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 does “bear market” mean in stock market terminology?
[A] A period when stock prices rise steadily
[B] Foreign investors outperform domestic investors
[C] Higher investment in money market than capital market
[D] Stock prices fall 20% or more from recent highs for at least two months
Show Answer
Correct Answer: D [Stock prices fall 20% or more from recent highs for at least two months]
Notes:
A bear market occurs when securities prices fall 20% or more from recent highs. This decline is usually measured over at least a two-month period. Periods with such declines are marked by negative investor sentiment and widespread pessimism. The S&P 500 index has entered bear markets during several global economic downturns, including a 25% drop from June 2022 to June 2023.
12. India’s Foreign Trade Policy also known as Export Import Policy (EXIM) is framed and implemented by the:
[A] Director General of Foreign Trade (DGFT)
[B] Home Ministry
[C] Niti Aayog
[D] Finance commission
Show Answer
Correct Answer: A [ Director General of Foreign Trade (DGFT) ]
Notes:
The Director General of Foreign Trade is responsible for implementing the India’s Foreign Trade Policy.
13. At which HAL facility are MiG aircraft engines assembled and manufactured?
[A] Engine Division at Koraput, Odisha
[B] Engine Division at Bangalore, Karnataka
[C] Sukhoi Engine Division at Koraput, Odisha
[D] Nasik Airframe Factory, Maharashtra
Show Answer
Correct Answer: A [Engine Division at Koraput, Odisha]
Notes:
The Engine Division of Hindustan Aeronautics Limited at Sunabeda, near Koraput, Odisha, was established in 1964. It manufactures engines for MiG fighter aircraft, including R11, R25, R29B, and RD-33 series. Since 2007, the facility has produced RD-33 engines for MiG-29 aircraft under license from Russia. Over 1,300 engines have been manufactured at this division.
14. 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.
15. In which type of remittances, money is transferred from one country to another?
[A] Foreign Remittance
[B] Digital Remittance
[C] Blockchain Remittance
[D] None of the above
Show Answer
Correct Answer: A [Foreign Remittance]
Notes:
In banking terminology, remittance means transfer of fund one place to another. When money transferred from one country to another, this is called Foreign Remittance.
16. Which is a primary cause of inflation? (UPSC Prelims 1979).
[A] Increase in money supply
[B] Fall in production
[C] Increase in money supply and fall in production
[D] Decrease in money supply and rise in production
Show Answer
Correct Answer: C [Increase in money supply and fall in production]
Notes:
Inflation is caused by an increase in the money supply and a decrease in production. Demand-pull inflation arises when the growth in money supply surpasses economic output. Cost-push inflation occurs with supply shocks or reduced production. Both factors together can increase the general price level. India has experienced inflation due to these sources in multiple years.
17. Which economic system does the “Socialistic Pattern” evolve from? (UPSC Prelims 1979).
[A] Free Economy
[B] Mixed Economy
[C] Public Sector
[D] None of the above
Show Answer
Correct Answer: B [Mixed Economy]
Notes:
The “Socialistic Pattern” is derived from the Mixed Economy system. In a mixed economic system, the features of both capitalism and socialism are amalgamated. It safeguards private property ownership and promotes certain economic liberty regarding capital usage. Yet, it also permits the government to meddle in economic activities to fulfill societal goals. This marriage of capitalism and socialism in a mixed economy paves the way for the emergence of the so-called “Socialistic Pattern”.
18. Which is a non-conventional energy source in rural India? (UPSC Prelims 1988)
[A] Fuel wood
[B] Cow-dung cake
[C] Solar mini-grids
[D] Agricultural residue burning
Show Answer
Correct Answer: C [Solar mini-grids]
Notes:
Solar mini-grids use solar photovoltaic panels to generate electricity. They are classified as non-conventional energy sources in India. Distributed renewable energy initiatives have installed solar mini-grids in rural areas under government schemes. Solar energy is renewable and does not emit greenhouse gases. By June 2024, multiple villages in India have been electrified using solar mini-grids. Solar power is not traditional in Indian rural energy use.
19. Where is the headquarters of the United Nations World Tourism Organization (UNWTO) located?
[A] Paris
[B] Madrid
[C] New York
[D] Geneva
Show Answer
Correct Answer: B [Madrid]
Notes:
The World Tourism Organization (UNWTO) is the United Nations agency responsible for the promotion of sustainable and universally accessible tourism. Its headquarters is located at Madrid, Spain.
20. Who wrote the book principles of economics?
[A] Alfred Marshall
[B] Milton Friedman
[C] J S Mill
[D] None of the above
Show Answer
Correct Answer: A [Alfred Marshall]
Notes:
Principles of Economics is a leading political economy or economics textbook of Alfred Marshall (1842–1924), first published in 1890. It says The essence of economics can be reduced to three basic principles: scarcity, efficiency, and sovereignty
