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MCQOPTIONS
This section includes 2956 Mcqs, each offering curated multiple-choice questions to sharpen your UPSC IAS Exam knowledge and support exam preparation. Choose a topic below to get started.
| 2401. |
Which of the below statements are correct? I. Reverse account balance makes an adjustment between current account balance and capital account balance. II. If surplus in the Capital Account is more than deficit in the Current Account, there is net increase in the Forex Reserves of the country at the end of the year. III. If deficit in the current account is more than surplus in the Capital Account then there is net decrease in Foreign Reserves of the country at the end of the year. |
| A. | I & II |
| B. | I & III |
| C. | Only II |
| D. | All the above |
| Answer» E. | |
| 2402. |
Which statement is correct regarding capital account? I. On the credit side of this account receipt of foreign exchange due to Foreign Direct Investment (FDI) Foreign Capital Investment (FCI) and Foreign Borrowing (FB) is recorded. II. On the debit side of capital account payment of foreign exchange due to Direct Investment Abroad (DIA) Portfolio Investment Abroad (PIA) and Foreign Lending (FL) is recorded. |
| A. | Only II |
| B. | Only I |
| C. | Both I & II |
| D. | None of the above |
| Answer» D. None of the above | |
| 2403. |
Which unit of valuation is known as 'paper gold'? |
| A. | Eurodollar |
| B. | Petrodollar |
| C. | SDR |
| D. | GDR |
| Answer» D. GDR | |
| 2404. |
Match the following export products of India with the Percentage they constitute: Products PercentageI.Petroleuma.4%II.Gems & Jewelleryb.7.8%III.Transport & Equipment?sc.20.4%IV.Machineryd.16.3% |
| A. | I - c, II - d, III - b, IV - a |
| B. | I - a, II - c, III - b, IV - d |
| C. | I - b, II - a, III - d, IV - c |
| D. | I - d, II - c, III - a, IV - b |
| Answer» B. I - a, II - c, III - b, IV - d | |
| 2405. |
What are the facts regarding structural change in India?s export since 1991? I. There are indications that during 1990s some of Indian exports have moved upwards in value addition chain whereby instead of exporting raw materials the country has switched over to export of processed goods. II. There were significant compositional shift within the major manufactured product groups such as engineering goods chemicals and allied products etc. |
| A. | Only II |
| B. | Only I |
| C. | Both I & II |
| D. | None of the above |
| Answer» D. None of the above | |
| 2406. |
What are the categories in which India export? I. Agricultural and Allied Products II. Mineral Fuel and Lubricants III. Coal and petroleum |
| A. | Only II |
| B. | I & II |
| C. | Only III |
| D. | None of the above |
| Answer» C. Only III | |
| 2407. |
Why did the fixed exchange rate system collapsed? 1. The buildup of US debts abroad as a result of the need to fund the war in Vietnam II. Inflation in the USA III. Growing doubts about the stability of the US. |
| A. | Only I |
| B. | I & II |
| C. | II & III |
| D. | All the above |
| Answer» E. | |
| 2408. |
Which of the statement is correct according to Fixed Exchange rates? 1. Fixed rates are currency values which are tied to a precious metal such as gold, or anchored to another currency, like the US Dollar. II. Under a fixed system, a currency can rise or fall due to changes in demand or supply of currencies on the foreign exchange market. III. Under this imports and exports can readjust to move the balance of payments back towards a desirable equilibrium. |
| A. | I & II |
| B. | I & III |
| C. | II & III |
| D. | Only I |
| Answer» E. | |
| 2409. |
Which sentences are correct regarding special drawing rights?I. It was created in 1980II. It is also known as "paper gold".III. Its value is based on a basket of five key international key currencies and SDRs can be exchanged for freely usable currencies |
| A. | Only II |
| B. | I & III |
| C. | II & III |
| D. | All the above |
| Answer» D. All the above | |
| 2410. |
Which one of the following types of borrowings from the IMF has the softest servicing conditions? |
| A. | Second tranche loan |
| B. | SAF |
| C. | ESAF |
| D. | Oil facility |
| Answer» D. Oil facility | |
| 2411. |
Which sentence is correct regarding foreign exchange? I. Foreign exchange reserves in India comprises of 6 elements. II. Foreign exchange management can be done in three possible ways: Fixed currency regime, floating currency regime and managed exchange rates. III. Silver is an element of foreign exchange reserve |
| A. | I & II |
| B. | Only II |
| C. | Only III |
| D. | None of the above |
| Answer» C. Only III | |
| 2412. |
Match the following countries with its currencies: Country CurrencyI.USa.YenII.Chinab.DollarIII.Japanc.PoundIV.Britaind.Yuan |
| A. | I - b, II - d, III - a, IV - c |
| B. | I - a, II - d, III - b, IV - c |
| C. | I - b, II - c, III - a, IV - d |
| D. | I - a, II - c, III - b, IV - d |
| Answer» B. I - a, II - d, III - b, IV - c | |
| 2413. |
Consider the following statements regarding the Federation of Indian Export Organisation (FIEO): 1. FIEO was set up in 1965 under the aegis of Ministry of Commerce. 2. It is an apex body of Export Promotion Organisations 3. FIEO renders an integrated package of services to various organizations connected with export promotion. Which of the statements given above is/are correct? |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2414. |
Consider the following statements:1. International Monetary Fund (IMF) was initiated in 1944 at the Bretton Woods Conference and formally created in 1945.2. IMF grants loan to member country and other developing countries.Which of the statements given above is/are correct? |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | None |
| Answer» B. 2 only | |
| 2415. |
Which of the following would include Foreign Direct Investment in India? 1. By incorporating a wholly owned subsidiary or company anywhere 2. By acquiring shares in an associated enterprise 3. Through a merger or an acquisition of an unrelated enterprise 4. Participating in an equity joint venture with another investor or enterprise Select the answer using the codes given below. |
| A. | 1 and 2 |
| B. | 2, 3 and 4 |
| C. | 1, 3 and 4 |
| D. | 1, 2, 3 and 4 |
| Answer» E. | |
| 2416. |
Consider the following statements: 1. The Petrapole-Benapole border checkpoint controls the foreign trade between India and Bangladesh. 2. Petra pole is on Bangladesh side and Benapole is on Indian side. Which of the statements given above is/are correct? |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | None |
| Answer» B. 2 only | |
| 2417. |
Consider the following statements: 1. Kelkar Committee is associated to oil and gas. 2. Kelkar Committee has to prepare a roadmap for enhancing import of oil and gas. Which of the statements given above is/are correct? |
| A. | 1 only |
| B. | 2 only |
| C. | 1 and 2 |
| D. | None |
| Answer» B. 2 only | |
| 2418. |
Consider the following statements: 1. The Foreign Exchange Management Act FEMA became an act on the 1st day of June, 2002. 2. It replaced FERA. 3. It made all offenses regarding foreign exchange civil offenses, as opposed to criminal offenses as dictated by FERA. Which of the statements given above is/are correct? |
| A. | 1 and 2 |
| B. | 2 and 3 |
| C. | 1 and 3 |
| D. | None |
| Answer» C. 1 and 3 | |
| 2419. |
Consider the following: 1. International Bank for Reconstruction and Development (IBRD) 2. International Development Association (IDA) 3. International Finance Corporation (IFC) 4. Multilateral Investment Guarantee Agency (MIGA) 5. International Centre for Settlement of Investment Disputes (ICSID) Which among the above constitute the World Bank group? |
| A. | 1 2 |
| B. | 1 2 3 |
| C. | 1 2 3 4 |
| D. | 1 2 3 4 5 |
| Answer» E. | |
| 2420. |
Which of the following constitute the Capital Account? 1. Foreign Loan. 2. Foreign Direct Investment. 3. Private Remittances. 4. Portfolio Investment. Select the correct answer using the codes given below |
| A. | 2 & 4 |
| B. | 1 & 3 |
| C. | 1 & 2 |
| D. | 1, 2 & 4 |
| Answer» E. | |
| 2421. |
Which one of the following modes of privatization is the most comprehensive and complete? |
| A. | introduction of private capital in public sector |
| B. | contracting out management of public enterprises to the private sector |
| C. | transferring ownership and management to the workers |
| D. | transferring ownership and management to the private sector |
| Answer» E. | |
| 2422. |
We read in the newspapers that the Foreign Direct Investments are preferred over the Capital Inflow. In this context, please consider the following: 1. FDI brings in latest technology 2. FDI does not involve large outflow 3. FDI Improves efficiency of the economy Which among the above is / are most suitable reasons for the given statement? |
| A. | Only 1 |
| B. | Only 1 & 3 |
| C. | Only 1 & 2 |
| D. | All 1, 2 & 3 |
| Answer» B. Only 1 & 3 | |
| 2423. |
Market Economy: 1. The role of market forces and competition is eliminated by law 2. There is a high degree of competition in both commodity and factor markets 3. Private gains are the main motivating and guiding force for carrying out economic activities Which among the above is/ are correct statements? |
| A. | Only 1 & 2 are correct |
| B. | Only 2&3 are correct |
| C. | All are correct |
| D. | None of them is correct |
| Answer» C. All are correct | |
| 2424. |
Consider the following statements regarding the Indian Depository Receipts? 1. An IDR declares ownership of shares of a Foreign Company 2. The Shares in an IDR are held by an Indian Custodian 3. Using IDR, the Indian Residents get a chance to invest in a listed foreign entity Which among the above statements is / are correct? |
| A. | Only 1 |
| B. | Only 2 |
| C. | Only 1 & 2 |
| D. | Only 1 & 3 |
| Answer» E. | |
| 2425. |
Consider the following statements: 1. Indian Rupee has faced 2 devaluations till now 2. Indian Rupee faced highest devaluation in 1966 Which among the above statements is / are correct? |
| A. | Only 1 is correct |
| B. | Only 2 is correct |
| C. | Both 1 and 2 are correct |
| D. | Neither 1 nor 2 is correct |
| Answer» C. Both 1 and 2 are correct | |
| 2426. |
Consider the following:1. Balance of trade 2. Net factor income3. Net transfer paymentsWhich among the above make the part of the "Capital Account"? |
| A. | Only 1 |
| B. | 1 & 2 |
| C. | 2 & 3 |
| D. | 1, 2 & 3 |
| Answer» E. | |
| 2427. |
Foreign Direct Investments are preferred over Capital Inflow. In this context, please consider the following. 1. FDI brings in latest technology 2. FDI does not involve large outflow 3. FDI improves working efficiency Which is/are most suitable reason/reasons for the given statement? |
| A. | 1 only |
| B. | 1 and 3 |
| C. | 1 and 2 |
| D. | All 1, 2 and 3 |
| Answer» E. | |
| 2428. |
Consider the following statements relating to the World Trade Organization (WTO): 1. The WTO deals with the global rules of trade between nations. 2. The goal of the WTO is to help producers of goods and services, exporters, and importers conduct their business. 3. The WTO, which is a successor body of the General Agreement on Tariffs and Trade, came into being following the Uruguay Round of Negotiations. 4. The WTO distances itself in framing of rules on trade in intellectual property rights. Which of the statements given above are correct? |
| A. | 1, 2 and 3 |
| B. | 2, 3 and 4 |
| C. | 1, 2 and 4 |
| D. | 1 and 3 only |
| Answer» B. 2, 3 and 4 | |
| 2429. |
International Monetary Fund (IMF) argues that developing economies hold a massive stockpile of foreign exchange. Which could be the consequences of such stockpiling? 1. A trade imbalance or major difference in value of imports/exports is generated between the developing and emerging economies and the rich countries. 2. Such an imbalance is not a healthy sign. These imbalances have caused the current global economic crisis. 3. Such stockpiling is responsible not only for problems in trade balances but leads to money laundering. |
| A. | 1 only |
| B. | 2 only |
| C. | 3 only |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2430. |
Which of the following is correct about 'Foreign direct investment' (FDI)? 1. Through FDI a company buys a company in the target country. 2. Through PDI a company expand operations of an existing business in the target country. 3. FDI is an investment in the securities of another country such as stocks and bonds. 4. FDI is an investment directly into production in a country by a company located in another country. |
| A. | 1 and 2 |
| B. | 1, 2 and 4 |
| C. | 1, 2 and 3 |
| D. | 1, 2, 3 and 4 |
| Answer» C. 1, 2 and 3 | |
| 2431. |
Which of the following would include Foreign Direct Investment in India? 1. Subsidiaries of foreign companies in India 2. Majority foreign equity holding in Indian companies 3. Companies exclusively financed by foreign companies 4. Portfolio investment Select the correct answer using the codes given below |
| A. | 1, 2, 3 and 4 |
| B. | 2 and 4 |
| C. | 1 and 3 |
| D. | 1, 2 and 3 |
| Answer» E. | |
| 2432. |
The earnings of India from diamond export is quite high. Which one of the following factors has contributed to it? |
| A. | pre-independene stock-piling of diamonds in the country which are now exported |
| B. | large production of industrial diamonds in the country |
| C. | expertise available for cutting and polishing of imported diamonds which are then exported |
| D. | as in the past, India produces huge quantity of gem diamonds which are exported |
| Answer» D. as in the past, India produces huge quantity of gem diamonds which are exported | |
| 2433. |
Which of the following pairs are correctly matched?1. Increase in-monetary expansion2. Low import growth rate in India-Recession in Indian industry3. Euro-issues-Shares held by Indian companies in European countries4. Portfolio investment-Foreign institutional investors. |
| A. | 1, 2 and 4 |
| B. | 3 and 4 |
| C. | 1, 2 and 3 |
| D. | 1, 2, 3 and 4 |
| Answer» B. 3 and 4 | |
| 2434. |
The New Economic Policy (1991) was launched in the background of the following economic indicators:1. India's foreign exchange reserves had fallen to US 1 billion.2. The fall of the Soviet Union had deprived India of almost a quarter of its export market.3. There was negative growth in real GDP.Indian rupee had to be devalued by 45 per cent. |
| A. | 1, 2, 3 and 4 |
| B. | 1 only |
| C. | 1 and 2 |
| D. | 1, 2 and 3 |
| Answer» D. 1, 2 and 3 | |
| 2435. |
FDI in Multi-Brand Retail Trade (MBRT) in all products is now permitted in India subject to1. a ceiling of 51%2. minimum amount to be brought in as FDI by the foreign investor is US 100 million.3. at least 50% of the procurement of manufactured/processed products should be sourced from 'small industries'.4. retail sales locations set-up only in cities with a population of more than 10 lakh.Select the correct answer using the codes given below |
| A. | 1, 2, 3 and 4 |
| B. | 1 and 4 |
| C. | Only 2 |
| D. | 1, 2 and 4 |
| Answer» E. | |
| 2436. |
Consider the following statements. Most internationals agencies which fund development programmes in Indian on inter-government bilateral agreements, mainly provide. 1. Technical assistance 2. Soft loans which are required to be paid back with interest 3. Grants, not required to be paid back 4. Food assistance to alleviate poverty |
| A. | 2 and 4 are correct |
| B. | 1, 2 and 3 are correct |
| C. | 1, 2 and 4 are correct |
| D. | 3 and 4 are correct |
| Answer» C. 1, 2 and 4 are correct | |
| 2437. |
Areas which are engines for economic growth supported by quality infrastructure and complemented by an attractive fiscal package are known as |
| A. | Export Processing Zones |
| B. | Duty Free Tariff Zones |
| C. | Special Economic Zones |
| D. | Technology Parks |
| Answer» D. Technology Parks | |
| 2438. |
AoA in context with World Trade Organization is_____? |
| A. | Article of Association |
| B. | Agreement on Agriculture |
| C. | Agreement on Association |
| D. | Administration of Agriculture |
| Answer» C. Agreement on Association | |
| 2439. |
Christine Lagarde is the head of which among the following international agencies / bodies? |
| A. | Asian Development Bank |
| B. | Non-alignment Movement |
| C. | International Atomic Energy Agency |
| D. | International Monetary Fund |
| Answer» E. | |
| 2440. |
Global capital-flows to developing countries increased significantly during the nineties. In view of the East Asian financial crisis and Latin American experience, which type of inflow is good for the host country? |
| A. | Commerical loans |
| B. | Foreign Direct Investment |
| C. | Foreign Portfolio Investment |
| D. | External Commercial Borrowings |
| Answer» C. Foreign Portfolio Investment | |
| 2441. |
A new term Lourdes Treatment and Resuscitation Option (LTRO) was making news in context with which among the following? |
| A. | World Bank |
| B. | International Monetary Fund |
| C. | European Central Bank |
| D. | Federal Reserve Bank of America |
| Answer» D. Federal Reserve Bank of America | |
| 2442. |
Companies backed by Sovereign guarantee of Member Country In which among the following forms, the Special Drawing Rights (SDR) are kept as currency of International Monetary Fund? |
| A. | Paper Currency |
| B. | Gold |
| C. | Book Keeping Entry |
| D. | A combination of all of three |
| Answer» D. A combination of all of three | |
| 2443. |
IMF can grant loan to _______? |
| A. | Any sovereign country of the World |
| B. | Any sovereign country of the World and Public Sector companies backed by Sovereign guarantee |
| C. | Any Member country of IMF |
| D. | Any Member country of IMF and Public Sector |
| Answer» D. Any Member country of IMF and Public Sector | |
| 2444. |
Which among the following countries is currently the biggest supplier of crude oil to India? |
| A. | Iran |
| B. | Saudi Arabia |
| C. | UAE |
| D. | Nigeria |
| Answer» C. UAE | |
| 2445. |
Which among the following will be a debit entry in India's balance of payments? |
| A. | Imports of goods by India. |
| B. | Income of Indian investments abroad. |
| C. | Receipts of transfer payments. |
| D. | Exports of services by India. |
| Answer» C. Receipts of transfer payments. | |
| 2446. |
In context with the two way trade of India with different regions, which among the following region is India's largest trade partner? |
| A. | EU Region |
| B. | Gulf Region |
| C. | North America |
| D. | Latin America |
| Answer» C. North America | |
| 2447. |
Which among the following is the most important source region of NRI remittances to India? |
| A. | North America |
| B. | Europe |
| C. | Asia Pacific |
| D. | South America |
| Answer» B. Europe | |
| 2448. |
TANKAN is revision of the Industry Classification of the Short-term Economic Survey of Enterprises (usually quarterly) is used in following country? |
| A. | Japan |
| B. | South Korea |
| C. | China |
| D. | All of them |
| Answer» B. South Korea | |
| 2449. |
Many a times we read in the newspapers that when Foreign Capital is allowed to enter the country freely, it can affect the economy adversely. Which among the following is a correct reason for the above assumption? |
| A. | It affects the balance of payments of the country by adversely affecting the Current Account |
| B. | It poses risks to the value of the country's currency as well as management of local liquidity |
| C. | The foreign capital earns profit in the country which is repatriated |
| D. | The Balance of Trade of the country is badly affected by Foreign Capital Inflows |
| Answer» C. The foreign capital earns profit in the country which is repatriated | |
| 2450. |
Asian Financial Crisis of 1997 started from which of the following countries? |
| A. | Myanmar |
| B. | Thailand |
| C. | Cambodia |
| D. | Malaysia |
| Answer» C. Cambodia | |