UPSC Essentials brings to you its initiative of subject-wise quizzes. These quizzes are designed to help you revise some of the most important topics from the static part of the syllabus. Attempt today’s subject quiz on the Economy to check your progress. 🚨 Click Here to read the UPSC Essentials magazine for July 2025. Share your views and suggestions in the comment box or at manas.srivastava@indianexpress.com🚨 QUESTION 1 Consider the following statements: 1. The total amount of penalty imposed by SEBI for violation of various market regulations surged 11 times during 2024-25 compared to the previous fiscal year. 2. The number of entities found violating different securities regulations increased in 2024-25 from 2023-24. 3. The highest number of violations were under Listing Obligations and Disclosure Requirements (LODR) regulations. How many of the statements given above are correct? (a) Only one (b) Only two (c) All three (d) None Explanation — The total amount of penalty imposed by Securities and Exchange Board of India (SEBI) for violation of various market regulations surged 11 times to Rs 813.83 crore during 2024-25, compared to Rs 74.66 crore in the previous fiscal. Hence, statement 1 is correct. — While the amount of penalty increased substantially, the number of entities found violating different securities regulations declined 26 per cent to 463 in 2024-25, down from 629 in 2023-24, according to Sebi’s Annual Report for 2024-25. Hence, statement 2 is not correct. — The regulator saw the highest number violations under Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) category with 155 entities found flouting regulations. This was followed by 116 entities violating Listing Obligations and Disclosure Requirements (LODR) regulations. Hence, statement 3 is not correct. — In 2024-25, direction of debarment was issued against 202 entities, both debarment and disgorgement directions were issued against 89 entities and only disgorgement direction was issued against 15 entities, the annual report showed. Therefore, option (a) is the correct answer. QUESTION 2 Which of the following are the proposed changes in the amendment of the Insolvency and Bankruptcy Code (IBC)? 1. Ensure faster admission of insolvency cases 2. An out-of-court mechanism. 3. Introduction of group and cross-border insolvency frameworks. Select the correct answer using the codes given below: (a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3 Explanation — The much-awaited bill to amend the Insolvency and Bankruptcy Code (IBC) was introduced in the Lok Sabha by Finance Minister Nirmala Sitharaman, who said that the proposed changes are aimed at reducing delays, maximising value for all stakeholders, and improving governance of all processes under the Code. — The proposed modifications include provisions to ensure faster admission of insolvency cases, an out-of-court mechanism to address “genuine business failures”, and introduction of group and cross-border insolvency frameworks, and a slew of others. — Introduced in 2016, the IBC promised to revolutionise insolvency resolution with the goal of rescuing and reorganising distressed enterprises through a time-bound process, prioritising their survival as going concerns. While the IBC has promoted a culture of accountability and credit discipline among debtors, its effectiveness has been hampered by procedural delays, personnel shortages, deviations from essential principles, and sluggish implementation of critical sections. Therefore, option (d) is the correct answer. QUESTION 3 What are the significant advantages of the E20 fuel? 1. Better acceleration and ride quality 2. Low carbon emissions 3. Lower-octane number as compared to petrol 4. Decreases air-fuel mixture density Select the correct answer using the codes given below: (a) 1 and 2 only (b) 1, 2 and 4 (c) 2, 3 and 4 (d) 3 and 4 only Explanation — India achieved 20 per cent ethanol blending just last month, five years ahead of the original target. The 20 per cent blending aim had earlier been advanced from 2030 to 2025-26, given the success the country tasted in achieving 10 per cent blending levels ahead of schedule. According to the government, the E20 fuel presents significant advantages for modern engines. — "The use of E20 fuel provides greater acceleration, riding quality, and, most importantly, reduces carbon emissions by approximately 30% when compared to E10. Ethanol's higher octane rating (approximately 108.5 compared to petrol's 84.4) makes ethanol-blended fuels a viable alternative for higher-octane requirements, which are critical for modern high-compression engines. Vehicles modified for E20 provide faster acceleration, which is critical in city driving circumstances. Furthermore, the increased heat of vaporisation in ethanol lowers intake manifold temperatures, increasing air-fuel combination density and volumetric efficiency, according to the Ministry of Petroleum and Natural Gas (MoPNG). Therefore, option (a) is the correct answer. QUESTION 4 With reference to the Cheque Truncation System (CTS), consider the following statements: 1. It is an online image-based cheque clearing system where cheque images and Magnetic Ink Character Recognition (MICR) data are captured at the collecting bank branch. 2. It is protected by a comprehensive PKI-based security architecture. 3. The Reserve Bank of India (RBI) will roll out a new system to clear cheques within a few hours from October 2025. How many of the statements given above are correct? (a) Only one (b) Only two (c) All three (d) None Explanation — Starting October 4, 2025, the Reserve Bank of India (RBI) will roll out a new system to clear cheques within a few hours—a big improvement from the current processing time of up to two working days. Hence, statement 3 is correct. — Under the new system, cheques will be scanned, processed, and settled continuously during business hours, instead of being cleared in batches. This means that the current T+1 clearing cycle (where T is the day of cheque deposit) will be reduced to just a few hours. — Currently, the Cheque Truncation System (CTS) clears cheques in one or two working days, depending on when they are deposited. The RBI aims to improve customer convenience and reduce settlement risk by moving to a faster, real-time clearing process. — Cheque Truncation System” (CTS) is an online image-based cheque clearing system where cheque images and Magnetic Ink Character Recognition (MICR) data are captured at the collecting bank branch and transmitted electronically eliminating the actual cheque movement. Hence, statement 1 is correct. — CTS is protected by a comprehensive PKI-based security architecture which incorporates basic security and authentication controls such as dual access control, user ID and passwords with cryptobox and smart card interfaces. Hence, statement 2 is correct. Therefore, option (c) is the correct answer. (Other Source: cgda.nic.in) QUESTION 5 With reference to Stagflation, consider the following statements: 1. It is an economic condition characterised by slowing economic growth, high unemployment, and inflation simultaneously. 2. It is tackled easily by cutting interest rates. 3. It only happens when demand is too high. How many of the statements given above are correct? (a) Only one (b) Only two (c) All three (d) None Explanation — American economist Paul Krugman, who received the 2008 Nobel Prize for Economics, in a Substack post on August 8 said key US data are looking increasingly stagflationary. — Stagflation is an economic condition that occurs when economic growth slows, unemployment rises, and prices rise (inflation). Hence, statement 1 is correct. — Stagflation cannot be remedied simply by lowering interest rates, as doing so can exacerbate inflation, making stagflation more difficult to combat. Hence, statement 2 is not correct. — Stagflation occurs when demand exceeds supply, which is frequently triggered by supply shocks rather than excess demand. Hence, statement 3 is not correct. — The Trump administration levied major additional tariffs in 2025, posing the United States' first long-term threat of stagflation in two generations. Therefore, option (a) is the correct answer. (Other Source: www.investopedia.com) QUESTION 6 What is the primary aim of the Special Rupee Vostro Account (SRVA)? (a) To facilitate trade settlements in foreign currencies only. (b) To allow international trade settlement in Indian Rupee. (c) To enable foreign banks to open accounts for their citizens in Indian banks. (d) To provide loans to exporters in foreign currency. Explanation — The SRVA mechanism was introduced in July 2022 to enable exporters and importers to invoice and settle trade in Indian Rupees. Therefore, option (b) is the correct answer. (Source: rbi.org.in) QUESTION 7 Consider the following statements: 1. India is the world’s third-largest consumer of crude oil and depends on imports to meet over 85 per cent of its requirement. 2. As per recent data,West Asian crude oil import for India is greater than crude oil imported from Russia. Which of the statements given above is/are true? (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2 Explanation — According to tanker data analysed by The Indian Express, over 45 per cent of crude oil imported by Indian refiners in May was likely to have been transported via the Strait of Hormuz. The importance of the chokepoint for India’s energy supply and security cannot be understated because the country is the world’s third-largest consumer of crude oil and depends on imports to meet over 85 per cent of its requirement. — India’s oil import strategy has evolved significantly over the past two-three years, with Russia displacing the West Asian majors as India’s largest source of crude. And Russian oil is logistically detached from the Strait of Hormuz as it reaches India mostly via the Suez Canal and Red Sea route, and in some cases via the Cape of Good Hope and the Pacific Ocean routes. — In April-May, Russian crude accounted for around 39 per cent of India’s oil imports, while West Asian oil had a share of around 41 per cent. Therefore, option (c) is the correct answer. QUESTION 8 Consider the following statements with reference to Bank Notes in India: 1. Bank notes are printed at four currency presses,all four are owned by the Reserve Bank of India. 2. The promissory clause printed on the banknotes i.e., "I promise to pay the bearer the sum of Rupees …” denotes the obligation on the part of the Bank towards the holder of the bank note. 3. The highest denomination note ever printed by the Reserve Bank of India was the ₹10,000 note. 4. It is not possible to have two or more banknotes with the same serial number. Which of the above given statements is/are true? (a) 1, 2 and 4 only (b) 2 and 3 only (c) 3 and 4 only (d) 1, 2, 3 and 4 Explanation According to FAQs on rbi.org.in — Bank notes are printed at four currency presses, two of which are owned by the Government of India through its Corporation, Security Printing and Minting Corporation of India Ltd. (SPMCIL) and two are owned by the Reserve Bank, through its wholly owned subsidiary, Bharatiya Reserve Bank Note Mudran Private Ltd. (BRBNMPL). The currency presses of SPMCIL are at Nasik (Western India) and Dewas (Central India). The two presses of BRBNMPL are at Mysuru (Southern India) and Salboni (Eastern India). Hence, statement 1 is not correct — Yes, it is possible to have two or more banknotes with the same serial number, but they would either have a different Inset Letter or year of printing or signature of a different Governor of RBI. An Inset Letter is an alphabet printed on the Number Panel of the banknote. There can be notes without any inset letter also. Hence, statement 4 is not correct. Therefore, option (b) is the correct answer. Previous Daily Subject-Wise-Quiz Daily Subject-wise quiz — History, Culture, and Social Issues (Week 121) Daily subject-wise quiz — Polity and Governance (Week 123) Daily subject-wise quiz — Science and Technology (Week 123) Daily subject-wise quiz — Economy (Week 122) Daily subject-wise quiz — Environment and Geography (Week 122) Daily subject-wise quiz – International Relations (Week 122) Subscribe to our UPSC newsletter and stay updated with the news cues from the past week. Stay updated with the latest UPSC articles by joining our Telegram channel – IndianExpress UPSC Hub, and follow us on Instagram and X.
