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Question 1 of 10
1. Question
2 points
Why ‘Indirect Tax’ is considered as regressive taxation
Correct
Indirect taxes make the distribution of income more unequal because of their regressive effects. The poor will get taxed a higher proportion of their income than the rich, making it a regressive tax.
Incorrect
Indirect taxes make the distribution of income more unequal because of their regressive effects. The poor will get taxed a higher proportion of their income than the rich, making it a regressive tax.
Question 2 of 10
2. Question
2 points
Which of the following statements best describes ‘Hard Currency’?
Correct
HARD CURRENCY refers to money that is issued by a nation that is seen as politically and economically stable. HARD CURRENCIES are widely accepted around the world as a form of payment for goods and services and may be preferred over the domestic CURRENCY.
Incorrect
HARD CURRENCY refers to money that is issued by a nation that is seen as politically and economically stable. HARD CURRENCIES are widely accepted around the world as a form of payment for goods and services and may be preferred over the domestic CURRENCY.
Question 3 of 10
3. Question
2 points
A ‘wilful default’ would be deemed to have occurred in which of the following events.
1.Defaulting in meeting its repayment obligations to the lender even when it has the capacity to repay.
2.Not utilising the finance from the lender for the specific purposes for which finance was availed and diverting the funds for other purposes.
3.Disposed off the movable fixed assets or immovable property given for the purpose of securing a term loan without the knowledge of the bank.
Which of the above statements is/are correct?
Correct
Simply, default means non-payment of a loan availed by a borrower. A willful defaulter is an entity or a person that has not paid the loan back despite the ability to repay it.
Incorrect
Simply, default means non-payment of a loan availed by a borrower. A willful defaulter is an entity or a person that has not paid the loan back despite the ability to repay it.
Question 4 of 10
4. Question
2 points
Consider the following statements regarding Devaluation of currency.
1.Devaluation decreases the prices of imports purchased in the home country.
2.Devaluation can be employed to eliminate balance-of-payments deficits.
3.Devaluation will not be effective if the balance-of-payments disequilibrium is a result of basic structural flaws in a country’s economy.
Which of the above statements is/are correct?
Correct
Devaluation, reduction in the exchange value of a country’s monetary unit in terms of gold, silver, or foreign monetary units. Devaluation is employed to eliminate persistent balance-of-payments deficits. For example, a devaluation of currency will decrease prices of the home country’s exports that are purchased in the import country’s currency. While making the exported goods cheaper for other countries, devaluation also increases the prices of imports purchased in the home country. Devaluation will not be effective if the balance-of-payments disequilibrium is a result of basic structural flaws in a country’s economy.
Incorrect
Devaluation, reduction in the exchange value of a country’s monetary unit in terms of gold, silver, or foreign monetary units. Devaluation is employed to eliminate persistent balance-of-payments deficits. For example, a devaluation of currency will decrease prices of the home country’s exports that are purchased in the import country’s currency. While making the exported goods cheaper for other countries, devaluation also increases the prices of imports purchased in the home country. Devaluation will not be effective if the balance-of-payments disequilibrium is a result of basic structural flaws in a country’s economy.
Question 5 of 10
5. Question
2 points
Reserve Tranche is the economic term used in the context with
Correct
A reserve tranche is a portion of the required quota of currency each member country must provide to the International Monetary Fund (IMF) that can be utilized for its own purposes—without a service fee or economic reform conditions.
Incorrect
A reserve tranche is a portion of the required quota of currency each member country must provide to the International Monetary Fund (IMF) that can be utilized for its own purposes—without a service fee or economic reform conditions.
Question 6 of 10
6. Question
2 points
Which of the following were the goals of the planning system in India between 1950-1990?
All the above are the goals of the planning system in India between 1950-1990.
Incorrect
All the above are the goals of the planning system in India between 1950-1990.
Question 7 of 10
7. Question
2 points
Consider the following statements regarding Development banks.
1.Development banks are financial institutions that provide only short-term credit for capital-intensive investments.
2.Such banks often lend at low and stable rates of interest with considerable social benefits.
3.Development banks are often supported by governments in the form of tax incentives for private sector banks and financial institutions to invest in securities issued by development banks.
4.IDBI was set up as an apex body of all development finance institutions.
Which of the above statements is/are correct?
Correct
Development banks are financial institutions that provide long-term credit for capital-intensive investments spread over a long period and yielding low rates of return, such as urban infrastructure, mining and heavy industry, and irrigation systems.
Incorrect
Development banks are financial institutions that provide long-term credit for capital-intensive investments spread over a long period and yielding low rates of return, such as urban infrastructure, mining and heavy industry, and irrigation systems.
Question 8 of 10
8. Question
2 points
Consider the following statements regarding Development banks.
1.Development banks are financial institutions that provide only short-term credit for capital-intensive investments.
2.Such banks often lend at low and stable rates of interest with considerable social benefits.
3.Development banks are often supported by governments in the form of tax incentives for private sector banks and financial institutions to invest in securities issued by development banks.
4.IDBI was set up as an apex body of all development finance institutions.
Which of the above statements is/are correct?
Correct
Development banks are financial institutions that provide long-term credit for capital-intensive investments spread over a long period and yielding low rates of return, such as urban infrastructure, mining and heavy industry, and irrigation systems.
Incorrect
Development banks are financial institutions that provide long-term credit for capital-intensive investments spread over a long period and yielding low rates of return, such as urban infrastructure, mining and heavy industry, and irrigation systems.
Question 9 of 10
9. Question
2 points
Consider the following statements regardingExternal debt of India.
1.The debtors can be the Union government, state governments, corporations or citizens of India.
2.Short-term borrowings dominate India’s external debt.
3.The largest share of India’s external debt is held in Indian rupees.
Which of the above statements is/are incorrect?
Correct
The external debt of India is the total debt the country owes to foreign creditors. The debtors can be the Union government, state governments, corporations or citizens of India. The debt includes money owed to private commercial banks, foreign governments, or international financial institutions such as the International Monetary Fund (IMF) and World Bank.
Incorrect
The external debt of India is the total debt the country owes to foreign creditors. The debtors can be the Union government, state governments, corporations or citizens of India. The debt includes money owed to private commercial banks, foreign governments, or international financial institutions such as the International Monetary Fund (IMF) and World Bank.
Question 10 of 10
10. Question
2 points
Aggregate demand is an important economic indicator. It can be increased by
1.More investments
2.Higher Taxation
3.Increasing bank rate by RBI
Select the correct answer code:
Correct
Aggregate demand is the total demand for final goods and services in an economy at a given time.
Investment creates infrastructure, generates demand for raw material, labor, provides employment and adds to the productive capacity of the economy. It is one of the most potent factors in increasing Aggregate demand (AD).
Incorrect
Aggregate demand is the total demand for final goods and services in an economy at a given time.
Investment creates infrastructure, generates demand for raw material, labor, provides employment and adds to the productive capacity of the economy. It is one of the most potent factors in increasing Aggregate demand (AD).
