Indian Economy GK Quiz-9

Indian Economy GK Quiz-9

Indian Economy Multiple Choice Questions (MCQs) Quiz for State and UPSC Civil Services Examinations. Objective Questions on Indian Economy for competitive examinations.

    161. Banks in India were nationalised for the first time in the year –

    (1) 1950 
    (2) 1960
    (3) 1969 
    (4) 1979
    Answer:
    161. (3) The Government of India issued an ordinance ('Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969')) and nationalized the 14 largest commercial banks with effect from the midnight of July 19, 1969. These banks contained 85 percent of bank deposits in the country. A second dose of nationalization of 6 more commercial banks followed in 1980.

    162. Fiscal policy is concerned with

    (1) Public revenue
    (2) Public expenditure and debt
    (3) Bank rate policy
    (4) Both (1) and (2)
    Answer:
    162. (4) Fiscal policy is the use of government revenue collection (taxation) and expenditure (spending) to influence the economy. The two main instruments of fiscal policy are government taxation and changes in the level and composition of taxation and government spending can affect the following variables in the economy: Aggregate demand and the level of economic activity; the pattern of resource allocation; and the distribution of income.

    163. Which of the following is the largest employer in India?

    (1) Food Corporation of India
    (2) Posts and Telegraphs Department
    (3) Indian Railways
    (4) Steel Authority of India
    Answer:
    163. (3) Indian Railways not just runs the world's third largest railroad network but is also among the largest employers. As in 2012, it is the world's seventh largest employer in the world, according to Economist magazine, with over 1.4 million employees. It is ranked as largest employer after the US Defence Department, the Chinese army, Wal-Mart, China National Petroleum, State Grid of China and British health services.

    164. The main objective of Antyodaya Programme is

    (1) upliftment of urban poor
    (2) upliftment of industrial workers
    (3) unpliftment of rural poor
    (4) upliftment of farmers
    Answer:
    164. (3) Antyodaya Anna Yojana (AAY) is a centrally sponsored scheme which was launched in December 2000 for one crore of the poorest families. It is on the lookout for the 'poorest of the poor' by providing them 35 kilos of rice and wheat at Rs.2 per kg. 

    165. The Reserve Bank of India issues currency notes under

    (1) fixed fiduciary system
    (2) maximum fidciuary system
    (3) minimum reserve system
    (4) proportional reserve system
    Answer:
    165. (3) Under Section 22 of the Reserve Bank of India Act, the Bank has the sole right to issue bank notes of all denominations. The distribution of one rupee notes and coins and small coins all over the country is undertaken by the Reserve Bank as agent of the Government. The system as it exists today is known as the minimum reserve system.

    166. The financial capital of India is

    (1) Mumbai 
    (2) Chennai
    (3) Delhi 
    (4) Chandigarh
    Answer:
    166. (1) Mumbai is the commercial capital of India. It is one of the world's top 10 centres of commerce in terms of global financial flow, generating 5% of India's GDP, and accounting for 25% of industrial output,70% of maritime trade in India (Mumbai Port Trust & JNPT), and 70% of capital transactions to India's economy. The city houses important financial institutions such as the Reserve Bank of India, the
    Bombay Stock Exchange, the National Stock Exchange of India, the SEBI and the corporate headquarters of numerous Indian companies and multinational corporations.

    167. Chairman of the Eleventh Finance Commission was

    (1) A.M. Khusro
    (2) Vijay Kelkar
    (3) Deepak Parekh
    (4) Manmohan Singh
    Answer:
    167. (1) The Eleventh Finance Commission of India was appointed by the President on July 3, 1998 for the period 2000-05. It was chaired by Prof. A.M. Khusro and its members were Shri N.C Jain, Shri J.C Jetly, Dr. Amaresh Bagchi, and T.N. Srivastava. Note : The Finance Commission came into existence
    in 1951. It was established under Article 280 of the Indian Constitution by the President of India. The
    chairman of 14th and current finance commission is former RBI governor Y.V.Reddy.

    168. India adopted the Five-Year Plans from

    (1) France 
    (2) former USSR
    (3) America 
    (4) England
    Answer:
    168. (2) India borrowed features of fundamental duties and planning mechanism from the former Soviet
    Union. India opted for planned economic growth model as resources were scarce at the time of independence. So it was imperative for the leaders to move along planned model so as to achieve
    optimum utilization of resources development and meeting the aim of social justice simultaneously.

    169. In Centre-State financial relations in India, Gadgil Formula is used in

    (1) division of tax revenue
    (2) formulating the policy for fresh borrowings
    (3) writing off States’ indebtedness to the Centre
    (4) allocating Central Plan assistance between States
    Answer:
    169. (1) The Gadgil formula was evolved in 1969 for determining the allocation of central assistance for state plans in India. It was adopted for distribution of plan assistance during Fourth and Fifth Five Year Plans. It was named after the then deputy chairman of the Planning Commission Dr. D R Gadgil.

    170. The concept of mixed economy means

    (1) to have balanced development in the agricultural and industrial sector
    (2) simultaneous development of the rural and urban sector
    (3) to have equal distribution of wealth among the rural and the urban poor
    (4) simultaneous existence of the private and public sector
    Answer:
    170. (4) Mixed economy is an economic system in which both the state and private sector direct the economy, reflecting characteristics of both market economies and planned economies. The basic idea of the mixed economy is that the means of production are mainly under private ownership; that markets remain the dominant form of economic coordination; and that profit-seeking enterprises and the accumulation of capital remain the fundamental driving force behind economic activity.

    171. Canalised list of items in foreign trade of India refers to

    (1) the items to be imported by the private agencies
    (2) list of items to be subsidised
    (3) list of items to be granted duty concession
    (4) items to be imported only by the State owned undertaking
    Answer:
    171. (4) The Export-Import Policy announced on March 31, 1992 said that all goods, except those coming under the negative list, could be freely imported and exported. The negative list consisted of goods, the import or export of which was prohibited; restricted through licensing or otherwise; or canalized. Canalized items can be imported by Canalizing Agency only and not by an individual importer. An individual importer requires an Import licence issued under the Export and Import Policy for importing canalized items.

    172. In the production of cotton textiles India ranks

    (1) fourth in the world
    (2) third in the world
    (3) second in the world
    (4) first in the world
    Answer:
    172. (3) As per the data of 2009-2010, China, India and the United States were the first three major
    producers. India is the second largest cotton producer and consumer. The textile industry accounted for
    14.4% of the country’s export earnings.

    173. The single largest item of expenditure of the Central Government in India in recent years is

    (1) Defence
    (2) Subsidies
    (3) Interest payment
    (4) General services
    Answer:
    173. (3) Interest payments are the single largest item of expenditure. As per the Economic Survey 2011-2012, Interest payments constituted 3 per cent of India’s GDP in 2011-12. Major subsidies constituted 1.5 per cent, while defense expenditure comprised 1.1 per cent of India’s GDP in 2011-12. Of the revenue expenditure in 2011-12, interest payments comprised 24.4 per cent; Major subsidies: 12.3 per cent and Defence expenditure: 8.7 per cent. 

    174. The most important source of revenue for the states in India is

    (1) Corporation tax
    (2) Income tax
    (3) Excise duties
    (4) Sales tax
    Answer:
    174. (4) The principal source of States own tax revenues is sales tax which accounts for about 60 per cent of the total. The other major components of States own tax revenues according to their revenue share are State excise, registration and stamp duty, motor vehicle and passenger tax, electricity duty, land revenues, profession tax, entertainment taxes and other sundry taxes.

    175. India’s First Five Year Plan gave priority to

    (1) Industry
    (2) Trade
    (3) Transportation
    (4) Agriculture
    Answer:
    175. (4) The First Five-Year Plan (1951–1956), based on the Harrod-Domar model, addressed, mainly, the agrarian sector, including investments in dams and irrigation. The total planned budget of Rs. 2069 crore was allocated to seven broad areas: irrigation and energy (27.2 percent), agriculture and community development (17.4 percent), transport and communications (24 percent), industry (8.4 percent), social services (16.64 percent), land rehabilitation (4.1 percent), and for other sectors and services (2.5 percent).

    176. Ways and Means Advances refers to

    (1) Industries getting temporary loans from commercial banks
    (2) Farmers getting loans from NABAED
    (3) Government getting temporary loans from RBI
    (4) Government-getting loans from international financial institutions
    Answer:
    176. (3) Ways and means advances (WMA) is a mechanism used by Reserve Bank of India (RBI) under its credit policy by which provides to the States banking with it to help them to tide over temporary mismatches in the cash flow of their receipts and payments. This is guided under Section 17(5) of RBI Act, 1934, and are repayable in each case not later than three months from the date of making that advance'.

    177. Cochin refineries is in :

    (1) Public Sector
    (2) Joint Sector
    (3) Private Sector
    (4) Co-operative Sector
    Answer:
    177. (2) Founded as a public sector company owned by the Government of India in 1963, Kochi Refineries was acquired by the Bharat Petroleum Corporation Limited in 2006 which presently owns and runs it. Consequent to the merger Order dated 18 August, 2006 issued by Ministry of Company Affairs, the refinery has been amalgamated with Bharat Petroleum Corporation, hence forth to be known as BPCL-Kochi Refinery.

    178. Which one of the following is not an industrial finance institution?

    (1) UTI 
    (2) ICICI
    (3) NABARD 
    (4) SFCs
    Answer:
    178. (3) NABARD provides its refinance for the promotion of agriculture in India.

    179. National Income at factor cost is equal to

    (1) Net National Product – Indirect taxes + Subsidies
    (2) Net National Product – Direct taxes + Subsidies
    (3) Gross National Product – Depreciation charges
    (4) Net National Product + Net income from abroad
    Answer:
    179. (1) Factor cost or national income by type of income is a measure of national income or output based on the cost of factors of production, instead of market prices. This allows the effect of any subsidy or indirect tax to be removed from the final measure.

    180. Which Indian private sector company has the largest sales turnover?

    (1) Tata Sons
    (2) Reliance Industries
    (3) ITC Ltd.
    (4) Hindustan Lever Ltd.
    Answer:
    180. (2) In 2012, Reliance Industries posted its highest ever turnover of USD 66.8 billion and net profit of USD 3.9 billion. Reliance Industries, is country’s largest private sector company on all major financial parameters with a turnover of Rs 339,792 crore, cash profit of Rs 31,994 crore and net profit of Rs 20,040 crore as of March 31,2012.

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