Rau’s IAS Mains Compass 2022 Economic Development PDF

Rau's IAS Mains Compass 2022 Economic Development PDF

Rau’s IAS Mains Compass 2022 Economic Development PDF

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Rau’s IAS Mains Compass 2022 Economic Development PDF:- Today be are sharing Rau’s IAS Mains Compass 2022 Economic Development PDF. This Rau’s IAS Mains Compass 2022 Economic Development PDF for upcoming examination like UPSC PRE & MAINS. Rau’s IAS Mains Compass 2022 Economic Development PDF if you are doing preparation for UPSC CSE so today we have brought for you all the material Notes You can download Rau’s IAS Mains Compass 2022 PDF free from the given link below. these Notes will cover all important subjects of the IAS Exam like Ethics Economic Development History & Culture of India International Relations & Security etc.

Rau’s IAS Mains Compass 2022 Economic Development PDF The UPSC Mains exam is the second stage of the Civil Services Examination. IAS aspirants who clear the Mains i.e. those who score above the cutoff in General Studies Paper I and more than 33% marks in General Studies Paper-II (CSAT) are eligible to appear for the UPSC Mains.

Rau’s IAS Mains Compass 2022 Economic Development PDF The UPSC Mains Test Series & Quality Improvement Program for Mains has been designed to enable UPSC aspirants develop multi-dimensional perspective across themes important for IAS Mains & improve their answer writing skills through tests, test discussions, evaluation, personal mentoring and mains revision classes. Compass Magazines provide in depth analysis of each and every topic which is important for mains. Rau’s IAS Mains Compass 2022 Economic Development PDF for upcoming examination like UPSC PRE & MAINS.

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Economic Development Question Answer

Q  1. India has experienced persistent and high food inflation in the recent past. What could be the reasons?(2011)

Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%.
As a consequence of increasing incomes, the consumption patterns of the% people have undergone a significant change.
The food supply chain has structural constraints.
Which of the statements given above1 are correct?

(a.) 1 and 2 only

(b.) 2 and 3 only

(c.) 1 and 3 only

(d.) 1, 2 and 3

Solution (b)

Q  2. In terms of economy, the visit by foreign nationals to witness the XIX Common Wealth Games in India amounted to(2011)

(a.) Export

(b.) Import

(c.) Production

(d.)Consumption

Solution (a)

Q  3. Which one of the following statements appropriately describes the “fiscal stimulus”?(2011)

(a.) It is a massive investment by the Government in manufacturing sector to ensure the supply of goods to meet the demand surge caused by rapid economic growth

(b.) It is an intense affirmative action of the Government to boost economic activity in the country

(c.) It is Government’s intensive action on financial institutions to ensure disbursement of loans to agriculture and allied sectors to promote greater food production and contain food inflation

(d.) It is an extreme affirmative action by the Government to pursue its policy of financial inclusion

Solution (b)

Q  4. Consider the following actions which the Government can take:

Devaluing the domestic currency.
Reduction in the export subsidy.
Adopting suitable policies which attract greater FDI and more funds from FIIs.
Which of the above action/actions can help in reducing the current account deficit?

(a.) 1 and 2

(b.) 2 and 3

(c.) 3 only

(d.) 1 and 3

Solution (a)

Q  5. A rapid increase in the rate of inflation is sometimes attributed to the “base effect”. What is “base effect”?(2011)

(a.) It is the impact of drastic deficiency in supply due to failure of crops

(b.) It is the impact of the surge in demand due to rapid economic growth

(c.) It is the impact of the price levels of previous year on the calculation of inflation rate

(d.)None of the statements (a), (b) and (c) ‘given above is correct in this context

Solution (c)

Q  6. Why is the offering of “teaser loans” by commercial banks a cause of economic concern?(2011)

The teaser loans are considered to be an aspect of sub-prime lending and banks may be exposed to the risk of defaulters in future.
In India, the teaser loans are mostly given to inexperienced entrepreneurs to set up manufacturing or export units.
Which of the statements given above is/are correct?

(a.) 1 only
(b.) 2 only
(c.) Both 1 and 2
(d.) Neither 1 nor 2

Solution (c)

Q  7. In the context of Indian economy, consider the following statements :(2011)

The growth rate of GDP has steadily increased in the last five years.
The growth rate in per capita income has steadily increased in the last five years.
Which of the statements given above is/are correct?

(a.) 1 only

(b.) 2 only

(c.) Both 1 and 2

(d.) Neither 1 nor 2

Solution (b)

Q  8. In India, which of the following have the highest share in the disbursement of credit to agriculture and allied activities?(2011)

(a.) Commercial Banks

(b.) Cooperative Banks

(c.) Regional Rural Banks

(d.) Microfinance Institutions

Solution (a)

Q  9. Economic growth is usually coupled with (2011)

(a.) Deflation

(b.) Inflation

(c.) Stagflation

(d.) Hyperinflation

Solution (b)

Q  10. The lowering of Bank Rate by the Reserve Bank of India leads to (2011)

(a.) More liquidity in the market

(b.) Less liquidity in the market

(c.) No change in the liquidity in the market

(d.) Mobilization of more deposits by commercial banks

Solution (a)

Q  11. Which one of the following is not a feature of “Value Added Tax”? (2011)

(a.) It is a multi-point destination-based system of taxation

(b.) It is a tax levied on value addition at each stage of transaction in the production-distribution chain

(c.) It is a tax on the final consumption of goods or services and must ultimately be borne by the consumer

(d.) It is basically a subject of the Central Government and the State Governments are only a facilitator for its successful implementation

Solution (c)

Q  12. A “closed economy” is an economy in which (2011)

(a.) the money supply is fully controlled

(b.) deficit financing takes place

(c.) only exports take place

(d.) neither exports nor imports take place

Solution (d)

Q  .Both Foreign Direct Investment (FDI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two? (2011)

(a.) FII helps bring better management skills and technology, while FDI only brings in capital

(b.) FII helps in increasing capital availability in general, while FDI only targets specific sectors

(c.) FDI flows only into the secondary market, while FII targets primary market

(d.) FII is considered to be more stable than FDI

Solution (b)

Economic Development Question Answer

Q  13. Microfinance is the provision of financial services to people of low-income groups. This includes both the consumers and the self-employed. The service/services rendered under micro-finance is/are: (2011)

Credit facilities
Savings facilities
Insurance facilities
Fund Transfer facilities
Select the correct answer using the codes given below the lists:

(a.) 1 only

(b.) 1 and 4 only

(c.) 2 and 3 only

(d.) 1, 2, 3 and 4

Solution (d)

Q  14. Which of the following can aid in furthering the Government’s objective of inclusive growth? (2011)

Promoting Self-Help Groups
Promoting Micro, Small and Medium Enterprises
Implementing the Right to Education Act
Select the correct answer using the codes given below:

(a.) 1 only

(b.) 1 and 2 only

(c.) 2 and 3 only

(d.) 1, 2 and 3

Solution (d)

Q  15. Why is the Government of India disinvesting its equity in the Central Public Sector Enterprises (CPSEs)? (2011)

The Government intends to use the revenue earned-from the disinvestment mainly to pay back the external debt.
The Government no longer intends to retain the management control of the CPSEs.
Which of the statements given above is/are correct?

(a.) I only

(b.) 2 only

(c.) Both 1 and 2

(d.) Neither 1 nor 2

Solution (d)

Q  16. The Reserve Bank of India (RBI) acts as a bankers’ bank. This would imply which of the following? (2012)

Other banks retain their deposits with the RBI.
The RBI lends funds to the commercial banks in times of need.
The RBI advises the commercial banks on monetary matters.
Select the correct answer using the codes given below :

(a) 2 and 3 only

(b) 1 and 2 only

(c) 1 and 3 only

(d) 1, 2 and 3

Solution (d)

Q  17. Under which of the following circumstances may ‘capital gains’ arise? (2012)

When there is an increase in the sales of a product
When there is a. natural increase in the value of the property owned
When you purchase a painting and there is a growth in its value due to increase in its popularity
Select the correct answer using the codes given below :

(a) 1 only

(b) 2 and 3 only

(c) 2 only

(d) 1, 2 and 3

Solution (b)

Q  18. Which of the following measures would result in an increase in the money supply in the economy? (2012)

Purchase of government securities from the public by the Central Bank
Deposit of currency in commercial banks by the public
Borrowing by the government from the Central Bank
Sale of government securities to the public by the Central Bank
Select the correct answer using the codes given below :

(a) 1 only

(b) 2 and 4 only

(c) 1 and 3

(d) 2, 3 and 4

Solution (c)

Q  19. Which of the following would include Foreign Direct Investment in India? (2012)

Subsidiaries of companies in India
Majority foreign equity holding in Indian companies
Companies exclusively financed by foreign companies
Portfolio investment
Select the correct answer using the codes given below :

(a) 1, 2, 3 and 4

(b) 2 and 4 only

(c) 1 and 3 only

(d) 1, 2 and 3 only

Solution (d)

Q  20. Consider the following statements: (2012)

The price of any currency in international market is decided by the

World Bank
demand for goods/services provided by the country concerned
stability of the government of the concerned country
economic potential of the country in question
Which of the statements given above are correct?

(a) 1, 2, 3 and 4

(b) 2 and 3 only

(c) 3 and 4 only

(d) 1 and 4 only

Solution (b)

Q  21. The basic aim of Lead Bank Scheme is that: (2012)

(a) big banks should try to open offices in each district

(b) there should be stiff competition among the various nationalized banks

(c) individual banks should adopt particular districts for intensive development

(d) all the banks should make intensive efforts to mobilize deposits

Solution (c)

Q  22. In India, in the overall Index of Industrial Production, the Indices of Eight Core Industries have a combined weight of 37-90%. Which of the following are among those Eight Core Industries? (2012)

Cement
Fertilizers
Natural gas
Refinery products
Textiles
Select the correct answer using the codes given below :

(a) 1 and 5 only

(b) 2, 3 and 4 only

(c) 1, 2, 3 and 4 only

(d) 1, 2, 3, 4 and 5

Solution (c)

Q  23. The balance of payments of a country is a systematic record of (2012)

(a) all import and transactions of a during a given period normally a year

(b) goods exported from a country during a year

(c) economic transaction between the government of one country to another

(d) capital movements from one country to another

Solution (a)

Q  24. The Reserve Bank of India regulates the commercial banks in matters of (2013)

liquidity of assets
branch expansion
merger of banks
winding-up of banks
Select the correct answer using the codes given below.

(a) 1 and 4 only

(b) 2, 3 and 4 only

(c) 1, 2 and 3 only

(d) 1, 2, 3 and 4

Solution (d)

Q  25. An increase in the Bank Rate generally indicates that the: (2013)

(a) market rate of interest is likely to fall

(b) Central Bank is no longer making loans to commercial banks

(c) Central Bank is following an easy money policy

(d) Central Bank is following a tight money policy

Solution (d)

Q 26. In India, deficit financing is used for raising resources for (2013)

(a) economic development

(b) redemption of public debt

(c) adjusting the balance of payments

(d) reducing the foreign debt

Solution (a)

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