Prelims 2009

1. Consider the following statements:

1. The Commission for Agricultural Costs and Prices recommends the Minimum Support Prices for 32 crops.
2. The Union Ministry of Consumer Affairs. Food and Public: Distribution has launched the National Food Security Mission.

Which of the statements given above is/ are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

• It recommends it for around 25 crops. Not more than 30 in any case  ( question on data this time but it’s not a close data i.e 23 or 24. You must have some idea)
• Agriculture ministry should launch mission to increase agri production, no?

Learning – CACP, MSP, CCEA, Procurement price v/s issue price, Shanta Kumar committee recommendations, decentralised procurement

2. To integrate cultural leaders into its meetings, which one of the following gives “CrystaIAward”?

1. Asia Pacific Economic Cooperation
2. International Bank for Reconstruction and Development
3. World Health Organization
4. World Economic Forum

• Only private organizations try to do such things. Integrate cultural leaders.
• WEF- bingo

Learning – India and membership of APEC, world health assembly and zika

Reports of World Economic Forum

3. In the context of Indian news in recent times, what is MCX – SX?

1. A kind of supercomputer
2. Title of Moon Impact Probe
3. Stock Exchange
4. Nuclear-Powered submarine

Obvious, stock exchange

Learning – commodity exchange, stock exchange, money market v/s capital market

4. NAMA-11 (Nama-11) group of countries frequently appears in the news in the context of the affairs of which one of the following?

1. Nuclear Suppliers Group
2. World Bank
3. World Economic Forum
4. W.T.O.

• Just terms NAMA – non agricultural market access
• Obviously WTO

Learning – NAMA, G-33,;G-77, G-7, G-4, Agreement on agriculture, Process v/s product patent, plurilateral v/s multilateral agreements

5. Among other things, which one of the following was the purpose for which the Deepak Parekh Committee was constituted?

1. To study the current socio-economic conditions of certain minority communities
2. To suggest measures for financing the development of infrastructure
3. To frame a policy on the production of genetically modified organisms.
4. To suggest measures to reduce the fiscal deficit in the Union Budget.

• Deepak parikh is a banker so b/w b and d
• Answer is actually b

Learning – committees and their reports, follow the govt committee bundle on the home page

6. In the context of independent India’s Economy, which one of the following was the earliest event to take place?

1. Nationalisation of Insurance companies
2. Nationalisation of State Bank of India
3. Enactment of Banking Regulation Act
4. Introduction of First Five-Year Plan

• 1st place we all know – 1950 -55, nationalisation of banks was in 1969 and 1980 but SBI was nationalised way back in 1955
• Life insurance was nationalised in 1956
• Banking regulation act – 1949

Learning – years of bank nationalisation, insurance nationalisation, RRB, NABARD, LEAD BANK, SIDBI, local area bank, Earlier name of SBI, formation of RBI

7. Which one of the following pairs is not correctly matched?

1. Japan: Nikkei
2. Singapore: Shcomp
3. UK : FISE
4. USA : Nasdaq

A nd d are easily correct. Always in news bulletin.

Make a guess here. Singapore

Learning – BSE v/s NSE, Nifty v/s sensex,

8. Consider the following:

1. Fringe Benefit Tax
2. Interest Tax
3. Securities Transaction Tax

Which of the above is/ are Direct Tax/Taxes?

1. 1 only
2. 1 and 3 only
3. 2 and 3 only
4. 1, 2 and 3

• Interest tax and a securities transaction tax clearly direct taxes
• Fringe benefit tax <taxation on perks and perquisites>has been abolished now, won’t be asked again. It’s a direct tax

Learning – tax Levying,collecting authority, accrue to whom, divide all taxes b/w direct and indirect taxes

9. Consider the following statements regarding Indian Planning:

1. The Second Five-Year Plan emphasized on the establishment of heavy industries.
2. The Third Five-Year Plan introduced the concept of import substitution as a strategy for industrialization.

Which of the statements given above is/ are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

• 1 is correct. We all know that.
• Import substitution -3rd plan

Learning – 3 points about every 5 year plan, Import substitution, Indicative planning

10. In the context of global economy, which one of the following pairs is not correctly matched?

1. JP Morgan Chase     : Financial Services
2. Roche Holding AG     : Financial Services
3. WL Ross & Co.     : Private Equity Firm
4. Warburg     : Private Equity Firm

They no longer ask such questions. May be they asked this in the wake of financial crisis.

11. Consider the following statements :

The functions of commercial banks in India include

1. Purchase and sale of shares and securities on behalf of customers.
2. Acting as executors and trustees of wills.

Which of the statements given above is/ are correct?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 nor 2

Learning– commercial v/s non commercial banks, investment banks, underwriting of shares

12. Which of the following is / are treated as artificial currency?

A. ADR
B. GDR
C. SDR
D. Both ADR and SDR

• SDR is special drawing rights. It’s unit of account of IMF. Though not a currency, sometimes considered as artificial reserve currency
• ADR is American depository receipt
• GDR is global depository receipt

Learning – SDR basket, Criteria for inclusion in SDR basket, Quota changes IMF, ADR v/s GDR v/s IDR

13. Stiglitz Commission established by the President of the United Nations General Assembly was in the international news. The commission was supposed to deal with

A. The challenges posed by the impending global climate change and prepare a road map
B. The workings of the global financial systems and to explore ways and means to secure, a more sustainable global order
C. Global terrorism and prepare a global action plan for the mitigation of terrorism
D. Expansion of the United Nations Security Council in the present global scenario

• Stiglitz we all know is Nobel laureate in economics so would do something related to economy and finance
• Only option is b

14. An objective of the National Food Security Mission is to increase the production of certain crops through area expansion and productivity enhancement in a sustainable manner in the identified districts of the country. What are those crops?

A. Rice and wheat only
B. Rice, wheat and pulses only
C. Rice, wheat, pulses and oil seeds only
D. Rice, wheat, pulses, oil seeds and vegetables

Learning — National Food Security mission v/s National Food security act

15. Which one of the following brings out the publication called “Energy Statistics” from time to time?

A. Central Power Research Institute
B. Planning Commission
C. Power Finance Corporation Ltd.
D. Central Statistical Organization

Reports very important

16. During which Five Year Plan was the Emergency clamped, new elections took place and the Janata Party was elected?

A. Third
B. Fourth
C. Fifth     
D. Sixth

• After st 3 plan, there were 3 plan holidays due to wars and famine
• 4th plan from 1969 to 1974
• Emergency in 1975 so obviously 5th plan

Learning – 3 pointers about every plan

17. With which one of the following has the B.K. Chaturvedi Committee dealt?

A. Review of Centre-state relations
B. Review of Delimitation Act
C. Tax reforms and measures to increase revenues
D. Price reform in the oil sector

• B. K Chaturvedi is former cabinet secretary and member planning commission
• It was in news then
• he also headed committee to restructure centrally sponsored schemes

Learning – oil sector reform, Restructuring of CSS, Delimitation act

18. Who among the following is the founder of World Economic Forum?

A. Klaus Schwab
B. John Kenneth Galbraith
C. Robert Zoellick
D. Paul Krugman

19. .Consider the following pairs:

Organisation                                    Location of Headquarters

1. Asian Development Bank                        Tokyo
2. Asia-Pacific Economic Cooperation            Singapore
3. Association of South East Asian Nations    Bangkok

Which of the above pairs is/are correctly matched?

A. 1 only
B. 2 only
C. Both 1 and 2
D. Neither 1 nor 2

• ADB HQ is in Manila
• ASEAN is Jakarta

Learning – Headquarters of imp, organizations, all 6 bodies of UN, UNICEF, IMF, WB, WTO, ADB, BRICS bank, ASEAN , G- 20 etc

P.S. – This completes our analysis of prelims economy