Economics · Banking Financial Awareness

Indian Economy and Policy

1,777 Questions

Indian economy and policy questions cover the structural dynamics and regulatory measures shaping the national market. Topics include foreign direct investment, taxation reforms, and government initiatives for growth. This section is highly relevant for competitive exams requiring economic awareness.

Foreign direct investmentGST impactEconomic reformsTrade policyGovernment economic initiatives

Indian Economy and Policy Questions

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Economic reforms of 1991 were introduced to ___________.

  1. Social structure of the country

  2. To demolish Zamindari system

  3. Maintain balance of payment

  4. All of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

In 1991, India met with an economic crisis relating to its external debt. India approached the International Bank for Reconstruction and Development (IBRD)  and the International Monetary Fund (IMF). 

India agreed to the conditionalities of IBRD and IMF. On the basis of these conditions, Economic reforms of 1991 were introduced. These measures were introduced to maintain the balance of payment and to bring inflation under control.

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Which of the following are highlights of the Liberalisation, Privatisation and Globalisation Policy in India?

  1. Foreign Technology Agreements

  2. Industrial Licensing

  3. Abolition of License -Permit Raj

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Following are highlights of the Liberalisation, Privatisation and Globalisation Policy in India :-

  • Foreign Technology Agreements
  • Industrial Licensing
  • Abolition of License-Permit Raj

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

The Government of India took some measures in 1991 for rapid industrialisation. The measures included______. 

  1. Abolition of industrial licensing

  2. Allowing foreign investment

  3. Encouragement to private sector

  4. Co-existence of public and private sectors

  5. All of the above
Reveal answer Fill a bubble to check yourself
E Correct answer
Explanation

The Government of India took some measures in 1991 for rapid industrialisation. The measures include:-

  • Abolition of industrial licensing
  • Allowing foreign investment
  • Encouragement to private sector
  • Co-existence of public and private sectors.

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

The ultimate benefits of liberalisation, privatisation and globalisation in India are the _____.

  1. sizeable decrease in foreign exchange reserves

  2. sizeable increase in foreign exchange reserves

  3. sizeable decrease in income of the country

  4. drying up of country's foreign exchange reserves
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The economy of India had undergone significant policy shifts in the beginning of the 1990s. This new model of economic reforms is commonly known as the LPG or Liberalisation, Privatisation and Globalisation model. The primary objective of this model was to make the economy of India the fastest developing economy in the globe with capabilities that help it match up with the biggest economies of the world.

Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Which feature was not included in the new industrial policy in 1991?

  1. Privatisation

  2. Liberalisation

  3. Nationalisation

  4. Globalisation
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Nationalisation was not included in the Industrial Policy of 1991. The policy envisaged disinvestment of government equity in public sector to mutual funds, financial institutions, the general public, and workers.

Multiple choice economics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

What was the reason for scarce resources in Indian domestic market?

  1. Large export surplus

  2. Large import surplus

  3. Large export deficit

  4. Large import deficit
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Scarce resources in Indian domestic market was because the British exported manufactured goods in surplus because selling manufactured goods means making more money as a state. Having more money as a state in return means that it can reinvest and can help its citizens better.

Multiple choice economics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Why did the export surplus not increase Indian wealth?

  1. The gold and silver earned from exports were used to purchase less expensive finished goods from Britain

  2. The gold and silver earned from exports were used to purchase more expensive finished goods from Britain

  3. The gold and silver earned from exports were used to purchase equally costing finished goods from Britain

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The reason why the British wanted to export manufactured goods is because selling manufactured goods means making more money as a state. Having more money as a state in return means that it can reinvest and can help its citizens better, or spend the money in any other way it had to, to keep the country going .The Britishers utilized the wealth earned from export not for India's development but to  purchase expensive  and materials from Britain for their own use.

Multiple choice economics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Why was India's foreign trade heavily restricted?

  1. As it would benefit Britain

  2. As it would benefit India

  3. As it would benefit India and Britain

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

They exported raw materials from India at cheap rates and imported finished goods from Britain which adversely affected the Indian industries and economy as a whole.The British imposed heavy duties on exportation of Indian goods and no duties were levied on British goods which benefited them. The British ruled India to drain its resources and thus turned India into a colonial economy. They adopt various policies and methods which adversely affected the Indian Economy. 



Multiple choice civics foreign trade in india the government and economic development indian economy on the eve of independence impact of technology on livelihoods

Which of the following is not the main feature of economic reforms?

  1. Liberalization

  2. Privatization

  3. Planned economy

  4. Globalization
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Panned economy is not the main feature of economic reforms. New economic policy was adopted by the Government of India in the year of 1991. It was based on liberalization, privatization and globalization. It helped to create a more free economy.

Multiple choice business studies tourism, transport and communication importance of transport system importance of transportation system introduction to transport and communication

Indian tourism promotes ________.

  1. National integration

  2. Rural backwardness

  3. Economic disparity

  4. Localization of industries
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Tourism promotes national integration, provides support to local handicrafts and cultural pursuits. It also helps in the development of international understanding about our culture and heritage. 

Multiple choice organization of commerce and management entrepreneurship opportunities for an entrepreneur small business and enterprises entrepreneurship development

___________ assist in accelerating the pace of industrialization in the backward areas and reduce the concentration of economic power in the hands of a few.

  1. Managerial Development Programmes

  2. Entrepreneurship Development Programmes

  3. Industrial Development Programmes

  4. On-the job trainings
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Entrepreneurship Development Programmes aims at building or developing the entrepreneurship skills and potentials among an individual. They assist in accelerating the pace of industrialization in the backward areas and reduce the concentration of economic power in the hands of a few.

Multiple choice organization of commerce and management entrepreneurship opportunities for an entrepreneur small business and enterprises entrepreneurship development

What led to development of Entrepreneurship in India?

  1. Growing concern for economic development

  2. Increase in population

  3. Too many professionals in India.

  4. Both (a) and (b)
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The 1991 economic liberalization in India led to Entrepreneurship as a catalyst in growth of business and economic development, that transformed India from a struggling economy to one of the best economies in the world.

Multiple choice business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

Which of the following suggests a micro approach for India?

  1. Identifying the causes of large scale unemployment in India.

  2. Input output analysis for the economy.

  3. Finding causes of high turnover in ABC Ltd.

  4. Analysing distribution of coal in the country.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Finding causes of high turnover in ABC Ltd. is a micro approach as it is related to a single firm and not to the whole economy.

Multiple choice business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

From the national point of view which of the following indicates micro approach?

  1. Per capital income of India

  2. Under employment in agricultural sector

  3. Lock out in TELCO

  4. Total savings in India
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

'Lock out in TELCO' is micro approach, because microeconomics deals with individual part of the society rather than all the units combined.

Multiple choice business economics and quantitative methods introduction to micro economics microeconomics and macroeconomics : introduction economic ideas of j k mehta micro and macro economics

Which of the following does not suggest a macroeconomic approach for India?

  1. Determining the GNP of India.

  2. Finding the causes of failure of X and Co.

  3. Identifying the causes of inflation in India.

  4. Analyse the causes of failure of industry in providing large scale employment.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Macro economics deals in the study of a nation's aggregate demand, aggregate supply, national income, employment, inflation etc. Therefore, it does not deal in individual variables like X and Co , it is micro approach because micro deals with individual part of the society.