UPSC Essentials | Daily subject-wise quiz : Economy (Week 14)

Each day, we will cover one new subject. Attempt today’s subject quiz on Economy to check your progress. Come back tomorrow to solve the MCQs on International Relations. Don’t miss checking the answers and explanations at the end of the quiz.

QUESTION 1

Consider the following statements about SAMRIDDHI Scheme:

1. The scheme will strengthen municipal revenue for infrastructure development all over India.

2. It will serve as a one-time property tax amnesty scheme for residents of authorised and regularised colonies in Delhi.

Which of the statement(s) given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

QUESTION 2

With reference to the Investment facilitation for development, consider the following statements:

1. It is launched by a group of developed countries.

2. The initiative covers market access, investment protection and investor-state dispute settlement.

Which of the statement(s) given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

QUESTION 3

Consider the following statements:

1. Core inflation is a measure of inflation calculated by adding the prices of food and fuel.

2. Super core inflation is calculated by removing gold and silver price inflation from core inflation.

Which of the statement(s) given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

QUESTION 4

With reference to the TReDS, consider the following statements:

1. It is an electronic platform for facilitating the financing/discounting of trade receivables of Micro, Small and Medium Enterprises (MSMEs) through multiple financiers.

2. MSMEs can participate as both sellers and buyers.

3. Only Non-Banking Financial Corporations are permitted by the Reserve Bank of India (RBI) to participate as financiers in TReDS.

How many of the statements given above is/are correct?

(a) Only one

(b) Only two

(c) All three

(d) None

QUESTION 5

With reference to the Gross Domestic Product (GDP), consider the following statements:

1. Real GDP is nothing but the total market value of all the goods and services produced in India in a financial year.

2. The Nominal GDP is derived from the Real GDP by removing the effect of inflation.

Which of the statement(s) given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

ANSWER TO MCQs

1. (b)

FYI:

— In a major relief to both residential and non-residential property owners, Lieutenant Governor (L-G) Vinai Kumar Saxena recently launched a one-time scheme – SAMRIDDHI, Strengthening and Augmentation of Municipal Revenue for Infrastructure Development in Delhi. Hence, statement 1 is not correct.

— This will serve as a one-time property tax amnesty scheme for residents of authorised and regularised colonies in Delhi. Hence, statement 2 is correct.

— Under this scheme, people will get a chance to settle the principal tax amount of the current and last five year. By doing so, people will get relaxation on all penalties and previous outstanding dues.

Therefore, option (b) is the correct answer.

2. (d)

FYI:

— It was launched in 2017 by a group of developing and least-developed WTO members. Hence, statement 1 is not correct.

— It is the Joint Initiative that aims at developing a multilateral agreement on Investment Facilitation for Development that will improve the investment and business climate, and make it easier for investors in all sectors of the economy to invest, conduct their day-to-day business and expand their operations.

— The initiative does not cover market access, investment protection and investor-state dispute settlement. Hence, statement 2 is not correct.

Therefore, option (d) is the correct answer.

(Source: http://www.wto.org)

3. (b)

FYI:

— The core inflation rate has inched to 6.2 per cent from 6.1 per cent in December and super core inflation rate has gone up to 6.3 per cent from 6.2 per cent.

— Core inflation is a measure of inflation calculated by removing the prices of food and fuel because the prices of food and fuel prices fluctuate massively. Hence, statement 1 is not correct.

— Super core inflation is calculated by removing gold and silver price inflation from core inflation. Hence, statement 2 is correct.

Therefore, option (b) is the correct answer.

4. (a)

FYI:

— TReDS is an electronic platform for facilitating the financing/discounting of trade receivables of Micro, Small and Medium Enterprises (MSMEs) through multiple financiers. These receivables can be due from corporates and other buyers, including Government Departments and Public Sector Undertakings (PSUs). Hence, statement 1 is correct.

— Sellers, buyers and financiers are the participants on a TReDS platform.

Seller: Only MSMEs can participate as sellers in TReDS. Hence, statement 2 is not correct.

Buyer: Corporates, Government Departments, PSUs and any other entity can participate as buyers in TReDS.

Financiers: Banks, NBFC – Factors and other financial institutions as permitted by the Reserve Bank of India (RBI), can participate as financiers in TReDS. Hence, statement 3 is not correct.

Therefore, option (a) is the correct answer.

(Source: rbi.org.in)

5. (d)

FYI:

— Nominal GDP is nothing but the total market value of all the goods and services produced in India in a financial year. Hence, statement 1 is not correct.

— The real GDP is “derived” from the nominal GDP by removing the effect of inflation. Hence, statement 2 is not correct.

— For analysing the economy, one often uses the “real” GDP but for preparing the budget, the nominal GDP matters.

— Once the government knows the nominal GDP of the current financial year, it uses this number to project the likely nominal GDP in the next financial year.

Therefore, option (d) is the correct answer.

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