CHAPTER-1-INDIAN ECONOMY ON THE EVE OF INDEPENDENCE

ASSERTION- REASON QUESTIONS

1 Read the following statements-Assertion (A) and Reason ( R ) . Choose one of the correct alternatives given
below.
Assertion (A) : The Britishers turned India a feeder economy for the industries in Britain .
Reason ( R ) :The Britishers wanted rapid industrialization in Britain.
Alternatives:
(a) Both Assertion(A) and Reason( R) are true and Reason (R ) is the correct explanation of
Assertion (A)
(b) Both Assertion(A) and Reason( R) are true and 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

2 Read the following statements-Assertion (A) and Reason ( R ) . Choose one of the correct alternatives given
below.
Assertion (A) : The infant mortality rate was very high in India on the eve of independence.
Reason ( R ) :The Britishers did not develop medical facilities in India.
Alternatives:
(a) Both Assertion(A) and Reason( R) are true and Reason (R ) is the correct explanation of
Assertion (A)
(b) Both Assertion(A) and Reason( R) are true and 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

3 Read the following statements-Assertion (A) and Reason ( R ) . Choose one of the correct alternatives given
below.
Assertion (A) : The TISCO was incorporated in 1907.
Reason ( R ) :The Britishers agreed to purchase steel from TISCO.
Alternatives
(a)Both Assertion(A) and Reason( R) are true and Reason (R ) is the correct explanation of
Assertion (A)
(b)Both Assertion(A) and Reason( R) are true and 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
4 Read the following statements-Assertion (A) and Reason ( R ) . Choose one of the correct alternatives given
below.
Assertion (A) : The British government established a monopoly control over India’s foreign trade.
Reason ( R ) :The opening of Suez canal did not act as a determinant to promote trade with Britain.
Alternatives:
(a)Both Assertion(A) and Reason( R) are true and Reason (R) is the correct explanation of
Assertion (A)
(b)Both Assertion(A) and Reason( R) are true and 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

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5 Read the following statements-Assertion (A) and Reason ( R ) . Choose one of the correct alternatives given
below.
Assertion (A) : Farmers in India were forced to take up the cultivation of indigo.
Reason ( R ) : The dyeing and bleaching of textile in the textile industry of Btitain :required indigo.
Alternatives:
(a)Both Assertion(A) and Reason( R) are true and Reason (R) is the correct explanation of
Assertion (A)
(b)Both Assertion(A) and Reason( R) are true and 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

6 Assertion(A):Year 1921 was called as year of Great Divide.

Reason(R):Prior to 1921, there was increase in India’s population growth rate whereas, it was
after 1921, India experienced fluctuations in its population growth rate.
A)Both Assertion(A) and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A).
B)Both Assertion(A) and Reason(R) are true and 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.
7 Assertion(A):Indian agriculture was the primary source of employment.
Reason(R):There was under development in Indian Industries.
A)Both Assertion(A) and Reason(R)are true and Reason(R)is the correct explanation of Assertion
(A).
B)Both Assertion(A) and Reason(R) are true and 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.
8 Assertion(A):There was decay of Indian Handicrafts during the British Rule.
Reason(R):India was the net exporter of raw material in the world.
A)Both Assertion(A)and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B)Both Assertion(A) and Reason(R) are true and 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.

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9 Assertion(A)Britishers introduced English as medium of language.
Reason(R):Britishers wanted to create a class of Indians who would be Indians by blood by
britishers in their lifestyle.
A)Both Assertion(A)and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B)Both Assertion(A) and Reason(R) are true and 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.
10 Assertion(A)During the British rule, production of cash crops improved the economic condition of
farmers.
Reason(R)Farmers were given higher price to produce cash crops.
A)Both Assertion(A)and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B)Both Assertion(A) and Reason(R) are true and 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.
11 Assertion: Some efforts were made by the Colonial Regime to improve infrastructure facilities
in India.
Reason: The real objective of the British was to sub serve various Colonial interests.
Alternatives:
A) Both A and R are true but R is the correct explanation of A.
B) Both A and R are true but R is not correct explanation of A.
C) A is true but R is false.
D) A is false but R is true.
12 Assertion (A): More than Half of India’s foreign trade was restricted to Britain
Reason (R): Britain maintained Monopoly control on India’s Import and Export
A) Both A and R are true and R is the correct explanation of A
B) Both A and R are true and R is not the correct explanation of A
C) A is true, but R is false
D) A is false, but R is true

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13 Assertion (A): Indian agriculture sector suffered due to partition.
Reason (R): A sizeable proportion of the undivided countries highly irrigated and fertilizers
land went to Pakistan.
A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A).
B) Both Assertion (A) and Reason (R) are true and 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.

14 Assertion (A): the agricultural sector on the eve of independence suffered from low
productivity.
Reason (R): due to decline in handicrafts, people were pushed back into agriculture and so it
becomes overcrowded.

(A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A)
(B) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation
of Assertion
(C) Assertion (A) is true but Reason (R) is false.
(D) Assertion (A) is false but Reason (R) is true.
15 Assertion (A): Zamindari system of land revenue gave incentives to tillers of soil to increase
their productivity.
Reason (R): Under zamindari system, the tillers lacked ownership rights. As a result, they had
no interest in improving the agriculture.

A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A)
B) Both Assertion (A) and Reason (R) are true and 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

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16 Assertion: Colonial government levied 0% import duty on British goods imported in
India.
Reason: Colonial government systematically destroyed Indian handicraft industry
A- Both A and R are true and R is the correct explanation of A.
B- Both A and R are true but R is NOT the correct explanation of A.
C- A is true but R is false.
D- A is false but R is true
17 Assertion: Agriculture was exploited through Zamindari system of Land Revenue
Reason: The Zamindars were supposed to pay a fixed sum to the government while they
could extract as much as they wanted from the actual tillers of the soil.
A- Both A and R are true and R is the correct explanation of A.
B- Both A and R are true but R is NOT the correct explanation of A.
C- A is true but R is false.
D- A is false but R is true.
18 Assertion(A):During colonial rule, India’s exports exceeded imports which resulted in a trade surplus.
Reason(R): Trade surplus was used for the development of the Indian Economy.
A. Both Assertion(A) and Reason(R) are true and Reason(R) is correct explanation of the Assertion(A).
B.Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of the
Assertion(A).
C.Assertion (A) is true but Reason (R) is false.
D.Assertion (A) is false but Reason (R) is true.
19 Assertion(A):India could not develop a sound industrial base under British Rule.
Reason(R): The colonial government reduced India to the status of a mere exporter of raw
materials to be used by upcoming industries in Britain.
A. Both Assertion(A) and Reason(R) are true and Reason(R) is correct explanation of the
Assertion(A).
B.Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of the
Assertion(A).

C. Assertion (A) is true but Reason (R) is false.

D. Assertion (A) is false but Reason (R) is true.

20 Assertion(A): India’s renowned handicraft industry was systematically destroyed due to discriminatory
tariff policies of the British Government.
Reason(R): Colonial Government imposed a heavy duty on import of finished goods from Britain.
A. Both Assertion(A) and Reason(R) are true and Reason(R) is correct explanation of the
Assertion(A).
B.Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of the
Assertion(A).

C.Assertion (A) is true but Reason (R) is false.

D.Assertion (A) is false but Reason (R) is true.

21 Assertion(A):The infrastructure facilities during British rule were highly developed.

Reason (R): The main aim motive behind infrastructural development was to serve various colonial
interests.
A. Both Assertion(A) and Reason(R) are true and Reason(R) is correct explanation of the Assertion(A).
B.Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of the
Assertion(A).
C.Assertion (A) is true but Reason (R) is false.
D.Assertion (A) is false but Reason (R) is true.

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22 Assertion (A): During the colonial period, the occupational structure of India showed little sign of
change.
Reason (R): There was no significant economic growth recorded during colonial rule. Write the
correct answer from the following:
A. Both A and R are true and R is the correct explanation of A
B. Both A and R are true but R is NOT the correct explanation of A
C. A is true but R is false
D. A is false and R is is true
23 Assertion (A): Parts of the Madras Presidency, Bombay and Bengal witnessed a rise in the
dependence of the workforce on the agricultural sector during colonial rule.
Reason (R): These regions commensurate increase in the manufacturing and the services sectors.
Write the correct answer from the following:
A. Both A and R are true and R is the correct explanation of A
B. Both A and R are true but R is NOT the correct explanation of A
C. A is true but R is false
D. A is false and R is is true
24 Assertion (A): Under the colonial regime, basic infrastructure such as railways, ports, water
transport, posts and telegraphs did develop.
Reason (R): The real motive behind this development was not to provide basic amenities to the
people. Write the correct answer from the following
A. Both A and R are true and R is the correct explanation of A
B. Both A and R are true but R is NOT the correct explanation of A
C. A is true but R is false
D. A is false and R is is true
25 (A): Zamindari (Semi Feudal Economy) in the colonial era were also responsible for the misery of
the cultivators.
(R): The terms of the revenue settlement system introduced were harsh on the Zamindars.
a) Both Assertion (A) and Reason (R)are true and Reason (R) is the correct explanation of
Assertion (A).
b) Both Assertion (A) and Reason (R) are true and 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

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26 Assertion (A) The year 1921 is described as the year of the Great Divide.
Reason (R) It was from this year, the population started increasing continuously.
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A).
b) Both Assertion (A) and Reason (R) are true and 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
27 Assertion (A): On the eve of independence Indian economy was Stagnant economy.
Reason (R): Largest section of Indian population depended on agricultural sector for sustenance.
Alternatives: (a)Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion (A).
(b)Both Assertion (A) and Reason (R) 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
28 Assertion (A): India became an exporter of primary products and an importer of finished consumer
and capital goods produced in Britain.
Reason (R): Restrictive policies of commodity production, trade and tariff pursued by the colonial
government adversely affected the structure, composition and volume of India's Foreign Trade

Alternatives: (a)Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion (A).
(b)Both Assertion (A) and Reason (R) 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
29 Assertion (A): Farmers were forced to produce cash crops like cotton or jute instead of
conventional crops Like rice and wheat during the British rule.
Reason (R): Agriculture was exploited through Zamindari System under the Colonial rule
Alternatives:
(a)Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A).
(b)Both Assertion (A) and Reason (R) 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
30 Assertion (A): The British introduced the railways in India in 1850 and it is considered as one of
their most important contributions.

Reason (R): Along with the development of roads and railways, the colonial dispensation also took
measures for developing the inland trade and sea lanes.

Alternatives: (a). Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion (A)
(b). Both Assertion (A) and Reason (R) are true and 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.

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31 Assertion (A): India could not develop a sound industrial base under British Rule;

Reason (R): The colonial government reduced India to the status of a mere exporter of raw
materials to be used by upcoming modern industries in Britain

Alternatives:
(a)Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A).
(b)Both Assertion (A) and Reason (R) 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

ANSWER

1.( a) 2. ( a) 3. (b) 4. (c ) 5. (a) 6-(C) 7-( A) 8- (B) 9- (A) 10- ( D)

11-A 12-A 13-A 14-A 15-D 16-A 17-A 18-C 19-A 20-C
21-D 22-A 23-A 24-C 25-A 26-B 27-B 28-A 29-B 30-B
31-A

PREPIRED BY : PGT ECONOMICS OF BHUBANESWAR, GUWAHATI,

KOLKATA, RANCHI, SILCHAR AND TINSIKIA REGION.

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 CHAPTER-3-LIBERALISATION, PRIVATISATION AND GLOBALISATION –

AN APPRAISAL
ASSERTION- REASON QUESTIONS
1. Assertion (A) Fiscal deficit leads to price spiral.
Reason (R) Often, the fiscal deficit is financed by the government by way of borrowingfrom the RBI. It
leads to increase in the supply of money in the economy. Other thingsremaining constant, higher the
supply of money, higher is the price spira
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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) are is true.
2. Assertion (A) The current account BOP deficit often leads to borrowing from rest of the
world.
Reason (R) : Current account BOP deficit often leads to borrowing .There are two principalsources of
finding the current account BOP deficit: (i) Borrowing from rest of the world,and (ii) Foreign investment in
the domestic economy, including (a) FDI (foreign directinvestment), and (b) FII(foreign institutional
investment). Of these two sources, foreigninvestment is volatile (uncertain) owing to volatility
(uncertainty) of the domestic market.Accordingly, the government often relies on borrowing from rest of
the world.
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are is true.
3. Assertion (A) Disinvestment is a compulsion for the government to tackle budgetarydeficit.
Reason (R): Disinvestment is not a compulsion for the government to tackle budgetarydeficit. The fact of
the matter is that the government resorts to disinvestment (sellingshares of public enterprises to private
entrepreneurs) only when the public sectorenterprises are found to be breeding centres of inefficiency
and corruption. Of course,once disinvestment is done it helps the government to manage budgetary
deficit.
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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) are is true.
4. Assertion (A) :FDI leads to economic colonialism.
Reason (R):FDI leads to economic colonialism. Because FDI implies ownership andmanagement of the
domestic enterprises by the foreign companies. Higher FDI leads tohigher economic control of the foreign
companies in the domestic market. This is whateconomic colonialism implies.
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation ofAssertion (A).
b. Both Assertion (A) and Reason(R) are true and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are is true.

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 5. Assertion (A). Indian economy has become a more vibrant economy.
Reason (R): Overall level of economic activity has trended up as indicated by GDP growth.Post LPG
policies, the growth of GDP shot up to as high as 8 per cent per annum
a. Both Assertion (A) and Reason(R) are true, and Reason (R) is the correct explanation ofAssertion (A).
b. Both Assertion (A) and Reason(R) are true, and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true, but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are true.
6. .ASSERTION(A) : INDIA HAS BECOME A FAVOURABLE DESTINATION OF OUTSOURCHING FOR
MOST OF THE MNCs.
REASON(R): INDIA WAS VAST SKILLED AND CHEAP MANPOWER WHICH ENHANCES THE FAITH OF
MNCs FOR INVESTMENT IN INDIA.
a. Both Assertion (A) and Reason(R) are true, and Reason (R) is the correct explanation of Assertion (A).
b. Both Assertion (A) and Reason(R) are true, and 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) are true.

7.Assertion(A): Due to Globalisation, a country cannot achieve self- sufficiency in food production.
Reasoning (R): Globalisation has created a revolution in IT sector.
a. Both Assertion (A) and Reason(R) are true, and Reason (R) is the correct explanation ofAssertion (A).
b. Both Assertion (A) and Reason(R) are true, and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true, but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are true.

8.Assertion (A) Agriculture sector experienced an increase in growth during the reform period.
Reason (R) Decline in public investment and removal of fertilizer subsidy adversely affected the status of
agriculture.
a. Both Assertion (A) and Reason(R) are true, and Reason (R) is the correct explanation ofAssertion (A).
b. Both Assertion (A) and Reason(R) are true, and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true, but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are true.

9.Assertion(A) As an immediate measure to resolve the financial crisis. India devalued its currency in
1991.
Reason (R) This allowed India to meet its import bill and resolve the BoP deficit.
a. Both Assertion (A) and Reason(R) are true, and Reason (R) is the correct explanation ofAssertion (A).
b. Both Assertion (A) and Reason(R) are true, and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true, but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are true.

10.Assertion(A) Selling off part of the equity of PSUs to the public is called disinvestment.
Reason (R) Disinvestment raises resources for the budget in order to reduce the fiscal deficit and provide
funds for modernisation of PSUs.
a. Both Assertion (A) and Reason(R) are true, and Reason (R) is the correct explanation ofAssertion (A).
b. Both Assertion (A) and Reason(R) are true, and Reason(R) is not the correct explanationof Assertion (A).
c. Assertion (A) is true, but Reason (R) is false.
d. Assertion (A) is false but Reason(R) are true.

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 11. Assertion (A): Every year the government fixes a target for disinvestment of Public sector
Enterprises (PSEs).

Reason (R ): Disinvestment is an excellent tool for discarding the loss making Public Sector
Enterprises (PSEs).
(i) Assertion (A) is true and Reason (R) is false.
(ii) Assertion (A) is false and Reason (R) is true.
(iii) Both Assertion (A) and Reason (R) are true , but Reason (R) is not the correct
explanation for Assertion (A).
(iv) Both Assertion (A) and Reason (R) are true , but Reason (R) is the correct
explanation for Assertion (A).
12. Assertion (A): Selling off a part of an equity of the PSEs to the public is called
disinvestment.

Reason (R ): The main reason for disinvestment is to bring all the operational units of the
country under the private sector.
(i) Assertion (A) is true and Reason (R) is false.
(ii) Assertion (A) is false and Reason (R) is true.
(iii) Both Assertion (A) and Reason (R) are true , but Reason (R) is not the correct
explanation for Assertion (A).
(iv) Both Assertion (A) and Reason (R) are true , but Reason (R) is the correct
explanation for Assertion (A).

13.Assertion (A): Agriculture sector experienced decelerating growth rate during the reform
period.

Reason (R ): The decline in public investment and removal of fertilizer subsidy adversely
affected the agricultural sector.
(i) Assertion (A) is true and Reason (R) is false.
(ii) Assertion (A) is false and Reason (R) is true.
(iii) Both Assertion (A) and Reason (R) are true , but Reason (R) is not the
correct explanation for Assertion (A).
(iv) Both Assertion (A) and Reason (R) are true , but Reason (R) is the correct
explanation for Assertion (A).

14.Assertion (A): During reform period, the prices of food grains increased.

Reason (R ): The export oriented policy strategies in agriculture focused on production of cash
crops instead of food crops.
(i) Assertion (A) is true and Reason (R) is false.
(ii) Assertion (A) is false and Reason (R) is true.
(iii) Both Assertion (A) and Reason (R) are true , but Reason (R) is not
the correct explanation for Assertion (A).
(iv) Both Assertion (A) and Reason (R) are true , but Reason (R) is the
correct explanation for Assertion (A).

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 15. Assertion (A): Reform led growth created more employment opportunities in the economy.

Reason (R ): India became a successful exporter of auto parts, engineering goods, IT software
and textiles during reform period.
(i) Assertion (A) is true and Reason (R) is false.
(ii) Assertion (A) is false and Reason (R) is true.
(iii) Both Assertion (A) and Reason (R) are true , but Reason (R)
is not the correct explanation for Assertion (A).
(iv) Both Assertion (A) and Reason (R) are true , but Reason (R)
is the correct explanation for Assertion (A).

16.Assertion (A): The role of Public sector was decreased under liberalisation policy in 1991.

Reason (R): It was felt that the government cannot control everything in the growth object of the country.
Choose the correct option:

A. Both A and R are true and R is the correct explanation of A.

B. Both A and R are true and R is not the correct explanation of A.
C. A is true and R is false.
D. A is false and R is true.

17.Assertion (A): Disinvestment means sale or liquidation of assets by the govt., usually PSUs
(Public Sector Undertakings) etc. to private sector.

Reason (R): The govt. undertake disinvestment to reduce the fiscal burden on the exchequer or to
raise money for specific needs.

Choose the correct option:

A. Both A and R are true and R is the correct explanation of A.

B. Both A and R are true and R is not the correct explanation of A.
C. A is true and R is false.
D. A is false and R is true.

18. Assertion(A): Most of the services like BPO, record keeping, accountancy, books transcription
etc. are being outsourced to India now a days.

Reason(R) : In India, there is low wage rate and availability of skilled manpower.

Choose the correct option:

A. Both A and R are true and R is the correct explanation of A.

4|Page 8 October 2021,ZIET BHUBANESWAR
 B. Both A and R are true and R is not the correct explanation of A.
C. A is true and R is false.
D. A is false and R is true.

19. Assertion(A):The GDP growth of India increased from 5.6 percent during 1980-91 to 8.2 % in
2007-12.

Reason(R) :GDP growth during reform period was mainly driven by growth in the agriculture
sector.

Choose the correct option:

A. Both A and R are true and R is the correct explanation of A.

B. Both A and R are true and R is not the correct explanation of A.
C. A is true and R is false.
D. A is false and R is true.

20. Assertion (A) : GST(Goods and Services Tax) Act came into effect on 1 st July 2017 as a fiscal
reform in India.

Reason: Fiscal reforms relates to the reforms related to the policy of govt. expenditure and govt.
revenue.

Choose the correct option:

A. Both A and R are true and R is the correct explanation of A.

B. Both A and R are true and R is not the correct explanation of A.
C. A is true and R is false.
D. A is false and R is true.

21. Assertion (A): liberalization of the economy was considered as key component of NEP
Reason (R): greater reliance was to be placed on market forces rather than checks and control.
Options:
a. A and R are true and R is correct explanation of A
b. A and R are true but R is not correct explanation of A
c. A is true but R is false
d. A is false but R is true
22.Assertion (A): Disinvestment is a policy instrument to promote privatization
5|Page 8 October 2021,ZIET BHUBANESWAR
 Reason (R): It is taken as a remedial measure to improve production and managerial efficiency as
well as to facilitate modernisation
Options:
a. A and R are true and R is correct explanation of A
b. A and R are true but R is not correct explanation of A
c. A is true but R is false
d. A is false but R is true
23, Assertion (A): Economic reforms aim at integrating the Indian economy with the global
economy
Reason (R): There will be restricted flow of goods and services, technology and expertise
between India and rest of the world
Options:
a. A and R are true and R is correct explanation of A
b. A and R are true but R is not correct explanation of A
c. A is true but R is false
d. A is false but R is true
24.Assertion (A): Outsourcing is an important outcome of the process of globalization
Reason (R): Outsourcing refers to a system of hiring business services from the outside world
Options:
a. A and R are true and R is correct explanation of A
b. A and R are true but R is not correct explanation of A
c. A is true but R is false
d. A is false but R is true
25.Assertion (A): foreign direct investment refers to investment by foreigners by way of their
business establishments in India
Reason (R): It does not involve any kind of direct control on the management of the Indian
companies where investment is made
Options:
a. A and R are true and R is correct explanation of A
b. A and R are true but R is not correct explanation of A
c. A is true but R is false
d. A is false but R is true

6|Page 8 October 2021,ZIET BHUBANESWAR

 26.Assertion (A) : India becomes one of the favorite outsourcing destination in the post reform
period
Reason (R): India is the hub of skilled manpower.

Alternatives:
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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.

27.Assertion (A): Under New Economic Policy, role of RBI shifted from that of facilitator to a
regulator.
Reason (R): Now, market forces decide interest rate structure, volume and the pattern of
investment.
Alternatives:
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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

28.Assertion (A) : Since 1991, there has been a continuous reduction in the taxes on individual
incomes.
Reason (R): Tax evasion is the consequence of high rates of income tax.

Alternatives:
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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

7|Page 8 October 2021,ZIET BHUBANESWAR

 29.Assertion (A) : In NEP, greater reliance was placed on market forces.
Reason (R): Excessive government control had given rise to corruption, undue delays and
inefficiency.

Alternatives:
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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
30Assertion (A) : The Burden of foreign debt service increased tremendously.
Reason (R): There is severe depletion in our forex reserves and a crisis of confidence in the
international foreign exchange market.

Alternatives:
a. Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation of
Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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
31.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.

32.Assertion (A): In the beginning rules and regulation which aimed at regulating economic activities
became major hindrance in growth and development of economy.
Reason (R): Removal of such barriers in form of rules and regulation is called liberalisation.
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.

8|Page 8 October 2021,ZIET BHUBANESWAR

 33.Assertion (A): deregulation of financial sector gave bank more autonomy which to give loans to
rising sector of economy which lead to growth of Indian economy.
Reason (R): One of the major aims of financial sector reforms was to reduce the role RBI from
regulator to facilitator of financial sector.
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.

34.Assertion (A): Since 1991, there has been continuous reduction in Direct Tax.
Reason (R): High taxes on individual lead to Tax evasion, while moderate taxes encourage savings
and disclosure of income.
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.

35.Assertion (A) Disinvestment is a compulsion for the government to tackle budgetary deficit.
Reason (R): Disinvestment is not a compulsion for the government to tackle budgetary deficit.
a.Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation
of Assertion (A).
b. Both Assertion (A) and Reason(R) are true and 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) are is true.

36.Assertion (A): In India, financial sector is regulated and controlled by the Reserve Bank of
India.
Reason (R): Prior to liberalisation, tax structure was quite complex and tax rates were quite high.
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A)
(b) Both Assertion (A) and Reason (R) are true and 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

37.Read the following statements-Assertion (A) and Reason (R). Choose one of the correct
alternative given below
Assertion (A): Trade and investment policy underwent a substantial change in the wake of
privatisation
Reason (R): There has been a substantial jump in private foreign investment after the adoption of
LPG policies.
Alternatives:
(a) Both Assertion (A) and Reason (R) Assertion (A)are true and Reason (R) is the correct
explanation of assertion (A)
(b) Both Assertion (A) and Reason (R) are true and 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
9|Page 8 October 2021,ZIET BHUBANESWAR
 38.Assertion (A): Government decided to develop Navratnas as global players in their respective
areas of industrialisation.
Reason(R): Navratnas were highly efficient profit making PSUs and were revenue generators for
the government
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
assertion (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of
explanation of Assertion (A)
(c) Assertion (A) is true but Reason (R) is false
d) Assertion (A) is false but Reason (R) is true

. 39. Assertion (A): Following liberalisation, reduction in tax rates led to fall in tax evasion.
Reason (R): Reduced tax rate paves way for tax compliance and therefore greater tax revenue for
government.
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A) (b) Both Assertion (A) and Reason (R) are true and 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

40.Assertion (A): New economic reforms paved way for increased consumer sovereignty.
Reason (R):Diverse global markets allowed a wide variety of goods and services to be available
to the consumers.
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A) (b) Both Assertion (A) and Reason (R) are true and 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

ANSWER SECTION

1- a 2- a 3- d 4-a 5- a 6-a 7-b 8-d 9-a 10-a

11- (iv) 12-(i) 13-iv 14- iv 15-ii 16-a 17-a 18-a 19-c 20-b

21-a 22-a 23-c 24-a 25-c 26-a 27-d 28-a 29-a 30-b
31-b 32-a 33-a 34-b 35-d 36-b 37-d 38-a 39-a 40-a

PREPIRED BY : PGT ECONOMICS OF BHUBANESWAR, GUWAHATI,

KOLKATA, RANCHI, SILCHAR AND TINSIKIA REGION.

10 | P a g e 8 October 2021,ZIET BHUBANESWAR

 CHAPTER-4-POVERTY
ASSERTION- REASON QUESTIONS

1 Assertion: Farmers committing suicide is a concern for Indian economy.

Reason: Crop failures due to drought or other natural calamities may cause inability of the farmers to
pay back the loans they borrow.
(A) Both Assertion and reason are true and reason is correct explanation of assertion.
(B) Assertion and reason both are true but reason is not the correct explanation of assertion.
(C) Assertion is true, reason is false.
(D) Assertion is false, reason is true.
2 Assertion : Mid-day meal scheme is one growth oriented approach to alleviate poverty.
Reason: Mid-day meal scheme aims to improve the food and nutritional status of the poor.
(A) Both Assertion and reason are true and reason is correct explanation of assertion.
(B) Assertion and reason both are true but reason is not the correct explanation of assertion.
(C) Assertion is true, reason is false.
(D) Assertion is false, reason is true.
3 Assertion :Casuallabourers are among the most vulnerable in society.
Reason: Casual labourers have no job security, no assets, limited skills.
(A) Both Assertion and reason are true and reason is correct explanation of assertion.
(B) Assertion and reason both are true but reason is not the correct explanation of assertion.
(C) Assertion is true, reason is false.
(D) Assertion is false, reason is true.
4 Assertion : A large section of poor people do not have access to safe drinking water.
Reason: Most poor households have no access to electricity.
(A) Both Assertion and reason are true and reason is correct explanation of assertion.
(B) Assertion and reason both are true but reason is not the correct explanation of assertion.
(C) Assertion is true, reason is false.
(D) Assertion is false, reason is true.
5 Assertion : The poverty alleviation programmes in India are not effective.
Reason: The government and bank officials are ill motivated, inadequately trained and corruption
prone.
(A) Both Assertion and reason are true and reason is correct explanation of assertion.
(B) Assertion and reason both are true but reason is not the correct explanation of assertion.
(C) Assertion is true, reason is false.
(D) Assertion is false, reason is true.
6 (A) In India the concept of poverty line is used to measure absolute poverty
Reason: (R) It is a poverty in which a person or a group of persons living below poverty line.
(a) Both assertion (A) and reason (R) are true but the reason (R) is the correct explanation of assertion
(A).
(b) Both assertion (A) and reason (R) 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.

1|Page 8 October 2021,ZIET BHUBANESWAR

7 (A) In India, poverty line cut-off may be determined either in terms of income or in terms of
consumption expenditure, but consumption should be preferred parameter than income.
Reason: (R) It reflects actual use of the goods and services by an individual, as well as the type of
goods actually used, while income only shows the capacity to purchase and data is not available on
the distribution of income.
(a) Both assertion (A) and reason (R) are true but the reason (R) is the correct explanation of assertion
(A).
(b) Both assertion (A) and reason (R) 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
8 (A) In India, the minimum calorie intake for rural areas has been estimated at 2400 calories and for
urban areas, the minimum calorie intake for urban areas has been estimated at 2100 calories.
Reason: (R) the calories requirement is higher in rural areas because hard-working male population is
found to be higher in rural areas.
(a) Both assertion (A) and reason (R) are true but the reason (R) is the correct explanation of assertion
(A).
(b) Both assertion (A) and reason (R) 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.
9 (A) In India, rapidly rising population is the most important cause of poverty.
Reason: (R) because it neutralises the gain of GDP growth.
(a) Both assertion (A) and reason (R) are true but the reason (R) is the correct explanation of assertion
(A).
(b) Both assertion (A) and reason (R) 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.
1 (A) In India, the government has spent huge amount of money on the poverty alleviation programmes.
0 Reason: (R) inefficient delivery mechanism of the government along with large-scale corruption are
the principal factors behind failure of poverty alleviation programmes.
(a) Both assertion (A) and reason (R) are true but the reason (R) is the correct explanation of assertion
(A).
(b) Both assertion (A) and reason (B) 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.

2|Page 8 October 2021,ZIET BHUBANESWAR

11 The poverty alleviation programmes have been foundunsatisfactory.
Reason: Huge number of resources have been allocated for Poverty alleviation Programmes.
(A) Both Assertion and reason are true and reason is correct explanation for the Assertion.
(B) Assertion and Reason both are true, but Reason is not the correct explanation for the
Assertion.
(C) Assertion is true, Reason is false.
(D) Assertion is false, Reason is true.

12 Although there is a steady decline in poverty over the last two decades but the total number of
poor people are remained constant.
Reason: There has been a considerable growth in population.
(A) Both Assertion and reason are true and reason is correct explanation for the Assertion.
(B) Assertion and Reason both are true, but Reason is not the correct explanation for the
Assertion.
(C) Assertion is true, Reason is false.
(D) Assertion is false, Reason is true.

13 Growth oriented approach to remove poverty proved to be quite effective.

Reason: Population growth resulted in a very low growth in per capita income.
(A) Both Assertion and reason are true and reason is correct explanation for the Assertion.
(B) Assertion and Reason both are true, but Reason is not the correct explanation for the
Assertion.
(C) Assertion is true, Reason is false.
(D) Assertion is false, Reason is true.

14 While determining the poverty line, higher calorie intake is fixed for rural areas.
Reason: People in rural areas have to do greater physical work as compared to urban people.
(A) Both Assertion and reason are true and reason is correct explanation for the Assertion.
(B) Assertion and Reason both are true, but Reason is not the correct explanation for the
Assertion.
(C) Assertion is true, Reason is false.
(D) Assertion is false, Reason is true.
15 Government started so many programmes for the removal of poverty, but poverty couldn’t be
removed so far.
Reason: There was a lot of corruption in implementation of the programmes.
(A) Both Assertion and reason are true and reason is correct explanation for the Assertion.
(B) Assertion and Reason both are true, but Reason is not the correct explanation for the
Assertion.
(C) Assertion is true, Reason is false.
(D) Assertion is false, Reason is true.

3|Page 8 October 2021,ZIET BHUBANESWAR

16 WHILE DETERMINING POVERTY IN VILLAGES HIGHER CALORIE INTAKE IS TAKEN
REASON:PEOPLE IN RURAL AREA DO MORE PHYSICAL WORK
a. both assertion and reason are true and reason is correct explanation of assertion
b. both assertion and reason are true and reason is not correct explanation of assertion
c. assertion is true but reason is false
d. assertion is false but reason is true
17 poverty is closely related to unemployment
Reason : unemployment compels indebtedness and leads to poverty
a. both assertion and reason are true and reason is correct explanation of assertion
b. both assertion and reason are true and reason is not correct explanation of assertion
c. assertion is true but reason is false
d. assertion is false but reason is true
18 migration lowers poverty.
Reason : people migrate to those areas which offer better job opportunities.
a. both assertion and reason are true and reason is correct explanation of assertion
b. both assertion and reason are true and reason is not correct explanation of assertion
c. assertion is true but reason is false
d. assertion is false but reason is true
19 Absolute poverty is prevalent in developed country
reason :mostof the developed countries are industrial economy.
a. both assertion and reason are true and reason is correct explanation of assertion
b. both assertion and reason are true and reason is not correct explanation of assertion
c. assertion is true but reason is false
d. assertion is false but reason is true
20 most small farmers in debt trap
Reason : they borrow money from money lenders who charge high rate of interest
a. both assertion and reason are true and reason is correct explanation of assertion
b. both assertion and reason are true and reason is not correct explanation of assertion
c. assertion is true but reason is false
d. assertion is false but reason is true

21 Assertion(A): Generally calorie based norm is not sufficient to identify the poor people
Reason(R):It divides the poor together and does not differentiate between the very poor and other
poor..
A.Both Assertion(A) and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B. Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of
Assertion(A)
C. Assertion(A) is true and Reason(R) is false.
D. Assertion(A) is false and Reason(R) is true.

4|Page 8 October 2021,ZIET BHUBANESWAR

22 Assertion(A): In recent years, regional disparities in India are very high in recent years.
Reason(R):Some regions have faced continuous political instability.
A.Both Assertion(A) and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B. Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of
Assertion(A)
C. Assertion(A) is true and Reason(R) is false.
D. Assertion(A) is false and Reason(R) is true.

23 Assertion(A): The main goal of Planning in India is to promote rapid and balanced economic
development with equality and social justice.
Reason(R):Poverty alleviation and unemployment are regarded as the major hindrances towards the
development of India.
A.Both Assertion(A) and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B. Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of
Assertion(A)
C. Assertion(A) is true and Reason(R) is false.
D. Assertion(A) is false and Reason(R) is true.
24 Assertion(A): The poverty alleviation programme has not undergone any radical transformation
during the last five and half decades.
Reason(R):There has been a radical change in the ownership of wealth and assets and provision of
basic amenities of life to the needy.
A.Both Assertion(A) and Reason(R) are true and Reason(R) is the correct explanation of
Assertion(A)
B. Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of
Assertion(A)
C. Assertion(A) is true and Reason(R) is false.
D. Assertion(A) is false and Reason(R) is true.
25 Assertion(A):Growth oriented approach to remove poverty proved to be quite effective .
Reason(R):Population growth resulted in a very low growth in per capita income.
A.Both Assertion(A) and Reason(R) are true and Reason(R) is the corret explanation of
Assertion(A)
B. Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of
Assertion(A)
C. Assertion(A) is true and Reason(R) is false.
D. Assertion(A) is false and Reason(R) is true.

26 Assertion: Poverty can be reduced by using labour intensive technique of production.

Reason: India is a country of large population Dr Gunnar Myrdal suggested that if India want to
solve the problem of poverty then it should follow labour intensive technology of production this
will create employment opportunity in the country.
(a) Both assertion and reason are true but the reason is the correct explanation of assertion.
(b) Both assertion and reason are true but reason is not the correct explanation of assertion
(c) Assertion is true but reason is false

5|Page 8 October 2021,ZIET BHUBANESWAR

 (d) Assertion is false but reason is true
27 Assertion: As per the finding of NSSO, the number of absolute poor in India in 2011-2012 were
22% of the total population.
Reason: India’s basic problem is relative poverty.
(a) Both assertion and reason are true but the reason is the correct explanation of assertion.
(b) Both assertion and reason are true but reason is not the correct explanation of assertion
(c) Assertion is true but reason is false
(d) Assertion is false but reason is true
28 Assertion: While determining the poverty line higher calorie intake is fixed for rural area.
Reason: People in rural area have to do greater physical work as compared to urban people
(a) Both assertion and reason are true but the reason is the correct explanation of assertion.
(b) Both assertion and reason are true but reason is not the correct explanation of assertion
(c) Assertion is true but reason is false
(d) Assertion is false but reason is true
29 Assertion: Growth oriented approach to remove poverty proved to be quite effective.
Reason: Population growth caused very low growth in per capita income.
(a) Both assertion and reason are true but the reason is the correct explanation of assertion.
(b) Both assertion and reason are true but reason is not the correct explanation of assertion
(c) Assertion is true but reason is false
(d) Assertion is false but reason is true.
30 Assertion: National food for work was a self-employment program.
Reason:It was merged with MNREGA-2005.
(a) Both assertion and reason are true but the reason is the correct explanation of assertion.
(b) Both assertion and reason are true but reason is not the correct explanation of assertion
(c) Assertion is true but reason is false
(d) Assertion is false but reason is true.

31 Assertion(A)Absolute poverty is prevalent in developed economics. REASON(R)most

developed economics are industrialized economy.
A) both assertion (A)and Reason(R) are true and reason (R) is the correct explanation of
assertion(A).
B) Both assertion (a) and reason(R)are true, and 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.
32 Assertion (A)Inflation is the cause of poverty.
Reason (R) Inflation (price spiral) erodes real income of the people. Other things remaining
constant, price spiral may push certain people below the poverty line.
Alternatives:
A) Both Assertion (A) and Reason(R) are true and Reason (R) is the correct 1 explanation
of Assertion (A).
B) Both Assertion (A) and Reason(R) are true and 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.

6|Page 8 October 2021,ZIET BHUBANESWAR

33 Assertion: Most of small farmer are in deb-trap.
Reason: They borrow money from money lenders who charge high rate of interest that
push them in to chronic indebtedness.
A) Both assertion and reason are true but the reason is the correct explanation of assertion.
B) Both assertion and reason are true but reason is not the correct explanation of assertion
C) Assertion is true but reason is false
D) Assertion is false but reason is true
34 Assertion (A)Migration lowers poverty.
Reason (R) People migrate to those areas which offer better opportunities of employment.
Getting employment or getting better employment leads to improvement in the quality of
life. It may help people shift above the poverty line.
A) Both Assertion (A) and Reason(R) are true and Reason (R) is the correct 1 explanation
of Assertion (A).
B) Both Assertion (A) and Reason(R) are true and 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
35 Assertion (A): The Poverty Alleviation Programmes have been found unsatisfactory.
Reason (R): Huge amount of resources have been allocated for Poverty Alleviation
Programmes.
Alternatives:
A) Both Assertion (A) and Reason (R) are True and Reason (R) is the correct explanation
of Assertion (A)
B) Both Assertion (A) and Reason (R) are True and 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
36 Assertion (A)Migration lowers poverty.
Reason (R) People migrate to those areas which offer better opportunities of employment.
Getting employment or getting better employment leads to improvement in the quality of
life. It may help people shift above the poverty line.
(A) Both Assertion (A) and Reason(R) are true and Reason (R) is the correct 1
explanation of Assertion (A).
(B) Both Assertion (A) and Reason(R) are true and 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) are is true.
37 Assertion: Although there is a steady decline in poverty over the last two decades but total
number of the poor people have remained constant.
Reason: There has been a considerable growth in population.
(A) Both assertion and reason are true but the reason is the correct explanation of
assertion.
(B) Both assertion and reason are true but reason is not the correct explanation of
assertion
(C) Assertion is true but reason is false
(D) Assertion is false but reason is true

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38 Assertion: Most of small farmer are in deb-trap.
Reason: They borrow money from money lenders who charge high rate of interest that
push them in to chronic indebtedness.
(A) Both assertion and reason are true but the reason is the correct explanation of
assertion.
(B) Both assertion and reason are true but reason is not the correct explanation of
assertion
(C) Assertion is true but reason is false
(D) Assertion is false but reason is true
39 Assertion (A)Mr. X is relatively richer than Mr. Y. But both can be poor.
Reason (R) Mr. X may have higher income than Mr. Y. But, both X and Y may not have
enough income to buy the essentials of life. So that, both are poor.
(A) Both Assertion (A) and Reason(R) are true and Reason (R) is the correct 1
explanation of Assertion (A).
(B) Both Assertion (A) and Reason(R) are true and 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.
40 Assertion(A): Capital formation is the key to eradicate the poverty in India.
Reason (R): Lack of capital implies lack of production capacity. - Low production capacity
implies low opportunities of employment. - Low level of employment implies high level of
poverty.
(A) Both Assertion (A) and Reason(R) are true and Reason (R) is the correct explanation
of Assertion (A).
(B) Both Assertion (A) and Reason(R) are true and 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.

ANSWER
1-A 2-D 3-A 4-B 5-A 6-A 7-A 8-A 9-A 10-A
11-C 12-A 13-D 14-A 15-C 16-A 17-A 18-A 19-D 20-A
21-A 22-C 23-A 24-C 25-D 26-A 27-C 28-A 29-D 30-D
31-B 32-A 33-A 34-A 35-C 36-A 37-A 38-A 39-A 40-A

PREPIRED BY : PGT ECONOMICS OF BHUBANESWAR,

GUWAHATI, KOLKATA, RANCHI, SILCHAR AND TINSIKIA REGION .
VETTED BY : GUWAHATI REGION

8|Page 8 October 2021,ZIET BHUBANESWAR