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. Natural Gas is one of the materials used in making of Fertilizers. Which among the following is the function of Natural gas in production of Fertilizers?
[A] As a fuel, to supply heat
[B] As a Reducing agent
[C] As a catalyst to produce complex fertilizers
[D] As a feedstock for the production of ammonia
Show Answer
Correct Answer: D [As a feedstock for the production of ammonia]
Notes:
Natural gas, essentially methane, is upgraded by combination with nitrogen from the air to form nitrogen fertilizer. 80% of the gas is used as feedstock for fertilizer while 20% is used for heating the process and producing electricity.
12. What happens to corporate bond with a fixed interest rate, if interest rates in nation increase?
[A] decrease in value
[B] Be returned to corporation
[C] remain unchanged
[D] increase in value
Show Answer
Correct Answer: A [decrease in value]
Notes:
If interest rates in nation increase, a corporate bond with a fixed interest rate will decrease in value.
13. Which trade agreement has India finalized with the European Union recently? (UPSC Prelims 1984)
[A] Rupee trade
[B] Free Trade Agreement (FTA)
[C] Barter trade
[D] Unilateral trade
Show Answer
Correct Answer: B [Free Trade Agreement (FTA)]
Notes:
India and the European Union concluded a Free Trade Agreement in 2024. The agreement includes gradual reduction of tariffs and covers approximately 33 billion of Indian exports. The FTA provides deeper access to 144 EU services sub-sectors. The EU is India’s largest trading partner, with bilateral trade reaching 136 billion in 2024-25. The EU represents around 25% of global GDP.
14. Which are major environmental causes of death in developing countries? (UPSC Prelims 1993)
[A] Lack of safe water, pesticide use, ozone thinning
[B] Contaminated food, global warming, CFCs
[C] Polluted air, greenhouse effect, soil erosion
[D] Unsafe water, contaminated food, polluted air
Show Answer
Correct Answer: D [Unsafe water, contaminated food, polluted air]
Notes:
Unsafe water, contaminated food, and polluted air are linked to around 40% of global deaths caused by pollution in developing countries. Waterborne diseases like cholera and diarrhoea account for significant mortality, especially in children. Air pollution contributes to respiratory diseases, increasing mortality rates among children under age five. Contaminated food transmits diarrhoeal diseases and other infections, particularly in low-income regions.
15. Which crop has the lowest international trade compared to total global production? (UPSC Prelims 1995)
[A] Rice
[B] Coffee
[C] Rubber
[D] Wheat
Show Answer
Correct Answer: A [Rice]
Notes:
In 2023–2024, global rice production was about 520 million metric tons. International rice trade accounts for less than 10 percent of total production. Rice is mainly consumed domestically in producing countries such as China and India. The largest exporters export a small share of total production. Rice is a staple for over half the world’s population, contributing to low export volumes.
16. Which of the following is considered as transfer payment?
[A] College fees
[B] Bank loan
[C] Bonus of employees
[D] Unemployed allowance by the government
Show Answer
Correct Answer: D [Unemployed allowance by the government]
Notes:
Transfer payment– is the payment by the government in grants, allowances, pensions etc to people such as pensioners, widows, sick or unemployed people or others with little or no income. It does not include subsidies given by the government .
Ex: PM KISAN amount transfer
17. Which sector gained most in GDP share post-1991 LPG reforms?
[A] Primary sector
[B] Secondary sector
[C] Tertiary sector
[D] Unorganised sector
Show Answer
Correct Answer: C [Tertiary sector]
Notes:
Tertiary sector grew fastest post-1991 LPG reforms, mainly due to IT, software, and services, contributing 54-55% to India’s GDP recently, while primary and secondary sectors’ shares decreased. Growth was fueled by liberalization, globalization, and increased demand for services.
18. Which of these is a non-edible oilseed?
[A] Sesame
[B] Sunflower
[C] Linseed
[D] Groundnut
Show Answer
Correct Answer: C [Linseed]
Notes:
Linseed, also called flaxseed, is primarily used for industrial purposes like making linoleum, varnishes, and paints. The oil extracted from linseed is not commonly used for edible purposes in India. Sesame, sunflower, and groundnut oils are widely consumed as cooking oils. India is among the top producers of linseed globally.
19. Which coffee varieties are commercially grown in India?
[A] Arabica and Robusta
[B] Robusta and Charrieriana
[C] Charrieriana only
[D] Arabica only
Show Answer
Correct Answer: A [Arabica and Robusta]
Notes:
Arabica was introduced to India in the 17th century in Karnataka’s Chikmagalur district. Robusta is the most widely grown coffee variety in India, accounting for over 60% of production. Charrieriana is not commercially cultivated in India. The main coffee growing states are Karnataka, Kerala, and Tamil Nadu. India produces both Arabica and Robusta, but not Charrieriana.
20. Rythu Bazar is a direct Agri produce marketing place in which state?
[A] Andhra Pradesh
[B] Telangana
[C] Both
[D] None
Show Answer
Correct Answer: C [Both ]
Notes:
States have introduced direct marketing of farm produce, examples being the Uzhavar Sandhai (Tamil Nadu), the Rythu Bazaar (Andhra Pradesh and Telangana), the Raitha Santhe (Karnataka), the Apni Mandi (Punjab) and the Krushak Bazaar – (Odisha).
