from 1987 to 2006. He is often associated with the monetary policies and market conditions that preceded the 2008 global financial crisis. The original question needed correction only in the spelling of his first name.
19. What is referred to as the “invisible hand” in a market economy?
[A] Trade
[B] Money
[C] Demand and supply
[D] Competition
Show Answer
Correct Answer: D [Competition]
Notes:
Adam Smith’s “invisible hand” describes competition, which guides market resources efficiently and benefits society even if individuals act in self-interest. This concept is foundational in classical economic theory and emphasizes the self-regulating nature of competitive markets.
20. Which Five-year plan was also known as “Gadgil Yojna”?
[A] Second
[B] Third
[C] Fourth
[D] Fifth
Show Answer
Correct Answer: B [Third]
Notes:
The third Five-year plan was made for the duration of 1961 to 1966. This plan is called ‘Gadgil Yojna’ also. The main target of this plan was to make the country economically independent.
