MCQs on Economics -40

1. According to 122nd Constitutional Amendment Bill,
1. IGST will appropriated to the state in which it is collected
2. No longer cess and surcharges levied
3. GST council has right to alter GST rate and resolve disputes related to GST
4. Exports are exempted from GST
(a) 1, 2, 3 correct
(b) 2, 3, 4 correct
(c) 1, 3, 4 correct
(d) 3, 4 correct

2. Land reforms are associated with
1. Tenancy reforms
2. Imposition of land ceilings
3. Abolition of intermediaries
4. Consolidation of land holdings

Choose your answer from the following

(a) 1 and 3
(b) 1, 2, and 3
(c) 2and 3
(d) 1 and 2

3. Consider the following statements:
1. Headline inflation is measured in terms of WPI
2. Producer Price Index doesn’t track change in tax burden
3. Service Price Index in India tracks the change in prices of various services
4. WPI is calculated by MoSPI
(a) 1, 2, 3 correct
(b) 1, 2 correct
(c) 2, 3, 4 correct
(d) All the above are correct

4. ‘Golden Revolution’ is related to
(a)Precious minerals
(b) Pulses
(c) Jute
(d) Horticulture

5. Which of the following is/are true with regard to inflation?
1. It erodes the value of rupee
2. It leads to decrease in exports
3. Its affect is similar to indirect tax
4. It makes imports attractive
(a) Only 1
(b) Only 3
(c) 1, 2, 3
(d) All the above

6. Which of the following are true with respect to deficits in fiscal policy?
1. An economy having Revenue deficit mean it has fiscal deficit
2. An Economy having primary deficit mean it has Revenue deficit
3. An Economy having Fiscal deficit mean it has both revenue and primary deficits
4. An Economy having budget deficit mean it has fiscal deficit
(a) 1, 3, 4
(b) 1, 2, 4
(c) 2, 3, 4
(d) All the above

7. Non-Tax revenue can be increased by improving the working of
(a) Electricity boards
(b) Commercial irrigation projects
(c) Indian Railways
(d) All the above

8. The term “Open Acreage Licensing Policy” refers to
(a) Exploration policy of Oil and Natural Gas
(b) Exploration policy of Coal
(c) Exploration policy of Natural Resources
(d) Allocation of land to SEZs

9. Consider the following statements:
1. Transfer payments are payments made between the divisions of a company
2. Transfer price is one way payment of money for which no money, good, or service is received in exchange
(a) Only 1 correct
(b) Only 2 correct
(c) Both 1 & 2 correct
(d) None of the above are correct

10. Zero Coupon Bond means
(a) Securities on which no interest rate is paid and the issuer only pays the Face value
(b) Bond issued against unsecured asset
(c) A convertible debenture
(d) Security issued at a very low interest rate

11. Special category status is awarded to a state based on following parameters
1. Low population density
2. Strategic locations along the borders of the country
3. Backwardness of state
4. Hilly and difficult terrain
5. Newly formed state
(a) 1, 3, 4, 5
(b) 1, 2, 3, 4
(c) 1, 2, 4, 5
(d) 1, 2, 4

12. In India, which of the following have the highest share in the disbursement of credit to agriculture and allied activities?
(a) Commercial Banks
(b) Cooperative Banks
(c) Regional Rural Banks
(d) Micro finance Institutions

13. ‘Base Rate’ is a banking term. The Base Rate s determined by
(a) RBI
(b) Commercial Bank
(c) Finance Ministry
(d) Loan Recipient

14. Which of the following statements with respect to external debt are true?
1. It is total amount due by the government and private sector to foreign creditors
2. External debt of GOI is managed by ministry of finance
3. NRI deposits are part of external debt
4. The long term external debt of GOI is lesser than short term external debt
(a) 1, 4 
(b) 1, 2, 4
(c) 1, 2, 3 
(d) None of the above

15. The recent announcement of fed tapering
1. Is to reduce inflation and increase interest rate in US economy
2. It led to steep appreciation of rupee
3. Led to increase in dollar denominated inflows into India
4. It is related to quantitative easing in USA

Which of the above statement are correct?
(a) 2, 3 correct
(b) 1, 4 correct
(c) 1, 3, 4 correct
(d) 1, 2, 4 correct



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