Part - A Introductory Microeconomics: Don't Just Be Human Be A Human Capital... !!

Don’t Just Be Human…Be A Human Capital... ……!!
By: Gulshan Kumar

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(End. Ph.D Economics)
Part –A Introductory Microeconomics
Assignment – Money and Banking
Q1. What is the defect of the barter system?

(A) Lack of double coincidence of wants
(B) Difficulty in the measurement of value
(C) Difficulty in store of value
(D) All of these
Answer: (D) All of these
Q2. Which of the following is the credit money?

(A) Cheque and draft
(B) Promissory note
(C) Exchange note
(D) All of these
Q3. Which among the following is the near money?

(A) Bonds
(B) Insurance policy
(C) Securities
(D) All of these
Q 4. Which of the following is the feature of money?

(A) General acceptability
(B) Homogeneous unit
(C) Liquid asset
(D) All of these
Q 5. In order to encourage investment in the economy, the Central Bank may ________
(A) Reduce Cash Reserve Ratio
(B) Increase Cash Reserve Ratio
(C) Sell Government securities in the open market
(D) Increase Bank Rate
Answer: (A) Reduce Cash Reserve Ratio
Q 6. Institution that accepts deposits for lending purpose is known as __________

(A) Commercial Bank
(B) Central Bank
(C) Government
(D) Public
Answer: (A) Commercial Bank
Q 7. Which of the following is the function of a commercial bank?

(A) Accepting deposits
(B) Credit creation
(C) Agency function
(D) All of these
Q 8. The central bank can increase the availability of credit by:

(A) Rasing repo rate
(B) Raising reverse repo rate
(C) Buying government securities
(D) Selling government securities
Answer: (D) Selling government securities
Q9. Giving permission to withdraw money by an amount more than deposited to is known as __
(A) Advance
(B) Overdraft
(C) Loan
(D) None of these
Answer: (B) Overdraft
Q 10. What are the alternative measures of money supply in India?

(A) M1
(B) M2
(C) M3 and M4
(D) All of these
Q 11. Who circulates all mint and one rupee not in India?
(A) Ministry of Finance
(B) RBI
(C) Ministry of External Affairs
(D) State Government
Answer: (A) Ministry of Finance
Q 12. Which of the following is the narrow measure of the money supply?
(A) M2
(B) M3
(C) M1
(D) M4
Answer: (C) M1
Q 13. When was the minimum reserve system started in India?

(A) 1947
(B) 1948
(C) 1951
(D) 1957
Answer: (D) 1957
Q 14. Which is the most liquid measure of the money supply?

(A) M4
(B) M3
(C) M2
(D) M1
Answer: (D) M1
Q 15. High Powered Money includes:

(A) C + DD + OD
(B) C + R + OD
(C) C + R + TD
(D) C + DD + TD
Answer: (B) C + R + OD
Q 16. Indian Monetary System is based on ________

(A) Paper Standard
(B) Metallic Standard
(C) Gold Standard
(D) Credit Money Standard
Answer: (A) Paper Standard
Q17. Which of the following is the apex bank of India?

(A) RBI
(B) SBI
(C) SBP
(D) PNB
Answer: (A) RBI
Q 18. Who has the right of note issue?

(A) Central Bank
(B) Commercial Bank
(C) Government
(D) Co-operative Bank
Answer: (A) Central Bank
Q19. Which of the following is the function of a Central bank?

(A) Issue of notes
(B) Banker to the Government and Banks
(C) Supply and control of money
(D) All of these
Q 20. The ratio of total deposits that a commercial bank has to keep with RBI is called:
(A) Statutory liquidity ratio
(B) Deposit ratio
(C) Cash reserve ratio
(D) Legal reserve ratio
Answer: (C) Cash reserve ratio
Q 21. Demand deposits include

(A) Saving account deposits and fixed deposits
(B) Saving account deposits and current account deposits
(C) Current account deposits and fixed deposits
(D) All type of deposits
Answer: (B) Saving account deposits and current account deposits
Q 22. What are the necessary conditions of the Barter System?

(a) Limited Needs
(b) Limited Exchange Area
(c) Economically Backward Society
(d) All the above
Answer: (d) All the above

Q23. What are the advantages of the Barter System?
(a) Simple System
(b) More Mutual Co-operation
(c) No Economic Disparities
(d) All the above
Q 24. Which one is the difficulty of the Barter System?

(a) Lack of Double Coincidence
(b) Difficulty of Division of the Goods
(c) Lack of General Acceptable Measure of Value
(d) All the above
Q 25. Which is the correct order of money evolution?

(a) Commodity Money, Paper Money, Metal Money
(b) Commodity Money, Metal Money, Paper Money, Credit Money
(c) Credit Money, Metal Money, Paper Money
(d) None of the above
Answer: (b) Commodity Money, Metal Money, Paper Money, Credit Money
Q 26. “Money is what money does.” Who said it?

(a) Hartley Withers
(b) Hawtrey
(c) Thomas
(d) Keynes
Answer: (a) Hartley Withers
Q 27. Which one is included in the primary function of money?

(a) Medium of Exchange
(b) Measure of Value
(c) Both (a) and (b)
(d) Store of Value
Answer: (c) Both (a) and (b)
Q 28. Which one is included in the secondary function of money?

(a) To make Deferred Payments
(b) Store of Value
(c) Transfer of Value
(d) All of these
Answer: (d) All of these
Q29.“Money is a pivot around which the whole economy clusters.” Who said it?
(a) Keynes
(b) Robertson
(c) Marshall
(d) Hawtrey
Answer: (c) Marshall
Q 30. The function of money is:

(a) Medium of Exchange
(b) Measure of Value
(c) Store of Value
(d) All the above
Q31. The functions of money include:

(a) Value determination
(b) Store of value
(c) Means of exchange
(d) All of these
Q 32. Money is a matter which is:

(a) a measure of value
(b) accepted as a means of exchange
(c) used to store wealth
(d) All of these
Q 33. By supply of money we mean :

(a) Money deposited in the bank
(b) Money available with the public
(c) Deposits with post office savings bank
(d) All of these
Q34. Which of the following is not a function of money?

(a) Medium of exchange
(b) Price stability
(c) Store of value
(d) Unit of account
Answer: (b) Price stability
Q35. Which one is the Bank of the Public?

(a) Commercial Bank
(b) Central Bank
Answer: (a) Commercial Bank
Q 36. The primary function of Commercial Bank is?

(a) Accepting Deposits
(b) Advancing Loans
(c) Credit Creation
(d) All of these
Q 37. Deposits accepted by the Commercial Banks:

(a) Current Deposits
(b) Saving Deposits
(c) Time Deposits
(d) All of these
Q 38. What type of loan is advanced by Commercial Banks?

(a) Cash Credit
(b) Overdraft
(c) Loan and Advance
(d) All of these
Q 39. Which function is the Secondary Function of Commercial Banks?

(a) Agency Function
(b) General Utility Function
(c) Social Function
(d) All of these
Q 40. Which is the Agency Function of Commercial Banks?

(a) Advancing Loans
(b) Accepting Deposits
(c) Act as Trustee
(d) Locker Facility
Answer: (c) Act as Trustee
Q 41. Credit Multiplier is:

(a) 1CRR
(b) cash×1 CRR
(c) Cash x CRR
(d) None of these
Answer: (a) 1CRR
Q 42. Credit money is increased when CRR:

(a) Falls
(b) Rises
(d) None of these
Answer: (a) Falls
Q. 43. The full form of ATM is:

(a) Any Time Money
(b) All Time Money
(c) Automated Teller Machine
(d) Both (a) and (b)
Answer: (c) Automated Teller Machine
Q 44. The main function of a commercial bank is:

(a) Credit control
(b) Loaning to other banks
(c) Accept deposits from customers
(d) All the above
Answer: (c) Accept deposits from customers
Q 45.What is the Central Bank of India?

(a) Commercial Bank
(b) Central Bank
(c) Private Bank
(d) None of these
Answer: (a) Commercial Bank
Q46. Commercial banks:

(a) Issue currency notes
(b) Accepts deposits from customers
(c) Provide loans to customers
(d) Only (b) and (c)
Answer: (d) Only (b) and (c)
Q 47.What is true for the Central Bank?

(a) Apex Bank of the Country
(b) Ownership of the Government
(c) Regulates the entire banking system in the country
(d) All the above
Q 48. Central Bank of India is:

(a) Reserve Bank of India
(b) State Bank of India
(c) Central Bank of India
(d) Bank of India
Answer: (a) Reserve Bank of India
Q 49. Which of the following is the function of the Central Bank?

(a) Monopoly of Note Issue
(b) Banker of the Government
(c) Custodian of Foreign Exchange Reserves
(d) All the above
Q 50. Which type of currency is issued by Central Bank?

(a) Currency
(b) Credit Money
(c) Coins
(d) All of these
Answer: (a) Currency

Government Budget and Economy
Question 1.An annual statement of the estimated receipts and expenditure of the government
over the fiscal year is known as
(A) Budget
(B) Income estimates
(C) Account
(D) Expenditure
Answer: (A) Budget
Question 2.Which of the following is an example of direct tax?

(A) VAT
(B) Excise duty
(C) Entertainment tax
(D) Wealth tax
Answer: (D) Wealth tax
Question 3.What is the period of a fiscal year?

(A) 1 April to 31 March
(B) 1 January to 31 December
(C) 1 March to 28 February
(D) None of these
Answer: (A) 1 April to 31 March
Question 4. When government spends more than it collects by way of revenue, it incurs ______
(A) Budget surplus
(B) Budget deficit
(C) Capital expenditure
(D) Revenue expenditure
Answer: (B) Budget deficit
Question 5.The fiscal deficit is the difference between the government’s total expenditure and its
total receipts excluding ______
(A) Interest
(B) Taxes
(C) Spending
(D) Borrowings
Answer: (D) Borrowings

Question 6. Which of the following is the component of a budget?
(A) Fiscal budget
(B) Capital budget
(C) Both of these
(D) None of these
Answer: (C) Both of these
Question 7.What is the annual statement of the government’s fiscal revenue and fiscal
expenditure known?
(A) Budget
(B) Fiscal Budget
(C) Capital Budget
(D) All of these
Answer: (B) Fiscal Budget
Question 8.How many types of revenue receipts are there?

(A) 2
(B) 3
(C) 4
(D) 6
Answer: (A) 2
Question 9.The amount collected by the government as taxes and duties is known as _______
(A) Capital receipts
(B) Tax revenue receipts
(C) Non-tax revenue receipts
(D) All of these
Answer: (B) Tax revenue receipts
Question 10.The amount collected by the government in the form of interest, fees, and dividends
is known as ________
(A) Tax-revenue receipts
(B) Capital receipts
(C) Non-tax revenue receipts
(D) None of these
Answer: (C) Non-tax revenue receipts
Question 11.Borrowing in the government budget is:

(A) Revenue deficit
(B) Fiscal deficit
(C) Primary deficit
(D) Deficit in taxes
Answer: (B) Fiscal deficit

Question 12.The non-tax revenue in the following is:
(A) Export duty
(B) Import duty
(C) Dividends
(D) Excise
Answer: (C) Dividends
Question 13.The primary deficit in a government budget will be zero, when _______
(A) Revenue deficit is zero
(B) Net interest payments are zero
(C) Fiscal deficit is zero
(D) Fiscal deficit is equal to interest payment
Answer: (D) Fiscal deficit is equal to interest payment
Question 14.Direct tax is called direct because it is collected directly from:

(A) The producers on goods produced
(B) The sellers on goods sold
(C) The buyers of goods
(D) The income earners
Answer: (D) The income earners
Question 15.Financial Year in India is:

(a) April I to March 31
(b) January 1 to December 31
(c) October 1 to September 30
Answer: (a) April I to March 31
Question 16.Which objectives government attempts to obtain by Budget

(a) To Promote Economic Development
(b) Balanced Regional Development
(c) Redistribution of Income and Wealth
(d) All the above
Question 17.Which is a component of Budget?

(a) Budget Receipts
(b) Budget Expenditure

Question 18.Which is a component of the Budget Receipt?
(a) Revenue Receipt
(b) Capital Receipt
Question 19.Tax revenue of the Government includes :

(a) Income Tax
(b) Corporate Tax
(c) Excise Duty
(d) All of these
Question 20.Which is included in the Direct Tax?

(a) Income Tax
(b) Gift Tax
(d) Excise Duty
Question 21.Which is included in Indirect Tax?

(a) Excise Duty
(b) Sales Tax
(d) Wealth Tax
Question 22.The expenditures which do not create assets for the government is called :
(a) Revenue Expenditure
(b) Capital Expenditure
Answer: (a) Revenue Expenditure
Question 23.Direct tax is :

(a) Income Tax
(b) Gift Tax
(d) None of these

Question 24.In India, one rupee note is issued by:
(b) Finance Ministry of Government of India
(c) State Bank of India
(d) None of these
Answer: (b) Finance Ministry of Government of India
Question 25.Capital budget consist of:

(a) Revenue Receipts and Revenue Expenditure
(b) Capital Receipts and Capital Expenditure
(c) Direct and Indirect Tax
(d) None of these
Answer: (b) Capital Receipts and Capital Expenditure
Question 26.Which of the following is an indirect tax?

(a) Excise Duty
(b) Sales Tax
(c) Custom Duty
(d) All of these
Question 27.Which type of expenditure is made in bridge construction?

(a) Capital Expenditure
(b) Revenue Expenditure
Answer: (a) Capital Expenditure
Question 28.Which of the following budget is suitable for developing economies?

(a) Deficit Budget
(b) Balanced Budget
(c) Surplus Budget
(d) None of these
Answer: (a) Deficit Budget
Question 29.What is the duration of a Budget?

(a) Annual
(b) Two Years
(c) Five Years
(d) Ten Years
Answer: (a) Annual

Question 30.Which of the following is included in fiscal policy?
(a) Public Expenditure
(b) Tax
(c) Public Debt
(d) All of these
Question 31.Which of the following is the capital expenditure of the government?

(a) Interest Payment
(b) Purchase of House
(c) Expenses on Machinery
(d) All of the above
Answer: (a) Interest Payment
Question 32.The budget may include:

(a) Revenue Deficit
(b) Fiscal Deficit
(c) Primary Deficit
(d) All of these
Question 33.Which of the following statement is true?

(a) Fiscal deficit is the difference between total expenditure and total receipts
(b) Primary deficit is the difference between total receipt and interest payments
(c) Fiscal deficit is the sum of primary deficit and interest payment
(d) All of these
Answer: (c) Fiscal deficit is the sum of primary deficit and interest payment
Question 34.Budget:
(a) is a description of income-expenditure of government
(b) is a document of the economic policy of the government
(c) is a description of non-programs of the government
(d) All of these
Question 35.In an unbalanced budget:

(a) Income is greater than expenditure
(b) Expenditure is higher relative to income
(c) Deficit is covered by loans or printing of notes
(d) Only (b) and (c)
Answer: (d) Only (b) and (c)

Question 36.Which is included in indirect tax?
(a) Income tax
(b) Wealth tax
(c) Excise Duty
(d) Gift tax
Answer: (c) Excise Duty
Question 37.Which one of the following is a pair of direct tax?

(a) Excise duty and Wealth Tax
(b) Service Tax and Income Tax
(c) Excise Duty and Service Tax
(d) Wealth Tax and Income Tax
Answer: (d) Wealth Tax and Income Tax
Question 38.Which of the following is not a revenue receipt?

(a) Recovery of Loans
(b) Foreign Grants
(c) Profits of Public Enterprise
(d) Wealth Tax
Answer: (a) Recovery of Loans
Question 39.Which of the following is a correct measure of the primary deficit?

(a) Fiscal deficit minus revenue deficit
(b) Revenue deficit minus interest payments
(c) Fiscal deficit minus interest payments
(d) Capital expenditure minus revenue expenditure
Answer: (c) Fiscal deficit minus interest payments
Question 40.The duration of the Government budget is:

(a) 5 years
(b) 2 years
(c) 1 year
(d) 10 years
Answer: (c) 1 year
Question 41.Budget is presented in the Parliament by:

(a) Prime Minister
(b) Home Minister
(c) Finance Minister
(d) Defence Minister
Answer: (c) Finance Minister

Question 42.Budget speech in Lok Sabha is given by:
(a) President
(b) Prime Minister
(c) Finance Minister
(d) Home Minister
Answer: (c) Finance Minister
Question 43.Professional tax is imposed by:

(a) Central Government
(b) State Government
(c) Municipal Corporation
(d) Gram Panchayat
Answer: (b) State Government
Question 44.From the following which is included in the direct tax:

(a) Income Tax
(b) Gift Tax
(d) Excise Tax
Question 45.Who issues 1 rupee note in India:

(b) Finance Ministry of India
(c) State Bank of India
(d) None of these
Answer: (b) Finance Ministry of India
Balance of payment
Question 1.The price of one currency in terms of another is known as _________
(A) Foreign exchange rate
(B) Trade rate
(C) Interest rate
(D) Balance of Payment
Answer: (A) Foreign exchange rate
Question 2.The market where the national currencies are traded for one another is known as
________
(A) Domestic exchange market
(B) Foreign exchange market
(C) Bazaar
(D) Shop
Answer: (B) Foreign exchange market
Question 3.Increase in the value of foreign commodities is known as _________

(A) Revaluation
(B) Devaluation
(C) Inflation
(D) None of these
Answer: (B) Devaluation

Question 4.Decrease in the value the foreign commodities is known as _________
(A) Revaluation
(B) Devaluation
(C) Deflation
(D) All of these
Answer: (A) Revaluation
Question 5.What is the cause of the devaluation of any country’s currency?

(A) Increase in the domestic inflation rate
(B) Domestic real interest rates are less than foreign interest rates
(C) Much increase in the income
(D) All of these

Question 6.The operation of daily nature in the foreign exchange market is known as ________
(A) Spot market
(B) Forward market
(C) Domestic market
(D) International market
Answer: (A) Spot market
Question 7.The operation of future delivery in the foreign exchange market is known as
________
(A) Spot market
(B) Current market
(C) Forward market
(D) Domestic market
Answer: (C) Forward market

Question 8.Hybrid in management of fixed and flexible exchange rate is known as ________
(A) Managed to float
(B) Crawling Peg
(C) Wider Bands
(D) None of these
Answer: (A) Managed floating
Question 9.When was the gold standard abandoned?

(A) 1930’s
(B) 1920’s
(C) 1940’s
(D) 1950’s
Answer: (B) 1920’s
Question 10.Trade of visible items between the countries is known as ________

(A) Balance of Payment
(B) Balance of Trade
(C) Deficit Balance
(D) All of these
Answer: (B) Balance of Trade
Question 11.When the import and export of visible items are equal, the situation is known as
_______
(A) Balance of Trade
(B) Balance of Payment
(C) Trade Surplus
(D) Trade Deficit
Answer: (A) Balance of Trade
Question 12.When there is a favourable balance of trade?

(A) X > M
(B) X = M
(C) X < M
(D) None of these
Answer: (A) X > M
Question 13.When there is unfavourable balance of trade?

(A) X > M
(B) X = M
(C) X < M
(D) None of these
Answer: (C) X < M

Question 14.The trade of visible and invisible items is known as _________
(A) Balance of Payments
(B) Balance of Trade
(C) Deficit of interest
(D) Profit
Answer: (A) Balance of Payments
Question 15.Other things remaining unchanged, when in a country the price of foreign currency
rises, national income is:
(A) Likely to rise
(B) Likely to fall
(C) Likely to rise and fall both
(D) Not affected
Answer: (A) Likely to rise
Question 16.Other things remaining the same, when in a country the market price of foreign
currency falls, national income is likely:
(A) To rise
(B) To fall
(C) To rise or to fall
(D) To remain affected
Answer: (B) To fall
Question 17.Which one is the king of the exchange rate?

(a) Fixed Exchange Rate
(b) Flexible Exchange Rate
Question 18.Which of the following is true?

(a) Fixed exchange rate is determined by the government
(b) Flexible exchange rate is determined by market forces (demand and supply of foreign exchange)
Question 19.Which one is a kind of fixed exchange rate?

(a) Gold Standard System of Exchange Rate
(b) Bretton Woods System of Exchange Rate
Question 20.Which one is a merit of the fixed exchange rate?

(a) Promotes Foreign Trade
(b) Induces Foreign Capital
(c) Increases Capital Formation
(d) All the above
Question 21.Which one is a demerit of the fixed exchange rate?

(a) Ignores National Interests
(b) Restricted Movement of Capital
(c) Sudden Fluctuations in Exchange Rates
(d) All the above
Question 22.Which one is a merit of the flexible exchange rate?

(a) Simple System
(b) Continuous Adjustments
(c) Improves Balance of Payments
(d) All the above
Question 23.Which one is a demerit of the flexible exchange rate?

(a) Bad Results of Low Rate
(b) Uncertainty
(c) Instability in Foreign Exchange
(d) All the above

Question 24.Which one is a source of the demand for foreign exchange?
(a) Imports of Goods and Services from Abroad
(b) Investment in Foreign Nations
(c) Gift Scheme to Foreign Nations
(d) All the above
Question 25.Foreign exchange is determined by:

(a) Demand for foreign currency
(b) Supply of foreign currency
(c) Demand and supply in the foreign exchange market
Answer: (c) Demand and supply in a foreign exchange market
Question 26.The forms of foreign exchange market is/are:

(a) Spot market
(b) Forward market
(d) None of these
Question 27.The foreign exchange rate is determined by:

(a) Government
(b) Bargaining
(c) World Bank
(d) Demand and Supply forces
Answer: (d) Demand and Supply forces
Question 28.By exchange rate we mean:

(a) How much local currency we have to pay for a foreign currency
(b) How much of a foreign currency we have to pay for another foreign currency
(c) The rate at which foreign currency is bought and sold
(d) All of these
Question 29.Balance of Trade =?

(a) Export of Visible Items – Imports of Visible Items
(b) Export of both Visible and Invisible Items – Import of both Visible and Invisible Items
(c) Import of Visible Items – Export of Visible Items
Answer: (a) Export of Visible Items – Imports of Visible Items
Question 30.Which items are included in the Balance of Payments?

(a) Visible Items
(b) Invisible Items
(c) Capital Transfers
(d) All the above
Question 31.Which one is the visible item of Balance of Payments?

(a) Machine
(b) Cloth
(c) Cement
(d) All of these
Question 32.Which one is the invisible item of Balance of Payment?

(a) Banking
(b) Shipping
(c) Communication
(d) All of these
Question 33.Which one is the feature of Balance of Payment?

(a) Systematic Accounts
(b) Fixed Time Period
(c) Comprehensiveness
(d) All the above
Question 34.Which account is included in the composition of the Balance of Payments?

(a) Current Account
(b) Capital Account

Question 35.Which one is the item of the Current Account?
(a) Import of Visible Items
(b) Expenses of Tourists
(c) Exports of Visible Items
(d) All the above
Question 36.Which one is the item of Capital Account?

(a) Government Transaction
(b) Priva Transactions
(c) Foreign Direct Investment
(d) All the above
Question 37.The component(s) of Balance of Payment is/are:

(a) Current Account
(b) Capital Account
(d) None of these
Question 38.Which items are included in the balance of trade?

(a) Invisible Item
(b) Capital Transfer
(c) Visible Item
(d) All of these
Answer: (c) Visible Item
Question 39.Balance of Trade means:

(a) Capital Transaction
(b) Import and export of goods
(c) Total debit and credit
(d) All the above
Answer: (b) Import and export of goods
Question 40.The reason for the imbalance in the balance of payment is:
(a) Natural Reasons
(b) Economic Reasons
(c) Political Reasons
(d) All of these
Question 41.Structure of balance of payment includes which account:

(a) Current account
(b) Capital account
(d) None of these.
Question 42.Balance of trade means:

(a) Capital transactions
(b)Import and export of goods,
(c) Total credit and debit
Answer: (b)Import and export of goods

Question 43.Measures to improve the adverse balance of payment includes:
(a) Currency devaluation
(b) Import substitution
(c) Exchange control
Answer: (d) All of the above.
Question 44.Foreign Exchange Rate is determined by:

(a) Demand for foreign currency
(b) Supply of foreign currency
(c) Demand and supply in the foreign exchange market
(d) None of these
Answer: (c) Demand and supply in the foreign exchange market

Question 45.Types of Foreign Exchange Market are:
(a) Spot market
(b) Forward market
(d) None of these

Part – B Indian Economic Development
Development Experience (1947-90) and Economic Reforms Since
1991
Question 1.Industrial revolution came first in:
(a) France
(b) Germany
(c) England
(d) America.
Answer: (c) England
Question 2.In which year first train ran on rails in India:

(a) 1950
(b) 1953
(c) 1853
(d) 1901.
Answer: (c) 1853
Question 3.Development plans started in India in which year:

(a) 15 August 1947
(b) 1 April 1951
(c) 26 January 1950
(d) 15 July 1969.
Answer: (b) 1 April 1951
Question 4.Which of the following organisation frame 5 year plan:

(a) Yojana Ayog
(b) National development
(c) Finance ministry
(d) Home ministry.
Answer: (a) Yojana Ayog
Question 5.In the year 1951 what % of contribution was from agriculture towards national
income:
(a) 72%
(b) 65%
(c) 59%
(d) 51%.
Answer: (c) 59%

Question 6.In India green revolution was successful for:
(a) Wheat and Potato
(b) Wheat and Rice
(c) Cereals and Rice
(d) Pulses and Com.
Answer: (b) Wheat and Rice
Question 7.Small scale industry is:

(a) Labour intensive
(b) Capital intensive
(c) Complementary to large scale industries
(d) None of these.
Answer: (a) Labour intensive
Indian Economy on the Eve of Independence

Question 1.In how many sectors is the occupational structure of India is divided?
(A) One
(B) Two
(C) Three
(D) Four
Answer: (C) Three
Question 2.What is another name for the service sector?

(A) Tertiary
(B) Primary
(C) Secondary
(D) Agriculture
Answer: (A) Tertiary
Question 3.What was the nature of the Indian economy on the eve of independence?
(A) Stagnant
(B) Backward
(C) Underdeveloped
(D) All of these
Question 4.What was the life expectancy at birth in India on the eve of Independence?
(A) 44 years
(B) 50 years
(C) 60 years
(D) All of these
Answer: (A) 44 years
Question 5.What was the growth rate of per capita income in India on the eve of Independence?
(A) 0.9%
(B) 0.5%
(C) 1.2%
(D) 3%
Answer: (B) 0.5%
Question 6.Which of the following activities is included in the primary sector?

(A) Agriculture
(B) Services
(C) Industries
(D) All of these
Answer: (A) Agriculture
Question 7.In which of the following sectors is manufacturing activity included?

(A) Primary
(B) Tertiary
(C) Secondary
(D) All of these
Answer: (C) Secondary
Question 8.Where was the first iron and steel company established?
(A) Kolkata
(B) Jamshedpur
(C) Patna
(D) Ranchi
Answer: (B) Jamshedpur
Question 9.What is the tax or duty on imports called?

(A) Tariff
(B) Quota
(C) Export
(D) None of these
Answer: (A) Tariff
Question 10.Which of the following was the major occupation on the eve of independence?
(A) Industry
(B) Services
(C) Agriculture
(D) None of these
Answer: (C) Agriculture
Liberalisation, Privatisation and Globalisation: An Appraisal

Question 1.In which year did India adopt the economic reforms?
(A) 1991
(B) 1993
(C) 1998
(D) 2001
Answer: (A) 1991
Question 2.Why there was a need for economic reforms in India?

(A) Due to fiscal deficit
(B) Due to adverse BOP
(C) Rise in prices
(D) All of the above
Answer: (D) All of the above
Question 3.When did the Gulf Crisis take place?

(A) 1985
(B) 1990-91
(C) 1995
(D) 1975
Answer: (B) 1990-91
Question 4.How much loan was provided by World Bank and IMF during the nineties to bail
India out of the crisis?
(A) $10 million
(B) $10 billion
(C) $7 billion
(D) $20 billion
Answer: (C) $7 billion
Question 5.What is the main feature of New Economic Policy?

(A) Liberalisation
(B) Privatisation
(C) Globalisation
(D) All of the above
Answer: (D) All of the above

Question 6.For how many industries, licensing is still necessary?
(A) 7
(B) 6
(C) 9
(D) 10
Question 7.How many industries are entirely reserved for the public sector?
(A) 6
(B) 10
(C) 2
(D) 4
Answer: (C) 2
Question 8.What is the investment limit in small scale industries?

(A) 50 lakh
(B) 1 crore
(C) 25 lakh
(D) 75 crore
Answer: (B) 1 crore
Question 9.When was VAT introduced in most of the States of India?

(A) 1995
(B) 2001
(C) 2005
(D) 2006
Answer: (C) 2005
Question 10.How many countries are the members of WTO?

(A) 164
(B) 120
(C) 96
(D) 48
Answer: (A) 164

Question 11.When was WTO established?
(A) 1996
(B) 1998
(C) 2000
(D) 1995
Answer: (D) 1995
Question 12.Where is the headquarters of WTO located?
(A) Italy
(B) Geneva
(C) New York
(D) Washington
Answer: (B) Geneva
Poverty
Question 1.More than _______ of the world’s poor live in India.
(A) half
(B) one-third
(C) one-fourth
(D) one-fifth
Answer: (D) one-fifth
Question 2.What was the percentage of the population below the poverty line in India in 2011-
12?
(A) 26.1%
(B) 19.3%
(C) 22%
(D) 32%
Answer: (C) 22%
Question 3.Which of the following is the poverty determination measure?

(A) Head Count Ratio
(B) Sen Index
(C) Poverty Gap Index
(D) All of these
Question 4.When was the Task Force on Projections of Minimum Needs and Effective
Consumption Demand was formed?
(A) 1969
(B) 1979
(C) 1989
(D) 1999
Answer: (B) 1979
Question 5.Those who regularly move in and out of poverty are called
(A) Chronically poor
(B) Churning poor
(C) Occasionally poor
(D) Transient poor
Answer: (B) Churning poor

Question 6.In 2011-12, poverty line was defined worth ________ as consumption per person a
month for rural areas and _______ for urban areas.
(A) ₹816 and ₹1,000
(B) ₹1,012 and ₹1,210
(C) ₹550 and ₹860
(D) ₹860 and ₹673
Answer: (A) ₹816 and ₹1,000
Question 7.Which of the following is an action adopted under the provision of minimum basic
amenities to the people?
(A) Prime Minister’s RozgarYojna
(B) Swarna Jayanti Shahari RozgarYojna
(C) Pradhan Mantri Gramodaya Yojna
(D) National Rural Livelihood Mission
Answer: (C) Pradhan Mantri Gramodaya Yojna
Question 8.In 2011-12, which state had the highest poverty rate in India?
(A) Odisha
(B) Bihar
(C) Madhya Pradesh
(D) West Bengal
Answer: (A) Odisha
Question 9.NFWP was launched in:

(A) November 2004
(B) December 2003
(C) November 2002
(D) December 2005
Answer: (A) November 2004
Question 10.Which of the following programmes provide assistance to elderly people are given
under?
(A) VAMBAY
(B) NSAP
(C) PMGY
(D) PMRY
Answer: (B) NSAP

Human Capital Formation in India
Question 1.Which of the following is not a merit of human capital formation?
(A) Improves technical knowledge
(B) Enlarges the size of business
(C) Increases cost of production
(D) Changes social outlooks
Answer: (C) Increases cost of production
Question 2.Match and choose the correct combination.
(i) Preventive medicine (A) medical intervention during illness
(ii) Curative medicine (B) vaccination
(iii) Social medicine (C) the spread of health literacy
(A) (i) – (B); (ii) – (A); (iii) – (C)

(B) (i) – (A); (ii) – (B); (iii) – (C)
(C) (i) – (C); (ii) – (B); (iii) – (A)
(D) (i) – (B); (ii) – (C); (iii) – (A)
Answer: (A) (i) – (B); (ii) – (A); (iii) – (C)
Question 3.Which of the following is not an indicator of education level?

(A) Years of schooling
(B) Life expectancy
(C) Teacher-pupil ratio
(D) Enrollment rate
Answer: (B) Life expectancy
Question 4.Which of the following institutes comes under the health sector?
(A) NCERT
(B) UGC
(C) AICTE
(D) ICMR
Answer: (D) ICMR
Question 5.Which level of education takes a major share of total education expenditure in India?
(A) Elementary
(B) Secondary
(C) Higher
(D) Tertiary
Answer: (A) Elementary
Question 6.What was the share of education in total government expenditure in 2014?
(A) 7.92 percent
(B) 15.7 percent
(C) 0.64 percent
(D) 3.31 percent
Answer: (B) 15.7 percent
Question 7.What percent of GDP was invested in education in the year 1952?
(A) 7.92 percent
(B) 11.7 percent
(C) 0.64 percent
(D) 3.31 percent
Answer: (C) 0.64 percent
Question 8.When was Right to Education Act enacted?

(A) 2008
(B) 2009
(C) 2010
(D) 2012
Answer: (B) 2009
Question 9.What was the average youth literacy rate in 2015?

(A) 89.5 percent
(B) 74 percent
(C) 88 percent
(D) 95.5 percent
Answer: (A) 89.5 percent
Question 10.Which of the following is not the role of on-the-job training?

(A) Eradicates inequality
(B) Encourages innovation
(C) Promotes modern methods
(D) Enhances productivity
Answer: (D) Enhances productivity

Rural Development
Question 1.Which among the following is an initiative taken for the development of rural India?
(A) Human Capital Formation
(B) Land Reforms
(C) Poverty Alleviation
(D) All of these
Question 2.What was the growth rate of agricultural output during 2007-12?
(A) 32% per annum
(B) 6% per annum
(C) 1.5% per annum
(D) 5% per annum
Answer: (A) 32% per annum
Question 3.When was the National Bank for Agricultural and Rural Development set up?
(A) 1962
(B) 1972
(C) 1982
(D) 1992
Answer: (C) 1982
Question 4.Which of the following is an institutional source of rural credit?

(A) Moneylenders
(B) Regional Rural Banks
(C) Traders
(D) Landlords
Answer: (B) Regional Rural Banks
Question 5.Which source of credit had emerged to fully integrate the formal credit system into
the overall rural social and community development?
(A) Self-help Groups
(B) Regional Rural Banks
(C) Commercial Banks
(D) Land Development Banks
Answer: (A) Self-help Groups

Question 6.Which among the following is a process that involves the assembling, storage,
processing, transportation, packaging, grading, and distribution of different agricultural
commodities across the country?
(A) Agricultural Management
(B) Agricultural Banking
(C) Agricultural Diversification
(D) Agricultural Marketing
Answer: (D) Agricultural Marketing
Question 7.Which Indian state has been held as a success story in the efficient implementation
of milk cooperatives?
(A) Punjab
(B) Gujarat
(C) Uttar Pradesh
(D) West Bengal
Answer: (B) Gujarat
Question 8.What is the name of the vegetable and fruit market in Andhra Pradesh?
(A) Apni Mandi
(B) Hadaspar Mandi
(C) Rythu Bazars
(D) Uzhavar Sandies
Answer: (C) Rythu Bazars
Question 9.How much do the “inland sources” contribute to the total fish production in India?
(A) 64 percent
(B) 39 percent
(C) 50 percent
(D) 75 percent
Answer: (A) 64 percent
Question 10.Which status has been accorded to the retail chains and supermarkets for selling
organic food?
(A) Eco Status
(B) Sustainable Status
(C) Nutritional Status
(D) Green Status
Answer: (D) Green Status

Part - A Introductory Microeconomics: Don't Just Be Human Be A Human Capital... !!

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Part - A Introductory Microeconomics: Don't Just Be Human Be A Human Capital... !!

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Don’t Just Be Human…Be A Human Capital... ……!!

By: Gulshan Kumar

Q1. What is the defect of the barter system?

Answer: (D) All of these

Q2. Which of the following is the credit money?

Answer: (D) All of these

Q3. Which among the following is the near money?

Answer: (D) All of these

Q 4. Which of the following is the feature of money?

Answer: (D) All of these

Q 6. Institution that accepts deposits for lending purpose is known as __________

Answer: (A) Commercial Bank

Q 7. Which of the following is the function of a commercial bank?

Answer: (D) All of these

Q 8. The central bank can increase the availability of credit by:

Answer: (D) Selling government securities

Answer: (B) Overdraft

Q 10. What are the alternative measures of money supply in India?

Answer: (D) All of these

Q 13. When was the minimum reserve system started in India?

Answer: (D) 1957

Q 14. Which is the most liquid measure of the money supply?

Q 15. High Powered Money includes:

Q 16. Indian Monetary System is based on ________

Answer: (A) Paper Standard

Q17. Which of the following is the apex bank of India?

Answer: (A) RBI

Q 18. Who has the right of note issue?

Answer: (A) Central Bank

Q19. Which of the following is the function of a Central bank?

Answer: (D) All of these

Answer: (C) Cash reserve ratio

Q 21. Demand deposits include

Answer: (B) Saving account deposits and current account deposits

Q 22. What are the necessary conditions of the Barter System?

Answer: (d) All the above

Answer: (d) All the above

Q 24. Which one is the difficulty of the Barter System?

Answer: (d) All the above

Q 25. Which is the correct order of money evolution?

Q 26. “Money is what money does.” Who said it?

Answer: (a) Hartley Withers

Q 27. Which one is included in the primary function of money?

Answer: (c) Both (a) and (b)

Q 28. Which one is included in the secondary function of money?

Answer: (c) Marshall

Q 30. The function of money is:

Answer: (d) All the above

Q31. The functions of money include:

Answer: (d) All of these

Q 32. Money is a matter which is:

Answer: (d) All of these

Q 33. By supply of money we mean :

Answer: (d) All of these

Q34. Which of the following is not a function of money?

Q35. Which one is the Bank of the Public?

Answer: (a) Commercial Bank

Q 36. The primary function of Commercial Bank is?

Answer: (d) All of these

Q 37. Deposits accepted by the Commercial Banks:

Answer: (d) All of these

Q 38. What type of loan is advanced by Commercial Banks?

Answer: (d) All of these