Option C is correct.

• Statements 1 and 3 are correct. Statement 2 is incorrect.

• A Pigouvian tax is a tax on a market transaction that creates a negative externality borne by individuals not directly involved in the transaction. The tax is normally set by the government to correct an undesirable or inefficient market outcome (a market failure).

• Examples include carbon taxes-imposed on companies that burn coal, oil or gas which emits greenhouse gases. These emissions cause climate change which is a negative externality.

• Some of the advantages include:

1) Fosters market efficiency: Pigouvian taxes promote market efficiency by incorporating the additional costs imposed by negative externalities. In such a case, the final cost (original cost plus tax) will reflect the full social cost of the economic activity. Hence, statement 1 is correct.

2) Generates additional government revenue: It is a tax assessed against private individuals or businesses for engaging in activities that create adverse side effects for society. However, it does not promote government companies over private companies. Pigouvian taxes generate additional revenues for the government. The additional funds may be used to subsidize initiatives and programs that will further challenge negative externalities. Hence, statement 2 is incorrect.

3) Discourages harmful activities: In certain cases, Pigouvian taxes may effectively discourage the activities that lead to negative externalities. Examples of pigouvian taxes include tobacco taxes, sugar taxes, and carbon taxes. Hence, statement 3 is correct.

Option A is correct.

• Statement 1 is correct. Statement 2 is incorrect.

• Helicopter money involves the central bank or central government supplying large amounts of money to the public to create demand, as if the money was being distributed or scattered from a helicopter. Helicopter money is the money handed directly to consumers, which increases the demand.

• Quantitative easing (QE) is a form of unconventional monetary policy in which a central bank purchases longer-term securities from the open market in order to increase the money supply and encourage lending and investment. Buying these securities adds new money to the economy and also serves to lower interest rates.

• Statement 1 is correct. Quantitative easing also involves the use of printed money by central banks to buy government bonds. In case of quantitative easing, printed money is used by central banks to buy government bonds and the government has to pay back for the assets that the central bank buys. However, in case of helicopter money, currency is distributed to the public without any repayment liability.

• Statement 2 is incorrect. Helicopter money involves printing large sums of money and distributing it to the public. It basically means non-repayable money transfer from the central bank to the government.

Option B is correct.

• Statement 1 is incorrect. Statement 2 is correct.

• The Reserve Bank of India (RBI) has named the top three lenders in India – State Bank of India (SBI), ICICI Bank, and HDFC Bank-as Domestic Systemically Important Banks (D-SIBs), or banks that are too big to fail. In other words, these banks are interconnected entities whose failure could potentially impact the entire financial system and cause instability. As a result, they are subject to closer supervision and regulation by the RBI. Hence, statement 1 is incorrect.

• Statement 2 is correct. A D-SIB is a bank that is considered to be so important to the financial system that its failure could cause significant disruption. As a result, these banks are required to maintain higher capital buffers to protect against potential losses and ensure their stability. In India, the RBI has established a framework for dealing with D-SIBs, which requires the central bank to disclose the names of designated banks starting from 2015 and place them in appropriate buckets based on their systemic importance.

Option A is correct.

• Statements 1 and 3 are incorrect. Statement 2 is correct.

• Statement 1 is incorrect. APMCs are regulated and managed under the Agricultural Produce Market Act

• (APMC Act) enacted by the respective state governments. Agricultural Produce Market Committee

• (APMC) is a system operating under the State Government since agricultural marketing is a State subject.

• Statement 2 is correct. The introduction of APMC was to limit the occurrence of Distress Sale by the farmers under the pressure and exploitation of creditors and other intermediaries. APMC ensures worthy prices and timely payments to the farmers for their produce.

• Statement 3 is incorrect. APMCs have not been kept out of the scope of National Agriculture Market (eNAM).

• eNAM is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities. The aim of the eNAM is integration of APMCs across the country through a common online market platform to facilitate pan-India trade in agriculture commodities. Currently, around 1000 APMC markets are linked to the eNAM network from 18 states and 3 UT’s.

• APMC does not procure agricultural crops at MSP (Minimum Support Price).

• Both the statements are incorrect.

• Commercial Banks accept deposits from the public and lend out this money to interest- earning investment projects. The rate of interest offered by the bank to deposit holders is called the ‘borrowing rate’ and the rate at which banks lend out their reserves to investors is called the ‘lending rate’. The difference between the two rates is called ‘spread’. It is the profit that is appropriated by the banks. Hence, statement 1 is incorrect.

• Under the ‘Credit Rationing’ tool, the central bank (RBI) fixes maximum ceiling of loans to be granted by the commercial banks. Hence, statement 2 is incorrect.

• Moral Suasion: Under this method central bank persuades and pressurizes the commercial banks to adopt a credit policy which is in line with the overall objectives of the economy.

Option A is correct.

• Options 1 and 2 are correct. Option 3 is incorrect.

• Securities transaction tax (STT) is levied on gains from securities (tradable investment instruments) such as shares, bonds, debentures, equity-oriented mutual funds (MFs) and so on, issued either by companies or by the Indian government in the domestic stock exchange. It is a direct tax that the central government levies and collects. STT was introduced in 2004. This tax was introduced to avoid tax evasion in case of capital gains. It is levied on the value of securities (except commodities and currency). STT is governed by the Securities Transaction Tax Act (STT Act).

• Option 1 is correct. One of the most recognizable forms of securities is Equity (shares in a company listed on a stock exchange). So Mutual Funds investing in Equities (there are MFs investing on other instruments as well) are covered under the ambit of the STT.

• Option 2 is correct. Shares of a company, whether purchased during secondary transactions (FPOs) or during an IPO (Initial Public Offer i.e. when they are listed on the stock exchange for the first time) are also covered under Equities and thus come under the ambit of STT.

• Option 3 is incorrect. Transactions involving speculation on currencies in foreign exchange markets (Forex Market Trades) are not covered under STT.

• Futures and Options are Derivatives (instruments trading on the value of underlying objects like agricultural commodities, or metal, etc). Derivatives are covered under the ambit of STT too, so by extension Futures & Options attract STT as well.

Option D is correct.

• Both the statements are incorrect.

• Transaction demand for money is the amount of money required for current transactions of individuals and firms. It is the quantity of money that all the Individuals and firms desire to keep on hand for the purpose of financing their forthcoming expenditure.

• Statement 1 is incorrect. The transactions demand for money is negatively affected by the interest rates. The demand for money is inversely related to the interest rate. At high-interest rates, people prefer to hold money in bonds and banks and thus transactive demand for money will reduce.

• If prices rise (Price level rise), then people will need to hold a higher level of money balances to meet their payments transactions. If prices fall, people will need a lower volume of money balances to support a given level of transactions.

• Statement 2 is incorrect. The transactions demand for money is positively affected by the amount of real income. If the aggregate income and output produced in the goods market increases, then clearly there will be a larger volume of transactions and thus transactive demand for money will increase. People will need to have a larger volume of money to meet all these transactions and make payments.

Option C is correct.

• Statement 1 is incorrect. Statements 2 and 3 are correct.

• The Securities and Exchange Board of India‘s initiative to create a Social Stock Exchange (SSE) will boost social and & environmental impact investing in India by creating a new platform. The Entrepreneurs can mobilize the capital through the Social Stock Exchanges. But this is the economic capital and not social capital. Hence, statement 1 is incorrect.

• Social capital basically comprises the value of social relationships and networks that complement the economic capital for the economic growth of an organization and the community. It will help the speedy recovery during the rescue and relief operations. Hence, statement 2 is correct.

• Social capital is a set of shared values that allows individuals to work together in a group to effectively achieve a common purpose. The idea is generally used to describe how members are able to band together ino live harmoniously. Society can obtain better trust and a shared sense of identity by means of it. Hence, statement 3 is correct.

• Option B is correct.

Green Gross Domestic Product (Green GDP) is a measure of economic output that takes into account the environmental costs of production, such as pollution and resource depletion. It is an alternative to traditional GDP, which measures the value of all goods and services produced in an economy but does not account for the environmental costs of production. The idea behind Green GDP is that traditional GDP does not provide an accurate picture of the sustainability of an economy because it does not consider the negative environmental impacts of economic activity. By accounting for these costs, Green GDP provides a more accurate measure of economic progress and helps policymakers identify areas where economic growth may be coming at the expense of the environment. There are several methods for calculating Green GDP, including the “shadow price” method, which estimates the value of environmental resources and services based on the amount that people are willing to pay to preserve them, and the “physical replacement cost” method, which estimates the cost of replacing lost or damaged environmental resources. Green GDP has been used in a number of countries, including China, which began publishing Green GDP data in 2004. However, it is still not widely used and has faced criticism for its lack of precision and the difficulty of accurately valuing environmental resources and services.

• Option A is correct.

• Statement 1 is correct. Statement 2 is incorrect.

• Statement 1 is correct. The Central Public Sector Enterprises (CPSEs) are those companies in which the direct holding of the Central Government or other CPSEs is 51% or more.

• Statement 2 is incorrect. A CPSE should also have a Navratna status (not Maharatna status), be listed on an Indian stock exchange.