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 published by the World Bank?
[A] Only 1 and 2
[B] Only 2 and 3
[C] Only 3
[D] None
Show Answer
Correct Answer: C [Only 3]
Notes:
The Global Innovation Index is published by WIPO with partners, the Global Competitiveness Index by the World Economic Forum, and only the Ease of Doing Business Index is published by the World Bank Group. Thus, among the options, only the third report is published by the World Bank. The other two are not associated with the World Bank.
12. Consider the following statements regarding the Asian Infrastructure Investment Bank (AIIB):
- India participated in the founding of the bank and signed the Memorandum of Understanding in October 2014.
- The headquarters of the AIIB are located in Beijing, China, specifically at the Asia Financial Center in the Olympic Forest Park area.
- The AIIB currently has over 100 member states from around the world.
Which of the above statements is/are correct?
[A] Only 1
[B] 1 and 2 only
[C] 2 and 3 only
[D] 1, 2 and 3
Show Answer
Correct Answer: D [1, 2 and 3]
Notes:
All three statements are correct. India was among the founding members of the AIIB and signed the MoU in October 2014. The bank’s headquarters are indeed located in Beijing’s Asia Financial Center in the Olympic Forest Park area. As of now, AIIB has 111 members (including prospective members) from different continents, confirming it has over 100 member states.
13. 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.
14. Which industries mainly benefit from Mumbai Port in Maharashtra?
[A] Iron and Steel industry
[B] Sugar and Cotton textile industry
[C] Cotton textile and Petrochemical industry
[D] Engineering and Fertilizer industry
Show Answer
Correct Answer: C [Cotton textile and Petrochemical industry]
Notes:
Mumbai Port in Maharashtra is a major center for handling cotton, petroleum, oil, and petrochemical shipments. It serves as a key import point for long staple cotton and machinery for the cotton textile sector. The port’s specialized terminals handle large volumes of petrochemical products. Cotton textile and petrochemical industries have longstanding reliance on Mumbai Port for raw material and export requirements.
15. Which city in Gujarat hosts the world’s largest ship-breaking yard?
[A] Jamnagar
[B] Alang
[C] Surat
[D] Kandla
Show Answer
Correct Answer: B [Alang]
Notes:
Alang is located in Bhavnagar district, Gujarat. It is recognized as the world’s largest ship-breaking yard. Alang consists of 183 ship breaking yards along 14 kilometers of coastline with a maximum capacity of 4.5 million Light Displacement Tonnage. As of 2024–25, Alang dismantles about 98% of ships broken up in India.
16. What do we call the instruments of monetary policy which directly affect the quantity of money supply?
[A] Quantitative instruments
[B] Qualitative instruments
[C] Money instruments
[D] None of the above
Show Answer
Correct Answer: A [Quantitative instruments]
Notes:
The instruments of monetary policy which directly affect the quantity of money supply are called as Quantitative instruments. Example: Open Market Operations Liquidity Adjustment Facility (Repo and Reverse Repo) etc.
17. Micro or Small Enterprise (as defined in the MSMED Act 2006) may be said to have become Sick, if?
[A] Any of the borrowal account of the enterprise remains NPA for ten months or more
[B] Any of the borrowal account of the enterprise remains NPA for eight months or more
[C] Any of the borrowal account of the enterprise remains NPA for five months or more
[D] Any of the borrowal account of the enterprise remains NPA for three months or more
Show Answer
Correct Answer: D [Any of the borrowal account of the enterprise remains NPA for three months or more]
Notes:
Micro or Small Enterprise (as defined in the MSMED Act 2006) may be said to have become Sick, if any of the borrowal account of the enterprise remains NPA for three months or more.
18. Which of the following clearly defines land ceiling?
[A] To fix a land area for irrigation purposes
[B] To fix rural land holdings at the existing level
[C] To fix urban land holdings at the existing level
[D] To fix the quantum of land held by a family
Show Answer
Correct Answer: D [To fix the quantum of land held by a family]
Notes:
Land ceiling implies settling maximum size of land holding that an individual/family can own. Land over and above the ceiling limit, called surplus land. This surplus land is handed over to landless laborers without any fair compensation.
19. Which of the following is the main source of financing the implementation of development programmes? (UPSC Prelims 1991)
[A] Internal resources from taxes and other measures
[B] External finance as borrowings/loans from foreign governments
[C] External finance as loans from international finance agencies
[D] External finance as loans from foreign governments and international finance agencies
Show Answer
Correct Answer: A [Internal resources from taxes and other measures]
Notes:
The main source of financing the implementation of development programmes is from taxes and other measures.
20. 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.
