Indian Economy MCQ Questions and answers for practice

21.
The Board of Industrial and Financial Reconstruction (BIFR) came into existence in

A. 1984

B. 1986

C. 1987

D. 1989

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22.
The current price index (base 1960) is nearly 330. This means that

A. all items cost 3-3 times more than what they did in 1960

B. the prices of certain selected items have gone up to 3-3 times

C. weighted means of prices of certain item has increased 3-3 times

D. gold price has gone up 3-3 times

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23.
Notes on which denomination has the portrait of Mahatma Gandhi printed on them?

A. 1000 rupee

B. 500 rupee

C. 100 rupee

D. All of the above

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24.
Devaluation of currency will be more beneficial if

A. prices of domestic goods remain constant

B. prices of exports remain constant

C. prices of imports remains constant

D. prices of exports rise proportionately

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Answer & Solution

Answer: Option B

Solution:

Under a fixed exchange rate system, devaluation and revaluation are official changes in the value of a country's currency relative to other currencies. Under a floating exchange rate system, market forces generate changes in the value of the currency, known as currency depreciation or appreciation.
Devaluation is a monetary policy tool used by countries that have a fixed exchange rate or semi-fixed exchange rate. One reason a country may devaluate its currency is to combat trade imbalances. Devaluation causes a country's exports to become less expensive, making them more competitive in the global market.
Currency war, also known as competitive devaluations, is a condition in international affairs where countries seek to gain a trade advantage over other countries by causing the exchange rate of their currency to fall in relation to other currencies.

Devaluation of currency will be more beneficial if prices of exports remain constant.

After a devaluation, the new lower value of the domestic currency will make it less expensive for foreign consumers to obtain local currency with which to buy locally produced export goods, so more exports will be sold, helping domestic businesses. Further, the new exchange rate will make it more expensive for local consumers to obtain foreign currency with which to import foreign goods, hurting domestic consumers and causing less to be imported. The combined effect will be to reduce or eliminate the previous net outflow of foreign currency reserves from the central bank, so if the devaluation has been to a great enough extent the new exchange rate will be maintainable without foreign currency reserves being depleted any further.

Source : gkplanet.com

25.
Of the gross tax revenue of the Union Government the indirect taxes account for nearly

A. 70 per cent

B. 75 percent

C. 65 percent

D. 60 percent

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26.
The banks are required to maintain a certain ratio between their cash in the hand and total assets. This is called

A. Statutory Bank Ratio (SBR)

B. Statutory Liquid Ratio (SLR)

C. Central Bank Reserve (CBR)

D. Central Liquid Reserve (CLR)

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27.
Reserve Bank of India was nationalized in the year

A. 1935

B. 1945

C. 1949

D. 1969

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28.
In India, rural incomes are generally lower than the urban incomes, which of the following reasons account for this?

I=A large number of farmers are illiterate and know little about scientific agriculture
II=Prices of primary products are lower than those of manufactured products

III=Investment in agriculture has been low when compared to investment in industry

A. I, II, III

B. I, II

C. I, III

D. II, III

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29.
National Agricultural Insurance Scheme replacing Comprehensive Crop Insurance Scheme was introduced in the year

A. 1997

B. 1998

C. 1999

D. 2000

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30.
If the fiscal deficit of the Union Government is Rs. 75,000 crores relending to State is Rs. 25,000 crores, interest payments are Rs. 25,000 crores, what is the amount of the primary deficit?

A. Rs. 50,000 crores

B. Rs. 25,000 crores

C. Rs. 1,00,000 crores

D. Rs. 1,25,000 crores

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Indian Economy MCQ Questions and answers for practice | GK

21. The Board of Industrial and Financial Reconstruction (BIFR) came into existence in

Answer & Solution

22. The current price index (base 1960) is nearly 330. This means that

Answer & Solution

23. Notes on which denomination has the portrait of Mahatma Gandhi printed on them?

Answer & Solution

24. Devaluation of currency will be more beneficial if

Answer & Solution

25. Of the gross tax revenue of the Union Government the indirect taxes account for nearly

Answer & Solution

26. The banks are required to maintain a certain ratio between their cash in the hand and total assets. This is called

Answer & Solution

27. Reserve Bank of India was nationalized in the year

Answer & Solution

Answer & Solution

29. National Agricultural Insurance Scheme replacing Comprehensive Crop Insurance Scheme was introduced in the year

Answer & Solution

30. If the fiscal deficit of the Union Government is Rs. 75,000 crores relending to State is Rs. 25,000 crores, interest payments are Rs. 25,000 crores, what is the amount of the primary deficit?

Answer & Solution

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21.
The Board of Industrial and Financial Reconstruction (BIFR) came into existence in

22.
The current price index (base 1960) is nearly 330. This means that

23.
Notes on which denomination has the portrait of Mahatma Gandhi printed on them?

24.
Devaluation of currency will be more beneficial if

25.
Of the gross tax revenue of the Union Government the indirect taxes account for nearly

26.
The banks are required to maintain a certain ratio between their cash in the hand and total assets. This is called

27.
Reserve Bank of India was nationalized in the year

29.
National Agricultural Insurance Scheme replacing Comprehensive Crop Insurance Scheme was introduced in the year

30.
If the fiscal deficit of the Union Government is Rs. 75,000 crores relending to State is Rs. 25,000 crores, interest payments are Rs. 25,000 crores, what is the amount of the primary deficit?