41. As the number of investments made by a firm increases, what will be its internal rate of return?
[A] declines due to diminishing marginal productivity
[B] declines because the market rate of interest will fall, ceteris paribus
[C] increases to compensate the firm for the current consumption foregone
[D] increases because the level of savings will fall
Show Answer
Correct Answer: C [increases to compensate the firm for the current consumption foregone]
Notes:
Internal rates of return are commonly used to evaluate the desirability of investments or projects. The higher the internal rate of return of a project, the more desirable it is to undertake the project. A firm, in theory, makes all available projects or investments with an IRR that exceeds the cost of capital.
42. Which of the following are income and consumption?
[A] inversely related
[B] directly related
[C] partially related
[D] unrelated
Show Answer
Correct Answer: B [directly related]
Notes:
Consumption and income are directly or positively related. An increase in income is associated with an increase in income; a decrease in consumption accompanies a decrease in income.
43. The __ sector is characterized by small and scattered units that are largely outside the control of the government.
[A] Unorganised
[B] Organised
[C] Disguised
[D] Seasonal
Show Answer
Correct Answer: A [Unorganised]
Notes:
The unorganized or informal sector is characterized by small and scattered units which are largely outside the control of the government. It mainly includes small scale workers, casual workers in construction, trade, transportation etc. The workers in the unorganized sector also include street vendors, rag pickers, garment makers etc.
44. Antyodaya program is associated with which of the following?
[A] liberation of bonded labour
[B] bringing up cultural revolution in India
[C] demands of textile labourers
[D] upliftment of the poorest of the poor
Show Answer
Correct Answer: D [upliftment of the poorest of the poor]
Notes:
Antyodaya Anna Yojana (AAY) is a centrally sponsored scheme launched on December 25, 2000 for one crore poor families with the aim of ensuring food security in India. This is an important milestone in providing food grains to the poor. It considered providing 35kg. of food grains per month at highly subsidized rates of Rs. 2 per kg. for wheat and Rs. 3 per kg. For rice to each Antyodaya family.
45. Which of the following is not in the list of Maharatnas?
[A] Coal India Limited
[B] Steel Authority of India Limited
[C] Hindustan Petroleum Corporation Limited
[D] Bharat Heavy Electricals Limited
Show Answer
Correct Answer: C [Hindustan Petroleum Corporation Limited]
Notes:
There are 8 Maharatnas Bharat Petroleum Corporation Limited; National Thermal Power Corporation; Oil and Natural Gas Corporation; Steel authority of India Limited; Bharat Heavy Electricals Limited; Indian Oil Corporation Limited; Coal India Limited; Gas Authority of India Limited. Hindustan Petroleum Corporation Limited is a Navratna.
46. What is the total number of nationalized banks in India?
[A] 12
[B] 19
[C] 21
[D] 30
Show Answer
Correct Answer: A [12]
Notes:
The number of nationalised banks in India has been significantly reduced after the government in 2021 merged 10 PSBs into four banks. As of January 2024, there are 12 national banks in India. These are: Bank of Baroda; Bank of India; Bank of Maharashtra; Canara Bank; Central Bank of India; Indian Bank; Indian Overseas Bank; Punjab National Bank; Punjab & Sind Bank; Union Bank of India; UCO Bank and State Bank of India.
47. Commercial banks lend to which of the following priority sector?
[A] Heavy Industries
[B] Agriculture, Small scale industries
[C] Foreign Companies
[D] State Government in an emergency situation
Show Answer
Correct Answer: B [Agriculture, Small scale industries]
Notes:
Priority sector lending by the Reserve Bank of India (RBI) to banks is an important role in providing a specified share of bank credit to certain specific sectors such as agriculture and allied activities, micro and small enterprises and weaker sections. The aim is to ensure that adequate institutional credit flows to some of the weaker sectors of the economy.
48. What are Debenture holders of a company?
[A] Shareholders
[B] Creditors
[C] Debtors
[D] Directors
Show Answer
Correct Answer: B [Creditors
]
Notes:
Companies issue debentures instead of shares to extend their business. These debentures are issued to borrow loans from the general public; interest is paid on the borrowed money to the debenture holders. So a debenture holder is essentially a creditor who simply gives a loan to the company.
49. Who among the following was not the Governor of Reserve Bank of India?
[A] D. Subbarao
[B] Manmohan Singh
[C] M Narasimham
[D] M S Gill
Show Answer
Correct Answer: D [M S Gill]
Notes:
Manohar Singh Gill is an Indian politician of the Indian National Congress party, who has served as the Minister of Youth Affairs and Sports. He represents Punjab in the Rajya Sabha, the upper house of the Indian Parliament.
50. By whom can the fixed foreign exchange rate be changed?
[A] RBI
[B] SEBI
[C] Ministry of Finance
[D] FIPB
Show Answer
Correct Answer: A [RBI]
Notes:
The Reserve Bank of India is responsible for maintaining fixed exchange rates with all other member countries of the International Monetary Fund. Apart from maintaining the exchange rate of the rupee, the Reserve Bank will have to act as the custodian of India’s reserves of international currencies. It operates the exchange control system.
