790+ Indian Economy Solved MCQs

These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) , Bachelor of Arts (BA) , Bachelor of Arts in Economics (BA Economics) , Union Public Service Commission (UPSC) .

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501.	Consider the following statements: [CDS 2002] 1. The Ministry of External Affairs is in-charge of monetary policy in India. 2. The. Ministry of External Affairs is in-charge of foreign exchange rate determination in India. 3. The Ministry of Commerce puts forward the Export-Import Policy in India. 4. The Planning Commission prepares the Annual Budget of the Government Which of the statements is/are correct ?
A.	1, 2, and 3
B.	2 only
C.	3 only
D.	2 and 4
Answer» C. 3 only

502.	Which of the following are the public sector undertakings of the Government of India? 1. Balmer Lawrie and Company Ltd. 2. Dredging Corporation of India 3. Educational Consultants of India Ltd. Select the correct answer using the code given below [IAS 2008]
A.	1 and 2 only
B.	2 and 3 only
C.	1 and 3 only
D.	1, 2 and 3
Answer» D. 1, 2 and 3

503.	Which one of the following statements is not correct? [IAS 2005]
A.	Rourkela Steel Plant, the first integrated steel plant in the Public Sector of India was set up with the Soviet Union collaboration.
B.	Salem Steel Plant is a premier producer of stainless steel in India.
C.	Maharashtra Elektrosmelt Ltd. is a subsidiary of the Steel Authority of India Ltd.
D.	Visakhapatnam Steel Plant is a unit of the Rashtriya Ispat Nigam Ltd.
Answer» A. Rourkela Steel Plant, the first integrated steel plant in the Public Sector of India was set up with the Soviet Union collaboration.

504.	Which of the following pairs are correctly matched? [IAS 2005] Enterprise Industrial Group 1. VSNL : Bharati Group 2. Mundra Special Economic Zone Ltd. : Adani Group 3. CMC Ltd. : Tata Group 4. IPCL : Reliance Group Select the correct answer using the codes given below:
A.	1, 2 and 3
B.	3 and 4
C.	1, 2 and 4
D.	2, 3 and 4
Answer» D. 2, 3 and 4

505.	Which of the following authority sanctions foreign exchange for the import of goods? [UP PCS 2011]
A.	Any Nationalised Bank
B.	Exchange Bank
C.	Reserve Bank of India
D.	Ministry of Finance
Answer» C. Reserve Bank of India

506.	Which organisation promotes the foreign trade? [UP PCS 2011]
A.	ECGC
B.	MMTC
C.	STC
D.	All of these
Answer» D. All of these

507.	Import substitution implies [Asstt Commdt 2011]
A.	importing new items in place of old items of import
B.	gradual reduction of imported goods to save foreign exchange
C.	increasing domestic supply of goods by imposing import restrictions
D.	replacing import items by domestic production of such items
Answer» D. replacing import items by domestic production of such items

508.	Why is the Government of India disinvesting its equity in the Central Public Sector Enterprises (CPSEs)? 1. The Government intends to use the revenue earned from the disinvestment mainly to pay back the external debt. 2. The Government no longer intends to retain the management control of the CPSEs. Which of the statements given above is/are correct? [CSAT 2011]
A.	1 only
B.	2 only
C.	Both 1 and 2
D.	Neither 1 nor 2
Answer» D. Neither 1 nor 2

509.	Both Foreign Direct Investment (FOI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two? [CSAT 2011]
A.	FII helps bring better management skills and technology, while FDI only brings in capital
B.	FII helps in increasing capital availability in general, while FDI only targets specific sectors
C.	FDI flows only into the secondary market, while FII targets primary market
D.	FII is considered to be more stable than FDI
Answer» B. FII helps in increasing capital availability in general, while FDI only targets specific sectors

510.	Which one among the following statements is correct? [CDS 2012]
A.	Due to border problems, India's trade with China did not register a quantum jump between the years 2001·2010
B.	The stand-off between India and China on Pakistan and Arunachal Pradesh did not let India's trade to grow with China in the years 2001-2010 as much as it grew in the years 1991- 2001
C.	While India-China trade has registered a quantum jump between the years 2001-2010, both the countries have ensured parity of trade
D.	In spite of border problems, India's trade with China registered a quantum jump during the years 2001-2010
Answer» D. In spite of border problems, India's trade with China registered a quantum jump during the years 2001-2010

511.	Sickness of small units can be because of the factors: 1. under-utilisation of capacity 2. non-payment by the large firms 3. dependence on borrowed funds 4. lack of management expertise
A.	1, 2 and 3
B.	2, 3 and 4
C.	1, 2 and 4
D.	3 and 4
Answer» C. 1, 2 and 4

512.	"Sunrise Industries" are Industries:
A.	which are well-developed and have ample scope for further development
B.	which improve export performance of the country
C.	which are small-scale industries
D.	which have high growth potential and meet further requirements of the economy
Answer» D. which have high growth potential and meet further requirements of the economy

513.	Arbitrage implies:
A.	practice of taking advantage of rice difference in two markets
B.	the practice of under invoicing exports
C.	the practice of dumping viz., selling goods in a foreign market cheaper than the home market
D.	the practice of over-invoicing imports
Answer» A. practice of taking advantage of rice difference in two markets

514.	Sector-wise, maximum employment in the public sector is in :
A.	electricity, gas and water
B.	community, social and personal services
C.	finance, insurance and real estate
D.	transport, storage and communication
Answer» B. community, social and personal services

515.	Over the last few years: 1. the value of imports has increased at a faster rate as compared to exports 2. exports have fallen as compared to imports 3. both exports and imports have risen 4. the balance of trade has been favourable to India
A.	1, 2 and 3
B.	1 and 3
C.	1
D.	1, 3 and 4
Answer» B. 1 and 3

516.	Which of the following are not features of India's small-scale industries in general? 1. large employment potential 2. great export potential 3. highly skilled labour 4. efficient marketing system
A.	1 and 3
B.	2 and4
C.	1 and 2
D.	3 and 4
Answer» D. 3 and 4

517.	Which one among the following is not true for Special Economic Zones? [CDS 2011]
A.	No licence is required for import
B.	Manufacturing and service activities are allowed
C.	No permission for subcon- tracting
D.	No routine examination of cargo for export/import by customs authorities
Answer» C. No permission for subcon- tracting

518.	The biggest Public Sector undertaking in the country is ____ [Corporation Bank PO 2011]
A.	Iron & steel plants
B.	Roadways
C.	Railways
D.	Airways
Answer» C. Railways

519.	With reference to India, which one of the following statements is NOT correct? [IAS 2003]
A.	IPCL is India's largest petrochemical company
B.	RIL is the largest private sector· company in India
C.	MTNL is listed on NYSE
D.	BSNL is the first telecom service organization in India to launch a nationwide cellular service at one time
Answer» A. IPCL is India's largest petrochemical company

520.	What is the current account of balance of payments?
A.	It is the account showing difference of total exports and imports in one year
B.	It is the account showing transactions in invisible account like tourism, shipping, insurance etc.
C.	It is the account showing transactions like net external assistance, NRI deposits, etc.
D.	It is the account showing trade balance plus invisible balance
Answer» D. It is the account showing trade balance plus invisible balance

521.	Core industries include:
A.	basic industries
B.	industries catering to defence requirements
C.	critical industries
D.	all the above
Answer» D. all the above

522.	The core sector includes: I. Coal II. Power III. Petroleum IV. Soaps and Detergent
A.	I and II
B.	I, II and III
C.	I
D.	II and III
Answer» B. I, II and III

523.	Invisible Export means export [Corporation Bank PO 2011]
A.	Services
B.	Prohibited goods
C.	Unrecorded goods
D.	Goods through smuggling
Answer» A. Services

524.	Which of the following sectors does not come under tertiary sector?
A.	Transport
B.	Trade
C.	Business Services
D.	Electricity
Answer» D. Electricity

525.	Which of the following committees was assigned to recommend reforms in the insurance sector?
A.	Rekhi Committee
B.	Nadkarni Committee
C.	Malhotra Committee
D.	Chelliah Committee
Answer» C. Malhotra Committee

790+ Indian Economy Solved MCQs

Which of the following are the public sector undertakings of the Government of India? 1. Balmer Lawrie and Company Ltd. 2. Dredging Corporation of India 3. Educational Consultants of India Ltd. Select the correct answer using the code given below [IAS 2008]

Which one of the following statements is not correct? [IAS 2005]

Which of the following pairs are correctly matched? [IAS 2005] Enterprise Industrial Group 1. VSNL : Bharati Group 2. Mundra Special Economic Zone Ltd. : Adani Group 3. CMC Ltd. : Tata Group 4. IPCL : Reliance Group Select the correct answer using the codes given below:

Which of the following authority sanctions foreign exchange for the import of goods? [UP PCS 2011]

Which organisation promotes the foreign trade? [UP PCS 2011]

Import substitution implies [Asstt Commdt 2011]

Both Foreign Direct Investment (FOI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two? [CSAT 2011]

Which one among the following statements is correct? [CDS 2012]

Sickness of small units can be because of the factors: 1. under-utilisation of capacity 2. non-payment by the large firms 3. dependence on borrowed funds 4. lack of management expertise

"Sunrise Industries" are Industries:

Arbitrage implies:

Sector-wise, maximum employment in the public sector is in :

Over the last few years: 1. the value of imports has increased at a faster rate as compared to exports 2. exports have fallen as compared to imports 3. both exports and imports have risen 4. the balance of trade has been favourable to India

Which of the following are not features of India's small-scale industries in general? 1. large employment potential 2. great export potential 3. highly skilled labour 4. efficient marketing system

Which one among the following is not true for Special Economic Zones? [CDS 2011]

The biggest Public Sector undertaking in the country is ____ [Corporation Bank PO 2011]

With reference to India, which one of the following statements is NOT correct? [IAS 2003]

What is the current account of balance of payments?

Core industries include:

The core sector includes: I. Coal II. Power III. Petroleum IV. Soaps and Detergent

Invisible Export means export [Corporation Bank PO 2011]

Which of the following sectors does not come under tertiary sector?

Which of the following committees was assigned to recommend reforms in the insurance sector?

Consider the following statements: [IAS 2004] 1. National Thermal Power Corporation has diversitled into hydropower sector 2. Power Grid Corporation of India has diversified into telecom sector Which of the statements given above is/are correct?

Whenever newspapers talk about the performance of core industries, which of the following is NOT considered among them? [Bank of India PO 2010]

Which one of the following pairs is not correctly matched? [CDS 2008]

Which institution provides long run finance to industries?

One of the main factors that led to rapid expansion of Indian exports is :

The main argument advanced in favour of small scale and cottage industries in India is that:

Present Industrial policy in India aims at :

When does the problem of unfavourable balance of payment arise?

The difference between visible exports and visible imports is defined as [Corporation Bank PO 2011]

Which of the following was formed to suggest means for eradicating black money? [I. Tax 1992]

BoP (Balance of Payment) refers to :

Mashelkar Committee was constituted to report on :

Which of the statements given above is/are correct? [CDS 2008] 1. The USSR assisted in the building of the Bhilai Steel plant. 2. The British assisted in the building of the Bokaro Steel plant.

New exim policy has choosen a town for the pottery export :

A country is said to be in a debt trap if: [IAS 2002]

'Dumping' in the context of international trade refers to : [CDS 2000]

The exports of India:

G-77 summit is a forum for: [CDS 2000]

The headquarters of World Trade Organisation is in : [CDS 2000]

The headquarters of OPEC (Organisation of Petroleum Countries) is at :

Per capita income Which of the above is/are the parameters for the measurement of Human Development Index by UNDP? [CDS 2005]

Which of the following constitute the World Bank? [IAS 1995] 1. International Bank of Reconstruction and Development 2. International Finance Corporation 3. International Development Association 4. International Monetary Fund Choose the correct answer from the codes given below:

The headquarters of IMF and World Bank are located at :

Voting rights in the IMF are distributed on the basis of: [CDS 1993]

"World Development Report" is an annual publication of: [IAS 2002]

Which of the following are the public sector undertakings of the Government of India?
1. Balmer Lawrie and Company Ltd.
2. Dredging Corporation of India 3. Educational Consultants of India Ltd.
Select the correct answer using the code given below [IAS 2008]

Which of the following pairs are correctly matched? [IAS 2005] Enterprise Industrial Group
1. VSNL : Bharati Group
2. Mundra Special Economic Zone Ltd. : Adani Group
3. CMC Ltd. : Tata Group
4. IPCL : Reliance Group
Select the correct answer using the codes given below:

Sickness of small units can be because of the factors:
1. under-utilisation of capacity
2. non-payment by the large firms
3. dependence on borrowed funds
4. lack of management expertise

Over the last few years:
1. the value of imports has increased at a faster rate as compared to exports
2. exports have fallen as compared to imports
3. both exports and imports have risen
4. the balance of trade has been favourable to India

Which of the following are not features of India's small-scale industries in general?
1. large employment potential
2. great export potential
3. highly skilled labour
4. efficient marketing system

Consider the following statements: [IAS 2004]
1. National Thermal Power Corporation has diversitled into hydropower sector
2. Power Grid Corporation of India has diversified into telecom sector
Which of the statements given above is/are correct?

Which of the statements given above is/are correct? [CDS 2008]
1. The USSR assisted in the building of the Bhilai Steel plant.
2. The British assisted in the building of the Bokaro Steel plant.

Which of the following constitute the World Bank? [IAS 1995]
1. International Bank of Reconstruction and Development
2. International Finance Corporation
3. International Development Association
4. International Monetary Fund
Choose the correct answer from the codes given below:

526.	Consider the following statements: [IAS 2004] 1. National Thermal Power Corporation has diversitled into hydropower sector 2. Power Grid Corporation of India has diversified into telecom sector Which of the statements given above is/are correct?
A.	1 only
B.	2 only
C.	both 1 and 2
D.	neither 1 nor 2
Answer» A. 1 only

527.	Whenever newspapers talk about the performance of core industries, which of the following is NOT considered among them? [Bank of India PO 2010]
A.	Petroleum
B.	Automobile
C.	Mining
D.	Steel
Answer» C. Mining

528.	Which one of the following pairs is not correctly matched? [CDS 2008]
A.	Hindalco Industries - Novelis
B.	Tata Steel - Corus Group
C.	Jet Airways - Air Sahara
D.	Kingfisher Airlines - MDLR Airlines
Answer» D. Kingfisher Airlines - MDLR Airlines

529.	Which institution provides long run finance to industries?
A.	UTI
B.	LIC
C.	GIC
D.	All of these
Answer» D. All of these

530.	One of the main factors that led to rapid expansion of Indian exports is :
A.	liberalisation of the economy
B.	diversification of exports
C.	imposition of import duties
D.	recession in other countries
Answer» A. liberalisation of the economy

531.	The main argument advanced in favour of small scale and cottage industries in India is that:
A.	cost of production is low
B.	they require small capital investment
C.	they advance the goal of equitable distribution of wealth
D.	they generate a large volume of employment
Answer» D. they generate a large volume of employment

532.	Present Industrial policy in India aims at :
A.	promoting the private sector units
B.	increasing the production of public sector units
C.	accelerating the performance of mixed economy
D.	discourage the performance of the private sector
Answer» C. accelerating the performance of mixed economy

533.	When does the problem of unfavourable balance of payment arise?
A.	When exports decrease
B.	When exports increase
C.	When imports increase
D.	When imports are greater than exports
Answer» D. When imports are greater than exports

534.	The difference between visible exports and visible imports is defined as [Corporation Bank PO 2011]
A.	Balance of trade
B.	Balance of payment
C.	Balanced terms of trade
D.	Gains from trade
Answer» A. Balance of trade

535.	Which of the following was formed to suggest means for eradicating black money? [I. Tax 1992]
A.	Finance Commission
B.	Sarkaria Commission
C.	Shah Commission
D.	Chelliah Committee
Answer» D. Chelliah Committee