SEM 5 MCQS

1. Since 1951, India has been a _______________ economy.

A) Socialist
B) Capitalist
C) Mixed
D) Feudal
2. The fiscal crisis faced by the Indian economy in 1990s was caused primarily by
A) widening gap between imports and exports
B) difference between savings and investment
C) widening gap between government expenditure and revenue
D) difference between aggregate demand and aggregate supply
3. which of the following factors was one of the primary causes of the balance of payments
crisis in 1991?
A) low rate of inflation
B) surplus budget
C) high interest rate
D) rising oil price and poor remittances
4. which of the following sentences would best describe the Indian economy in 1990-91?
A) high inflation low foreign exchange reserves
B) low inflation low foreign exchange reserves
C) huge current account deficit fiscal surplus
D) current account surplus huge fiscal deficit
5. which of the following measures was adopted in 1991 to stabilise the economy?
a) banking sector reforms
b) capital market reforms
c) control of inflation
d) insurance reforms
6. one of the measures adopted to control inflation in 1990-91 was
a) lowering of CRR and SLR
b) lowering of bank rate
c) raising CRR and SLR
d) restricting imports of essentials commodities
7. which of the following measure did not form a part of fiscal correction in 1991?
a) increasing tax collection
b) cutting down subsidies
c) Reducing budgetary support to public enterprises
d) Raising tax rates
8. Which of the following measures was implemented by the government in order to reduce
current account deficit?
a) Revaluation of the rupee
b) Strict exchange control
c) Devaluation of the rupee
d) Import restrictions were increased
9. Structural reforms are
a) Long term measure
 b) Improve the supply side of the economy
c) Remove growth bottlenecks
d) All the above
10. Which of the following was not a feature of the new industrial policy 1991?
a) Abolition of industrial licensing
b) Setting up of new public sector enterprises
c) Permitted foreign investment
d) Removal of MRTP limit
11. One of the policies adopted to make public sector more efficient was
a) Raising fresh equity from the market
b) Increasing governments shareholding in public enterprise
c) Maintaining public sector monopoly
d) Increasing operational control on public enterprises by the government
12. Which of the following is an important is an important banking sector reform introduced in
1991?
a) Raising SLR and CRR
b) RBI determined interest rates
c) Introduction of prudential norms
d) None of the above
13. Capital adequacy norms help to
a) Increase banks profits
b) Maintain financial stability
c) Control inflation
d) Reduce balance of payments deficit
14. Capital market reforms includes
a) Setting up of SEBI
b) Special recovery tribunals
c) Introductions of capital adequacy norms
d) Deregulations of interest rates
15. The FDI limit in the insurances sector in India is
a) 100%
b) 79%
c) 49%
d) 26%
16. Which of the following is true of social infrastructure?
a) It includes the education and health network
b) It is aimed at improving quality life
c) It is an investment in human capital
d) All the above
17. Which of the following describes the change in India after 1991
a) Reduced private investment in education health
b) Increased job security
c) Reduced subsidies to social sector in relative terms
d) Increased formal jobs creation
18. According to the human development report 2016 India HDI rank is_______ among 188
countries
a) 131
b) 125
 c) 141
d) 100
19. Which of the following is not true of the right to education act
a) Free education to all children between 6 and 14 years
b) It was enacted in 2009
c) It is an adult literacy programme
d) It is aimed at providing quality elementary education
20. Which of the following describes the change in India after 1991?
a) Reduced private investment in education and health
b) Increased job security
c) Reduced subsidies to social sector in relative terms
d) Increased formal jobs creation
21. According to the human development report 2016, India’s HDI rank is _______ among 188
countries.
a) 131
b) 125
c) 141
d) 100
22. Which of the following is not true of the right to education act?
a) Free education to all children between 6 to 14 years
b) It was enacted in 2009
c) It is an adult literacy programme
d) It is aimed at providing quality elementary education
23. The scheme for providing residential schools as elementary level for girls is
a) National programme for education of girls at elementary level
b) Model schools’ scheme
c) Rashtriya Madhyamik Shiksha Abhiyan
d) Kasturba Gandhi Balika Vidyalaya
24. The scheme for improving access to secondary education is
a) National programme for education of girls at elementary level
b) Model schools’ scheme
c) Rashtriya Madhyamik Shiksha Abhiyan
d) Kasturba Gandhi Balika Vidyalaya
25. Community health centres are located at the ________ level of public infrastructure.
a) Primary
b) Secondary
c) Tertiary
d) None of the above
26. AIIMS are at the __________ level of public health infrastructure
a) Primary
b) Secondary
c) Tertiary
d) None of the above
27. The _____ provides a reference point for the functioning of the public health centres
a) Indian public health standards
b) Indian public health Guidelines
c) Indian public health Manual
d) Indian public health rules
28. Which of the following is a programme aimed at controlling the spread of communicable
diseases?
a) National oral health programme
b) National mental health programme
c) National TB control programme
d) National programme for prevention and control of deafness
29. _________ is a fund that financially supports poor patients suffering from major life
threatening illnesses
a) Rashtriya Swasthya Bima Yojana
b) Rashtriya Arogya Nidhi
c) Pradhan Mantri Swasthya Yojana
d) All of the above
30. Rashtriya Swasthya Bima Yojana provides health insurance coverage to
a) Workers in the unorganized sector
b) Workers in the organized sector
c) The entire population
d) Only women and children
31. Which of the following statements best describes economic development?
a) It always accompanies economic growth
b) It indicates the increase in GDP
c) It is reflected in the quality of life of the people
d) It is a quantitative concept
32. Which of the following is not included in UNDP’s HDI composite?
a) Culture
b) Education
c) Health
d) Standard of living
33. Sustainable developments includes which of the following?
a) Economic development
b) social development
c) Environmental development
d) All the above
34. __________ is responsible for coordinating the SDG’s in India
a) Planning Commission
b) Ministry of human resource development
c) NITI Aayog
d) Ministry of finance
35. _________ is an initiative to make India a manufacturing hub
a) Skill India
b) NITI Aayog
c) Invest India
d) Make in India
36. The scheme for skill training of youth to be implemented through the national skill
development corporation is
a) National skill development mission
b) Pradhan Mantri Kaushal Vikas Yojana
c) Skill loan scheme
d) All the above
 37. Which of the following constitutes foreign direct investment?
a) Purchase of stocks
b) Reinvestment of earning by a wholly owned subsidiary abroad
c) Lending of funds to a foreign subsidiary
d) All the above
38. Which of the following best describes horizontal foreign direct investment?
a) FDI into industry that provide inputs to the firm
b) FDI into industry that uses the firm’s output
c) Long term lending to a foreign firm
d) FDI in the same industry abroad as the foreign investors firm
39. Which one of the following is not one of the benefits of FDI?
a) Culture of consumerism
b) Infrastructure development
c) Transfer of technology
d) Sectoral development
40. Which of the following are advantages of TNCs?
a) Direct and indirect employment generation
b) Increased competition
c) Industrial expansion
d) All the above
41. The government institution that is responsible for formulation of FDI policy in India is
a) Foreign investment promotion board
b) The department of industrial policy and promotion
c) The ministry of external affairs
d) The RBI
42. Which of the following was not a part of the FDI policy 2017?
a) Strengthening the FIPB
b) Introduction of foreign investment facilitation portal
c) Introduction of standard operating procedures
d) Issue of convertible notes by start-ups
43. Which of the following sectors has received the highest FDI equity investment in India during
April-December 2017?
a) Retail
b) Banking
c) Telecommunication
d) Software
44. Which country has been the highest source of FDI to India during April-December 2017?
a) Japan
b) USA
c) Singapore
d) Mauritius

Mod 2

45. The objective of national agricultural policy 2000 is to achieve agriculture growth rate of
a) 3%
b) 4%
c) 5%
d) 6%
46. the average agriculture growth rate since 2000 is
a) above 4%
b) less than 4 %
c) 4%
d) -4%
47. Agriculture prices in India are
a) Very certain
b) Uncertain
c) Very remunerative
48. Agriculture price policy is required to
a) Provide incentives to farmers
b) To encourage farmers to spend more
c) To increase income inequality
49. Minimum support price guarantees the farmer with
a) High income
b) Floor price
c) Competitive price
50. Issue price is at which the government supplies food grains
a) In the open market
b) To the middleman
c) To ration shops
51. Fair price shops protect the interest of
a) Poor farmers
b) Poor consumers
c) Poor traders
52. Price policy mainly benefits
a) Small farmers
b) Marginal farmers
c) Large farmers
53. Major part of the agricultural credit is supplied by
a) Money lenders
b) Commercial banks
c) Co-operative banks
54. RRB’s were established to provide credit to
a) Only to non-agricultural activities in rural areas
b) Both agricultural and non-agricultural activities
c) Only to agricultural activities
55. Kisan Credit Card was introduced by
a) RBI
b) NABARD
c) Co-operative banks
56. Non- institutional credit very often leads to
a) Indebtedness
b) Exploitation of borrowers
c) Loss of land and property
d) All the above
57. Farmers require long term credit for
a) Consumption expenditure
 b) Purchase of land
c) Purchasing seeds and fertilizers
58. Regional Rural Banks were established to provide finance to
a) Small and marginal farmers
b) Village artisans
c) Agricultural labourers
d) All the above
59. Agricultural market faces the problems of
a) Seasonal price fluctuation
b) Low prices when crop fails
c) High prices when there is bumper crop
60. Demand for agricultural commodities
a) Very elastic
b) Unit elastic
c) Less elastic
61. Regulated markets aim at protecting
a) Consumers
b) Farmers
c) Traders
d) Both a and b
62. AGMARK enables to ensure
a) Quality of product
b) Better price
c) Bothe a and b
63. Market information reduces exploitation of
a) Farmers
b) Traders
c) Commission agents
d) None of the above

Mod 3

64. Industrialisation involves

a) Technological innovation
b) Social changes
c) Relative decline of agriculture’s share in the GDP
d) All the above
65. Functional composition of industries refers to
a) Ownership based criteria
b) Use based criteria
c) Investment based criteria
d) Turnover based criteria
66. Which of the following is not a apart of the new industrial policy 1991?
a) Increased investment in public sector enterprises
b) Abolition of licensing policy
c) Encouraging foreign direct investment
d) Amendment of MRTP act
67. IIP measures
a) Industrial inputs inflation
 b) Growth of industrial production
c) Growth of industrial investment
d) Growth of industrial exports
68. Currently, the base year for estimating IIP is
a) 1993-94
b) 2004-05
c) 2015-16
d) 2011-12
69. Which of the following is not an objective of the competition Act 2002?
a) Prohibition of anti-competitive agreements
b) Regulation of combinations
c) Control of monopolies
d) Prohibition of abuse of dominant position
70. Competition advocacy refers to
a) Control of monopolies
b) Restricting investments through licensing
c) Control of unreasonable profits
d) Promoting a competition culture
71. Which of the following statements is not true of the PSUs in India?
a) They have generated large scale employment
b) They have high returns on investment
c) They have saved foreign exchange
d) They have created a diversified industrial base for India
72. Which of the following is a problem faced by the PSUs in India?
a) Mounting losses
b) Underutilization of capacity
c) Administrative defects
d) All the above
73. The central government department responsible for disinvestment is
a) Department of investment and public asset management
b) Department of commerce
c) Department of industrial policy and promotion
d) Department of revenue
74. Which of the following is not a function of the DIPAM?
a) Advising government of matters related to CPSE
b) All matters relating to sale of central government equity through offer for sale or private
investment
c) Decision on the recommendations of administrative ministries, NITI Aayog for
disinvestment
d) Promotion of foreign direct investment
75. Offer of shares by a listed CPSE or the government out of its shareholding or a combination
of both to the public for subscriptions is done through
a) Initial public offering
b) Offer for sale
c) Further public offering
d) Strategic sale
76. Only financial institute can participate in
a) Initial public offering
 b) Offer for sale
c) Further public offering
d) Institutional placement programme
77. In 1999, the investment limit of the small-scale unit was determined at
a) 25 lakhs
b) 50 lakhs
c) 1 crore
d) 5 crores
78. The MSME Act was passed in
a) 2005
b) 2002
c) 2008
d) 2006
79. According to the MSME Act micro manufacturing units are classified as those with
investment limit of
a) 25 lakhs
b) 50 lakhs
c) 1 crore
d) 75 lakhs
80. ________ units in the ___________ sector have an investment range between 2 crore and 5
crores
a) Medium, manufacturing
b) Micro, manufacturing
c) Small, service
d) Medium, service
81. A separate ministry for small industries was setup in
a) 1991
b) 1999
c) 2007
d) 2005
82. ________ is the nodal development agency for the MSME sector
a) Division commissioner MSME
b) Development commissioner MSME
c) Directorate general MSME
d) Development council MSME
83. ____________ is a SIDBI initiative that provides capital to new SME starts-up
a) ISARC
b) Credit Guarantee Fund Trust
c) CLCSS
d) SIDBI Venture capital ltd
84. ________ is not a SIDBI initiative
a) ICRA
b) SMERA
c) CGFT
d) ISARC
85. The MSME- MDA does not provide funding to MSMEs for
a) Participation in international trade
b) Acquiring quality and environmental certifications
 c) Carrying out sector specific market studies
d) Contesting anti-dumping cases
86. The scheme to improve ease of doing business in the MSME sector is
a) SFURTI
b) UAM
c) CLCSS
d) ASPIRE
87. The law enacted as an outcome of the Bhopal gas tragedy is
a) Public liability insurance act
b) The Environment(protection) Act
c) The Air (prevention and control of pollution) Act
d) All the above
88. Which of the following is not true of toxic wastes in India?
a) There are highly efficient systems for their disposals
b) They can be caused by e waste
c) Handling them can be fatal at sometimes
d) These constitutes 10-15% of industrial waste
89. Bharat stage IV emission standard were opted in
a) 1991
b) 2001
c) 2015
d) 2005
90. Air pollution is caused by
a) The release of harmful gases
b) Solid and liquid particulate materials
c) Smoke emissions
d) All the above
91. Which of the following is not true about global warming?
a) It is causing glaciers to melt
b) It has put human lives to threat
c) It has prevented extinction of wildlife
d) It has resulted in frequent natural calamities
92. Which of the following is not a characteristic of the service sector?
a) Output includes intangible products
b) Is the fastest growing sector globally
c) Produces primary products
d) Involves a wide range of activities
93. Which of the following activities does not belong to the service sector in India?
a) Retail trade
b) Real estate
c) Insurance
d) Automobile
94. In 2017-18. the service sectors contribution to the GVA was
a) 55.2%
b) 65.2%
c) 59%
d) 45%
 95. Service sectors contribution to employment as percentage of total employment in 2015-16
was
1) 40%
2) 32%
3) 50%
4) 25%
96. The FDI limit in multi-brand retailing is
a) 49%
b) 74%
c) 100%
d) 51%
97. FDI limit in single branding retailing is
a) 49%
b) 74%
c) 100%
d) 51%
98. The healthcare industry includes
a) Hospitals
b) Health insurance
c) Pharmaceuticals companies
d) All the above
99. The FDI limit permitted for all health related services under automatic route is
a) 51%
b) 100%
c) 74%
d) 26%
100. Which of the following is not a characteristic of the Indian health care industry?
a) Every citizen has access to high quality services
b) Inadequate infrastructure
c) High incidence of diseases
d) Inadequate insurance coverage
101. Type of tourism that helps conserve natural diversity is
a) Eco tourism
b) Heritage tourism
c) Adventure tourism
d) Medical tourism

Mod 4

102. A scheduled bank is one which has

a) Paid up capital and reserve not less than 5 lakh
b) Term deposit of 5 lakh
c) Demand deposit of 5 lakh
103. Public sector banks include
a) Only state bank of India
b) Only nationalised banks
c) Only regional rural bank
d) All the above
104. The population for every bank branch in 2015 was
 a) 64000
b) 16000
c) 10,300
d) 12000
105. To promote financial inclusion on 28 august 2014 the following new scheme was
introduced
a) Garibi Hatao
b) The Pradhan Mantri Jan Dhan Yojana
c) Mahatma Gandhi national rural employment guarantee scheme
106. Which one of the following schemes was introduced under operational technology
a) ATMs
b) Mobile banking
c) Electronic fund transfers
d) All the above
107. In 2017 advances of commercial banks to the priority sector was
a) 40%
b) Less than 40%
c) More than 40%
108. Financial inclusion aims at providing financial services to
a) Industrialist
b) Poor people
c) Indian investors abroad
d) Rich people
109. In recent years Indian banks have increased their efficiency by
a) Using informational technology
b) By reducing number of employees
c) By increasing number of branches
110. Virtual banking aims at rendering banking services through
a) Branch expansion
b) Advancing cheap credit
c) Use of IT services
111. The IRDA Act was passed in the year
a) 1999
b) 1998
c) 2000
d) 1997
112. Insurance Regulatory and Development Authority was established in the following
year?
a) 1999
b) 2000
c) 2001
d) 1998
113. How much FDI is allowed in the insurance companies
a) 26%
b) 49%
c) 51%
d) 75%
114. Which of the following committee was established to suggest insurance sectors
reforms?
a) Malhotra committee
b) Rangarajan committee
c) Narashimham Committee
d) Raja Chelliah Committee
115. Which of the following is a part of the organised sector of Indian money market?
a) Indigenous bankers
b) Loan companies
c) Call money market
d) Money lenders
116. Which of the following is not the main player of the Indian money market??
a) Government
b) RBI
c) Commercial banks
d) Over the counter exchange of india
117. Which of the following are the main participants in the call money market?
a) Commercial banks
b) Cooperative banks
c) Primary dealers
d) All the above
118. Which of the following is not the feature of commercials bills?
a) Short term
b) Trade bills
c) Issued by RBI
d) High degree of liquidity
119. Which of the following money market instruments is issued by commercial banks?
a) CPs
b) Commercial bills
c) CDs
d) Treasury bill
120. Which of the following measures liquidity from the financial system?
a) Repo
b) Reverse repo
c) MSF
d) Buying of securities under OMO
121. Capital market is a market for
a) Short term funds
b) Long term funds
c) Medium term funds
d) Medium- and long-term funds
122. Which of the following does not constitute the structure of capital market in India?
a) Gilt edged market
b) Industrial securities market
c) RBI
d) Mutual funds
123. The primary market does not include
a) Equity issues
 b) GDR issues
c) Screen based trading
d) Debt issues
124. Which of the following measures constitute primary market reforms?
a) Abolition of controller of capital issues
b) Setting up of NSE
c) Setting up of OTCEI
d) None of the above
125. Secondary market reforms does not include
a) Screen based trading
b) LAF
c) Depository system
d) Rolling settlement
126. Foreign institutional investors are allowed to invest in
a) Only equity shares
b) Only debt market
c) Both the above market
127. The over Counter Exchange of India (OTCEI) allows the companies to register only in
a) OTCEI
b) OTCEI AND NSE
c) OTCEI AND BSE
128. Mutual funds play an important role in Indian capital market as
a) Speculator in stock market
b) Investment avenue for small investors
c) Promoter of large-scale industries