Top 550+ Solved Indian Economy MCQ Questions Answer

From 61 to 75 of 798

Q. Convertibility of the rupee implies: [IAS 1994]

a. being able to convert rupee notes into gold

b. freely permitting the conversion of rupee to other major currencies and vice versa

c. allowing the value of the rupee to be fixed by market forces

d. developing an international market for currencies in India

  • b. freely permitting the conversion of rupee to other major currencies and vice versa

Q. Black money is :

a. counterfeit currency

b. illegally earned money

c. money earned through underhand deals

d. income on which payment of tax is usually evaded

  • d. income on which payment of tax is usually evaded

Q. Broad money in India is :

a. M1

b. M2

c. M3

d. M4

  • c. M3

Q. The Issue Department of the RBI maintains a _______ against printing of notes:

a. Minimum Reserve System

b. Proportional Reserve System

c. Proportional Gold Reserve System

d. Proportional Foreign Securities Reserve System

  • a. Minimum Reserve System

Q. Which of the following is incorrect about convertibility?

a. The exchange rate should be determined by the forces of demand and supply of the currency

b. The exchange rate' would indicate the strength of the economy

c. It would discourage black market transactions

d. The RBI will be a direct player now rather than being an indirect one

  • d. The RBI will be a direct player now rather than being an indirect one

Q. The States' debt does not include:

a. loans from State Bank of India

b. loans from the Central Government

c. Provident Funds

d. treasury bills issued to international financial institutions

  • d. treasury bills issued to international financial institutions

Q. Hard Currency is defined as currency:

a. which can hardly be used for international transactions

b. which is used in times of war

c. which loses its value very fast

d. traded in foreign exchange market for which demand is persistently relative to the supply

  • d. traded in foreign exchange market for which demand is persistently relative to the supply

Q. Inflation implies: [Railways 1994]

a. rise in budget deficit

b. rise in money supply

c. rise in general price index

d. rise in prices of consumer goods

  • c. rise in general price index

Q. The situation with increasing unemployment and inflation is termed as: [CPO AC 2003]

a. hyperinflation

b. galloping inflation

c. stagflation

d. reflation

  • c. stagflation

Q. Which of the following factors contributes to an inflationary trend?

a. 15% fall in production of industrial goods

b. 15% increase in prices of agricultural products

c. 15% increase in supply of money in the market

d. none of these

  • c. 15% increase in supply of money in the market

Q. Which of the following can be used for checking inflation temporarily?

a. Increase in wages

b. Decrease in money supply

c. Decrease in taxes

d. None of the above

  • b. Decrease in money supply
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