Civils Economy-5

Economy Civils Prelims Practice Questions,UPSC,CSAT,SSC,UPPSC,kpsc

The reserve bank of India (RBI) acts as a banker’s bank. This would imply which of the following?
1. Other bank retain their deposits with the RBI.
2. The RBI lends funds to the commercial banks in times of need.
3. The RBI advices the commercial banks on monetary matters.
Select The correct answer using the codes given below:

(A) 2 and 3 only
(B) 1 and 2 only
(C) 1 and 3 only
(D) 1,2, and 3

Under which of the following circumstances may ‘capital gains’ arises?
1. When there is an increases in the sales of a product.
2. When there is a natural increases in the value of the property owned
3. When you purchase a painting and there is a growth in its value due to increases in its popularity.
Select The correct answer using the codes given below:

(A) 1 only
(B) 2 and 3 only
(C) 2 only
(D) 1,2 and 3

which of the following measures would result in an increase in the money supply in the economy ?
1. purchase of government securities from the public by the central bank
2. Deposit of currency in commercial banks by the public
3. Borrowing by the government from the central bank
4. Sale of government securities to the public by the central bank
Select The correct answer using the codes given below:

(A) 1 only
(B) 2 and 4 only
(C) 1 and 3
(D) 2, 3 and 4

which of the following would include Foreign Direct Investment in India ?
1. Subsidiaries of foreign companies in India
2. Majority foreign equity holding in Indian companies
3. Companies exclusively financed by foreign companies
4. portfolio investment
select the correct answer using the codes given below :

(A) 1, 2, 3 and 4
(B) 2 and 4 only
(C) 1 and 3 only
(D) 1,2 and 3 only

consider the following statements, The price of any currency in international market is decided by the
1. World Bank
2. Demand for Goods/services provided by the country concerned
3. Stability of the government of the concerned country
4. Economic potential of the country in question
which of the statements given above are correct ?

(A) 1, 2, 3 and 4
(B) 2 and 3 only
(C) 3 and 4 only
(D) 1 and 4 only

The basic aim of Lead Bank Scheme is that ?

(A) Big Banks should try to open offices in each district
(B) There should be stiff competition among the various nationalized banks
(C) Individual banks should adopt particular districts for intensive development
(D) All the banks should make intensive effortsto mobilize deposits

India has experienced persistent and high food inflation in the recent past, what could be the reasons ?
1. Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased
2. As a consequence of increasing incomes, the consumption patterns of the people have undergone a significant change
3. The food supply chain has structural constraints
which of the statements given above are correct ?

(A) 1 and 2 only
(B) 2 and 3 only
(C) 1 and 3 only
(D) 1, 2 and 3

which one of the following statements appropriately describes the ‘fiscal stimulus’ ?

(A) It is a massive investment by the government in manufacturing sector to ensure the supply of goods to meet the demand surge caused by rapid economic growth
(B) It is an intensive affirmative action of the government to boost economic activity in the country
(C) It is government ‘s intensive action on financial institutions to ensure disbursement of loans to agriculture and allied sectors to promote greater food production and contain food inflaton
(D) It is an extreme affirmative action by the government to purse its policy of financial inclusion

Consider the following actions which the government can take :
1. Devaluing the domestic currency
2. Reduction in the export subsidy
3. Adopting suitable policies which attract greater FDI and more funds from FIIs
which of the above action/actions can help in reducing the current account deficit ?

(A) 1 and 2 only
(B) 2 and 3 only
(C) 3 only
(D) 1 and 3 only

which one of the following is not a feature of ‘value Added tax ?

(A) It is a multi-point destination based system of taxation
(B) It is a tax levied on value addition at each stage of trassaction in the production –distribution chain
(C) It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer
(D) It is basically a subject of the central government and the state government are only a facilitator for its successful implementation

A ‘closed’ economic is an economy in which ?

(A) The money supply is fully controlled
(B) Deficit financing takes place
(C) Only exports take place
(D) Neither exports nor imports take place

with what purpose is the government of India promoting the concept of ‘Mega food parks’ ?
1. To provide good infrastructure facilities for the food prossing industry
2. To increase the processing of perishable items and reduce wastage
3. To provide emerging and eco-friendly food processing technology to enterprises
select the correct answer using the codes given below:

(A) 1 only
(B) 1 and 2 only
(C) 2 and 3 only
(D) 1, 2 and 3

All revenues received by union government by way of taxes and other receipts for the conduct of government business are credited to the

(A) Contingency fund of India
(B) public accounts
(C) Consolidated fund of India
(D) Deposits and advance fund

Microfinance is the provision of financial services to people of low income groups This includes both the consumers and self employed: The service rendered under microfinance is/ are
1. Credit facility
2. Savings facility
3. Insurance facility
4. Fund transfer facility
Select The correct answer using the codes given below:

(A) 1 only
(B) b 1 and 4 only
(C) 2 and 3 only
(D) 1, 2, 3 and 4

Among the following who are eligible to benefit from the ‘Mahatma Gandhi National Rural Employment Guarantee Act’ ?

(A) Adult members of only the scheduled caste and scheduled tribe household
(B) b Adult members of below poverty line (BPL) household
(C) Adult members of households of all backward communities
(D) Adult members of any household

what is the different between ‘vote on-account ‘and ‘interim budget’ ?
1. The provision of a ‘vote-on-account ‘ is used by a regular government . while an ‘interim budget ‘ is a provision used by caretaker government
2. A ‘vote- on –account’ only deals with the expenditure in government ‘s budget’ includes both expenditure and receipts
which of the statements given above is / are correct

(A) 1 only
(B) 2 only
(C) both 1 and 2
(D) neither 1 nor 2

Regarding the International Monetary Fund which one of the following statements is correct ?

(A) It can grant loans to any country
(B) It can grant loans to only developed countries
(C) It grant loans to only member countries
(D) It can grant loans to the central bank of a country.