TSPSC- Group1

Indian Economy:Expected questions

Consider the following statements:
Other things remaining unchanged, market demand for a
good might increase if
1. Price of its substitute increases
2. Price of its complement increases
3. The good is an inferior good and income of the consumers
increases
4. Its price falls
Which of the above statements are correct?
a) 1 and 4 only
b) 2, 3 and 4
c) 1, 3 and 4
d) 1, 2 and 3
If a commodity is provided free to the public by the
Government, then

(a) the opportunity cost is zero.

(b) the opportunity cost is ignored.

(c) the opportunity cost is transferred from the

consumers of the product to the tax-paying public.

(d) the opportunity cost is transferred from the

consumers of the product to the Government.
Which of the following statements about GDP
calculations is correct?

a. Gross Domestic Product excludes the production

made by foreign nationals in India.
b. Gross National Income includes production
made by foreign nationals in India
c. Gross value addition does not include any taxes
or subsidies
d. GDP at factor cost includes production taxes but
not product taxes
Which of the following is/are included in the capital budget
of the Government of India?
(1) Expenditure on acquisition of assets like roads,
buildings, machinery, etc.
(2) Loans received from foreign governments
(3) Loans and advances granted to the States and Union
Territories.
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Components of budget:
There has been a persistent deficit budget year after
year. Which action/actions of the following can be
taken by the Government to reduce the deficit?
(1) Reducing revenue expenditure
(2) Introducing new welfare schemes
(3) Rationalizing subsidies
(4) Reducing import duty
Select the correct answer using the code given
below.
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2, 3 and 4
Consider the following sets

1. John Mathai - A. First budget of the Republic of India

2. Morarji Desai - B. Recommended separate Railway
budget
3. Dwarkanath Deshmukh - C. Presented first interim
budget
4. Mitchell Acworth - D. Presented the budget highest
number of times

Choose the correct code:

a. 1-b, 2-c, 3-d, 4-a

b. 1-a, 2-d, 3-c, 4-b
c. 1-c, 2-b, 3-a, 4-d
d. 1-d, 2-a, 3-b, 4-c
History of budget in India:

➢ The first Indian Budget was

presented by James Wilson on
February 18, 1869. Mr Wilson was
the Finance Member of the India
Council that advised the Indian
Viceroy.
➢ The first budget of Independent India
was presented by Sir RK Shanmukham
Chetty on November 26, 1947, in the
backdrop of partition and riots.
➢ First budget of the Republic of India
delivered by John Mathai in 1949-50.
➢ Mr. Deshmukh, the first Indian Governor
of the Reserve Bank of India as well as
the Finance Minister, presented an
interim budget for 1951-52.
➢ Morarji Desai, presented the budget
highest number of times (10) between
from 1959 to 1963 and again from 1967
to 1969.
The case of Railway budget:

➢ In 1921, British railway economist,

William Mitchell Acworth was appointed
chairman of the Committee on Indian
Railways.

➢ The report of the committee, known as

the "Acworth Report", led to separating
the railway finances of India from the
general government finances.
➢ In 1924, the first Railway Budget was
presented.

➢ In 2016, Bibek Debroy Committee has

recommended discontinuance of a
separate Rail Budget.

➢ From financial year 2017-18, the

Railway Budget was merged with the
General Budget.
Which of the following is/are indirect taxes?

1. Goods and Services tax

2. Custom duty
3. Capital gain tax
4. Service tax

Choose the correct code:

a. 1,2 and 3 only

b. 2,3 and 4 only
c. 1,2 and 4 only
d. 1,2,3 and 4
Which one of the following is one of the
maturity periods of T-Bills?

a. 184 days
b. 368 days
c. 270 days
d. 91 days
FRBM act 2003 was introduced with an aim
of

a. Promoting tax collection for the

government
b. To constraint the role of RBI in the
auctioning of Government securities
c. Improve the management of public
funds.
d. Merger of Government Banks
To which of the following ministries does the
highest amount was allocated in the budget
2024?

a. Ministry of Railways
b. Ministry of Defence
c. Ministry of Health
d. Ministry of Housing and Urban
development
Highlights of the Budget:
- Vision of budget 2024: Prosperous Bharat' in harmony with nature,
with modern infrastructure, and providing opportunities for all
citizens and all regions to reach their potential.
- GIFT IFSC (International Financial Services Centre) located at
Gandhinagar in Gujarat is to develop and promote the trading of
global securities, including commodities and create leadership in
deriving prices for such globally traded commodities.
- Direct Benefit transfer saved the government worth 2.7 lakh crores.
- 25 crore people moved out of poverty.
- Credit assistance was given to 78 lakh street vendors under
PM-Svanidhi.
- 1.4 crore people trained under Skill India Mission.
- Headcount ratio in 2022-23- 11.2%
(Multidimensional) Poverty percentage in India).
- 43 crore loans sanctioned to Youth under PM-MUDRA
scheme.
- Number of IITs as of 2023: 23
- No. of AIIMS as of 2023: 22
- No.of Universities in India: 1113.
- Direct financial assistance to 11.8 crore farmers
under PM-KISAN.
- Crop Insurance to 4 crore farmers under PM Fasal
Bima Yojana.
- Integration of 1,361 mandis under eNAM,
supporting a trading volume of ₹ 3 lakh crore.
- 30 crore Mudra Yojana loans disbursed to women
entrepreneurs.
- Increased female enrolment in higher education
by 28 per cent in 10 years.
- 43 per cent of female enrolment in STEM courses.
- 83 lakh SHGs with 9 crore women are
transforming the rural socio-economic landscape
with empowerment and self-reliance.
- Aim to enhance the target for Lakhpati Didi from
2 crore to 3 crore.
- Net Zero (Amount of CO2 released into
environment equals to amount captured) by
2070.
- Rooftop solarisation of 1 crore households will
be taken up.
- >10 crore LPG connections released under
PMUY.
- 36.9 crore LED bulbs, 72.2 lakh LED Tube
lights, and 23.6 lakh Energy efficient fans
distributed under UJALA.
- 1.3 crore LED Street Lights installed under
SNLP 5.
- Pradhan Mantri Awas Yojana (Grameen) is close
to achieving the target of 3 crore houses, an
additional 2 crore targeted for the next 5
years.
- Vaccination for girls in the age group of 9 to 14
years for prevention of cervical cancer.
- U-WIN platform for managing immunisation
and intensified efforts of Mission Indradhanush.
- PM Matsya Sampada Yojana will be expanded to:
● Enhance aquaculture productivity from
existing 3 to
5 tons per hectare,
● Double exports to 1 lakh crore and
● Generate 55 lakh employment opportunities in
the near future.
- Current account deficit as of 2023: 2% of total
GDP.
- Unemployment rate as of 2022-23- 3.2%
- Gross Non-performing assets as of 2023- 3.2% of
Gross advances.
- Digital transactions in 2023: 1200
crores.
- Headline inflation as of 2023-6.7%
- Average processing time of tax returns
as of 2023- 10 days.
- Tax buoyancy between 2017-2023:
1.22.
- Corporate tax for existing companies-
22%
- Corporate tax for new companies -
15%
Total amount of budget (2024-25) 4765768 crores

Revenue receipts (2024-25) 3001275 crores

Capital receipts (2024-25) 1764494 crores

Revenue expenditure (2023-24) 35,02,136 crore

Capital expenditure 12,00,961 crore

If the RBI decides to adopt an expansionist monetary
policy, which of the following would it not do?

(1) Cut and optimize the Statutory Liquidity Ratio

(2) Increase the Marginal Standing Facility Rate

(3) Cut the Bank Rate and Repo Rate

Select the correct answer using the code given below:

(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3
Which of the following is not included in the assets
of a commercial bank in India?

(a) Advances

(b) Deposits

(c) Investments

(d) Money at call and short notice

Consider the following statements :

(1) Inflation benefits the debtors.

(2) Inflation benefits the bondholders.

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
Which of the following has/have occurred in India after
its liberalization of economic policies in 1991?
1. Share of agriculture in GDP increased enormously.
2. Share of India's exports in world trade increased.
3. FDI inflows increased.
4. India's foreign exchange reserves increased
enormously.

Select the correct answer using the codes given below :

(a) 1 and 4 only

(b) 2, 3 and 4 only
(c) 2 and 3 only
(d) 1, 2, 3 and 4
Which programme given the slogan of Garibi

Hatao?

(a) 7th five-year plan

(b) 3rd five year plan

(c) 6th five year plan

(d) 5th five-year plan

Disguised unemployment generally means

(a) large number of people remain unemployed

(b) alternative employment is not available

(c) marginal productivity of labour is zero

(d) productivity of workers is low

Which of the following is a feature of Primary
market?

a. Existing shares are the only ones that can

be traded.
b. Prices are determined by the securities
demand and supply.
c. The stock exchange allows for both the
buying and selling of securities.
d. Company sells securities directly to the
investor.
Primary Market Secondary Market

There is a sale of securities by new companies Existing shares are the only ones that can be
or further (new issues of securities to investors traded.
by existing companies).

The company sells securities directly to the Investors exchange ownership of existing
investor. securities. The company is not involved in any
way.

The primary market only allows for the The stock exchange allows for both the buying
purchase of securities; it does not allow for the and selling of securities.
sale of securities.

The company's management determines and Prices are determined by the securities demand
decides on prices. and supply.

It does not have any fixed geographic location. Located in specific locations.
In the context of Balance of Payments, which of
the following forms part of Capital account?

a. Import of services
b. Export of goods
c. Foreign investments
d. Remittances
Balance of Payment: (BoP)

➢ BoP is the annual statement of accounts of a monetary transactions

of the resident of a country vis-a-vis rest of the world. These
transactions arise due to transaction of goods, services and capital.
The famous “Marrakesh Agreement” is related to
which of the following?

a. World Trade Organisation

b. World Intellectual Property Organisation

c. World Economic Forum

d. World Bank
What is the agreement about?

➢ It led to the establishment of the WTO in

1995, replacing General Agreement on
Tariffs and Trade (GATT) as an international
organization.
➢ It serves as basic framework for trade
relations among all WTO members.
➢ It expanded the scope beyond trade in
goods to trade in services, intellectual
property, and other topics.
➢ It established modern multilateral trading
system, facilitating negotiations, dispute
settlement, and economic cooperation
among members.
About World Trade Organisation:

➢ It is an intergovernmental organization
that regulates and facilitates international
trade between nations.
➢ It officially commenced operations on 1
January 1995, pursuant to the 1994
Marrakesh Agreement, thus replacing the
General Agreement on Tariffs and Trade
(GATT) that had been established in 1948
➢ The WTO is the world’s largest
international economic organization, with
164 member states representing over 98%
of global trade and global GDP
Ministerial Conference:

➢ It is the WTO’s highest

decision-making entity, convenes
typically every two years.
➢ It puts together all of the WTO’s
members, which are either
nations or customs unions.
➢ All decisions pertaining to any of
the multilateral trade agreements
must be made by the Ministerial
Conference.
Ministerial Conference 2024:

➢ 13th edition.
➢ Two countries – Comoros and
Timor Leste acceded to the WTO
on the opening day.
➢ It has taken place from 26 to 29
February 2024 in Abu Dhabi,
United Arab Emirates.
Which of the following statements about
Multidimensional Poverty Index (MPI) since 2005-06
recently released is/are correct?

1. The index is released by NITI Aayog.

2. It has three dimensions- health, education and
standard of living.
3. It has total 10 indicators.
4. Telangana stands at 21st in the index with poverty
rate at 5.88

Choose the correct code:

a. 1,2 and 4 only

b. 1,2 and 3 only
c. 2,3 and 4 only
d. 1,2 and 4 only
Arrange the following countries with regard
to their stock markets from largest to
smallest

1. India
2. USA
3. Japan
4. China

Choose the correct code:

a. 4-2-3-1
b. 2-4-1-3
c. 2-4-3-1
d. 4-2-1-3
India overtakes Hong Kong to become the world’s
fourth-largest stock market.

According to data compiled by Bloomberg, the

combined value of shares listed on Indian
exchanges reached USD 4.33 trillion, versus USD
4.29 trillion for Hong Kong, on Jan 22, 2024.

Top three stock markets are the US, China, and

Japan.
Consider the following statements about 16th Finance Commission,
recently constituted

1. It was constituted by President of India in pursuance of Article

280(1) of the Constitution.
2. The government has appointed N.K.Singh as the chairman of
16th finance commission.
3. The 16th FC recommendations, would cover the period of five
years commencing April 1, 2026.
4. The Commission’s work involves redressing the vertical
imbalances between the taxation powers and expenditure
responsibilities of the center and the States respectively.

Choose the correct code:

a. 1,2 and 4 only

b. 1 and 3 only
c. 2,3 and 4 only
d. 1,3 and 4 only
Which of the following statements about Domestic
Systemically Important Banks (D-SIBs) is incorrect?

a. These are the banks systemically important due

to their size and cross-jurisdictional activities.
b. They are declared by Bank of International
settlements
c. They are declared based on the Basel
Committee on Banking Supervision’s (BCBS’s)
framework.
d. As of May 2024, there are only 3 banks which
are part of Domestic Systemically Important
Banks (D-SIBs)
Which of the following statements about Urea Gold is
correct?

1. It is a neam coated Urea.

2. It is a non-organic slow-release fertilizer .
3. It prolongs the urea action, thus helping plants to
stay greener for longer time.
4. It is developed by Rashtriya Chemicals and Fertilizers
Ltd (RCF), a leading fertilizer manufacturing company
in India in Public Sector.
a. 1,2 and 3 only
b. 2,3 and 4 only
c. 1,3 and 4 only
d. 1,2,3 and 4
Which of the following statements about Annual Survey of
Industries (ASI) 2024 recently released is/are correct?

1. It is released by NITI Aayog.

2. It covers all factories registered under the Factories Act,
1948.
3. In terms of Gross Value Addition, Maharashtra remained
at the top, followed by Karnataka.
4. Tamil Nadu topped in terms of employment generation
of industries.

Choose the correct code:

a. 1,3 and 4 only

b. 2 and 4 only
c. 1,2 and 4 only
d. 3 only
Which of the following statements about Human Development
index Report (HDR) 2023-2024 is/are correct?

1. It is released annually by United Nations Development

Programme (UNDP) since 1990.
2. The Human development index is developed based in 4
dimensions.
3. According to the report, India is ranked at 134 with the
improvement in ranking compared to last year.
4. Switzerland ranked first, followed by Norway and Iceland.

Choose the correct code:

a. 1 only
b. 2,3 and 4 only
c. 1, 3 and 4 only
d. 1 and 2 only
“Project Gaia” recently launched by Bank for
International Settlements was aimed at

a. To estimate the impact of COVID-19 on global

economy.
b. To facilitate the analysis of climate-related risks in
the financial system.
c. To promote the participation of MSME sector in
service sector
d. To evaluate the role of Artificial intelligence in
manufacturing sector.
Recently ‘Vocal For Local’ Initiative to promote
grassroots Entrepreneurship and Self Reliance
was launched by

a. World Bank
b. NITI aayog
c. Telangana Government
d. Ministry of commerce and industries
Which of the following is major objective of launching
Asset reconstruction companies in India?

a. To create assets by enhancing the capital

expenditure by the state and central governments
b. To reduce and manage the Non-performing Assets
c. To regulate real estate business in a transparent
manner
d. To streamline flow of bank loans to selective
sectors which can create assets in India
Which of the following are among those Eight Core
Industries?

1. Cement
2. Fertilizers
3. Shipping
4. Refinery products
5. Textiles

Select the correct answer using the codes given

below

a. 1,2 and 4 only

b. 2,3 and 4 only
c. 3,4 and 5 only
d. 1,2 and 3 only
What are core industries?

➢ Core Industries of the economy

are the main or key industries in
the economy.

➢ There are 8 such sectors in India.

➢ Eight core industries Coal, Crude

Oil, Natural Gas, Petroleum
Refinery Products, Fertilizers,
Steel, Cement and Electricity.
➢ The Index of eight core industries
(ICI) is prepared every month by the
Office of the Economic Adviser
(OEA), the Department for
Promotion of Industry and Internal
Trade (DPIIT), and the Ministry of
Commerce & Industry.

➢ These comprise 40.27% of the

weight of items included in the Index
of Industrial Production (IIP).
Consider the following statements
1. The weightage of food in Consumer Price Index
(CPI) is higher than that in Wholesale Price Index
(WPI).
2. The WTI does not capture changes irt, the prices of
services, which CPI does.
3. Reserve Bank of India has now adopted WPI as its
key measure of inflation and to decide on changing the
key policy rates.
Which of the statements given- above is/are correct ?

a. 1 and 2 only
b. 2 only
c. 1 and 3 only
d. 1,2 and 3
CPI vs WPI comparison

Parameter CPI WPI

Meaning It reflects the average change It reflects changes in average

in prices paid by consumers at wholesale prices for goods sold
the retail level. in bulk.

Frequency of Publishing Monthly (14th of every month) Primary articles, fuel, and
power on a Weekly basis
(Generally Thursdays) Overall
index on monthly basis.

Source The CPI's item weights are The WPI's item weights are
based on average household based on production values.
expenditures gathered from
consumer expenditure surveys.

Status of services Services are included in the Services are not included in
CPI (like housing, education, the WPI.
medical care etc)
Thank You.
All the best.