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Generate QuizEconomics – Easy Level – GK Questions
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The Securities and Exchange Board of India (SEBI), which regulates the mutual fund industry and protects investor interests in the capital markets, was given statutory powers through an Act of Parliament in the year ___.
- Veblen
- C2 (or Comprehensive)
- base
- 1992
Answer: 1992
SEBI was initially set up in 1988 as a non-statutory executive body with no real enforcement teeth to curb rampant market manipulation and insider trading. It was only after the massive Harshad Mehta stock market scam that the government rushed through the SEBI Act in 1992, granting it sweeping statutory powers to penalize offenders, regulate stock exchanges, and enforce strict disclosure norms.
The 'PM SVANidhi' scheme was launched to provide collateral-free working capital loans of up to Rs. 10,000 specifically to ___ who were severely impacted by the pandemic lockdowns.
- destination (or consumption)
- street vendors
- FEMA
- Current
Answer: street vendors
Street vendors operate in the informal cash economy and lack the credit history or collateral required by formal banks. PM SVANidhi (Street Vendor's AtmaNirbhar Nidhi) provided them with quick, small-ticket loans to restart their businesses, purchase inventory, and sustain their livelihoods without falling into the debt trap of local, high-interest informal moneylenders.
Which of the following is a mandatory characteristic of a 'Perfectly Competitive' market?
- Firms spend heavily on advertising to differentiate their brands
- There are significant barriers to entry and exit for new firms
- All firms sell perfectly homogeneous (identical) products and are price takers
- A single dominant firm dictates the market price for the entire industry
Answer: All firms sell perfectly homogeneous (identical) products and are price takers
In perfect competition, the market is characterized by a vast number of buyers and sellers trading an identical product (like wheat or copper). Because the products are indistinguishable and there are no barriers to entry, no single firm has any market power to influence the price. They are forced to accept the equilibrium price determined by the aggregate forces of market supply and demand.
The 'Opportunity Cost' of a decision is best defined as:
- The total financial cost incurred to execute the decision
- The value of the next best alternative that is forgone when a choice is made
- The sunk costs that cannot be recovered regardless of the decision
- The accounting profit minus the explicit costs of production
Answer: The value of the next best alternative that is forgone when a choice is made
Opportunity cost is the foundational concept of economics, arising from the reality of scarce resources. It is not the sum of all rejected alternatives, but strictly the value of the single *best* alternative you gave up. For example, if you use a free hour to study instead of working a Rs. 500 shift, the opportunity cost of studying is exactly Rs. 500.
Article ___ of the Indian Constitution strictly mandates that no money shall be withdrawn from the 'Consolidated Fund of India' except under appropriation made by law passed by the Parliament.
- dumping
- 2003
- Governing Council
- 266 (or 266(3))
Answer: 266 (or 266(3))
Article 266 establishes the Consolidated Fund of India, which comprises all government revenues, loans raised, and money received in repayment of loans. Clause (3) of this article is the bedrock of parliamentary democracy and financial control, ensuring that the executive branch cannot spend a single rupee of the public's money without the explicit legislative approval and oversight of the elected representatives.
To avoid the problem of double counting while estimating National Income, economists only consider the value of ___ goods and services, completely ignoring the value of intermediate goods used in the production process.
- final
- India Debt Resolution Company Ltd (IDRCL)
- Mobile
- countervailing
Answer: final
Double counting occurs when the value of raw materials (like wheat) and the final product (like bread) are both added to the GDP, artificially inflating the national income. By strictly counting only 'final' goods—those purchased by the end consumer for direct consumption or investment—the economy accurately captures the total value created without duplicating the costs of intermediate inputs.
The 'PM Gati Shakti' National Master Plan is a digital platform that integrates and coordinates the infrastructure planning and execution of ___ central ministries and state governments to avoid siloed working.
- Unfunded
- micro
- frictional
- 16
Answer: 16
Historically, infrastructure projects in India suffered from severe delays because ministries worked in silos (e.g., a road being dug up immediately after completion to lay optical fiber cables). Gati Shakti integrates the spatial data and plans of 16 key ministries (including Railways, Roadways, Petroleum, and Telecom) onto a single GIS-based digital platform, ensuring synchronized, multi-modal infrastructure development.
The Agricultural and Processed Food Products Export Development Authority (APEDA) was established by the Government of India to promote the export of agricultural products, and it functions under the administrative control of the Ministry of ___.
- Okun's
- High Powered (or Base / M0)
- Commerce and Industry
- 1998
Answer: Commerce and Industry
While domestic agriculture is handled by the Ministry of Agriculture, APEDA operates under the Ministry of Commerce and Industry because its primary mandate is export-oriented. It is responsible for setting standards, conducting market research, and providing financial assistance to exporters of fruits, vegetables, meat, poultry, and processed foods to enhance India's footprint in global agri-trade.
During the severe Balance of Payments crisis in 1991, India had to pledge its gold reserves to secure an emergency loan from the IMF. Where was this gold physically airlifted and pledged?
- Federal Reserve, New York
- Bank of England, London and Union Bank of Switzerland
- Bank for International Settlements, Basel
- World Bank Headquarters, Washington D.C.
Answer: Bank of England, London and Union Bank of Switzerland
In a defining moment of economic history, India airlifted 67 tonnes of gold to the Bank of England and the Union Bank of Switzerland in May-July 1991. This desperate measure secured a $600 million emergency loan from the IMF, preventing a sovereign default and setting the stage for the historic LPG (Liberalization, Privatization, Globalization) reforms spearheaded by Dr. Manmohan Singh.
The 'Udyam Registration' portal, launched by the Ministry of MSME, requires enterprises to upload extensive physical documents and pay a nominal registration fee to obtain their MSME certificate.
- True
- False
Answer: False
Udyam Registration was specifically designed to eliminate bureaucratic friction. It is a completely free, paperless, and self-declaration-based platform. It integrates seamlessly with the Income Tax and GSTN databases to automatically verify investment and turnover details, providing MSMEs with a permanent, dynamic identity without requiring them to visit any government office or submit physical proofs.
Which of the following is an example of a Direct Tax?
- Goods and Services Tax (GST)
- Customs Duty on imported electronics
- Corporation Tax on the net profits of a company
- Excise Duty on petrol and diesel
Answer: Corporation Tax on the net profits of a company
A direct tax is levied directly on the income or wealth of the person or entity that ultimately bears the burden of the tax; it cannot be passed on to someone else. Corporation tax is paid directly by the company out of its profits. GST, Customs, and Excise are indirect taxes, where the initial payer (the business) shifts the tax burden to the final consumer via higher prices.
The Basel Committee on Banking Supervision (BCBS), which formulates the global standards for bank capital and liquidity, is headquartered at the Bank for International Settlements (BIS) in:
- New York, USA
- London, UK
- Basel, Switzerland
- Frankfurt, Germany
Answer: Basel, Switzerland
The BCBS was founded in 1974 by central bank governors of the G10 countries. Operating from Basel, Switzerland, it serves as the primary global standard-setter for the prudential regulation of banks, aiming to enhance financial stability worldwide by ensuring that banks maintain adequate capital buffers to absorb unexpected shocks.
The PM SVANidhi scheme was launched during the pandemic to provide affordable working capital loans of up to Rs. 10,000 specifically to ___, who were severely impacted by the lockdowns.
- street vendors
- Refinery Products
- multiplier
- National Income
Answer: street vendors
Street vendors operate entirely in the informal cash economy and rarely possess the collateral required for traditional bank loans. PM SVANidhi (Street Vendor's AtmaNirbhar Nidhi) provided collateral-free, short-term micro-credit with an interest subsidy to help them restart their small businesses and sustain their livelihoods without falling into the debt trap of local moneylenders.
The Economic Survey of India, which provides a comprehensive review of the country's economic developments over the past year, is presented in Parliament by the Chief Economic Adviser (CEA) a day before the Union Budget.
- True
- False
Answer: False
While the Economic Survey is indeed prepared under the guidance of the Chief Economic Adviser (CEA) within the Ministry of Finance, it is formally tabled in Parliament by the Union Finance Minister, not the CEA. The Survey serves as the analytical prelude to the Budget, outlining the macroeconomic health, challenges, and policy outlook of the nation.
The apex governing body of the NITI Aayog, which includes the Prime Minister and the Chief Ministers of all states and Union Territories with legislatures, is known as the ___.
- Governing Council
- 266 (or 266(3))
- durable (or capital / physical)
- notice
Answer: Governing Council
The Governing Council is the premier body tasked with evolving a shared vision of national priorities and strategies. It embodies the principle of 'cooperative federalism' by providing a direct, high-level platform where state leaders can interact with the Centre as equals, rather than being dictated to by a top-down planning authority.
The 'Gini Coefficient' is a statistical measure primarily used in economics to represent:
- The rate of inflation over a decade
- The income or wealth inequality within a nation
- The efficiency of capital investments
- The balance of trade deficit
Answer: The income or wealth inequality within a nation
The Gini coefficient ranges from 0 to 1 (or 0% to 100%). A score of 0 represents perfect equality, where every citizen has the exact same income, while a score of 1 represents perfect inequality, where a single individual holds all the nation's wealth. It is a crucial metric for assessing the inclusiveness of economic growth.
The MUDRA Bank, launched to provide funding to the non-corporate, non-farm small/micro enterprises, operates under the tagline 'Funding the ___'.
- inflation
- Rules
- Unfunded
- public
Answer: Unfunded
MUDRA stands for Micro Units Development and Refinance Agency. Its core mandate is to 'Fund the Unfunded' by providing institutional credit to millions of small entrepreneurs, street vendors, and artisans who traditionally fall outside the purview of formal banking channels and rely on exorbitant informal moneylenders.
The 'Bombay Plan', drafted in 1944 by leading Indian industrialists, primarily advocated for:
- Complete laissez-faire capitalism with zero state intervention
- A rapid transition to a fully agrarian, decentralized village economy
- Significant state intervention and public sector investment in heavy industries and infrastructure
- Immediate integration with the global free trade market
Answer: Significant state intervention and public sector investment in heavy industries and infrastructure
Authored by industrialists like J.R.D. Tata and G.D. Birla, the Bombay Plan surprisingly argued that the private sector lacked the massive capital required for post-independence reconstruction. It advocated for a strong, interventionist state to drive investments in heavy industries, infrastructure, and social services, heavily influencing India's subsequent mixed-economy and Five-Year Plan models.
The Special Drawing Rights (SDR), an international reserve asset created by the IMF to supplement its member countries' official reserves, is colloquially known as ___.
- stagflation
- Paper Gold
- IDRCL (or India Debt Resolution Company Ltd)
- jobless growth
Answer: Paper Gold
The SDR was created in 1969 during the Bretton Woods fixed exchange rate system when gold and the US dollar were the primary reserve assets. Because it was intended to act as a synthetic substitute for gold in international settlements, despite existing only as a bookkeeping entry, it earned the nickname 'Paper Gold'.
The Insurance Regulatory and Development Authority of India (IRDAI) was established as a statutory body in the year ___ to regulate and promote the insurance industry.
- first
- 1999
- Pareto Efficiency (or Pareto Optimality)
- crowding out
Answer: 1999
Following the recommendations of the R.N. Malhotra Committee, the IRDA was constituted in 1999 and later given statutory status through the IRDA Act, 1999. Its mandate includes issuing licenses to private and foreign insurers, protecting policyholder interests, and ensuring the orderly growth of the insurance sector in India.