1. Home
  2. |  
  3. Civil Services|  

IAS Prelims Exam 2016: GS Economy Questions: Economic Planning

May 31, 2016 13:55 IST

    From UPSC Civil Services IAS Examination point of view, the Indian Economy Questions are very important. The UPSC IAS Exam aspirants must be aware of every aspect of Indian Economy and its interaction with other subjects. The most important thing is the basic issues arising in the contemporary era and the issues cropping up in the current affairs.

    For the Civil Services aspirants, here, we have developed Multiple Choice Questions for the UPSC IAS Prelims Exam based on Indian Economy

    1.Consider the following statements regarding the term “Planning”:

    I.According to D. Dickinson, economic planning is, “the making of major economic decisions- what and how much is to be produced and to whom it is to be allocated by the conscious decision of a determinate authority, on the basis of a comprehensive survey of the economic system as a whole.”

    II.It could be considered the broadest possible definition of planning- under a democratic system, may be defined as the technical coordination, by disinterested experts of consumption, production, investment, trade, and income distribution, in accordance with social objectives set by bodies representative of the nation.

    III.According to the Planning Commission of India, “Planning involves the acceptance of a clearly defined system of objectives in terms of which to frame overall policies".

    Which of the following statement(s) is/are correct?

    a.Only I

    b.I and II

    c.I and III

    d.All of the above

    Answer: d

    Explanation:

    According to D. Dickinson, Economic planning is, “the making of major economic decisions- what and how much is to be produced and to whom it is to be allocated by the conscious decision of a determinate authority, on the basis of a comprehensive survey of the economic system as a whole.” It could be considered the broadest possible definition of planning- Planning, under a democratic system, may be defined as the technical coordination, by disinterested experts of consumption, production, investment, trade, and income distribution, in accordance with social objectives set by bodies representative of the nation.  Such planning is not only to be considered from the point of view of economics, and raising of the standard of living, but must include cultural and spiritual values, and the human side of life". According to the Planning Commission of India (now it is known as NITI Ayog), “Planning involves the acceptance of a clearly defined system of objectives in terms of which to frame overall policies".

    2.Consider the following statements regarding the “National Planning Committee” in India:

    I.National Planning Committee, set up in 1951 by the Indian National Congress which, for the first time, tried to define planning (in 1955, though, its final report was published in 1956) in India.

    II.By the late 1930s, there was an almost political consensus that independent India will be a planned economy.

    III.As India commenced economic planning by the early 1950s, the Planning Commission of India also went on to define planning.

    Which of the following statement(s) is/are correct?

    a.Only I

    b.I and II

    c.II and III

    d.All of the above

    Answer: c

    Explanation:

    National Planning Committee, set up in 1938 by the Indian National Congress which, for the first time, tried to define planning (in 1940, though, its final report was published in 1949) in India. By the late 1930s, there was an almost political consensus that independent India will be a planned economy. As India commenced economic planning by the early 1950s, the Planning Commission of India also went on to define planning.

    3.Consider the following statements regarding an ‘Economic Plan’:

    I.An economic plan is simply a set of specific economic targets to be achieved in a given period of time with a stated strategy.

    II.Economic plans may be either comprehensive or partial.

    III.A comprehensive plan sets targets to cover all major aspects of the economy while a partial plan may go for setting such targets for a part of the economy (i.e. agriculture, industry, public sector, etc.)

    Which of the following statement(s) is/are correct?

    a.Only I

    b.I and II

    c.II and III

    d.All of the above

    Answer: d

    Explanation:

    An economic plan is simply a set of specific economic targets to be achieved in a given period of time with a stated strategy. Economic plans may be either comprehensive or partial. A comprehensive plan sets targets to cover all major aspects of the economy while a partial plan may go for setting such targets for a part of the economy (i.e. agriculture, industry, public sector, etc.). Taken broadly, the planning process itself can be described as an exercise in which a government first chooses social objectives, then sets various targets (i.e. economic targets), and finally organises a framework for implementing, coordinating, and monitoring a development plan.

    4.Consider the following statements regarding the working definition of planning in the perspective of Indian Economy:

    I.Planning is a process

    II.Planning must have well-defined goals

    III.Optimum utilisation of the available resources

    Which of the following statement(s) is/are correct?

    a.Only I

    b.I and II

    c.II and III

    d.All of the above

    Answer: d

    Explanation:

    The form and the nature of planning kept changing from country to country and from time to time.  Planning is a process which means planning is a process of doing something. Till we have some goals and objectives left regarding our lives, the process might continue. With the changing nature of our needs, the nature and scope of the planning process might undergo several changes. Planning is not an end in itself. As processes accelerate and decelerate, change direction and course, so also does planning. In due course of time, there emerged a consensus that planning must have some goals and those goals should be well-defined (not vaguely defined)—so that the government’s discretionary intervention in the economic organisation could be democratically transparent and justified.

    5.With reference to the planning as a tool of utilising resources to achieve any kind of goals for the policy makers, around the world which of the following concept is incorrect:

    a.Trying to achieve a particular size of family for different countries came to be known as family planning.

    b.Every budget, be it of the government or of the private sector is nothing but exercises in the area of urban planning.

    c.The process of providing suitable physical and social infrastructure for the erstwhile or the upcoming urban areas came to be known as town/urban planning.

    d.A country trying to optimise the use of its revenues for different categories of expenditures came to be known as financial planning.

    Answer: b

    Explanation: 

    Trying to achieve a particular size of family for different countries came to be known as family planning. The process of providing suitable physical and social infrastructure for the erstwhile or the upcoming urban areas came to be known as town/urban planning. A country trying to optimise the use of its revenues for different categories of expenditures came to be known as financial planning. Financial planning is more popularly known as budgeting. Every budget, be it of the government or of the private sector is nothing but exercises in the area of financial planning.

    6.In which of the following countries, the first regional planning was started?

    a.India

    b.Russia

    c.USA

    d.Germany

    Answer: c

    Explanation:

    It was at the regional level that planning was used as a part of development policy by any country for the first time. It was the USA which started the first regional planning after the Tennessee Valley Authority (TVA) was set up in 1916—for a large-scale rehabilitation in south-eastern USA covering parts of seven states. The US experience of regional planning became such a success in realising its well-defined goals that it emerged as a role model and an object of inspiration for many countries around the world in the coming decades—the Damodar Valley Corporation (DVC) in India (1948), the Volta River Project in Ghana (1966), etc.

    7.In which of the following countries, the National Planning had been established for the first time?

    a.Soviet Union

    b.USA

    c.China

    d.United Kingdom

    Answer: a

    Explanation: 

    The official experiment in the area of national planning is rooted in the Bolshevik Revolution of Russia (1917)—the Soviet Union. Dissatisfied with the pace of industrialisation, it was in 1928 that Joseph Stalin announced its policy of central planning for the Soviet Union. The collectivisation of agriculture and forced-draft industrialisation was other radical new policy initiatives announced by Stalin besides economic planning in 1928. The Soviet Union went for its first five year plan for the period 1928-33 and the world was to have its first experience of national planning.

    8.Imperative Planning is:

    a.The planning process followed by the state economies (i.e. the socialist or communist)

    b.The type of planning which gives less emphasis upon the social and institutional dimensions

    c.In such planning, the planners just search for the best possible results in relation to the established goals giving less importance to issues like caste, creed, religion, region, language, marriage, family, etc.

    d.The systems planning gives due importance to the socio-institutional factors.

    Answer: a

    Explanation:

    The planning process followed by the state economies (i.e the socialist or communist) is known as the imperative planning. Such planning is also called as directive or target planning. Such planning had two main variants. In the Socialist system, all economic decisions were centralised in the hands of the state with collective ownership of resources (except labour). In the Communist system (i.e. China of past) all resources were to be owned and utilised by the state (including labour, too).

    9.Normative planning is:

    a.The type of planning which gives less emphasis upon the social and institutional dimensions

    b.In such planning, the planners just search for the best possible results in relation to the established goals giving less importance to issues like caste, creed, religion, region, language, marriage, family, etc.

    c.The systems planning gives due importance to the socio-institutional factors.

    d.Both a and b

    Answer: d

    Explanation:

    A major classification of planning is done on the basis of societal emphasis by the planning. The type of planning which gives less emphasis upon the social and institutional dimensions is known as the normative planning. In such planning, the planners just search for the best possible results in relation to the established goals giving less importance to issues like caste, creed, religion, region, language, marriage, family, etc. Opposed to the normative planning, the ‘systems planning’ gives due importance to the socio-institutional factors. This is a planning from social-technical point of view but only suitable for a country which has lesser degree of social diversities (naturally, not fit for the Indian conditions).

    10.Which of the following statement is correct regarding the Economic planning?

    a.Economic planning can also be classified into more types—sectoral and spatial.

    b.In sectoral planning, the planners emphasise the specific sector of the economy i.e. agriculture, industry or the services.

    c.In spatial planning development is seen in the spatial dimensions of development might be defined by the pressure and requirements of national economic development.

    d.All of the above

    Answer: d

    Explanation:

    Economic planning is classified into more types—sectoral and spatial. In sectoral planning, the planners emphasise the specific sector of the economy i.e. agriculture, industry or the services. In spatial planning development is seen in the spatial framework. The spatial dimensions of development might be defined by the pressure and requirements of national economic development. Indian planning has been essentially normative—single level economic planning with a greater reliance on the sectoral approach though the multi-level regional or spatial dimensions are being increasingly emphasised since the early 1990s.

    Click here for GS Economy Study Material

    For further queries and discussion on various subjects click here

     

    DISCLAIMER: JPL and its affiliates shall have no liability for any views, thoughts and comments expressed on this article.

    Latest Videos

    Register to get FREE updates

      All Fields Mandatory
    • (Ex:9123456789)
    • Please Select Your Interest
    • Please specify

    • ajax-loader
    • A verifcation code has been sent to
      your mobile number

      Please enter the verification code below

    This website uses cookie or similar technologies, to enhance your browsing experience and provide personalised recommendations. By continuing to use our website, you agree to our Privacy Policy and Cookie Policy. OK
    X

    Register to view Complete PDF