UPSC Static Quiz, 23 May 2023

Correct Answer: A
Ans: A the Paris Agreement
● Global Stocktake- It was established under article 14 of the Paris Agreement. The Global
Stocktake is designed to “assess the collective progress towards achieving the purpose of the
Paris Agreement and its long-term goals.”
● The Global Stocktake will evaluate progress at the global level — not the individual country level
— and identify overall trends that should inform countries’ national climate commitments (NDCs),
which are required to be updated at least every five years.
● The purpose of the Global Stocktake is not to create a single point of assessment or a snapshot
in time, but rather a living tool that continually informs countries’ enhanced climate commitments
on issues related to mitigation, adaptation and finance, as well as cross-cutting issues of equity.
● The third and final step of the first Global Stocktake will occur at COP28 in the United Arab
Emirates in 2023. Since the Global Stocktake is set to be completed every five years, this phase
would occur again in 2028 and 2033, etc

Correct Answer: D
Ans: D 1, 2 and 3 only
● Lottery, betting and gambling are actionable claims and come within the definition of goods
under Section 2 (52) of the Central Goods and Services Tax Act, 2017. Thus statement 2 is correct.
● The Supreme Court (SC) has held that lottery, gambling and betting are taxable under the Goods and Services Tax (GST) Act, 2017. Only activities relating to lottery, betting and gambling are subject to GST and except these three, no actionable claim is covered under GST by virtue of Schedule III. Thus, statement 1 is correct.
● Article 366(12) defines goods as “goods” includes all materials, commodities, and articles; thus statement 3 is correct.

Correct Answer: B
Ans: B 2 and 3 only
● The NDS-OM is an electronic, screen based, anonymous, order driven trading system for
dealing in Government securities owned by RBI. The Reserve Bank owns NDS-OM and CCIL
maintains it. Since other financial institutions cannot own g-sec, thus, statement 1 is incorrect.
● The NDS-OM brings transparency in secondary market transactions in Government securities.
The system ensures complete anonymity among the participants as CCIL acts as the central
counterparty (CCP) for settlement of all the trades. Thus, statement 2 is correct.
● RBI has allowed retail investors to open gilt accounts with the central bank to invest in
Government securities (G-secs) directly.
● Under the scheme (Retail Direct Scheme), retail investors (individuals) will have the facility to
open and maintain the ‘Retail Direct Gilt Account’ (RDG Account) with the RBI. thus statement 3
is correct.

Correct Answer: D
Ans: D 1, 2, 3, 4 and 5
● While recommending price policy of various commodities under its mandate, the CACP keeps in
mind the various Terms of Reference (ToR) given to CACP in 2009.
Accordingly, it analyses
1) demand and supply;
2) cost of production;
3) price trends in the market, both domestic and international;
4) inter-crop price parity;
5) terms of trade between agriculture and non-agriculture;
6) a minimum of 50 percent as the margin over cost of production; and
7) likely implications of MSP on consumers of that product.
● It may be noted that cost of production is an important factor that goes as an input in
determination of MSP, but it is certainly not the only factor that determines MSP.
● It takes into account following factors.
-Cost of production
-Changes in input prices
-Input-output price parity
-Demand and supply
-Effect on industrial cost structure
-Effect on the cost of living
-Effect on the general price level
-Parity between prices paid and prices received by the farmers Effect on issue prices and
implications for subsidy.
Thus, all are correct.
https://pib.gov.in/newsite/erelcontent.aspx?relid=46638

Correct Answer: C
Ans: C 1 and 3 only
● Discretionary Fiscal Policy:
The central government exercises discretionary fiscal policy when it identifies an unemployment
or inflation problem, establishes a policy objective concerning that problem, and then deliberately
adjusts taxes and/or spending accordingly. Depending on the situation, the central government
could, for example, institute a tax cut or raise the tax rate, change personal income tax
exemptions or deductions, grant tax rebates or credits, levy surcharges, initiate or postpone
transfer programmes, and either initiate or eliminate direct spending projects.
● PM-Garib Kalyan Anna yojana is a deliberate attempt by the government to help ease the food
inflation for the poor and to stimulate demand. Thus 1 is correct.
● Similarly, increasing income tax to combat inflation is a DFP, as when larger share will go in
income tax, people will have less money, thus liquidity contained. Hence statement 3 is correct.
● Another type of fiscal action — automatic stabilization — takes place when changing economic
conditions cause government expenditures and taxes to change automatically, which, in its turn,
helps to combat unemployment or demand-pull inflation. Two automatic fiscal policy stabilizers
are of primary importance transfer payments, especially unemployment compensation, and the
personal income tax.
● For instance, during recession, the income of individuals decreases and thus their income tax
also decreases and consequently they are left with more money to spend and thus this
automatically stabilizes the economy and vice-versa. Thus statement 2 is incorrect.
● Statement 4 is incorrect because the accommodative stance of the Central Bank is a monetary
policy and not a fiscal policy.