5 MCQs a Day

ESI
RBI Gr B | NABARD Gr A | SEBI Gr A
2019

India & World

Economic Situation
and Prospects 2019

LECTURE
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5 MCQs a Day

TOPIC

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.1) World Economic Situation and Prospects 2019 is a joint product of:
1. United Nations Department of Economic and Social Affairs (UN/DESA)
2. United Nations Conference on Trade and Development (UNCTAD)
3. International Monetary Fund (IMF)
[1] 1 & 2
[2] 1 & 3
[3] 2 & 3
[4] All of the above
[5] None of the above

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 Explanation
World Economic Situation
Topic
and Prospects 2019

World Economic Situation and Prospects is the United Nations’ flagship annual
publication on expected trends in the global economy.

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 Explanation
World Economic Situation
Topic
and Prospects 2019

• World Economic Situation and Prospects 2019 is a joint product of:

• the United Nations Department of Economic and Social Affairs (UN/DESA),

• the United Nations Conference on Trade and Development (UNCTAD) and

• the five United Nations regional commissions (Economic Commission for Africa
(ECA), Economic Commission for Europe (ECE), Economic Commission for Latin
America and the Caribbean (ECLAC), Economic and Social Commission for Asia and the
Pacific (ESCAP) and Economic and Social Commission for Western Asia (ESCWA)).

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.1) World Economic Situation and Prospects 2019 is a joint product of:
1. United Nations Department of Economic and Social Affairs (UN/DESA)
2. United Nations Conference on Trade and Development (UNCTAD)
3. International Monetary Fund (IMF)
*[1] 1 & 2
[2] 1 & 3
[3] 2 & 3
[4] All of the above
[5] None of the above

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.2) United Nations report World Economic Situation and Prospects 2019 estimates that Global growth is
expected to remain steady at ______ in 2019 and 2020.
[1] 3%
[2] 4%
[3] 5%
[4] 6%
[5] None of the above

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 Explanation
World Economic Situation
Topic
and Prospects 2019

Key Findings of World Economic Situation and Prospects 2019

The report estimates that Global growth is expected to remain steady at 3% in 2019 and 2020, after an
expansion of 3.1% in 2018.

As the impulse from fiscal stimulus in 2018 wanes, Growth in the United States is projected to decelerate
to 2.5% in 2019 and 2% in 2020.

European Union would witness a steady growth of 2%, even though risks are tilted to the downside,
including a potential fallout from Brexit.

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 Explanation
World Economic Situation
Topic
and Prospects 2019

Key Findings of World Economic Situation and Prospects 2019

China’s growth is expected to moderate from 6.6% in 2018 to 6.3% in 2019 since policy support would
partly offset the negative impact of trade tensions.

Large commodity-exporting countries, such as Brazil, Nigeria and the Russian Federation, are projected
to see a moderate pickup in growth in 2019–2020, albeit from a low base.

The report expresses concerns over the sustainability of global economic growth in the face of rising
financial, social and environmental challenges

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.2) United Nations report World Economic Situation and Prospects 2019 estimates that Global growth is
expected to remain steady at ______ in 2019 and 2020.
*[1] 3%
[2] 4%
[3] 5%
[4] 6%
[5] None of the above

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.3) Which of the following is not one of the challenges as listed in World Economic Situation and Prospects
2019?
[1] Per capita incomes would stagnate or grow only marginally in 2019 in several parts of Africa, Western Asia,
Latin America and the Caribbean.
[2] Eradicating poverty by 2030 will require both double-digit growth in Africa and steep reductions in income
inequality.
[3] Simultaneous appearance of several important risks endangers efforts to achieve the 2030 Agenda for
Sustainable Development
[4] All of the above are the challenges listed in World Economic Situation and Prospects 2019
[5] None of the above

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 Explanation
World Economic Situation
Topic
and Prospects 2019

United Nations report World Economic Situation and Prospects 2019 discusses various
challenges in attaining the sustainable development goals. The challenges listed are:

Economic growth is uneven and is failing to reach where it is most needed. Per capita incomes would
stagnate or grow only marginally in 2019 in several parts of Africa, Western Asia, Latin America and
the Caribbean.

Even where the per capita growth is strong, economic activity is driven by core industrial and urban
regions, leaving peripheral and rural areas behind.

The report notes that eradicating poverty by 2030 will require both double-digit growth in Africa and
steep reductions in income inequality. This seems a distant possibility in the current scenario.

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 Explanation
World Economic Situation
Topic
and Prospects 2019

The various risks include escalation of trade policy disputes; financial instabilities linked to elevated
levels of debt; and rising climate risks, as the world experiences an increasing number of extreme
weather events.

The confluence of risks is clouding and it may severely disrupt economic activity and inflict significant
damage on longer-term development prospects.

The report notes that the simultaneous appearance of several important risks endangers efforts to
achieve the 2030 Agenda for Sustainable Development containing 17 specific goals to promote
prosperity and social well-being while protecting the environment.

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.3) Which of the following is not one of the challenges as listed in World Economic Situation and Prospects
2019?
[1] Per capita incomes would stagnate or grow only marginally in 2019 in several parts of Africa, Western Asia,
Latin America and the Caribbean.
[2] Eradicating poverty by 2030 will require both double-digit growth in Africa and steep reductions in income
inequality.
[3] Simultaneous appearance of several important risks endangers efforts to achieve the 2030 Agenda for
Sustainable Development
*[4] All of the above are the challenges listed in World Economic Situation and Prospects 2019
[5] None of the above

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.4) According to World Economic Situation and Prospects 2019, India’s GDP growth is expected to accelerate to
_________ in 2019-20.

[1] 6.6 per cent

[2] 7.1 per cent
[3] 7.6 per cent
[4] 8.3 per cent
[5] None of the above

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 Explanation
World Economic Situation
Topic
and Prospects 2019

Key Facts about India from WESP 2019

• India’s GDP growth is expected to accelerate to 7.6 per cent in 2019-20 from an estimated 7.4 per
cent in the current fiscal ending March 2019 and growth rate may come down to 7.4 per cent a year
later.

• India will march ahead as world’s fastest-growing large economy in 2019 as well as in 2020, much
ahead of China.

• India’s growth is driven by robust private consumption, a more expansionary fiscal stance and
benefits from previous reforms and robust and sustained recovery of private investment remain
crucial for lifting the medium-term growth.

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.4) According to World Economic Situation and Prospects 2019, India’s GDP growth is expected to accelerate to
_________ in 2019-20.

[1] 6.6 per cent

[2] 7.1 per cent
*[3] 7.6 per cent
[4] 8.3 per cent
[5] None of the above

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.5) According to World Economic Situation and Prospects 2019, which among the following countries are more
vulnerable to stress due to tightening fiscal conditions?
[1] countries with a substantial amount of dollar-denominated debt
[2] countries with high current account or fiscal deficits
[3] countries with large external financing needs
[4] All of the above
[5] None of the above

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 Explanation
World Economic Situation
Topic
and Prospects 2019

The World Economic Situation and Prospects 2019 discusses various challenges before the global
economy. The important of them are:

Trade Tightening
Tensions fiscal Climate risks
conditions

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 Explanation
World Economic Situation
Topic
and Prospects 2019

Trade Tensions
• The global trade growth moderated at 3.8 per cent in 2018 against the growth rate of 5.3 per cent in
2017.

• The stimulus measures and direct subsidies have offset much of the direct economic impacts on
China and the United States.

• But if these trade tensions continue for a prolonged period of time it may severely disrupt the global
economy.

• The spillover effects of this trade tensions would spread through global value chains, particularly in
East Asia.

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 Explanation
World Economic Situation
Topic
and Prospects 2019

Tightening fiscal conditions

• Tightening fiscal conditions would result in a rapid rise in interest rates.

• On the other hand, the strengthening of the US dollar could exacerbate emerging market fragilities,
leading to a heightened risk of debt distress.

• These risks can be further aggravated by global trade tensions, monetary policy adjustment in
developed economies, commodity price shocks, or domestic political or economic disruptions.

• The countries with a substantial amount of dollar-denominated debt, high current account or fiscal
deficits, large external financing needs and limited policy buffers are more vulnerable to stress due
to tightening fiscal conditions.

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 Explanation
World Economic Situation
Topic
and Prospects 2019

Climate Risks

• The climate change risks necessitate a fundamental shift in the way the world powers economic
strategies.

• Integrating the economic decision making with negative climate risks associated with emissions would
be imperative.

• The tools for achieving the integration would be carbon pricing measures, energy efficiency
regulations such as minimum performance standards and building codes, and reduction of socially
inefficient fossil fuel subsidy regimes.

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 Question
World Economic Situation
Topic
and Prospects 2019

Q.5) According to World Economic Situation and Prospects 2019, which among the following countries are more
vulnerable to stress due to tightening fiscal conditions?
[1] countries with a substantial amount of dollar-denominated debt
[2] countries with high current account or fiscal deficits
[3] countries with large external financing needs
*[4] All of the above
[5] None of the above

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