Indian Economy Test-17-Indian Economy-Quiz

Prelims 2020 Test Series-Indian Economy Test-17

Q 1.
The concept of valley of death coined by Andrews Hargadon is related with:

a.)
(a) Patents
b.)
(b) Fiscal crisis
c.)
(c) Capital mobility
d.)
(d) Start-ups

Q 2.
Operation twist by the RBI through buying of long-term government securities:

1. Decreases the yield of long-term government securities as the RBI increased the purchase of such securities

2. Decreases the fiscal deficit of the Government as debt is owned by the Government.

Codes:

a.)
a.) 1 and 2 correct
b.)
b.) only1 is correct
c.)
c.) both are incorrect
d.)
d.) only 2 is correct

Q 3.
Liquidity trap implies

1. Non-responsiveness of interest rate to changes in money supply.

2. Instance of the limitation of monetary policy.

a.)
(a) Only 1 is correct
b.)
(b) neither 1 nor 2 is correct
c.)
(c) Both are correct
d.)
(d) Only 2 is correct

Q 4.
Consider the following statements about undervalued currency and select the correct ones using the codes given below.

1. Countries make their currencies undervalued to make trade gains

2. Foreign exchange market intervention through heavy purchase of foreign currencies makes undervalued currency.

Codes:

a.)
a.) 1 and 2 correct
b.)
b.) only1 is correct
c.)
c.) both are incorrect
d.)
d.) only 2 is correct

Q 5.
Making economic gains by influencing the political parties and the administration is:

a.)
(a) Fabian socialism
b.)
(b) Cartels
c.)
c.) Crony capitalism
d.)
d.) Insider trading

Q 6.
The IMF’s is undergoing significant transition in the post crisis global economy. Which of the following statements are indicative of this transition? Select the correct answer using the codes given below.

A new Director outside Europe has been appointed for the first time.

Lending schemes have been restructured to meet the new economic challenges and problems of the member countries.

The Fund’s resources have been enhanced to undertake bailouts and economic assistance.

Governance reforms aimed at increasing voting rights of developing countries were introduced.

Codes:

a.)
(a) 1, 2, 3 and 4
b.)
(b) 1, 3, 4
c.)
(c) 2, 3 and 4
d.)
(d) 1, 2, and 3

Q 7.
The IMF’s director board members are:

a.)
a.) Appointed by each member state
b.)
b.) Elected from the members
c.)
c.) Finance Ministers of the member states
d.)
d.) Governors of the member countries’ central banks

Q 8.
The RBI makes an intervention in the foreign exchange market by purchasing dollars on a particular day. Which of the following can be an outcome of such an intervention? Choose the correct answer using the codes given below.

Curtailing excessive speculation.

Maintenance of competitiveness of the currency

Accretion to foreign exchange reserve

Codes:

a.)
(a) Only 1 is correct
b.)
(b) 1, 2 and 3
c.)
(c) 2 and 3
d.)
(d) Only 2 is correct

Q 9.
The Rupee’s exchange rate with US Dollar is moving from Rs 66 to Rs 55. Which of the following outcomes are correct related to this exchange rate movement? Choose the correct answer using the codes given below.

1. Imports into India are going to decrease

2. Domestic commodities have become costlier in the international market

3. Hedging improves the condition of exporters.

4. Foreign commodities become cheaper in the Indian market.

Codes:

a.)
(a) 1, 2, 3 and 4
b.)
(b) 1, 2 and 3
c.)
(c) 1, 2 and 4
d.)
(d) 2, 3 and 4

Q 10.
Consider the following matches of experts and their respective areas.

1. UK Sinha – Group Insolvency

2. Akhilesh Ranjan – Foreign Direct Investment

3. Bimal Jalan – Economic Capital Framework

4. Uday Kotak – Corporate Governance

Which of these matches are correct?

a.)
(a) 1, 2, 3 and 4
b.)
(b) 2, 3 and 4
c.)
(c) 3 and 4
d.)
(d) 1, 3 and 4

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