Multiple Choice Questions On Indian Economy

1     The credit control operation in India is performed by:

a)    Rural Banks

b)   Commercial Banks

c)    Reserve Bank of India

d)   State Bank of India

2     Division of labour is limited by:

a)    The number of workers

b)   Hours of work

c)    Extent of the market

d)   Working space

3     The four factors of production are:

a)    Land, labour, capital, organization

b)    Land, electricity, water, labour

c)    Labour, Capital, land, rainfall

d)   Labour, climate, land, tools

4     What is main purpose of currency?

a)    Currency chest

b)   Standard of Postponed Payments

c)    Standard of Money

d)   Medium of Exchange

5     National Income accounting is the study of the income and expenditure of the entire:

a)    Family

b)   State

c)    Economy

d)   Organization

6     The problem of Economics arises from:

a)    Plenty of goods

b)   Scarcity of goods

c)    More wants less goods

d)   All of these

7     Agriculture income tax is a source of revenue to:

a)    Central Government

b)   State Government

c)    Local Administration

d)   Central and State Government

8     Beyond a certain point, deficit financing will certainly lead to :

a)    Inflation

b)   Deflation

c)    Recession

d)   Economic stagnation

9     To achieve economic self reliance was the main objective of which of the following Five Year Plan?

a)    Second Plan

b)   First Plan

c)    Third Plan

d)   Fourth Plan

10  The preparation of National Income Estimates is the responsibility of the:

a)    Planning Commission

b)   National Development Council

c)    National Sample Survey

d)   Central Statistical Organization

11  Which one of the following is the most sensitive indicator of the health of a community?

a)    Birth rate

b)   Infant mortality rate

c)    Death rate

d)   Maternal mortality rate

12  The objectives of Indian Planning are :

a)    Increasing national income

b)   Reducing inequalities in income and wealth

c)    Elimination of poverty

d)   All of the above

13  The Gandhian economy was based on the principle of :

a)    State control

b)   Copetition

c)    Trusteeship

d)   Rural Cooperation

14  Fiscal policy is concerned with :

a)    Public revenue

b)   Public Expenditure and debt

c)    Bank rate policy

d)   Both a and b

15  Devaluation of a currency refers to :

a)    Decrease in the internal value of money

b)   Decrease in the external value of money

c)    Decrease both in the external and internal value of money

d)   Government withdrawal of a currency not of a denomination

16  The maternal mortality rates in Asia are the highest in :

a)    Bangladesh

b)   India

c)    Indonesia

d)   Nepal

17  To get the Net National Product we deduct what from the Gross National Product?

a)    Direct Taxes

b)   Imports

c)    Interim Payments

d)   Loss

18  Protection means

a)    Restriction imposed on import trade

b)   Protection to home industries

c)    No free exchange of goods and services between two countries

d)   All of these

19  The reserve Bank of India:

a)    Provide direct finance to agriculture

b)   Provides finance to primary cooperative societies

c)    Provides finance to state cooperative banks

d)   Does not provide finance to agriculture

20  In which sector of the Indian economy is productivity the highest?

a)    Manufacturing

b)   Transport , Communication, Commerce

c)    Agriculture

d)   Other sectors

21  Which of the following is not method of estimating national income?

a)    Income method

b)   Value added method

c)    Expenditure method

d)   Export import method

22  Population explosion in a country means:

a)    High birth rate and high death rate

b)   High birth rate and low death rate

c)    Low birth rate and high death rate

d)   Low birth rate and Low death rate

23  The measurement of poverty line is based on the criteria of :

a)    Their dwelling houses

b)   The nature of employment

c)    Caloric consumption

d)   Level of education

24  Elasticity of demand is a tendency line is based on the criteria of:

a)    Increase or decrease on the change of price

b)   Increase on the rising of price

c)    Decrease on the falling of price

d)   Consistency of demand on rising and falling prices

25  Capital is that wealth:

a)    Which is used for the production of wealth

b)   Which is kept in boxes and lockers

c)    Which is buried in the land

d)   Which is stored for consumption

26  Function of an entrepreneur is:

a)    Organization of labour

b)   Collection of capital

c)    Showing efficiency in collection of loans from the banks and the market

d)   Risk taking

27  The poverty line has been defined in the :

a)    Seventh Five Year Plan

b)   Sixth Five Year Plan

c)    Eighth Five Year Plan

d)   Fifth Five Year Plan

28  In Centre and State financial relations in India. The Gadgil Formula is used in :

a)    Division of tax revenue

b)   Formulating the policy for fresh borrowings

c)    Writing off states indebtedness to the Centre

d)   Allocating Central Plan assistance between States

29  According to the Reserve Bank of India the term ‘Open Market Operation’ means sale and purchase of:

a)    Gold

b)   Government securities

c)    Iron and steel

d)   Foreign exchange

30  Reserve bank of India was established on:

a)    January 1, 1934

b)   April 1, 1934

c)    January 1, 1935

d)   April 1, 1935