Economy has always been a vital part of the IAS prelims general studies paper. The candidates are expected to be familiar with the recent economic developments world over in general and India in particular. One can’t afford to ignore the subject in the course of preparation given its enormous importance. Here we are giving a set of 20 questions from the subject, flick through the questions to assess your preparation level.
1. Which body in India finally provided tax exemption on the 9.5 per cent interest income on PF deposits for 2010-11?
a. Reserve Bank of India
b. Income Tax Department
c. Employees’ Provident Fund Organisation
d. Corporate Affairs Ministry
Answer: (b)
2. The Reserve Bank of India (RBI) capped bank investments into liquid schemes to what per cent of the bank’s net worth?
a. 15%
b. 10%
c. 12%
d. 13.2%
Answer: (b)
3. The information and broadcasting ministry endorsed/okayed the recommendation by TRAI to enhance foreign direct investment (FDI) ceiling for direct to home TV, Internet protocol TV and teleport from 49% to _%.
Complete the sentence by filling in the correct percentage.
a. 70%
b. 74%
c. 75%
d. 78%
Answer: (b)
4. According to data released by the Controller General of Accounts on 31 May 2011 the fiscal deficit went down to what percentage in 2010-11?
a. 5.2%
b. 4.7%
c. 4%
d. 3.56%
Answer: (b)
5. Consider the following statements:
1. A committee on natural resources allocation called for the creation of a national coal market to ensure greater transparency in the allocation of the dry fuel and reduce the demand-supply mismatch.
2. The operation of the platform, which would be owned by FICCI and register all approved users, could be regulated by the proposed coal regulator.
3. The committee highlighted that introduction of both captive mining and e-auctions were right steps taken in the direction of moving toward market-based allocation.
4. The committee headed by former Finance Secretary Sumit Bose recommended creation of a platform for commercial trading of coal by suppliers and buyers
Which of the above statement/statements is/are true?
a. 2 & 4
b. 1 & 3
c. 1 & 2
d. 2 & 3
Answer: (b)
6. Which of the following was/were declared to be delisted by the Tata Steel?
a. Tata BlueScope Steel
b. Riversdale Mining
c. Both the above companies
d. None of the above
Answer: (b)
7. What is correct regarding FDI in the financial year 2010-11?
a. FDI was stagnant in comparison with the financial year 2009-10
b. FDI by Indian firms jumped more than two-folds in financial year 2010-11
c. FDI dipped tremendously
d. None of the above
Answer: (b)
8. The Export-Import Bank of the U.S. on 18 July 2011 sanctioned loans worth $1.4 billion (about Rs.6300 crore) for companies in which of the following Indian sectors, thereby increasing their investment in that sector?
a. Handloom & Cottage industries
b. Renewable energy sector
c. IT
d. Media & Entertainment
Answer: (b)
9. A study titled Being five star in productivity — road map for excellence in Indian banking was released FICCI-IBA-BCG on 22 August 2011, the eve of IBA-FICCI annual banking conference. Which of the facts related to the report stated below are not true?
1. India's gross domestic product (GDP) growth will make the Indian banking industry third largest in the world by 2025.
2. The report highlighted that banks have to strive for excellence on three dimensions: branch sales and service, new channels and lean operations
3. Indian banks deploy 62 per cent of staff in customer facing roles as against the benchmark of 82 per cent observed by BCG globally.
4. Indian banks, the report mentioned were to be doing well overall with industry cost-income ratio below 50 per cent.
a. 1 & 3
b. Only 3
c. Only 2
d. 3 & 4
Answer: (c)
10. The Cabinet Committee on Economic Affairs on 30 August 2011 approved disinvestment of 5 per cent of its stake in which of the following Central Public Service Enterprises (CPSE)?
a. NTPC
b. HPCL
c. BHEL
d. SAIL
Answer: (c)
11. The Agriculture Ministry on 20 October 2011 proposed a hike of Rs 115 per quintal in the minimum support price (MSP) of wheat to what sum per quintal to cover rising farm input cost and encourage farmers to increase acreage?
a. Rs 1251 per quintal
b. Rs 1293 per quintal
c. Rs 1285 per quintal
d. Rs 1233 per quintal
Answer: (c)
12. Which stock exchange in India launched operations on the National Stock Exchange (NSE) platform on 28 November 2011 and became the only stock exchange in India to offer facility to trade on three trading platforms?
a. Guwahati Stock Exchange
b. Bombay Stock Exchange
c. MCX Stock Exchange (MCX-SX)
d. Ahmedabad Stock Exchange
e. Calcutta Stock Exchange
Answer: (e)
13. Union government raised the ad valorem duty (export duty) on iron ore exports to what per cent from 20 percent?
a. 30%
b. 33%
c. 41%
d. 43%
Answer: (a)
14. Which of the following bodies unveiled rules for direct investment in stocks by foreign investors, including individuals to put curbs on opaque structures to prevent routing of funds by resident Indians?
a. IRDA
b. FICCI
c. CCI
d. SEBI
Answer: (d)
15. The Prime Minister's Economic Advisory Panel (PMEAC) on 22 February 2012 projected 7.5 - 8 per cent growth rate for the fiscal 2012-13. Which of the following facts are true with respect to the above statement?
1. The economy recorded a growth rate of 8.4 per cent in 2010-11, which according to the CSO estimates is expected to moderate to 6.7 per cent in the current fiscal 2011-12
2. Inflation was projected to moderate to 6.5% by March 2012 and 5-6 per cent in 2012-13.
3. The manufacturing sector was projected to grow by 4.8 percent while construction segment is expected to expand by 5.3 percent.
4. Projected Gross Domestic Product (GDP) growth for 2012 is substantially down from the budgetary target of around nine percent, and 8.4 percent expansion registered in 201
a. Only 4
b. Only 1
c. Only 2
d. 1, 2 & 4
Answer: (d)
16. Union government on 23 March 2012 reduced the import tariff value of which metal from USD 573 per 10 grams to USD 530 per 10 grams?
a. Gold
b. Silver
c. Copper
d. Iron
Answer: (a)
17. Credit rating agency Moody's Investors Service downgraded the local currency rating of which of the following?
a. BHEL & IOC
b. BHEL & GAIL
c. ONGC & IOC
d. ONGC & GAIL
e. ONGC & BHEL
Answer: (d)
18. International Monetary Fund (IMF) in its World Economic Outlook (WEO), released ahead of the IMF-World Bank Spring Meetings, marginally lowered India’s economic growth forecast to what per cent in 2012?
a. 4%
b. 3.5%
c. 6.9%
d. 7.3%
Answer: (c)
19. Which of the following rating organization, revised the credit outlook rating for India from stable to negative?
a. Moody’s
b. Goldman Sachs
c. Standard and Poor’s
d. Crisil
Answer : c
20. Union Government decided on 1 million Cap on External Commercial Borrowing for which of the following sectors?
a. Handicraft & Small Industries sector
b. Power sector
c. Aviation sector
d. Insurance sector
Answer: (c)
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