1) which policy came into existence to prevent certain firms from becoming more efficient?

(a) liberalization
(b)disinvestment
(c)permit/licence raj
(d)trade policy

2)Privatisation promotes:
a.) socialist pattern
b.) Increased efficiency
c.) Producer’s sovereignty
d.) Laissez faire system

Which one of the followin

g is used for credit creation:
(a) K = 1/CRR (b) K = 1/SLR (c) K = 1/Bank Rate (d) K = 1/LRR

During deflation, it is advisable to ___________

(a) Increase the bank rate and purchase of securities in the open market
(b) Decrease in bank rate and sale of securities in the open market
(c) Lower the bank rate and purchase of securities in the open market
(d) Increase in bank rate and sale of securities in the open market

Read the following statements - Assertion (i) and Reason (ii). Choose one of the correct alternatives
given below:
Assertion (i): Total quantity or stock of money available in the economy at particular point of time is
known as money supply.
Reason (ii): Demand deposit is not the part of money supply.
(A) Both Assertion (i) and Reason (ii) are true and Reason (ii) is the correct explanation of Assertion
(i)
(B) Both Assertion (i) and Reason (ii) are true and Reason (ii) is not the correct explanation of
Assertion (i)
(C) Assertion (i) is true but Reason (ii) is false.
(D) Assertion (i) is false but Reason (ii) is true.

Read the following statements - Assertion (i) and Reason (ii). Choose one of the correct alternatives
given below:
Assertion (i): Money creation is the main function of Commercial banks.
Reason (ii): How many times the total deposit would be of the initial deposit is known as Money
Multiplier.
(A) Both Assertion (i) and Reason (ii) are true and Reason (ii) is the correct explanation of Assertion
(i)
(B) Both Assertion (i) and Reason (ii) are true and Reason (ii) is not the correct explanation of
Assertion (i)
(C) Assertion (i) is true but Reason (ii) is false.
(D) Assertion (i) is false but Reason (ii) is true.

Arrange the following events in chronological order in context of Indian economy and choose the
correct alternative
i. Establishment of TISCO ii. First census data collected during British India
iii. Opening of the Suez canal iv. Introduction of the railway by the British
a. ii,iv.iii,i
b. iv,ii,iii,i
c. iv,iii,ii,i
d. i,ii,iii,iv

The motive of British Government behind de-industrialization was

(i)To get raw material from India at cheap rate.
(ii)To sell British manufactured goods in Indian market at high prices.
(iii)To focus on development of agriculture.
(iv)To get finished products from India at cheap rate.
a. (i) and (ii)
b. (ii) and (iv)
c. Only (iii) d.
Only (iv)

Occupational structure refers to:

a. Nature of different occupations
b. Size of working force in a country
c. Number of people living in a country
d. Distribution of working force among the different occupations

High Birth Rate and Low Death Rate represents ___________ stage of demographic transition.
a) Third
b) First
c) Second
d) First and second

Self-reliance is does not include

a) To reduce our dependence on foreign countries, especially for food
b) To reduce our dependence on foreign countries, especially for defense items
c) Avoiding imports of those goods which could be produced in India itself
d) To reduce the foreign interference in our policies

Maximum limit to start small scale in present scenario is

a) 5 lakh
b) 50 lakh
c) 1 crore
d) 5 crore

......... refers to change in the ownership of land holdings.

(a) Land ceiling
(b) Land reforms
(c) Land fragmentation
(d) None of these

CASE STUDY -1:

Read the excerpt given and answer the question 14-17.
The case for privatisation is based on the belief that the private sector is more efficient,
and that public sector units do better when in private hands. But what does the evidence
tell us? These are issues to ponder as India embarks on a major sell-off.
India, it seems, is on the verge of its most ambitious privatisation drive ever. In the
Union Budget for 2021-22, Finance Minister Nirmala Sitharaman announced that outside
four strategic sectors, public sector units (PSUs) in the non-strategic sectors would be
privatised or closed. In the strategic sectors themselves a bare minimum of PSUs will be
present. The four sectors are atomic energy, space and defence; transport and
telecommunications; power, petroleum, coal and other minerals; and banking, insurance and
financial services.
We have not been told the time frame for implementation of this policy. The expression
being used is ‘privatisation’, not ‘disinvestment’, which is the sale of minority stakes in
PSUs. The change in lexicon has been widely noted. The government’s privatisation
programme has the support of much of the intellectual community. Several economists
have been urging the government for years to step up privatisation, most recently at a
meeting with the prime minister in early January. The ideological reason is the superior
efficiency that is said to be associated with the private sector relative to the public
sector
The government has, however, not articulated the case for privatisation at any length.
The Economic Survey of 2019-20 highlighted the efficiency gains from privatisation. In
recent months, economists have said that the government needs to increase investment
in infrastructure and, in the present fiscal situation, the necessary resources can come
only from privatisation.
There you have the two principal reasons for privatisation. The ideological reason is the
superior efficiency that is said to be associated with the private sector relative to the
public sector. The practical reason is that the government’s finances are strained and it
looks to augment its resources by selling government assets, notably PSUs.

14. The Government in recent drive to privatization plans to privatize its CPSE’S leaving bare
minimum presence in 4 sectors, Which of the following is not the strategic sector as
given in the article ?
a) Coal and mineral
b) Power and petroleum
c) Textile and handloom
d) Energy space and defence.

15. Assertion (A): Privatization of the PSU’s by selling of part of the equity of PSU’s to the
public is known as disinvestment.
Reason (R): The purpose was to improve financial discipline, modernization and
improved performance the PSU’s.
Alternatives:
a) Both the statements are true and reason (R) the correct explanation of assertion
(A)
b) Both the statements are true but reason (R) is not the correct explanation of
assertion (A)

c) Assertion (A) is true but reason (R) is false.

d) Assertion (A) is false but reason (R) is true.

16. Assertion (A): Privatisation can be done by Disinvestment and strategic sales of
shares of Central Public Sector Enterprises (CPSE’s.)
Reason: Sale of part of shares but retaining the control over management is known
as disinvestment.
Alternatives:
a) Both the statements are true and reason (R) the correct explanation of assertion
(A)
b) Both the statements are true but reason (R) is not the correct explanation of
assertion (A)
c) Assertion (A) is true but reason (R) is false.
d) Assertion (A) is false but reason (R) is true.

17. During reforms how did government made attempts improving the performance of PSU’s.
a) Giving PSU’s Financial support.
b) Giving them greater autonomy in managerial and operational decision making.
c) Providing technological support.
d) All of the above.

Read the following statements - Assertion (i) and Reason (ii). Choose one of the correct alternatives
given below:
Assertion (A): Economic reforms lead to the problem of fiscal management.
Reason (R): During reform Public expenditure declined and revenues also declined as
reduction in taxes did not increase tax revenues and reduced tariff also curtailed the scope for
raising revenues.
Alternatives:
a) Both the statements are true and reason (R) the correct explanation of assertion
(A)
b) Both the statements are true but reason (R) is not the correct explanation of
assertion (A)
c) Assertion (A) is true but reason (R) is false.
d) Assertion (A) is false but reason (R) is true.