Indian Economy GK Questions (MCQs) for SSC, State and All One Day Examinations of India. Objective Questions on Indian Economy for Competitive Examinations.
1. What is the name given to the graph that shows all those combinations of two goods that a consumer can afford economically at a given market price and within a particular income level?
[A] Demand Curve
[B] Isocost Line
[C] Supply Curve
[D] Budget Line
D [Budget Line]
Notes:
The budget line, also called the budget constraint, shows all combinations of two goods that a consumer can afford at market prices and within a particular income level. The knowledge of the concept of budget line is essential to understand the principle of consumer’s equilibrium.
2. What is meant by ‘Take off stage’ in an economy?
[A] Stage of growth
[B] Stage of stagnant
[C] Stage of collapse
[D] Stage of diminish
A [Stage of growth]
Notes:
Take-off is defined as the interval during which the rate of investment increases in such a way that per capita real output increases and this initial increase is accompanied by a radical change in the techniques of production and the nature of income flows. which maintains the new scale of investment and thereby maintains a tendency to increase per capita output.
3. A part of the national debt which is known as external debt is__
[A] borrowed by its citizens from abroad
[B] lent by its citizens to foreign governments
[C] borrowed by its government from abroad
[D] lent by its government to foreign government
C [borrowed by its government from abroad]
Notes:
External debt (or foreign debt) is that portion of a country’s total debt that is owed to creditors outside the country. Debtors can be governments, corporations or private households. Debt includes money owed to private commercial banks, other governments, or international financial institutions such as the International Monetary Fund (IMF) and the World Bank.
4. NTPC is a Central Public Sector Enterprise in which sector?
[A] Education
[B] Health
[C] Power
[D] Transport
C [Power]
Notes:
NTPC Limited (earlier known as National Thermal Power Corporation Limited) is an Indian PSU Public Sector Undertaking, engaged in the business of power generation and allied activities. NTPC’s core business is generation and sale of electricity to state-owned power distribution companies and state electricity boards in India.
5. The steel sheet used in the production of furniture is an example of?
[A] an intermediate good
[B] a final good
[C] an investment good
[D] a consumption good
A [an intermediate good]
Notes:
Intermediate goods are semi-finished products that are used as inputs in the production of other goods, including final goods. It includes a material or commodity that is the end product of one process but is also used as an input in the production process of another good. Steel sheets serve as a raw material in the production of furniture.
6. What are the reserves maintained by commercial banks with the Reserve Bank of India over and above the statutory minimum called?
- [A] Cash reserves
- [B] Deposit reserves
- [C] Excess reserves
- [D] Momentary reserves
C [Excess reserves]
Notes:
In banking, excess reserves are bank reserves in excess of the reserve requirement set by a central bank. They are reserves of cash more than the required amounts.
7. Who has been appointed as the Chairman of the 15th Finance Commission?
- [A] Vijay Kelkar
- [B] Arbind Pangarhia
- [C] N K Singh
- [D] C Rangrajan
C [N K Singh]
Notes:
Former Planning Commission member N.K. Singh was appointed chairman of the 15th Finance Commission, which, among other things, has been asked to look into the impact of the goods and services tax (GST) on the finances of both the centre and states.
8. A situation where the expenditure of the government exceeds its revenue is called__
[A] Default Financing
[B] Deficit Revenue
[C] Budget Deficit
[D] Default Revenue
C [Budget Deficit]
Notes:
The Budget Deficit is the financial situation wherein the expenditures exceed the revenues. It generally relates to the government’s expenditure and not the business or individual’s spending. The budgetary deficit is usually expressed as a percentage of GDP.
9. What is the main purpose of devaluation?
[A] encourage imports
[B] encourage exports
[C] encourage both exports and imports
[D] discourage both exports and imports
B [encourage exports]
Notes:
‘Devaluation’ means the official lowering of the value of a country’s currency within a fixed exchange rate system, by which the monetary authority formally sets a new fixed rate with respect to a foreign reference currency. Devaluation makes a country’s exports relatively less expensive for foreigners and makes foreign products relatively more expensive for domestic consumers, discouraging imports.
10. The hypothesis that a rapid increase in per capita income will be linked to a reduction in poverty is called?
[A] trickle-down Hypothesis
[B] trickle-up hypothesis
[C] U shaped hypothesis
[D] poverty estimation hypothesis
A [trickle-down Hypothesis]
Notes:
According to the trickle-down hypothesis the rapid growth of per capita income will be associated with a reduction in poverty. In India, this hypothesis has been interpreted to suggest that growth in agricultural output without radical institution reform will reduce the incidence of poverty in the context of agricultural development in India.