CH 2 Sectors of The Indian Economy

1. OBJECTIVE QUESTIONS Ans : (c) Employment is insecure

9. Which among the following activities is not related to

1. MGNREGA guarantees job to poor for primary sector?
(a) 100 days (b) 90 days (a) Fishing
(c) 60 days (d) 50 days (b) Natural gas extraction
Ans : (a) 100 days (c) Making of sugar
(d) Mining
2. ATM is an example of
Ans : (c) Making of sugar
(a) primary sector (b) secondary sector
(c) tertiary sector
10. Which among the following workers are not very
Ans : (c) tertiary sector productive in tertiary sector?
(a) Educated and trained professionals
3. Animal Husbandry is a part of
(b) Repair persons and daily wage earners
(a) Primary sector (b) secondary sector
(c) People in defence services
(c) tertiary sector (d) none of these
(d) People working in health centres and hospitals
Ans : (a) Primary sector
Ans : (b) Repair persons and daily wage earners
4. The goods that are used as raw materials for further
production are known by which name? 11. Places of work which follow rules and regulation are
(a) Final goods (b) Consumer goods termed as
(a) organised sector (b) unorganised sector
(c) Material goods (d) Intermediate goods
(c) tertiary sector (d) secondary sector
Ans : (d) Intermediate goods
Ans : (a) organised sector
5. Which of the following is not an example of tertiary
sector? 12. All economic activities that directly involve conversion
(a) Banking (b) Transport of natural resources are classified under
(a) secondary sector (b) primary sector
(c) Trade (d) Forestry
(c) tertiary sector (d) government sector
Ans : (d) Forestry
Ans : (b) primary sector
6. Hidden unemployment is also called
(a) organised sector 13. The sector in which the productive units are owned,
maintained and managed by government
(b) disguised unemployment
(a) organised sector (b) primary sector
(c) tertiary sector
(c) public sector (d) industrial sector
(d) contractual unemployment
Ans : (c) public sector
Ans : (b) disguised unemployment
14. Public health is responsibility of
7. GDP of a country is based on (a) primary sector (b) government
(a) total value of good and services
(c) private sector (d) none of these
(b) final value of goods and services
(c) initial value of goods and services
Ans : (b) government
(d) all of these
Ans : (b) final value of goods and services

8. Which among the following is a feature of unorganised

sector?
(a) Fixed number of work hours
(b) Paid holidays
(c) Employment is insecure
(d) Registered with the government
15. The secondary sector is also known as ............. as this 25. In terms of ownership, enterprises owned by individuals
sector produces useful items from natural products. are known as ..........
(a) manufacturing (b) construction (a) public sector (b) primary sector
(c) building (d) making (c) unorganised sector (d) private sector

Ans : (a) manufacturing Ans : (d) private sector

16. Service is
(a) tangible (b) intangible 2. FILL IN THE BLANK
(c) both a and b (d) physical Product
DIRECTION : Complete the following statements with
Ans : (c) both a and b appropriate word(s).
17. Converting iron is a part of 1. Transport, communication and banking come under
(a) primary activity (b) secondary activity ......... sector.
(c) tertiary sector (d) all of these Ans : Tertiary
Ans : (b) secondary activity
2. The goods produced by exploiting natural resources
18. The sum total of production of all goods and services comes under the category of .......... .
in the three sectors are combinedly Ans : Primary sector
(a) NDP (b) NI
(c) GNI (d) GDP 3. Another name for tertiary sector is .......... .
Ans : Service sector
Ans : (d) GDP
4. Another name for secondary sector is .......... .
19. The task of collection of data in all the three sectors
of the economy is done by which of the following Ans : Industrial sector
anlanizations.
5. Tertiary is a larger sector in ........... country.
(a) NSSO (b) BPO
Ans : Developed
(c) KPO (d) UNDP
Ans : (a) NSSO
3. TRUE/FALSE
20. In the last 100 years, the sector gaining prominance is
(a) secondary sector (b) primary sector DIRECTION : Read each of the following statements and
(c) tertiary sector (d) all of these write if it is true or false.
Ans : (c) tertiary sector
1. Unorganised sector are registered with the government.
21. In India, .......... sector is largest employer while ......... Ans : False
sector is largest income generator.
(a) secondary, tertiary (b) tertiary, primary 2. Maximum share of GDP comes from Public Sector.
(c) primary, tertiary (d) tertiary, secondary Ans : True
Ans : (c) primary, tertiary 3. Provision of appointment letter is not there in
unorganised sector.
22. The type of unemployment in which more number of
people work than actually needed is known as Ans : True
(a) disguised unemployment 4. Tertiary sector is gaining importance in India.
(b) seasonal unemployment Ans : True
(c) underemployed
(d) over employed 5. People cannot expect job security in an organised
sector.
Ans : (a) disguised unemployment
Ans : True
23. Information and Technology is a part of
(a) tertiary sector (b) primary sector
(c) secondary sector (d) all of these
4. ASSERTION AND REASON
Ans : (a) tertiary sector DIRECTION : Mark the option which is most suitable :‘
24. A labourer working under a contractor, is in which (a) If Both assertion and reason are true, and reason
type of sector? is the correct explanation of assertion.
(a) Public sector (b) Unorganised sector (b) If Both assertion and reason are true, but reason
(c) Service sector (d) None of these is not the correct explanation of assertion.
Ans : (b) Unorganised sector (c) If Assertion is true, but reason is false.
(d) If Both assertion and reason are false.
1. Assertion : In India, over the forty years between
 1973-74 and 2013-14, while production in all the three produced within the domestic territory of a country
sectors has increased, it has increased the most in the in a year.
tertiary sector. Ans : (a) Both assertion and reason are true, and
Reason : Tertiary sector is the only organized sector in reason is the correct explanation of assertion.
the economy so the government spends a lot of money
GDP is the value of all final goods and services produced
for creating jobs in tertiary sector.
within a country. A higher GDP is indicative of higher
Ans : (c) Assertion is true, but reason is false. production level and higher economic activity. Also, a
There are several reasons for increased production higher GDP implies people of the country are earning
in tertiary sector such as increase in demand tor more so it is indicative of the size of an economy.
education, health, communication and transportation, 6. Assertion : Rakesh is an educated and skilled worker
development of agriculture sector, increase in level who earns a high monthly salary as he is employed in
of income and development of information and a private bank in a city.
technology sector. Reason : All service sectors in India are growing
2. Assertion : Reliance industries is a privately-owned extremely well and each individual engaged in any
firm. kind of tertiary activity earns a high income.
Reason : Government is a major stakeholder is reliance Ans : Ans. (c) Assertion is true, but reason is false.
industries.
In India, not the entire service sector is growing equally
Ans : (c) Assertion is true, but reason is false.
well. Service sector in India employs many different
Reliance industry is a privately-owned firm as the kinds of people. At one end there are a limited number
assets and delivery of goods and services in Reliance of services that employ highly skilled and educated
is controlled by private individuals workers. At the other end, there are a very large
number of workers engaged in services such as small
3. Assertion : The development of agriculture and shopkeepers, repair persons, transport persons, etc.
industry leads to the development of service sector. These people barely manage to earn a living and yet
Reason : As the primary and secondary sectors they perform these services because no alternative
develops, the demand for transport, storage structures, opportunities for work are available to them.
banks, insurance, etc., increases. 7. Assertion : Leela works five days a week, receives her
Ans : (a) Both assertion and reason are true, and income on the last day of each month and gets medical
reason is the correct explanation of assertion. facilities from her firm.
As the primary and secondary sector develops the Reason : Leela is working in organized sector.
demand for the aforementioned tertiary activities Ans : (a) Both assertion and reason are true, and
increase. Not just the demand for mentioned services reason is the correct explanation of assertion.
increases, but as individuals become better off, the The firms in organized sector are registered by the
demand for education, health services, professional government and have to follow its rules and regulations
training and communication also increase. Therefore, which are given in various laws such as the Factories
the development of primary and secondary sectors Act, Minimum Wages Act, Payment offcratuity Act,
leads to the development of service or tertiary sector. Shops and Establishments Act etc
4. Assertion : An individual who manufactures flour 8. Assertion : Mohan is a shopkeeper who pays his taxes
from wheat is engaged in primary sector. on time. He has employed two workers Rakesh and
Reason : When some process of manufacturing is used Raghu in his shop. He pays them well, however, none
the product is a part of secondary sector. of the workers get any paid leaves in the year.
Ans : (d) Both assertion and reason are false. Reason : Rakesh and Raghu are employed in
unorganized sector.
An individual who manufactures flour from wheat is
engaged in secondary sector as the products that are Ans : (a) Both assertion and reason are true, and
not manufactured directly from nature but require reason is the correct explanation of assertion.
some manufacturing process are a part of secondary If Rakesh and Raghu were employed in organized
sector. sector, they would receive benefits such as paid leaves,
5. Assertion : GDP shows how big an economy is. medical insurance and pension schemes from the
Reason : GDP is the value of all goods and services employer. Mohan is not following labour laws as he
does not provide any paid leave to his employees in
the year.
9. Assertion : When calculating the total value of goods
and services produced in a country, the value of all
goods and services at each stage of production should
be calculated.
Reason : At each stage of production some value is
added to a good or service, therefore, the value added
at each stage of production is added to derive the
total value of gods and services in an economy.
Ans : (d) Both assertion and reason are false.
 When calculating the total value of goods and services
produced in a country, the value of final goods and
services is calculated. If we add the value of goods
and services at each stage of production, we will get
an inflated GDP as the same value would be included
multiple times.
10. Assertion : There are several goods and services that
the society needs; however, the private sector does not
produce all of them.
Reason : Private sector is profit driven.
Ans : (a) Both assertion and reason are true, and
reason is the correct explanation of assertion.
Some of the services such as defense require a lot of
spending and do not provide any profit. Therefore,
private sector does not invest in such activities. Also,
certain services such as public transportation and
irrigation facilities require massive spending which is
beyond the capacity of private sector.
11. Assertion : Id India, the primary sector is the largest
employer.
Reason : The demand for services has increased
enormously.
Ans : (b) Both assertion and reason are true, but
reason is not the correct explanation of assertion.
The primary sector remains the largest employer
in India because not enough jobs were created in
the secondary and tertiary sectors. However, the
demand for services has increased owing to increase
in demand for education, health, communication and
transportation, development of agriculture sector,
increase in level of income and development of
information and technology sector.