Indian Economy Test 30

Result

Indian Economy Test 30

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Weekly Quiz Competition

Question 1
1 / -0

When two goods are completely interchangeable, they are

A
Perfect substitutes

B
Perfect complements

C
Giffen goods

D
Veblen goods

Solution

Good which can be used in place of another good with just the same function, is called perfect substitute for the other good. For such goods, if price of one good increases, the demand for its substitute increases. For example, if someone gets the same satisfaction and utility from tea or coffee and they can be interchanged for each other, the two are perfect substitutes.
Question 2
1 / -0

Consider the following specific stages of demographic transition associated with economic development:
1. Low birth rate with low death rate
2. High birth rate with high death rate
3. High birth rate with low death rate
Select the correct order of the above stages using the codes given below.

A
1, 2, 3

B
2, 1, 3

C
2, 3, 1

D
3, 2, 1

Solution

Countries are initially characterized with high birth rate and high death rate as the there are not enough health facilities available, the population is unaware of the health and hygiene practices to be followed. As development happens, improvements in hygiene, sanitation, food availability reduces the death rate. This is the phase when population growth quickens. With further development, education and literacy, the population is apprised of family planning and contraception which checks the birth rate as well.
Question 3
1 / -0

During which decade did the population record a negative growth rate in India?

A
1921-1931

B
1911-1921

C
1941-1951

D
1931-1941

Solution

Population of India in 1911 was 252.09 million and it dropped to 251.32 million in 1921, registering a decline of -0.31%. For this reason, 1921 has been termed by the Census Commissioner as the year of Great Divide. Growth has been positive for all other decades, it was moderate from 1921-1951 and then quickened post 1951.
Question 4
1 / -0

Who declares the Financial Emergency?

A
President

B
Prime Minister

C
Finance Minister

D
None of these
Question 5
1 / -0

Consider the following statements:
1. Kerala is the best performer in terms of HDI in India.
2. Kerala has performed better than Norway in terms of overall HDI.
Which of the statements given above is/are correct?

A
Only 1

B
Only 2

C
Both 1 and 2

D
Neither 1 nor 2

Solution

Human Development Index (HDI) is calculated based on three parameters: 1) Life expectancy 2) Education 3) Per capita income. Norway tops the list across nations with a HDI of 0.949. India ranked 131 in 2015 and scored 0.624. Kerala was the best among Indian states with a score 0.712.
Question 6
1 / -0

The Reserve Bank of India (RBI) acts as a bankers' bank.This would imply which of the following ?
1) Other banks retain their deposits with RBI
2) The RBI lends funds to the commercial banks in times of need.
3) The RBI advises the commercial banks on monetary matters.
Select the correct answer using the codes given below

A
Only 2

B
1 and 2

C
2 and 3

D
All of the above

Solution

The Reserve Bank of India acts as a lender of last resort and a bankers' bank. It provides credit to banks in times of need and other banks retain their deposits with the RBI. Although RBI time and again gives its views on the health of the banking sector and takes measures to strengthen it, it does not really advise the commercial banks on monetary matters.
Question 7
1 / -0

Consider the following sources
1) Net bank credit to the government.
2) Bank credit to the commercial sector.
3) Net foreign exchange assets of the banking system.
Which of the sources given above is / are the major sources of the 'Broad Money' in the India economy ?

A
Only 2

B
1 and 3

C
2 and 3

D
All of these

Solution

Broad Money is a measure of the money supply in the system. It includes currency with the public, demand deposits and time deposits with the banks and other deposits with the RBI.

Basically, Broad Money = Net bank credit to the Govt + bank credit to the commercial sector + Net foreign exchange assets of the banking system + Govt's current liabilities to the public - Net non-monetary liabilities of the banking sector (other than time deposits).
Question 8
1 / -0

Consider the following statements
1. More than 50% of the Net Domestic Product is contributed by the unorganised sector of Indian economy.
2. Less than one-fourth of Net Domestic Product is contributed by the organised sector of Indian economy.
Which of the statements given above is/are correct?

A
Only 1

B
Only 2

C
Both 1 and 2

D
Neither 1 nor 2
Question 9
1 / -0

Which one of the following laws stated that bad money drives out good if their exchange rate is set by law?

A
Gresham's law

B
Gilbert's law

C
Keynes' law

D
Kuznet's law

Solution

Gresham's law is a monetary principle stating that "bad money drives out good". In currency valuation, the law states that if a new coin (bad money) is assigned the same face value as an older coin containing a higher amount of precious metal (good money), then the new coin will be used in circulation while the old coin will be hoarded and will disappear from circulation.
Question 10
1 / -0

Since Independence, both plan and non-plan expenditures have increased, the increase in non-plan expenditure is little more than the former. Which one of the following expenditure causes the increase in non-plan-expenditure and select the correct answer using the codes
1. Interest payment
2. Subsidy
3. Irrigation

A
1,2 and 3

B
1 and 2

C
1 and 3

D
Only 2

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Indian Economy Test 30

Result

Indian Economy Test 30

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Rank

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SHARING IS CARING

Question 1

Perfect substitutes

Perfect complements

Giffen goods

Veblen goods

Solution

Question 2

1, 2, 3

2, 1, 3

2, 3, 1

3, 2, 1

Solution

Question 3

1921-1931

1911-1921

1941-1951

1931-1941

Solution

Question 4

President

Prime Minister

Finance Minister

None of these

Question 5

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

Solution

Question 6

Only 2

1 and 2

2 and 3

All of the above

Solution

Question 7

Only 2

1 and 3

2 and 3

All of these

Solution

Question 8

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

Question 9

Gresham's law

Gilbert's law

Keynes' law

Kuznet's law

Solution

Question 10

1,2 and 3

1 and 2

1 and 3

Only 2

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