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 MSMEs’ share in India’s total manufacturing sector output? (UPSC Prelims 1992)
[A] 48.58%
[B] 35.4%
[C] 31.1%
[D] 24.63%
Show Answer
Correct Answer: B [35.4%]
Notes:
As per data from Union Budget 2026-27 and Ministry notifications, Micro, Small and Medium Enterprises account for about 35.4% of total manufacturing sector output in India. There are 7.47 crore MSME units in India. MSMEs also contribute 48.58% to exports and 31.1% to GDP. Earlier, MSMEs’ share in output was 40% in 1998-99.
12. Which goods do Middle East arid nations export to India in FY 2024-25? (UPSC Prelims 1996)
[A] Precious stones and pearls
[B] Perfume and coffee
[C] Raw wool and carpets
[D] Fruits and palm oil
Show Answer
Correct Answer: D [Fruits and palm oil]
Notes:
Arid Middle Eastern countries, like Bahrain and UAE, export fruits (notably dates, dry fruits) and edible oils (notably palm oil) to India. These are key exports due to the region’s suitable climate and agriculture, supporting India’s food security needs. FY 2024-25 trade data affirms the trend.
13. Who among the following created the Human development index?
- Amartya Sen
- Mehboob Ul Haq
- Paul Krugman
- Walter Gillies
Choose the correct option from the code given below:
[A] 1 and 2 only
[B] 2 and 3 only
[C] 1 and 4 only
[D] 3 and 4 only
Show Answer
Correct Answer: A [1 and 2 only]
Notes:
Amartya sen and Mehboob Ul Haq created the Human Development Index which captures the development of human beings of a country as development is not only about economic indicators.
14. Which of the following is the limitation of the Socialist Economic system?
[A] High Taxes
[B] Easy Mobilization of resources
[C] Concentration of wealth is prevented
[D] Market Monopoly doesn’t exist
Show Answer
Correct Answer: A [High Taxes]
Notes:
In a socialist economy, taxes are high on the people as the state has to provide all the goods and services to all. The other options given are the advantages of the system.
15. 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.
16. In which year, Goods & Services Tax was introduced in India?
[A] 2017
[B] 2016
[C] 2018
[D] 2019
Show Answer
Correct Answer: A [2017]
Notes:
Goods and Services Tax was launched on July 1, 2017. It is an indirect tax used in India on the supply of goods and services.
17. Which five year plan gave emphasis on the removal of poverty for the first time?
[A] Fifth
[B] Sixth
[C] Seventh
[D] Eigth
Show Answer
Correct Answer: A [Fifth ]
Notes:
The Fifth Five-Year Plan from (1974-78) laid stress on employment, poverty alleviation (Garibi Hatao), and justice. It is the first time a plan had emphasis on poverty. The plan also focused on self-reliance in agricultural production and defense. In 1978 the newly elected Morarji Desai government rejected the plan.
18. Which crop is given Fair and Remunerative Price by the government?
[A] Coffee
[B] Tea
[C] Sugarcane
[D] Barley
Show Answer
Correct Answer: C [Sugarcane]
Notes:
Fair and Remunerative Price (FRP) for sugarcane was introduced by the Government of India in 2009-10 under the Sugarcane (Control) (Amendment) Order, 2009. FRP is fixed annually by the central government on the recommendation of the Commission for Agricultural Costs and Prices. Sugar mills are legally required to pay this price to sugarcane farmers.
19. Which of the following is a genetically modified (GM) crop?
[A] Basmati Rice
[B] Sticky Rice
[C] All the above
[D] Golden Rice
Show Answer
Correct Answer: D [Golden Rice]
Notes:
Golden Rice is a genetically modified variety developed to biosynthesize beta-carotene, a precursor of vitamin A. It was developed in the late 1990s by Ingo Potrykus and Peter Beyer. Golden Rice was created to address vitamin A deficiency in developing countries. The rice grains contain provitamin A, giving them a golden-yellow color. It is not commercially released in most countries as of 2024.
20. What percentage of Indian urea production must be neem-coated by manufacturers?
[A] 35%
[B] 50%
[C] 100%
[D] 75%
Show Answer
Correct Answer: C [100%]
Notes:
In September 2015, the Government of India mandated 100 percent neem coating for domestically produced urea. This requirement was implemented to prevent diversion of subsidized urea, enhance nitrogen use efficiency, and improve crop yields. Neem coating of urea acts as a nitrification inhibitor, reducing nitrogen loss through leaching and volatilization while discouraging misuse of urea for industrial purposes.
