1.
Dual economy is mixture of ?
Correct Answer
B. Traditional agricultural sector and a modern industrial sector
Explanation
A dual economy refers to an economic system that consists of two distinct sectors, namely a traditional agricultural sector and a modern industrial sector. This means that the economy has both a traditional sector that relies on agriculture and a modern sector that focuses on industrialization and manufacturing. This combination allows for economic development and growth while also maintaining traditional agricultural practices.
2.
A bank normally does not have to deal with an issue related to—
Correct Answer
C. Intellectual property rights
Explanation
A bank normally does not have to deal with issues related to intellectual property rights because banks primarily focus on financial transactions and services, such as lending, borrowing, and managing accounts. Intellectual property rights are legal protections for creative works, inventions, and trademarks, which are typically not within the scope of a bank's operations.
3.
Which of the following is not a function of a bank ?
Correct Answer
C. Deciding policy rates like CRR, Repo Rates/SLR etc
Explanation
Deciding policy rates like CRR, Repo Rates/SLR etc is not a function of a bank because it is the responsibility of the central bank, such as the Reserve Bank of India, to determine and regulate these policy rates. Banks are required to comply with the policy rates set by the central bank but do not have the authority to decide them. The other options listed, such as providing project finance, selling mutual funds, and settlement of payments on behalf of customers, are all functions typically performed by banks.
4.
As we all know, the limit of exemption on personal income tax has been raised. Whenever a relief in direct taxes is given, the underlying motive is always to make money available for which of the following purposes ?
1. Savings
2. Investment for High returns
3. Personal Consumption
Correct Answer
C. Only 1 and 3
Explanation
The correct answer is Only 1 and 3. When a relief in direct taxes is given, the underlying motive is to make money available for savings and personal consumption. By reducing the tax burden, individuals have more disposable income which they can choose to save or spend on their personal needs and desires. This can stimulate economic growth and provide individuals with more financial security. Investment for high returns is not mentioned as a specific purpose for the relief in direct taxes.
5.
The Reserve Bank of India (RBI) recently announced a hike in some policy rates and also indicated that there may be another change in near future. Which of the following is/are considered a policy rate(s) in the hands of the RBI?
1. Repo Rate
2. SLR
3. BPLR
Correct Answer
D. Only 1 and 2
Explanation
The correct answer is "only 1 and 2." The repo rate and the SLR (Statutory Liquidity Ratio) are both considered policy rates in the hands of the RBI. The repo rate is the rate at which the RBI lends money to commercial banks, while the SLR is the percentage of total deposits that banks are required to maintain in the form of liquid assets like cash, gold, or government securities. BPLR (Benchmark Prime Lending Rate) is not a policy rate, but rather an interest rate set by individual banks for their most creditworthy customers.
6.
Which of the following is not a bank or finance company ?
Correct Answer
C. Lufthansa
Explanation
Lufthansa is not a bank or finance company. It is a German airline company that operates in the aviation industry. Barclays, BNP Paribas, and HSBC are all well-known banks and finance companies.
7.
‘Sensitive sector’ as defined by RBI include(s)—
Correct Answer
D. All the above
Explanation
The correct answer is "All the above." The term "sensitive sector" as defined by RBI includes capital market, real estate, and commodities. These sectors are considered sensitive because they can have a significant impact on the overall economy and financial stability. Therefore, RBI closely monitors and regulates these sectors to ensure their proper functioning and to mitigate any potential risks or vulnerabilities.
8.
The index of measuring economic development is—
Correct Answer
D. Any of the above
Explanation
The index of measuring economic development can be any of the options mentioned: increase in productive assets, national income, or per-capita income. This is because economic development can be assessed using various indicators, including the growth in productive assets, the overall national income, or the income per person. All three options are valid measures to evaluate the level of economic development in a country.
9.
In common meaning, inflation is a condition in which—
Correct Answer
D. Price of commodity increases and value of money decreases
Explanation
Inflation refers to a situation where the general level of prices for goods and services is rising, resulting in a decrease in the purchasing power of money. This means that the price of commodities increases, making them more expensive for consumers to purchase. At the same time, the value of money decreases as it can buy less than before due to the rising prices. Therefore, the correct answer is that both the price of commodities increases and the value of money decreases in the condition of inflation.
10.
Which is the main reason of demand pull inflation ?
Correct Answer
D. All of the above
Explanation
The main reason for demand pull inflation is a combination of all the factors mentioned: an increase in money supply, an increase in commercial expenditure, and an increase in foreign demand for goods. When there is an increase in money supply, people have more money to spend, leading to an increase in demand for goods and services. Additionally, when commercial expenditure increases, businesses are investing more in production and advertising, which also leads to an increase in demand. Lastly, an increase in foreign demand for goods means that there is a higher demand for a country's exports, leading to increased production and inflation.