UGC NET Economics December 2019 Question PaperPaper 1 & Paper 2 with Answer Key
The complete UGC NET December 2019 question paper for Economics, covering Paper 1 (General Aptitude) and Paper 2 (Economics). Every question below is shown with its options and the correct answer, and a detailed explanation you can unlock by signing in. All 150 questions are free to practise.
UGC NET December 2019 at a glance
Exam
UGC NET December 2019
Papers
Paper 1 (General Aptitude) and Paper 2 (Economics)
50 questions with the answer key and explanations.
Question 1
From the list given below identify those competencies of an effective teacher which relate to the domain of personality and attitude.
a. Locus of control
b. Communicating
c. Managing
d. Self-efficacy
e. Teacher enthusiasm
f. Being organised and orderly
Select the correct answer from the options given below:
Aa, b and c
Ba, d and e
Cb, c and d
Dd, e and f
Answer:(B) a, d and e
Explanation
Teacher competencies are divided into personality/attitude (affective traits) and professional/behavioral management skills.
A. a, b and c — incorrect because communicating and managing are procedural behavioral skills rather than personal affective traits.
B. a, d and e — correct. Locus of control, self-efficacy, and teacher enthusiasm directly reflect the teacher's personal mindset, intrinsic beliefs, and affective disposition.
C. b, c and d — incorrect because communication and management belong to classroom administration and instructional delivery.
D. d, e and f — incorrect because being organized and orderly represents structural organizational competence rather than an attitude or personality trait.
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Question 2
In the spectrum of teaching methods which of the following will be called 'dialogic'?
a. Demonstration method
b. Problem-solving method
c. Chalk and talk method
d. Team teaching based method
e. Interactive presentation
f. Tutorials
Select your answer from the options given below:
Aa, b and c
Bb, c and d
Cc, d and e
Db, e and f
Answer:(D) b, e and f
Explanation
Dialogic teaching methods rely on reciprocal conversation, collaborative inquiry, and active exchange between teachers and learners.
A. a, b and c — incorrect because demonstration and chalk-and-talk are primarily teacher-led didactic displays.
B. b, c and d — incorrect because chalk-and-talk is purely monologic and team teaching focuses on instructor coordination rather than student dialogue.
C. c, d and e — incorrect because traditional lecturing lacks reciprocal dialogue.
D. b, e and f — correct. Problem-solving, interactive presentations, and small-group tutorials require two-way discourse, student questioning, and shared exploration.
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Question 3
In which level of teaching, lower level learning outcomes get focussed?
AMemory level
BUnderstanding level
CReflective level
DAutonomous development level
Answer:(A) Memory level
Explanation
The memory level of teaching focuses on lower-order cognitive processes such as rote memorization, recall, and factual retention.
A. Memory level — correct. Proposed by Herbart, this level targets basic knowledge acquisition and factual reproduction without requiring deep conceptual abstraction.
B. Understanding level — incorrect. Proposed by Morrison, this level focuses on grasping relationships, comprehending principles, and explaining meanings.
C. Reflective level — incorrect. Proposed by Hunt, this represents the highest cognitive level centered on problem-solving, evaluation, and critical synthesis.
D. Autonomous development level — incorrect. Proposed by Bigge, this level emphasizes learner-directed organic growth and natural development.
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Question 4
Which of the following evaluation systems belongs to the category of being an innovative practice?
ASemesterized examinations
BPerformance evaluation
CPortfolio based evaluation
DLearning outcome based evaluation
Answer:(D) Learning outcome based evaluation
Explanation
Learning outcome based evaluation is an innovative reform that measures observable student competencies and real-world capabilities rather than time spent in instruction.
A. Semesterized examinations — incorrect because dividing the academic year into semesters is an administrative scheduling structure rather than an innovative evaluation model.
B. Performance evaluation — incorrect because general performance appraisal is a conventional grading practice.
C. Portfolio based evaluation — incorrect in this comparative exam context because the UGC reform agenda specifically established the Learning Outcomes-based Curriculum Framework as the primary innovative benchmark.
D. Learning outcome based evaluation — correct. Outcome-based education defines explicit demonstrable graduate attributes and designs assessment tasks directly around those targets.
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Question 5
The purpose of ICT use in education is to
AAttract students
BMake teaching interesting
COptimise learning outcomes
DPromote technology culture in teaching
Answer:(C) Optimise learning outcomes
Explanation
The ultimate pedagogical purpose of integrating information and communication technology into education is to optimize student learning outcomes.
A. Attract students — incorrect because institutional enrolment or student attraction is merely an administrative byproduct.
B. Make teaching interesting — incorrect because classroom engagement is an enabling technique rather than the ultimate goal of instruction.
C. Optimise learning outcomes — correct. ICT tools facilitate deeper comprehension, personalized pacing, rich simulations, and enhanced cognitive mastery.
D. Promote technology culture in teaching — incorrect because technology remains an instructional instrument rather than an end in itself.
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Question 6
In the post positivistic approach to research which of the following types of researches got emphasized?
a. Experimental research
b. Phenomenological research
c. Ethnographic research
d. Ex Post Facto research
e. Action research
Give the correct answer from the options given below:
Aa, b and c
Bb, c and d
Cb, c and e
Dc, d and e
Answer:(C) b, c and e
Explanation
Post-positivism rejects rigid objectivism and emphasizes qualitative, interpretative, and participatory inquiry to understand human subjective experience.
A. a, b and c — incorrect because experimental research relies on the classical positivist quantitative paradigm.
B. b, c and d — incorrect because ex post facto research is a quantitative non-experimental approach grounded in positivism.
C. b, c and e — correct. Phenomenological, ethnographic, and action research focus on lived experience, social context, and practitioner-led reflective change.
D. c, d and e — incorrect because ex post facto designs test pre-existing statistical associations rather than interpretative post-positivist meanings.
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Question 7
In which of the following formats, 'Research Abstract' is a must?
a. Research article
b. Seminar paper presented
c. Thesis
d. Research synopsis
Choose the most appropriate option from those given below:
Aa, c and d
Ba, b and d
Ca, b and c
Db, c and d
Answer:(C) a, b and c
Explanation
A research abstract is an obligatory standalone summary for completed scholarly outputs.
A. a, c and d — incorrect because a synopsis is a preliminary proposal submitted before research is conducted.
B. a, b and d — incorrect because a research synopsis outlines future plans rather than summarizing completed empirical findings.
C. a, b and c — correct. Published journal articles, presented conference papers, and formal doctoral theses must contain an abstract outlining objectives, methodology, key findings, and conclusions.
D. b, c and d — incorrect because an abstract is not a mandatory component of a research synopsis.
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Question 8
Which of the following sequences represents the most logical sequence in doing research?
AIdentifying and defining a research problem, formulating a hypothesis, testing of hypothesis and reporting the results
BIdentify a research problem, defining the population and sample, collecting data and analysis of data
CSurvey of research, defining the research problem, collecting data and presenting the outcomes
DDefining research variables, hypothesizing, testing of research and reporting of research outcomes
Answer:(A) Identifying and defining a research problem, formulating a hypothesis, testing of hypothesis and reporting the results
Explanation
Scientific inquiry follows a structured sequence from problem identification through empirical verification to final reporting.
A. Identifying and defining a research problem, formulating a hypothesis, testing of hypothesis and reporting the results — correct. This sequence covers the complete scientific lifecycle from initial problem formulation to final dissemination.
B. Identify a research problem, defining the population and sample, collecting data and analysis of data — incorrect because it omits hypothesis formulation and the terminal stage of reporting.
C. Survey of research, defining the research problem, collecting data and presenting the outcomes — incorrect because it bypasses hypothesis formulation and formal testing.
D. Defining research variables, hypothesizing, testing of research and reporting of research outcomes — incorrect because variables cannot be operationalized before the overarching problem is defined.
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Question 9
A university teacher intends to study the relationship between level of aspiration and achievement of rural children. Which design of research will be most appropriate in the context?
AExperimental research design
BEx Post Facto research design
CHistorical research design
DSurvey research design
Answer:(B) Ex Post Facto research design
Explanation
When the independent variable has already occurred naturally and cannot be experimentally manipulated or randomly assigned, an ex post facto design is required.
A. Experimental research design — incorrect because the researcher cannot artificially assign or manipulate children's inherent psychological aspirations and prior academic achievements.
B. Ex Post Facto research design — correct. Ex post facto research examines causal relationships retrospectively where the independent variable is a pre-existing attribute of the participants.
C. Historical research design — incorrect because the study assesses living children in contemporary educational settings rather than historical archival records.
D. Survey research design — incorrect because a descriptive survey merely profiles attitudes without specifically investigating quasi-causal relational dynamics.
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Question 10
Hypothesis testing is the main concept of which type of research?
AExperimental research
BHistorical research
CSurvey research
DExegetic research
Answer:(A) Experimental research
Explanation
Experimental research is defined by the deliberate manipulation of an independent variable and the statistical testing of formal hypotheses.
A. Experimental research — correct. It sets up controlled conditions to test cause-and-effect relationships by subjecting null hypotheses to empirical falsification.
B. Historical research — incorrect because historical studies rely on narrative synthesis and primary source critique rather than statistical hypothesis testing.
C. Survey research — incorrect because surveys are primarily descriptive or exploratory and do not always require formal hypothesis verification.
D. Exegetic research — incorrect because exegesis involves critical textual analysis and hermeneutic interpretation of documents.
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Question 11
Communication in the classroom takes place in which of the following levels?
AOpportunistic meaning
BSurfacial meaning
CNoise-level meaning
DNon-coded meaning
Answer:(B) Surfacial meaning
Explanation
Classroom instruction is structured around specific curriculum objectives and predetermined time limits, operating primarily at an explicit cognitive and surfacial level of meaning.
A. Opportunistic meaning — incorrect because classroom discourse is organized and planned rather than driven by random opportunism.
B. Surfacial meaning — correct. In time-constrained instructional sessions, teacher-student communication focuses on syllabus-aligned, direct conceptual exchanges.
C. Noise-level meaning — incorrect because noise represents communication interference that pedagogical design actively minimizes.
D. Non-coded meaning — incorrect because instructional communication relies on structured linguistic and symbolic codes.
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Question 12
Effective classroom communication can transform
Aacademic administration
Bacademic marketing
Cteaching-learning process
Dmanagement strategies
Answer:(C) teaching-learning process
Explanation
Classroom communication operates directly within the instructional environment, transforming the teaching-learning process through active dialogue and timely feedback.
A. academic administration — incorrect because institutional administration is governed by institutional policy rather than direct classroom exchanges.
B. academic marketing — incorrect because marketing deals with institutional promotion and admissions.
C. teaching-learning process — correct. Clear, responsive communication enhances student engagement, promotes critical thinking, and enriches pedagogical delivery.
D. management strategies — incorrect because corporate and executive governance are external to immediate classroom interactions.
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Question 13
Learner communication has relatively high potential of challenging
ATeaching as profession
BInnovative and creative ideas
CMethods of evaluation
DLong-held attitudes
Answer:(D) Long-held attitudes
Explanation
When learners actively articulate ideas and engage in dialectical dialogue, they confront personal preconceptions and challenge long-held attitudes.
A. Teaching as profession — incorrect because learner participation strengthens pedagogical professionalism rather than threatening it.
B. Innovative and creative ideas — incorrect because learner dialogue stimulates and fosters creativity.
C. Methods of evaluation — incorrect because evaluation frameworks are designed around curriculum guidelines.
D. Long-held attitudes — correct. Critical student questioning and open discourse expose cognitive biases, traditional stereotypes, and entrenched beliefs.
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Question 14
Which of the following are rhetorical techniques for structuring classroom communication?
a. Relating the day's topic to students' interests
b. Providing scattered information to the target audience
c. Smooth transition from one idea to another
d. Avoiding the use of artifacts
e. Using media to improve the quality aspect of reception of messages
f. Opting for one-way communication
Choose the correct option from the choices given below:
Aa, b and c
Bb, c and f
Ca, c and e
Dd, e and f
Answer:(C) a, c and e
Explanation
Effective rhetorical structuring in classroom communication aligns content with learner interests, maintains logical narrative flow, and enhances message reception.
A. a, b and c — incorrect because providing scattered information creates confusion and degrades comprehension.
B. b, c and f — incorrect because one-way communication eliminates feedback and student interaction.
C. a, c and e — correct. Linking concepts to student interests builds relevance, smooth transitions ensure coherence, and multimedia aids clarify complex ideas.
D. d, e and f — incorrect because artifacts are valuable teaching aids and one-way transmission is ineffective.
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Question 15
Assertion (A): Defining the objectives of the topic of discussion is not necessarily the first step in classroom communication
Reasons (R): Clear definitions of objectives make students understand the topic well.
ABoth (A) and (R) are true and (R) is the correct explanation of (A)
BBoth (A) and (R) are true and (R) is not the correct explanation of (A)
C(A) is true, but (R) is false
D(A) is false, but (R) is true
Answer:(D) (A) is false, but (R) is true
Explanation
In systematic instructional design, articulating clear learning objectives is the essential initial step that establishes purpose and direction for students.
A. Both (A) and (R) are true and (R) is the correct explanation of (A) — incorrect because Assertion (A) is false.
B. Both (A) and (R) are true and (R) is not the correct explanation of (A) — incorrect because Assertion (A) incorrectly claims objectives are not necessarily the primary step.
C. (A) is true, but (R) is false — incorrect because Reason (R) is undeniably true in pedagogical theory.
D. (A) is false, but (R) is true — correct. Stating clear objectives must occur at the outset of instruction to anchor learner attention and guide comprehension.
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Question 16
A is father of B and C is sister of A. D is grandson of C. How is D related to B?
AUncle
BNephew
CCousin
DGrandson
Answer:(B) Nephew
Explanation
Tracing generational bloodlines:
A is the father of B, and C is the sister of A. This makes C the paternal aunt of B.
C's child and B are first cousins, belonging to the same generation.
D is the grandson of C, which means D is the child of C's child.
Because D belongs to the generation directly below B, D is B's nephew in standard familial classification.
A. Uncle — incorrect because D belongs to the descendant generation, not the ascendant one.
B. Nephew — correct. The child of a cousin belongs to the nephew/niece generation relative to B.
C. Cousin — incorrect because cousins share the same generational level.
D. Grandson — incorrect because D is two generations below C, but only one generation below B.
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Question 17
If x : y = 7 : 9 then (3x - 5y) : (4x + y) = ?
A-24/37
B-22/37
C15/22
D42/37
Answer:(A) -24/37
Explanation
Substitute the ratio values into the expression:
Let x = 7 and y = 9.
Numerator:
3x - 5y = 3(7) - 5(9) = 21 - 45 = -24
Denominator:
4x + y = 4(7) + 9 = 28 + 9 = 37
Ratio:
(3x - 5y) / (4x + y) = -24 / 37
A. -24/37 — correct. Direct substitution yields -24 in the numerator and 37 in the denominator.
B. -22/37 — incorrect due to a subtraction arithmetic mistake.
C. 15/22 — incorrect from an inverted sign or flawed variable substitution.
D. 42/37 — incorrect from miscalculating the numerator with a positive sign.
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Question 18
If HPU = 9, JNU = 9, then DU = ?
A5
B6
C4
D7
Answer:(D) 7
Explanation
Calculate the alphabetical letter positions and take the sum of digits:
For HPU:
H = 8, P = 16, U = 21
Sum = 8 + 16 + 21 = 45
Digital sum = 4 + 5 = 9
For JNU:
J = 10, N = 14, U = 21
Sum = 10 + 14 + 21 = 45
Digital sum = 4 + 5 = 9
For DU:
D = 4, U = 21
Sum = 4 + 21 = 25
Digital sum = 2 + 5 = 7
A. 5 — incorrect calculation.
B. 6 — incorrect calculation.
C. 4 — incorrect calculation.
D. 7 — correct. The positional values sum to 25, whose digits add up to 7.
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Question 19
Which one is the wrong number in the given series?
3, 13, 43, 53, 63, 83.
A13
B53
C63
D83
Answer:(C) 63
Explanation
Evaluate the mathematical properties of each term in the series:
3 is prime.
13 is prime.
43 is prime.
53 is prime.
63 is composite, divisible by 1, 3, 7, 9, 21, and 63.
83 is prime.
Every number in the series is a prime number ending in 3 except 63.
A. 13 — incorrect because 13 is a prime number conforming to the pattern.
B. 53 — incorrect because 53 is a valid prime term.
C. 63 — correct. 63 is a composite number in a series otherwise composed exclusively of prime numbers.
D. 83 — incorrect because 83 is a valid prime term.
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Question 20
A sum of money with compound interest becomes Rs. 2,400 in one year and Rs. 3,000 in two years. Find out the principal amount.
ARs. 1,900
BRs. 1,910
CRs. 1,915
DRs. 1,920
Answer:(D) Rs. 1,920
Explanation
Compute the growth factor and principal using compound interest principles:
Let P be the principal and r be the annual rate of interest.
After 1 year:
P(1 + r) = 2400
After 2 years:
P(1 + r)^2 = 3000
Divide the second-year amount by the first-year amount:
1 + r = 3000 / 2400 = 5 / 4 = 1.25
Calculate the principal:
P = 2400 / (5 / 4) = (2400 * 4) / 5 = 1920
A. Rs. 1,900 — incorrect arithmetic approximation.
B. Rs. 1,910 — incorrect calculation.
C. Rs. 1,915 — incorrect calculation.
D. Rs. 1,920 — correct. Dividing the first-year total by 1.25 gives Rs. 1,920.
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Question 21
The term 'Yogaja' (intuitive) pertains to which of the following pramanas?
APerception
BInference
CVerbal testimony
DComparison
Answer:(A) Perception
Explanation
In Nyaya epistemology, perception (Pratyaksha) is categorized into ordinary (Laukika) and extraordinary (Alaukika) perception.
Alaukika Pratyaksha comprises three modes:
Samanyalaksana (perception of universals)
Jnanalaksana (perception based on prior association)
Yogaja (intuitive perception developed through yogic meditation)
A. Perception — correct. Yogaja is the extraordinary perception through which yogis intuitively grasp past, present, and subtle realities.
B. Inference — incorrect because Anumana derives knowledge through a middle term rather than direct extraordinary intuition.
C. Verbal testimony — incorrect because Shabda relies on the authoritative word of a trustworthy person.
D. Comparison — incorrect because Upamana produces knowledge through analogical comparison.
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Question 22
In which of the following propositions, both can be true simultaneously but cannot be false simultaneously?
AContrary
BContradiction
CSub contrary
DSubaltern
Answer:(C) Sub contrary
Explanation
In the classical Square of Opposition, sub-contraries are particular propositions (I and O) that can both be true together, but cannot both be false together.
A. Contrary — incorrect because contrary propositions (A and E) cannot both be true simultaneously, though they can both be false.
B. Contradiction — incorrect because contradictory propositions (A and O, E and I) cannot both be true and cannot both be false.
C. Sub contrary — correct. Sub-contrary propositions ('Some S are P' and 'Some S are not P') can both be true at the same time, but if one is false, the other must be true.
D. Subaltern — incorrect because subalternation describes the truth relationship between universal and particular propositions of the same quality.
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Question 23
Which of the following pramanas is used by classical Indian school of logic to prove the existence of God?
AArthapatti (postulation)
BUpamana (comparison)
CPerception (Pratyaksa)
DInference (anumana)
Answer:(D) Inference (anumana)
Explanation
In the classical Nyaya school of logic, the existence of God (Ishvara) is established through Inference (Anumana).
Nyaya logicians argue that the physical cosmos is an effect (karyatvat) composed of parts, which necessitates an intelligent, omniscient creator (karta) as its efficient cause, just as a pot requires a potter.
A. Arthapatti (postulation) — incorrect because Arthapatti is accepted primarily by Mimamsa and Advaita Vedanta, whereas Nyaya rejects it as an independent pramana.
B. Upamana (comparison) — incorrect because comparison establishes the relation between a name and the object denoted.
C. Perception (Pratyaksa) — incorrect because God is supersensuous and cannot be apprehended through ordinary sensory perception.
D. Inference (anumana) — correct. Nyaya philosophers like Udayana in Nyayakusumanjali formulate rational inferential arguments to establish God's existence.
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Question 24
"All tigers are animals". This is an example of which type of proposition?
AParticular Negative
BParticular Affirmative
CUniversal Negative
DUniversal Affirmative
Answer:(D) Universal Affirmative
Explanation
A proposition asserting that every member of the subject class belongs to the predicate class is a Universal Affirmative (A proposition).
A. Particular Negative — incorrect because an O proposition takes the form 'Some S are not P'.
B. Particular Affirmative — incorrect because an I proposition takes the form 'Some S are P'.
C. Universal Negative — incorrect because an E proposition takes the form 'No S are P'.
D. Universal Affirmative — correct. 'All tigers are animals' universally affirms the predicate 'animals' for the entire subject class 'tigers'.
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Question 25
The inference "A mouse is an animal. Therefore, a large mouse is a large animal" commits which one of the following fallacies?
AStraw man
BSlipper slope
CEquivocation
DFallacy of composition
Answer:(C) Equivocation
Explanation
The fallacy of equivocation occurs when a key term shifts its meaning or standard of comparison between premises and conclusion.
In this argument, the adjective 'large' is a relative term:
In the premise, 'large' is evaluated relative to the normal size of mice.
In the conclusion, 'large' shifts to an absolute scale evaluated relative to all animals.
A. Straw man — incorrect because the argument does not distort an opponent's position.
B. Slipper slope — incorrect because it does not assert an unjustified chain of causal consequences.
C. Equivocation — correct. Shifting the contextual standard of 'large' produces an unsound conclusion through semantic equivocation.
D. Fallacy of composition — incorrect because it does not attribute parts' properties to a whole.
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Question 26
The difference in the number of Acer computers sold in 2002 and 2005 is
The following table gives the sales of computers of different types or brands over the years 2001 to 2007 (in thousands):
Years
Lenovo
Acer
IBM
HCL
2001
20
40
50
80
2002
30
25
60
70
2003
50
50
50
55
2004
60
70
40
35
2005
70
85
70
25
2006
80
45
80
20
2007
90
60
100
10
A15,000
B20,000
C45,000
D60,000
Answer:(D) 60,000
Explanation
From the data table, retrieve the sales for Acer in thousands:
Sales in 2005 = 85 thousand
Sales in 2002 = 25 thousand
HCL: 80 -> 70 -> 55 -> 35 -> 25 -> 20 -> 10 (decreased in every successive year).
A. Lenovo — incorrect because sales grew monotonically each year.
B. Acer — incorrect because sales experienced alternating rises and drops.
C. IBM — incorrect because sales rose and fell across different periods.
D. HCL — correct. Sales dropped steadily from 80 thousand in 2001 down to 10 thousand in 2007 without any reversal.
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Question 31
In computer related activities, which of the following is inappropriate for describing a language translator?
AAssembler
BCompiler
CInterpreter
DCodec
Answer:(D) Codec
Explanation
A language translator is a system utility that converts human-readable program code into machine language executable by the CPU.
A. Assembler — incorrect because an assembler translates assembly language mnemonics into binary machine code.
B. Compiler — incorrect because a compiler translates an entire high-level source program into machine code in one pass.
C. Interpreter — incorrect because an interpreter translates and executes high-level source instructions line by line.
D. Codec — correct. A codec (coder-decoder or compressor-decompressor) encodes and decodes digital media streams such as audio and video rather than translating programming language code.
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Question 32
Which of the following is most suitable for being designated as Fourth Generation Language (4GL)?
AALGOL
BJava
CC
DSQL
Answer:(D) SQL
Explanation
Fourth Generation Languages (4GLs) are declarative, non-procedural languages designed around high-level database operations and report generation.
Programming language generations:
1GL: Machine language (binary)
2GL: Assembly language (mnemonics)
3GL: High-level procedural/object-oriented languages (ALGOL, C, Java)
4GL: Declarative languages (SQL)
A. ALGOL — incorrect because ALGOL is an early third-generation procedural language.
B. Java — incorrect because Java is a third-generation object-oriented language.
C. C — incorrect because C is a third-generation structured procedural language.
D. SQL — correct. SQL (Structured Query Language) specifies what data to retrieve rather than how to manipulate step-by-step memory instructions, making it the classic standard 4GL.
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Question 33
Assertion (A): Sniffing may be used to steal data or information over a network.
Reasons (R): Sniffing is a process of monitoring and capturing all data packets passing through given network.
ABoth (A) and (R) are true and (R) is the correct explanation of (A)
BBoth (A) and (R) are true and (R) is not the correct explanation of (A)
C(A) is true, but (R) is false
D(A) is false, but (R) is true
Answer:(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
Explanation
Packet sniffing involves capturing raw data packets as they travel across a local network or transmission medium.
Assertion (A) is true because packet sniffers capture unencrypted passwords, personal data, and confidential communication.
Reason (R) is true because packet sniffing specifically refers to intercepting, logging, and inspecting all network traffic passing through the monitored network adapter.
Because capturing all passing packets is the exact technical mechanism that enables malicious actors to harvest and steal data, Reason (R) correctly explains Assertion (A).
A. Both (A) and (R) are true and (R) is the correct explanation of (A) — correct.
B. Both (A) and (R) are true and (R) is not the correct explanation of (A) — incorrect because Reason (R) provides the direct causal explanation for how information theft occurs.
C. (A) is true, but (R) is false — incorrect because packet sniffing is factually a packet capture process.
D. (A) is false, but (R) is true — incorrect because packet sniffing is widely documented as an illicit data interception technique.
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Question 34
Which of the following terms is related to the digital learning environment for design?
Ae-Vidwan
Be-Acharya
Ce-Kalpa
De-Yantra
Answer:(C) e-Kalpa
Explanation
The Ministry of Education sponsored e-Kalpa under the National Mission on Education through ICT (NMEICT) to create an open digital learning environment for design in India.
A. e-Vidwan — incorrect because Vidwan is an expert database profiling scientists and researchers across Indian higher education institutions.
B. e-Acharya — incorrect because e-Acharya is an integrated e-content portal hosting digital resources across all disciplines.
C. e-Kalpa — correct. Developed collaboratively by IDC at IIT Bombay, NID, and IIT Guwahati, e-Kalpa provides collaborative design courses, digital design resources, and learning platforms.
D. e-Yantra — incorrect because e-Yantra is an initiative spearheaded by IIT Bombay to advance education in robotics and embedded systems.
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Question 35
Which of the following tools is a collaboration tool for providing virtual classroom environment?
AA-Lab
BA-View
CA-Tutor
DA-Learner
Answer:(B) A-View
Explanation
A-VIEW (Amrita Virtual Interactive E-Learning World) is an indigenously developed internet-based virtual classroom and collaboration system funded under NMEICT.
A. A-Lab — incorrect because it is not an NMEICT virtual classroom collaboration tool.
B. A-View — correct. A-VIEW enables interactive multimedia lecturing, multi-point audio-video conferencing, interactive whiteboards, and synchronized document sharing for remote classrooms across India.
C. A-Tutor — incorrect because ATutor is an open-source learning management system rather than the government-promoted interactive virtual classroom system.
D. A-Learner — incorrect because no such collaborative virtual classroom standard was established under NMEICT.
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Question 36
Methane, a greenhouse gas, is emitted from
a. landfills
b. construction debris
c. wet lands
d. e-waste
Choose the correct statements from the options given below:
Aa, b and d
Ba, c and d
Ca and c only
Da and d only
Answer:(C) a and c only
Explanation
Methane (CH4) is produced primarily through the anaerobic biological decomposition of organic matter in oxygen-deprived environments.
Landfills generate substantial methane as municipal solid organic waste undergoes anaerobic digestion.
Wetlands are the largest natural source of atmospheric methane due to waterlogged, anoxic soil conditions supporting methanogenic bacteria.
Construction debris and electronic waste consist of non-biodegradable inert materials (metals, concrete, ceramics, plastics) that do not generate methane through biological breakdown.
A. a, b and d — incorrect because construction debris and e-waste are not significant methane sources.
B. a, c and d — incorrect because e-waste does not emit methane.
C. a and c only — correct. Landfills and wetlands are well-documented organic methane emitters.
D. a and d only — incorrect because e-waste is not a source of biogenic methane emissions.
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Question 37
The share of which of the following sources of energy in electricity generation in India at present is the least?
AThermal
BSolar and Wind
CHydro
DNuclear
Answer:(D) Nuclear
Explanation
Among India's major electric power generation sources, nuclear energy accounts for the smallest fraction of total generation capacity.
Generation breakdown in India:
Thermal (coal, gas, lignite) forms the majority share (over 55% to 60%).
Solar and Wind renewable capacity accounts for roughly 15% to 20%.
Hydroelectric power contributes approximately 10% to 12%.
Nuclear energy produces approximately 2% to 3% of the nation's total generation.
A. Thermal — incorrect because thermal power is India's dominant electricity source.
B. Solar and Wind — incorrect because grid-connected renewables generate substantially more power than nuclear plants.
C. Hydro — incorrect because hydro power maintains a significantly larger generation base than nuclear.
D. Nuclear — correct. Nuclear power remains the lowest contributor among the listed power sources in India.
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Question 38
Biosphere reserves are :
i. area comprising terrestrial, marine and coastal ecosystems
ii. monitored by national governments
iii. areas where threatened animals and plants are kept in their habitat
iv. wildlife sanctuaries
Choose the correct statements from the options given below:
Ai and ii
Bii and iii
Ciii and iv
Di and iv
Answer:(A) i and ii
Explanation
Biosphere reserves are representative international conservation areas designated under UNESCO's Man and the Biosphere (MAB) Programme.
Statement (i) is correct because biosphere reserves encompass terrestrial, marine, and coastal ecosystems.
Statement (ii) is correct because each biosphere reserve remains under the sovereign jurisdiction and administrative monitoring of its national government.
Statement (iii) is an incomplete description that confuses broad landscape-level conservation with specific species shelters.
Statement (iv) is incorrect because wildlife sanctuaries represent a separate domestic legal category established under the Wildlife Protection Act, 1972.
A. i and ii — correct. These two statements accurately reflect UNESCO's foundational definition of biosphere reserves.
B. ii and iii — incorrect because statement iii is not part of the standard institutional definition.
C. iii and iv — incorrect because wildlife sanctuaries are distinct administrative entities.
D. i and iv — incorrect because biosphere reserves are not merely wildlife sanctuaries.
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Question 39
A green building
i. uses minimum amount of energy
ii. generates waste
iii. consumes a lot of water
iv. conserves natural resources
v. creates space for healthy living
Choose the correct statements from the options given below:
Ai, ii and iii
Bi, iv and v
Cii, iii and v
Dii, iv and v
Answer:(B) i, iv and v
Explanation
A green building is designed to reduce overall environmental impact throughout its lifecycle through resource efficiency and healthy indoor conditions.
Key characteristics of green buildings:
Uses minimum amount of energy through passive solar architecture, insulation, and high-efficiency fixtures (i).
Conserves natural resources by integrating sustainable, locally sourced, and recycled materials (iv).
Creates space for healthy living through natural ventilation, non-toxic materials, and daylighting (v).
Generates waste (ii) and consumes a lot of water (iii) are negative environmental impacts that green buildings actively minimize through recycling and rainwater harvesting.
A. i, ii and iii — incorrect because excessive waste generation and heavy water consumption contradict green design.
B. i, iv and v — correct. Energy minimization, resource conservation, and healthy living spaces are the core pillars of green building standards.
C. ii, iii and v — incorrect because waste generation and high water consumption are false traits.
D. ii, iv and v — incorrect because green buildings aim for waste reduction rather than waste generation.
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Question 40
National Disaster Management Authority is an agency of the Ministry of
AJal Shakti
BHome Affairs
CEarth Science
DHousing and Urban Affairs
Answer:(B) Home Affairs
Explanation
The National Disaster Management Authority (NDMA) is the apex statutory body for disaster management in India, established under the Disaster Management Act, 2005.
A. Jal Shakti — incorrect because the Ministry of Jal Shakti focuses on water resources and sanitation.
B. Home Affairs — correct. NDMA functions under the administrative control of the Ministry of Home Affairs, with the Prime Minister of India serving as its ex-officio Chairperson.
C. Earth Science — incorrect because the Ministry of Earth Sciences oversees meteorological services rather than executive disaster response governance.
D. Housing and Urban Affairs — incorrect because it handles urban planning rather than national disaster management.
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Question 41
Identify the distinctive feature of traditional method of Indian education from the following list :
A'Direct perception of truth' - both as means and end
BMaking everything on 'Trust'
CEvolving own way of learning
DFollowing Nyaya Philosophy with Deductive - Inductive Process
Answer:(A) 'Direct perception of truth' - both as means and end
Explanation
In ancient Indian educational philosophy, the supreme objective and guiding practice was the direct realization or intuitive perception of truth (Aparokshanubhuti).
A. 'Direct perception of truth' - both as means and end — correct. Traditional Indian pedagogy viewed direct apprehension of ultimate reality as both the pedagogical method (through shravana, manana, and nididhyasana) and the ultimate end of human life (Moksha).
B. Making everything on 'Trust' — incorrect because ancient Indian learning actively cultivated analytical debate and rigorous intellectual inquiry.
C. Evolving own way of learning — incorrect because traditional education followed disciplined guru-shishya parampara structures.
D. Following Nyaya Philosophy with Deductive - Inductive Process — incorrect because Nyaya logic was one specific philosophical school rather than the universal overarching feature of ancient Indian education.
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Question 42
Which of the following provides the overarching vision that guides research into socially relevant-areas?
AARIIA
BIMPRINT
CNIRF
DSWAYAM PRABHA
Answer:(B) IMPRINT
Explanation
IMPRINT (IMPacting Research INnovation and Technology) is a flagship national initiative providing an overarching vision to direct engineering and technological research into socially relevant areas.
A. ARIIA — incorrect because Atal Ranking of Institutions on Innovation Achievements ranks higher education institutions on innovation indicators.
B. IMPRINT — correct. Launched as a joint initiative of the IITs and IISc and funded by the Ministry of Education, IMPRINT channels academic research to address engineering challenges across 10 vital societal domains.
C. NIRF — incorrect because the National Institutional Ranking Framework benchmarks and ranks educational institutions.
D. SWAYAM PRABHA — incorrect because SWAYAM PRABHA is a group of DTH channels broadcasting educational video lectures.
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Question 43
In which of the following, 'One Nation, One Standard' is mentioned as the 'mantra' to ensure national standards and quality.
ANational Policy on Education - 1968
BNational Policy on Education - 1986
CNational Policy for Skill Development and Entrepreneurship - 2015
DNITI Aayog - Three Year Action Agenda - 2017-18 to 2019-2020
Answer:(C) National Policy for Skill Development and Entrepreneurship - 2015
Explanation
The National Policy for Skill Development and Entrepreneurship - 2015 explicitly adopted 'One Nation, One Standard' as its guiding mantra.
A. National Policy on Education - 1968 — incorrect because the 1968 policy focused on compulsory education and the three-language formula.
B. National Policy on Education - 1986 — incorrect because the 1986 policy focused on universal access, equity, and Operation Blackboard.
C. National Policy for Skill Development and Entrepreneurship - 2015 — correct. The policy established 'One Nation, One Standard' to unify skill training, certification, and curriculum frameworks across all sectors under the National Skills Qualifications Framework.
D. NITI Aayog - Three Year Action Agenda - 2017-18 to 2019-2020 — incorrect because this document sets broad governance roadmaps rather than introducing this specific skill standard mantra.
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Question 44
Non-traditional teaching and learning strategies lay emphasis on
i. Students' need based resource materials and learning standards
ii. Developing skills, attitude and values
iii. Promoting In-Box thinking process
iv. Lecture based model
v. Acquiring knowledge necessary to respond creatively
Select your answer from the following options :
Ai, ii and v
Bii, iii and iv
Ciii, iv and v
Di, iv and v
Answer:(A) i, ii and v
Explanation
Non-traditional teaching and learning strategies shift from passive, teacher-centric lecturing to dynamic, learner-centered pedagogy.
Emphasizes customized resource materials aligned with student needs (i).
Fosters comprehensive holistic skills, attitudes, and ethical values (ii).
Promoting in-box thinking (iii) and relying on lecture-based models (iv) are classic features of traditional instruction rather than non-traditional strategies.
A. i, ii and v — correct. These three attributes define the creative, learner-focused nature of non-traditional instruction.
B. ii, iii and iv — incorrect because in-box thinking and lecture models are traditional methods.
C. iii, iv and v — incorrect because in-box thinking and lecturing contradict non-traditional learning.
D. i, iv and v — incorrect because the lecture-based model is not a non-traditional strategy.
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Question 45
Identify values specially related to organizational ethos from the list given below :
i. Team work in the approach
ii. Productivity of the tasks
iii. Changes in the global contents
iv. Financial security
v. Humility in dealing with others' concerns
vi. Technological resources
Choose your answer from the following options :
Ai, iii and vi
Biii, iv and v
Cii, iii and iv
Di, ii and v
Answer:(D) i, ii and v
Explanation
Organizational ethos comprises the core shared cultural values, professional attitudes, and ethical standards that guide institutional behavior.
Teamwork (i) fosters collaboration, mutual trust, and shared accountability.
Task productivity (ii) reflects dedication to operational excellence, discipline, and performance.
Humility (v) demonstrates empathy, emotional intelligence, and mutual respect among members.
Global changes (iii) are external market conditions, financial security (iv) is an individual extrinsic reward, and technological resources (vi) are material assets rather than core cultural values.
A. i, iii and vi — incorrect because global changes and technological assets are structural resources rather than cultural values.
B. iii, iv and v — incorrect because financial security and global conditions are not core ethos dimensions.
C. ii, iii and iv — incorrect because external shifts and individual remuneration are not organizational ethos.
D. i, ii and v — correct. Teamwork, task productivity, and interpersonal humility represent the fundamental values defining positive organizational culture.
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Question 46
What does the analysis of pre-first world war popular movements reveal?
Read the passage carefully and answer questions from 46-50.
The pre-first world war era is really in a way well suited for an in-depth evaluation of popular movements, as they were spontaneous and no more than, marginally affected intelligentsia ideologies, objectives or techniques. The limitations of such spontaneity are fairly clear. Popular movements were directed usually against the immediate Indian oppressor rather than the distant white superior, and so were often not consciously or subjectively anti-imperialist. They tended to be fairly widely scattered in both space and time, and were extremely volatile with different social forms of articulation interpenetrating and passing over each other with bewildering ease. All this makes it rather difficult to accept without some qualification the concept of 'Peasant Nationalism' as a coherent alternative to elite patriotic ideologies and movements, popular initiative and autonomy were undoubted, even remarkable at times, but, unlike middle class nationalism which does have certain continuity, at the level of ideology at least, from the formulation of the drain of wealth theory in the 1870s onwards, the movement that have been considered were clearly fragmented. Yet despite such limitations and crudities, popular unrest did anticipate much of middle class nationalism in terms of issues and forms of struggle, while its specific gains were at times not inconsiderable. Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.
AIntelligentsia's influence on popular movement was less
BThe movements were ideological
CThe movements had clear objectives
DLimited spontaneity
Answer:(A) Intelligentsia's influence on popular movement was less
Explanation
The opening sentence of the passage states that pre-First World War popular movements 'were spontaneous and no more than, marginally affected intelligentsia ideologies, objectives or techniques.'
Being only 'marginally affected' directly demonstrates that the intelligentsia's influence on the popular movements was minimal or less.
A. Intelligentsia's influence on popular movement was less — correct. The passage explicitly characterizes the intelligentsia's effect as marginal.
B. The movements were ideological — incorrect because the text notes they lacked the continuous ideological framework found in middle class nationalism.
C. The movements had clear objectives — incorrect because the passage notes their spontaneity and fragmented nature rather than structured objectives.
D. Limited spontaneity — incorrect because the text affirms they were highly spontaneous.
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Question 47
The popular movements were
Read the passage carefully and answer questions from 46-50.
The pre-first world war era is really in a way well suited for an in-depth evaluation of popular movements, as they were spontaneous and no more than, marginally affected intelligentsia ideologies, objectives or techniques. The limitations of such spontaneity are fairly clear. Popular movements were directed usually against the immediate Indian oppressor rather than the distant white superior, and so were often not consciously or subjectively anti-imperialist. They tended to be fairly widely scattered in both space and time, and were extremely volatile with different social forms of articulation interpenetrating and passing over each other with bewildering ease. All this makes it rather difficult to accept without some qualification the concept of 'Peasant Nationalism' as a coherent alternative to elite patriotic ideologies and movements, popular initiative and autonomy were undoubted, even remarkable at times, but, unlike middle class nationalism which does have certain continuity, at the level of ideology at least, from the formulation of the drain of wealth theory in the 1870s onwards, the movement that have been considered were clearly fragmented. Yet despite such limitations and crudities, popular unrest did anticipate much of middle class nationalism in terms of issues and forms of struggle, while its specific gains were at times not inconsiderable. Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.
Aagainst imperalists
Bagainst their masters
Cconsciously violent
Dtime bound
Answer:(B) against their masters
Explanation
The passage notes that popular movements 'were directed usually against the immediate Indian oppressor rather than the distant white superior, and so were often not consciously or subjectively anti-imperialist.'
Targeting the 'immediate Indian oppressor' means their resistance was aimed directly at their immediate local masters (such as landlords, planters, and moneylenders) rather than the imperial administration.
A. against imperalists — incorrect because the author specifically notes they were often not consciously anti-imperialist.
B. against their masters — correct. The struggles focused on immediate oppressors and local masters.
C. consciously violent — incorrect because the passage does not describe them as consciously violent.
D. time bound — incorrect because the passage describes them as scattered in space and time.
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Question 48
According to the passage, the issue with peasant nationalism was
Read the passage carefully and answer questions from 46-50.
The pre-first world war era is really in a way well suited for an in-depth evaluation of popular movements, as they were spontaneous and no more than, marginally affected intelligentsia ideologies, objectives or techniques. The limitations of such spontaneity are fairly clear. Popular movements were directed usually against the immediate Indian oppressor rather than the distant white superior, and so were often not consciously or subjectively anti-imperialist. They tended to be fairly widely scattered in both space and time, and were extremely volatile with different social forms of articulation interpenetrating and passing over each other with bewildering ease. All this makes it rather difficult to accept without some qualification the concept of 'Peasant Nationalism' as a coherent alternative to elite patriotic ideologies and movements, popular initiative and autonomy were undoubted, even remarkable at times, but, unlike middle class nationalism which does have certain continuity, at the level of ideology at least, from the formulation of the drain of wealth theory in the 1870s onwards, the movement that have been considered were clearly fragmented. Yet despite such limitations and crudities, popular unrest did anticipate much of middle class nationalism in terms of issues and forms of struggle, while its specific gains were at times not inconsiderable. Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.
Aa viable alternative to elite nationalism
Bcoherence and control
Clack of continuity
Dquite timely
Answer:(C) lack of continuity
Explanation
The author contrasts peasant movements with middle class nationalism, observing that 'unlike middle class nationalism which does have certain continuity... the movement that have been considered were clearly fragmented.'
This explicit contrast identifies lack of continuity as the key limiting issue of peasant nationalism.
A. a viable alternative to elite nationalism — incorrect because the author finds it difficult to accept peasant nationalism as a coherent alternative without qualification.
B. coherence and control — incorrect because the text highlights fragmentation and absence of continuity as the decisive historical contrast.
C. lack of continuity — correct. Unlike middle-class political organization, popular peasant movements lacked sustained ideological and institutional continuity.
D. quite timely — incorrect because timeliness was not identified as an issue in the text.
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Question 49
The pre-war popular movements were of
Read the passage carefully and answer questions from 46-50.
The pre-first world war era is really in a way well suited for an in-depth evaluation of popular movements, as they were spontaneous and no more than, marginally affected intelligentsia ideologies, objectives or techniques. The limitations of such spontaneity are fairly clear. Popular movements were directed usually against the immediate Indian oppressor rather than the distant white superior, and so were often not consciously or subjectively anti-imperialist. They tended to be fairly widely scattered in both space and time, and were extremely volatile with different social forms of articulation interpenetrating and passing over each other with bewildering ease. All this makes it rather difficult to accept without some qualification the concept of 'Peasant Nationalism' as a coherent alternative to elite patriotic ideologies and movements, popular initiative and autonomy were undoubted, even remarkable at times, but, unlike middle class nationalism which does have certain continuity, at the level of ideology at least, from the formulation of the drain of wealth theory in the 1870s onwards, the movement that have been considered were clearly fragmented. Yet despite such limitations and crudities, popular unrest did anticipate much of middle class nationalism in terms of issues and forms of struggle, while its specific gains were at times not inconsiderable. Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.
Auniform social form
Binsignificant value
Cmiddle class nationalism
Dspecific gain at times
Answer:(D) specific gain at times
Explanation
Toward the conclusion of the passage, the author highlights that 'while its specific gains were at times not inconsiderable... Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.'
Describing their gains as 'not inconsiderable' confirms that the movements achieved specific gains at times.
A. uniform social form — incorrect because the text describes them as having different social forms of articulation interpenetrating with bewildering ease.
B. insignificant value — incorrect because the author affirms their autonomy was remarkable and their gains were not inconsiderable.
C. middle class nationalism — incorrect because they preceded and were distinct from middle class nationalism.
D. specific gain at times — correct. The movements achieved tangible, non-trivial gains on specific local grievances.
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Question 50
What is the author's assessment of the popular movements?
Read the passage carefully and answer questions from 46-50.
The pre-first world war era is really in a way well suited for an in-depth evaluation of popular movements, as they were spontaneous and no more than, marginally affected intelligentsia ideologies, objectives or techniques. The limitations of such spontaneity are fairly clear. Popular movements were directed usually against the immediate Indian oppressor rather than the distant white superior, and so were often not consciously or subjectively anti-imperialist. They tended to be fairly widely scattered in both space and time, and were extremely volatile with different social forms of articulation interpenetrating and passing over each other with bewildering ease. All this makes it rather difficult to accept without some qualification the concept of 'Peasant Nationalism' as a coherent alternative to elite patriotic ideologies and movements, popular initiative and autonomy were undoubted, even remarkable at times, but, unlike middle class nationalism which does have certain continuity, at the level of ideology at least, from the formulation of the drain of wealth theory in the 1870s onwards, the movement that have been considered were clearly fragmented. Yet despite such limitations and crudities, popular unrest did anticipate much of middle class nationalism in terms of issues and forms of struggle, while its specific gains were at times not inconsiderable. Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.
ASome of the popular issues were taken over by middle class nationalism
BIt was bewildering and amusing
CIt was remarkable and time-tested
DPre-war popular unrest was anti-imperialist
Answer:(A) Some of the popular issues were taken over by middle class nationalism
Explanation
The passage concludes by emphasizing that 'Forest rights, the burdens of rent, usury and land revenue, planter exploitation and labour grievances were all themes taken over by middle class nationalism later.'
This directly affirms the author's assessment that key grievances articulated by popular movements were later adopted into mainstream middle class nationalism.
A. Some of the popular issues were taken over by middle class nationalism — correct. The author explicitly credits popular unrest with introducing core economic and social struggle issues later embraced by middle class nationalism.
B. It was bewildering and amusing — incorrect because the author treats popular unrest with serious historical analysis rather than amusement.
C. It was remarkable and time-tested — incorrect because the movements were fragmented and lacked sustained continuity.
D. Pre-war popular unrest was anti-imperialist — incorrect because the author specifies that popular movements were often not consciously or subjectively anti-imperialist.
100 questions with the answer key and explanations.
Question 1
Arrange in chronological order the following economists in relation to their contribution to the Theory of Consumer Behaviour:
Choose the correct answer:
AA. Marshall, R. Stone, P. Samuelson, J.R. Hicks and R.G.D. Allen
BR. Stone, P. Samuelson, J.R. Hicks and R.G.D. Allen, A. Marshall
CP. Samuelson, J.R. Hicks and R.G.D. Allen, R. Stone, A. Marshall
DA. Marshall, J.R. Hicks and R.G.D. Allen, P. Samuelson, R. Stone
Answer:(D) A. Marshall, J.R. Hicks and R.G.D. Allen, P. Samuelson, R. Stone
Explanation
The development of consumer behavior theory followed this chronological sequence:
Alfred Marshall formulated the cardinal utility analysis in Principles of Economics (1890).
J.R. Hicks and R.G.D. Allen developed ordinal utility analysis using indifference curves in 1934.
Paul Samuelson introduced the Revealed Preference Theory in 1938.
Richard Stone developed the Linear Expenditure System in 1954.
A — places Stone before Samuelson and Hicks.
B — places Stone first and Marshall last.
C — places Samuelson before Hicks and Allen.
D — correct. Follows Marshall (1890), Hicks-Allen (1934), Samuelson (1938), and Stone (1954).
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Question 2
Among normal cost curves, which one of the following curves does not have a minimum point?
AAverage cost
BMarginal cost
CAverage variable cost
DAverage fixed cost
Answer:(D) Average fixed cost
Explanation
Average Fixed Cost (AFC) declines continuously as output expands because total fixed cost is spread over larger volumes of output.
AFC = TFC / q
Because TFC is positive and constant, AFC continuously approaches both axes asymptotically without ever reaching zero or turning upward. It forms a rectangular hyperbola and has no minimum point.
A. Average cost — U-shaped, reaches a minimum where MC equals AC.
B. Marginal cost — U-shaped, reaches a minimum before AC and AVC.
C. Average variable cost — U-shaped due to the law of variable proportions.
D. Average fixed cost — correct. Declines monotonically across all positive output levels.
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Question 3
The 'Compensation Criterion' which says that state A is socially preferable to state B, if those who gain from the change can compensate the losers and yet end up with surplus welfare gain is attributed to:
AW. Pareto
BN. Kaldor
CT. Scitovsky
DBergson
Answer:(B) N. Kaldor
Explanation
Nicholas Kaldor formulated the compensation principle in his 1939 paper Welfare Propositions of Economics and Interpersonal Comparisons of Utility.
Kaldor argued that a policy change increases social welfare if the gainers from the policy gain enough that they could hypothetically compensate the losers and still remain better off.
A. W. Pareto — required that at least one person is made better off without anyone being made worse off.
B. N. Kaldor — correct. Defined welfare improvement through hypothetical compensation by gainers.
C. T. Scitovsky — proposed the double criterion requiring that gainers can compensate losers and losers cannot bribe gainers to prevent the change.
D. Bergson — developed the concept of a Social Welfare Function.
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Question 4
In which of the following products, problem of adverse selection is encountered?
AMarket of Insurance
BMarket for Credit
CNeither (1) nor (2)
DBoth (1) and (2)
Answer:(D) Both (1) and (2)
Explanation
Adverse selection arises from pre-contractual asymmetric information where one party holds hidden characteristics before an agreement is signed.
In the insurance market, individuals with higher health or accident risks are more likely to buy insurance policies, driving up average costs and premiums (Rothschild-Stiglitz model).
In the credit market, raising interest rates discourages low-risk borrowers, leaving lenders with a riskier pool of borrowers (Stiglitz-Weiss model of credit rationing).
Both markets exhibit severe adverse selection, making Option D the correct answer.
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Question 5
Given the saving function S = -20 + 0.2Y and autonomous investment (I) = Rs. 100 million, the equilibrium level of consumption would be:
A500
B600
C400
D700
Answer:(A) 500
Explanation
Equilibrium national income occurs where saving equals investment:
S = I
-20 + 0.2Y = 100
0.2Y = 120
Y = 600 million
Consumption is given by C = Y - S or by the consumption function C = 20 + 0.8Y:
C = 600 - 100 = 500 million
A. 500 — correct. The equilibrium level of consumption.
B. 600 — this is equilibrium national income Y, not consumption C.
C. 400 — incorrect calculation.
D. 700 — exceeds total income.
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Question 6
For which of the following consumption functions, the value of the income multiplier K = 4?
AC = 100 + 0.5Y
BC = 50 + 0.8Y
CC = 200 + 0.75Y
DC = 50 + 0.4Y
Answer:(C) C = 200 + 0.75Y
Explanation
The simple Keynesian investment multiplier formula is:
A. C = 100 + 0.5Y — MPC = 0.5, so K = 1 / 0.5 = 2.
B. C = 50 + 0.8Y — MPC = 0.8, so K = 1 / 0.2 = 5.
C. C = 200 + 0.75Y — correct. MPC = 0.75, so K = 1 / 0.25 = 4.
D. C = 50 + 0.4Y — MPC = 0.4, so K = 1 / 0.6 = 1.67.
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Question 7
The inventory approach to the transaction demand suggests that the transaction component of the demand for money is:
Anegatively related to real wealth
Bnegatively related to real income
Cnegatively related to nominal income
Dnegatively related to interest rate
Answer:(D) negatively related to interest rate
Explanation
The Baumol-Tobin inventory theoretic model expresses the optimal transaction demand for money as:
M/P = sqrt(b * Y / (2 * r))
Here, b is the brokerage cost per transfer, Y is real income, and r is the nominal interest rate.
Because the interest rate r appears in the denominator, an increase in the interest rate raises the opportunity cost of holding cash, inducing individuals to hold smaller average money balances.
A — not a central implication of the inventory model.
B and C — money demand is positively related to income, not negatively.
D — correct. Transaction money demand varies inversely with the interest rate.
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Question 8
Friedman's modern Quantity Theory of Money concludes that changes in aggregate spending are primarily determined by changes in:
Athe money supply
Binterest rate
Cthe velocity of money
Dgovernment spending and taxes
Answer:(A) the money supply
Explanation
Milton Friedman restated the Quantity Theory of Money as a theory of the demand for money rather than a theory of output or prices.
Friedman showed that the demand for real money balances is a highly stable function of permanent income, wealth, and expected returns on alternative assets. Because money demand and velocity are stable and predictable, changes in nominal aggregate expenditure (PY) are predominantly driven by variations in the money supply (M).
A. the money supply — correct. Core monetarist proposition that money supply drives aggregate demand.
B. interest rate — viewed as having a minor, secondary influence on money demand.
C. the velocity of money — treated as relatively stable rather than the primary driver of spending fluctuations.
D. government spending and taxes — fiscal policy without monetary accommodation exerts little lasting impact on nominal spending.
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Question 9
For an exactly identified equation, the order condition that should be fulfilled is that the equation must:
AExclude one less than the total number of endogenous variables in the model
BInclude one less than the total number of endogenous variables in the model
CInclude only one of the endogenous variables in the model
DExclude two or more endogenous variables
Answer:(A) Exclude one less than the total number of endogenous variables in the model
Explanation
In simultaneous equation models, the order condition is a necessary condition for identification based on counting excluded variables.
Let M be the total number of endogenous variables in the system. For any individual equation to be identified, the total number of predetermined and endogenous variables excluded from that equation (K*) must satisfy:
K* >= M - 1
When K* equals exactly M - 1, the equation excludes exactly one less than the total number of endogenous variables in the model, satisfying the condition for exact identification.
A — correct. Excludes exactly M - 1 variables.
B — conflates inclusion with exclusion.
C — identification depends on exclusions across the system, not merely having one endogenous variable.
D — describes an arbitrary count rather than the general M - 1 rule.
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Question 10
Analysis of variance is carried out by using:
At-test
BZ-test
Cχ²-test
DF-test
Answer:(D) F-test
Explanation
Analysis of Variance (ANOVA) tests for significant differences among three or more group means by partitioning total variance into between-group and within-group components.
The test statistic is Snedecor F-ratio:
F = Mean Square Between (MSB) / Mean Square Within (MSW)
Under the null hypothesis of equal population means, this ratio follows an F-distribution.
A. t-test — used to compare means of at most two groups.
B. Z-test — used for large-sample tests of means or proportions with known population variance.
C. χ²-test — used for goodness-of-fit and independence in contingency tables.
D. F-test — correct. The standard test for ANOVA.
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Question 11
Under a Normal Probability Curve, the area within the range of μ - 1.96σ and μ + 1.96σ (where μ = mean, σ = standard deviation) is:
A90%
B95%
C75%
D99%
Answer:(B) 95%
Explanation
In a standard normal distribution Z ~ N(0, 1), the area contained between Z = -1.96 and Z = +1.96 equals exactly 0.95 (95%).
P(μ - 1.96σ <= X <= μ + 1.96σ) = 0.9500
A. 90% — corresponds to Z = ±1.645.
B. 95% — correct. Standard critical values for a 5% two-tailed alpha level.
C. 75% — corresponds to Chebyshev inequality lower bound for k = 2.
D. 99% — corresponds to Z = ±2.576.
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Question 12
Boot strapping technique is used to:
Atest for specification bias
Bobtain sampling distribution of parameters of interest
Ctest for auto-correlation
Dtest for normality of error term
Answer:(B) obtain sampling distribution of parameters of interest
Explanation
Bootstrapping is a computer-intensive statistical resampling method introduced by Bradley Efron (1979).
It repeatedly draws random samples with replacement from the observed sample dataset to empirically approximate the sampling distribution, standard errors, and confidence intervals of an estimator. This is especially valuable when theoretical distributions are unknown or sample size is small.
A — Ramsey RESET test evaluates specification bias.
B — correct. Estimates parameter sampling distributions via empirical resampling.
C — Durbin-Watson or Breusch-Godfrey tests evaluate autocorrelation.
D — Jarque-Bera or Shapiro-Wilk tests evaluate normality.
The inverse of a diagonal matrix is obtained simply by taking the reciprocal of each non-zero diagonal element while preserving all off-diagonal zeros.
For the given matrix with diagonal elements (2, 4, 5, 1):
1/2 = 0.5
1/4 = 0.25
1/5 = 0.2
1/1 = 1
Thus, the inverse diagonal elements are (0.5, 0.25, 0.2, 1).
A — transposes 0.25 and 0.5 in the first two rows.
B — uses incorrect reciprocal values.
C — correct. Diagonal values match 0.5, 0.25, 0.2, and 1 in sequence.
D — contains incorrect entries in the third and fourth rows.
For positive equilibrium output growth from period to period, the output ratio must be positive, requiring b / (b - a) > 0.
A — correct. Represents the condition ensuring positive output trajectory.
B — implies negative output ratios, which is economically meaningless.
C and D — specify a / (b - a) rather than the intertemporal expansion factor b / (b - a).
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Question 15
The total cost function of a firm is C = (1/10)q³ - 3q² + 50q + 300, where C = total cost, q = output. Marginal cost at q = 10 is:
A20
B10
C30
D50
Answer:(A) 20
Explanation
Marginal cost is the first derivative of the total cost function with respect to output q:
MC = dC/dq = (3/10)q² - 6q + 50
Evaluating at q = 10:
MC = 0.3 * (10)² - 6 * (10) + 50
MC = 0.3 * 100 - 60 + 50
MC = 30 - 60 + 50 = 20
A. 20 — correct.
B. 10 — arithmetic error in intermediate terms.
C. 30 — value of only the quadratic term (3/10 * 100).
D. 50 — constant term of the marginal cost equation.
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Question 16
For a Cobb-Douglas production function Q = 100 L⁰·⁷ K⁰·³, which of the following is not true?
AIt is Linear Homogenous function
BIt is characterized by constant returns to scale
CIt is having zero elasticity of factor substitution
DIt is characterized by unit elasticity of substitution
Answer:(C) It is having zero elasticity of factor substitution
Explanation
The exponents of labor and capital sum to 0.7 + 0.3 = 1.0, meaning the function is homogeneous of degree one and exhibits constant returns to scale.
A fundamental mathematical property of all Cobb-Douglas production functions is that the elasticity of substitution (σ) equals exactly 1 (unit elasticity). Zero elasticity of substitution characterizes a Leontief fixed-proportions production function, not Cobb-Douglas.
A — true. Degree of homogeneity is 0.7 + 0.3 = 1.
B — true. Constant returns to scale hold when output exponents sum to unity.
C — correct choice because it is false. Elasticity of substitution is 1, not 0.
D — true. σ = 1 for Cobb-Douglas.
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Question 17
If in a given situation, Pₓ = 170, Pₘ = 190 and Zₓ = 152, then which of the following will be the value of Single Factoral Terms of Trade (Tₛ)?
A136
B148
C84
D116
Answer:(A) 136
Explanation
Jacob Viner defined the Single Factoral Terms of Trade (Tₛ) by adjusting the commodity terms of trade for changes in export sector productivity:
Tₛ = (Pₓ / Pₘ) * Zₓ
Substituting the given values:
Pₓ = 170
Pₘ = 190
Zₓ = 152
Which trade policy results in the government levying both a specific tariff and an ad valorem tariff on imported goods?
AEffective tariff
BRevenue tariff
CCompound tariff
DNominal tariff
Answer:(C) Compound tariff
Explanation
A compound tariff combines two forms of import duties on the same product: a specific duty (a fixed monetary amount per physical unit) and an ad valorem duty (a fixed percentage of the invoice value).
A. Effective tariff — measures the net protection afforded to domestic value added.
B. Revenue tariff — designed primarily to raise government revenue rather than protect domestic industry.
C. Compound tariff — correct. Combines both specific and ad valorem rates.
D. Nominal tariff — the published tariff rate stated on the final product.
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Question 19
The Heckscher-Ohlin trade model maintains that:
AComparative advantage determines the distribution of the gains from trade
BA country exports goods for which its resource endowments are most suited
CAbsolute Advantage Theory determines the distribution of the gains from trade
DThe division of labour is limited by the size of the world market
Answer:(B) A country exports goods for which its resource endowments are most suited
Explanation
The Heckscher-Ohlin (H-O) factor endowment theorem posits that comparative advantage stems from differences in national factor endowments.
A nation will export the commodity whose production requires the intensive use of the nation relatively abundant and cheap factor of production, and import the commodity whose production requires the intensive use of its relatively scarce and expensive factor.
A — comparative advantage explains the pattern of trade, while terms of trade determine distribution of gains.
B — correct. Trade patterns reflect underlying domestic resource endowments.
C — Adam Smith formulated absolute advantage, not Heckscher-Ohlin.
D — Adam Smith famous dictum from The Wealth of Nations.
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Question 20
A tax of Rs. 20 per unit of imported cheese would be an example of a/an:
ACompound tariff
BSpecific tariff
CEffective tariff
DAd valorem tariff
Answer:(B) Specific tariff
Explanation
A specific tariff is assessed as a fixed monetary sum per physical unit of the imported good, regardless of its value (for instance, Rs. 20 per unit or per kilogram).
A. Compound tariff — combines both a specific tariff and an ad valorem tariff.
B. Specific tariff — correct. Levied as a fixed amount per unit of imported volume.
C. Effective tariff — measures the percentage increase in value added created by the tariff structure.
D. Ad valorem tariff — levied as a constant percentage of the total declared value of the good.
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Question 21
Which one of the following is an example of a positive externality?
APublic immunizations
BIncrease of corporate taxes
CIssuing extra permits for pollutions
DMonitoring the hazards caused by industries
Answer:(A) Public immunizations
Explanation
A positive externality occurs when an economic action confers unpaid benefits upon third parties who are not directly involved in the transaction.
Public immunizations generate significant external benefits by reducing the likelihood of disease transmission and building herd immunity across the entire community, yielding social benefits that exceed private benefits.
A. Public immunizations — correct. Classic positive consumption externality.
B. Increase of corporate taxes — fiscal policy measure, not an externality.
C. Issuing extra permits for pollutions — cap-and-trade instrument managing negative externalities.
D. Monitoring the hazards caused by industries — regulatory oversight to mitigate negative spillovers.
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Question 22
Which amongst the following market forms leads to the most efficient allocation of resources?
AMonopolistic Competition
BMonopoly
COligopoly
DPerfect Competition
Answer:(D) Perfect Competition
Explanation
Under long-run equilibrium in perfect competition, price equals marginal cost (P = MC), achieving allocative efficiency where society valuation of the marginal unit matches the marginal cost of producing it.
Firms also produce at the minimum point of their long-run average cost curve (P = min LAC), ensuring productive efficiency. By contrast, monopoly, monopolistic competition, and oligopoly all set price above marginal cost (P > MC), creating deadweight loss and allocative inefficiency.
A. Monopolistic Competition — exhibits excess capacity with P > MC.
B. Monopoly — restricts output to charge P > MC, generating deadweight loss.
C. Oligopoly — typically involves strategic barriers and price exceeding marginal cost.
D. Perfect Competition — correct. Simultaneously satisfies allocative and productive efficiency.
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Question 23
Incidence of tax refers to:
AWhether a tax is progressive, proportional or regressive
BAn authority which collects the tax
CThe person or group who ultimately pays the tax
DHow a tax is collected?
Answer:(C) The person or group who ultimately pays the tax
Explanation
In public finance, tax incidence (formal or economic incidence) denotes the final resting place of the tax burden.
While the initial impact falls on the individual or business legally obligated to pay the tax, shifting may transfer the burden to others. The economic incidence falls on the person or group whose real purchasing power is ultimately reduced by the levy.
A — describes the progressivity or rate structure of a tax.
B — refers to the tax administration agency (such as the Central Board of Direct Taxes).
C — correct. Identifies the final bearer of the financial burden.
D — refers to the collection mechanism or method of assessment.
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Question 24
'Displacement effect' in the Peacock-Wiseman Hypothesis implies:
AAn upward displacement of public expenditure according to higher economic growth
BThe movement from older level of public expenditure and taxation to a newer and higher level
CPublic expenditure increases at steady rate and reaches higher level
DGovernment undertakes more and newer activities and hence public expenditure rises steeply upwards
Answer:(B) The movement from older level of public expenditure and taxation to a newer and higher level
Explanation
Alan Peacock and Jack Wiseman (1961) hypothesized that public expenditure grows in step-like jerks rather than as a continuous smooth trend.
During times of national emergency or war, the government is forced to raise taxes and spending above the previously tolerated threshold (inspection effect). Once the emergency subsides, public expenditure and tolerable tax burdens do not return to their original baseline, but stabilize at a permanently higher plateau. This structural ratcheting is the displacement effect.
A — economic growth drives smooth continuous growth (Wagner Law), not sudden displacement.
B — correct. Shift from an older expenditure and tax level to a permanently higher level.
C — continuous steady growth is Wagner Law hypothesis.
D — reflects the expansion of state functions (concentration effect), not displacement itself.
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Question 25
Which one of the following is correct for the money supply measure - M₁?
ACurrency with the public + demand deposits of Commercial Banks + other deposits at a point of time
BCurrency with the public + demand deposits of Banks + other deposits over one year
CCurrency with the public + All bank deposits at a point of time
DCurrency with the public + Post office deposits + other deposits at a point of time
Answer:(A) Currency with the public + demand deposits of Commercial Banks + other deposits at a point of time
Explanation
Under the Reserve Bank of India monetary aggregates, narrow money (M₁) is defined as:
M₁ = Currency with the public (C) + Demand deposits with the banking system (DD) + Other deposits with the RBI (OD)
Money supply is a stock variable measured at a specific point of time.
A — correct. Specifies currency, demand deposits of commercial banks, and other deposits at a point in time.
B — deposits over one year are time deposits, which belong to M₃.
C — includes time deposits, which belong to broad money M₃.
D — post office deposits are included in M₂ and M₄, not M₁.
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Question 26
Which amongst the following is not the source of the income of RBI?
AInterest on government bonds held for conducting open market operations
BIncome from investment in foreign currency assets
CRetained earnings net of dividend paid to Government of India
DDividend on the shares of private equity held with the bank
Answer:(D) Dividend on the shares of private equity held with the bank
Explanation
The Reserve Bank of India derives its earnings primarily from sovereign and monetary policy operations, including interest on domestic government securities, discount on Treasury bills, and returns on foreign currency deposits and sovereign assets.
Under the Reserve Bank of India Act, 1934, the RBI does not invest in commercial corporate equity or private equity shares, and therefore receives no private equity dividends.
A — primary operational income derived from holding government securities for liquidity management.
B — major income source earned on foreign exchange reserves held abroad.
C — represents retained surplus after statutory transfers and dividend payments to the Central Government.
D — correct. RBI does not hold private equity investments.
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Question 27
Insolvency and bankruptcy code is primarily entrusted with which of the following?
AFacilitating the recovery of government dues and debt
BFacilitating recovery of debt given by foreign banks to Indian companies
CFacilitating banks recover higher amount of bad loans then they recovered earlier
DFacilitating banks recover their dues from the priority sector
Answer:(C) Facilitating banks recover higher amount of bad loans then they recovered earlier
Explanation
The Insolvency and Bankruptcy Code (IBC), 2016 was enacted to overhaul India fragmented insolvency framework by providing a time-bound, creditor-in-control resolution process.
Its central objective is resolving distressed corporate debtors to maximize asset value and enable financial creditors, especially commercial banks, to achieve substantially higher recovery rates on non-performing assets (NPAs) than older mechanisms like DRTs or SARFAESI.
A — recovery of government dues is secondary to corporate debtor turnaround and creditor claims.
B — applies uniformly to all domestic and foreign creditors under standard resolution guidelines.
C — correct. Enhances the recovery rate and realization value of stressed bank loans.
D — applies to all corporate borrowing, not just priority sector loans.
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Question 28
When the market rate of interest falls, which one of the following will happen?
ABond price and bond yield, both will rise
BBond price and bond yield both will fall
CBond price will rise and bond yield will fall
DBond price will fall and bond yield will rise
Answer:(C) Bond price will rise and bond yield will fall
Explanation
Bond prices and market interest rates share a fundamental inverse relationship.
The price of a bond represents the discounted present value of its fixed coupon payments and principal repayment:
P = sum(C / (1 + r)^t) + F / (1 + r)^T
When the market interest rate falls, future cash flows are discounted at a lower rate, causing the current bond price to rise while the effective yield on the bond falls.
A and B — bond prices and yields always move in opposite directions, never together.
C — correct. Bond price rises while bond yield declines.
D — occurs when market interest rates rise, not when they fall.
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Question 29
The elasticity of substitution (σ) of the production function which admits of both Hicks and Harrod neutral technical progress would be:
Aσ = 0
Bσ = 1
Cσ = ∞
D0 < σ < 1
Answer:(B) σ = 1
Explanation
Hirofumi Uzawa (1961) proved that an aggregate production function exhibits technical progress that is simultaneously Hicks-neutral and Harrod-neutral if and only if the elasticity of substitution between capital and labor equals unity (σ = 1) across all factor combinations.
A Cobb-Douglas production function with constant returns to scale satisfies σ = 1 and permits technical change to be represented interchangeably as Hicks-neutral (factor-augmenting) or Harrod-neutral (labor-augmenting).
A. σ = 0 — represents a Leontief fixed-proportions technology.
B. σ = 1 — correct. Necessary and sufficient condition for simultaneous Hicks and Harrod neutrality.
C. σ = ∞ — represents perfect linear factor substitutability.
D. 0 < σ < 1 — represents general CES technology where the two neutralities diverge.
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Question 30
In which of the following models does the 'knife-edge' problem occur?
AKaldor
BSolow
CHarrod
DSwan
Answer:(C) Harrod
Explanation
In Roy Harrod dynamic growth model, steady-state growth requires equality among the actual growth rate (G), the warranted growth rate (Gw), and the natural growth rate (Gn):
G = Gw = Gn
Because Harrod assumed a fixed capital-output ratio and a fixed saving propensity, any divergence between G and Gw triggers cumulative destabilizing forces leading to hyperinflation or prolonged depression, leaving steady equilibrium on a knife-edge.
A. Kaldor — resolved instability through flexible distribution of income between wages and profits.
B and D. Solow and Swan — eliminated the knife-edge by introducing neoclassical factor substitution with variable capital-labor ratios.
C. Harrod — correct. Originator of the knife-edge instability dilemma.
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Question 31
Consider an economy with a linear homogeneous Cobb-Douglas production function with two inputs—capital and labour. The shares of capital and labour are, respectively, 1/3 and 2/3. The rates of growth of capital and labour are, respectively, 6% and 3% per annum. If the rate of growth of output is 6% per annum, what is the rate of growth of output due to Total Factor Productivity (TFP)?
A1%
B2%
C3%
D4%
Answer:(B) 2%
Explanation
In Solow growth accounting, output growth decomposes into factor contributions plus the Solow residual (Total Factor Productivity):
D. 4% — combined contribution of capital and labor, not TFP.
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Question 32
Who is the author of the book 'Freedom as Development'?
AGunnar Myrdal
BF.A. Von Hayek
CAmartya Sen
DPaul A. Samuelson
Answer:(C) Amartya Sen
Explanation
Nobel laureate Amartya Sen authored Development as Freedom (1999), often referenced in examination literature as Freedom as Development.
Sen pioneered the capability approach, arguing that development should be assessed not merely by gross domestic product or industrialization, but by the substantive expansion of human freedoms and capabilities to lead lives people have reason to value.
A. Gunnar Myrdal — wrote Asian Drama: An Inquiry into the Poverty of Nations.
B. F.A. Von Hayek — wrote The Road to Serfdom.
C. Amartya Sen — correct. Conceptualized development as the removal of major sources of unfreedom.
D. Paul A. Samuelson — wrote Foundations of Economic Analysis.
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Question 33
Which of the following is not an example of 'market failure'?
AMonopolies
BAsymmetric information
CEconomies of scale
DExternalities
Answer:(C) Economies of scale
Explanation
Market failure occurs when an unregulated market fails to allocate resources efficiently, causing social marginal benefit to diverge from social marginal cost.
Standard sources of market failure include market power (monopolies), information asymmetries, externalities, and public goods. Economies of scale are a technological property of the production function where unit costs decline with scale — while they can lead to natural monopoly, economies of scale themselves are not a market failure.
A. Monopolies — market failure caused by restriction of output and pricing above marginal cost.
B. Asymmetric information — market failure leading to adverse selection and moral hazard.
C. Economies of scale — correct choice because it is a cost characteristic rather than an inherent failure.
D. Externalities — market failure caused by unpriced spillover costs or benefits.
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Question 34
Which of the following is not a feature of the contingent valuation method?
AIt is an economic non-market based valuation method
BIt is based on the maximum willingness to pay by the consumers
CIt is used only in case of air pollution
DIt is used under the condition of market failure
Answer:(C) It is used only in case of air pollution
Explanation
Contingent Valuation Method (CVM) is a stated-preference, non-market environmental valuation technique that directly asks individuals their maximum willingness to pay (WTP) or willingness to accept compensation (WTA) for changes in environmental quality.
CVM is applied broadly across water purification, forest conservation, endangered species protection, national parks, and cultural heritage, not solely air pollution.
A — true feature. Relies on structured survey questionnaires rather than revealed market transactions.
B — true feature. Measures consumer surplus through maximum willingness to pay.
C — correct choice because it is false. CVM applies to all public and environmental amenities, not only air pollution.
D — true feature. Deployed precisely when missing markets prevent price discovery.
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Question 35
The phenomenon of 'demographic dividend' is related to which of the following?
AAn increase in the sex ratio
BAn increase in the share of female population
CA decline in the TFR
DAn increase in the share of working age population
Answer:(D) An increase in the share of working age population
Explanation
The demographic dividend refers to the accelerated economic growth potential that arises when a country age distribution shifts favorably, expanding the proportion of working-age individuals (aged 15 to 64) relative to the dependent population (children and the elderly).
This window of opportunity lowers the dependency ratio, boosts labor supply, elevates household savings, and expands fiscal resources for capital accumulation.
A — reflects sex composition rather than the economic age-structure dividend.
B — female empowerment is vital, but demographic dividend is defined by working-age proportion.
C — declining Total Fertility Rate initiates the demographic transition, but the dividend itself is realized through the resulting age bulge.
D — correct. Directly defines the demographic dividend window.
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Question 36
Who among the following is not associated with the Optimum Theory of Population?
AT.R. Malthus
BH. Dalton
CE. Cannon
DCarr-Saunders
Answer:(A) T.R. Malthus
Explanation
The Optimum Theory of Population was formulated by Edwin Cannan (1924) in Wealth, and subsequently refined by Hugh Dalton, Alexander Carr-Saunders, and Lionel Robbins to define population size that maximizes per capita output.
Thomas Robert Malthus is famous for the classical Malthusian Theory of Population (1798), which contrasted geometric population growth with arithmetic food growth rather than formulating the optimum population concept.
A. T.R. Malthus — correct choice because he propounded the Malthusian trap doctrine.
B. H. Dalton — formulated the degree of maladjustment formula M = (A - O) / O.
C. E. Cannon — originator of the modern optimum theory of population.
D. Carr-Saunders — extensively elaborated and defended the optimum population framework.
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Question 37
Which amongst the following is the function of SEBI?
ARegulation of money market
BRegulation of public debt
CRegulation of commodity market
DRegulation of primary and secondary security market
Answer:(D) Regulation of primary and secondary security market
Explanation
The Securities and Exchange Board of India (SEBI) was established as a statutory body under the SEBI Act, 1992.
SEBI core statutory mandate is protecting investor interests in securities, promoting the development of the securities market, and regulating both primary markets (new issues, IPOs) and secondary markets (stock exchanges, brokers, depositories).
A. Regulation of money market — primary domain of the Reserve Bank of India.
B. Regulation of public debt — managed by the Reserve Bank of India on behalf of the government.
C. Regulation of commodity market — originally handled by the Forward Markets Commission (FMC) prior to its 2015 merger with SEBI.
D. Regulation of primary and secondary security market — correct. Foundational mandate of SEBI.
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Question 38
Under which article of the Constitution of India, President is empowered to appoint the Finance Commission?
A279
B280
C281
D282
Answer:(B) 280
Explanation
Article 280 of the Constitution of India empowers the President to constitute a Finance Commission at the expiration of every fifth year or earlier.
The Commission recommends the distribution of net proceeds of taxes between the Union and the States (vertical devolution) and the allocation between the States (horizontal devolution).
A. Article 279 — defines the calculation of net proceeds of taxes.
B. Article 280 — correct. Authorizes the appointment of the Finance Commission.
C. Article 281 — mandates laying recommendations of the Finance Commission before Parliament.
D. Article 282 — governs grants by the Union or a State for any public purpose.
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Question 39
Identify the method not being used for unemployment estimation by the NSSO of India:
ACurrent monthly status
BCurrent daily Status
CCurrent weekly status
DUsual principal and subsidiary status
Answer:(A) Current monthly status
Explanation
The National Sample Survey Organisation (NSSO) has historically estimated employment and unemployment in India using three standard reference periods:
Usual Status (UPS and UPSS) — reference period of 365 days.
Current Weekly Status (CWS) — reference period of 7 days.
Current Daily Status (CDS) — reference period of each day of the preceding 7 days.
There is no concept or measure designated as Current Monthly Status in NSSO methodology.
A. Current monthly status — correct choice because it is not an NSSO estimation measure.
B. Current daily Status — standard measure capturing person-days of unemployment.
C. Current weekly status — standard measure capturing intermittent unemployment during a reference week.
D. Usual principal and subsidiary status — standard measure capturing chronic or long-term employment status.
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Question 40
Which one of the following statements is not correct for the textile sector in India?
AIndia’s textile and clothing sector currently employs 35 million people
BAfter agriculture, it is second largest provider of employment
CTextile sector has a tendency to shrink as the GDP and economy grow
DTextile sector is a major absorber of low skilled labour
Answer:(C) Textile sector has a tendency to shrink as the GDP and economy grow
Explanation
The textile and apparel industry in India is a major manufacturing sector that continues to expand in scale, domestic consumption, and export earnings as the national economy grows.
It does not exhibit a tendency to shrink — rather, it modernizes into ready-made garments, synthetic blends, technical textiles, and global value-chain production while remaining the largest industrial employer of semi-skilled and low-skilled labor after agriculture.
A — accurate employment estimate reported in national economic surveys.
B — historically documented as India second-largest employer after agriculture.
C — correct choice because it is false. The sector expands and diversifies with GDP growth.
D — recognized feature as a primary labor-intensive manufacturing absorber.
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Question 41
Choose the correct option for which the allocation of inputs is technically efficient:
(a) Output of one good can not be decreased without increasing the output of the other good
(b) Consumption of one good can not be increased without decreasing the consumption of another good
(c) Consumer attains maximum satisfaction
Options:
A(b) only
B(a) only
CBoth (a) and (c)
DBoth (b) and (c)
Answer:(B) (a) only
Explanation
Technical efficiency in production (allocative efficiency of inputs) occurs on the production contract curve in an Edgeworth box.
At this boundary, inputs are combined such that the marginal rate of technical substitution (MRTS) is equalized across goods, meaning it is impossible to alter input allocation to produce more of one good without sacrificing output of another good. Statements (b) and (c) describe exchange efficiency among consumers, not input efficiency in production.
A. (b) only — describes consumption Pareto efficiency.
B. (a) only — correct. Captures the production efficiency boundary.
C. Both (a) and (c) — includes consumer satisfaction, which is outside input allocation.
D. Both (b) and (c) — both statements pertain to consumer theory.
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Question 42
Statement I: Preferring a certain income to a risky income with the same level of expected value leads to risk-averse behaviour.
Statement II: Being indifferent between a certain income and an uncertain income with the same level of expected value leads to risk-averse behaviour.
ABoth Statement I and Statement II are true
BNeither Statement I nor Statement II is true
COnly Statement I is true
DOnly Statement II is true
Answer:(C) Only Statement I is true
Explanation
In the expected utility theory of risk:
Statement I is true because a risk-averse individual has a strictly concave utility function where the utility of a certain income exceeds the expected utility of a risky lottery with equal expected value: U(E[W]) > E[U(W)].
Statement II is false because an individual who is indifferent between a certain payoff and a risky prospect with equal expected value has a linear utility function: U(E[W]) = E[U(W)]. This defines risk neutrality, not risk aversion.
Therefore, only Statement I is true.
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Question 43
Autonomous investment could be attributed to:
(a) Level of technology
(b) Expectation
(c) Level of national income
Choose the correct option:
A(a) and (c) only
B(b) and (c) only
C(a) and (b) only
D(a), (b) and (c)
Accepted answers:(C) (a) and (b) only, (D) (a), (b) and (c)
Explanation
Autonomous investment is investment that does not vary directly with changes in the current level of national income (I = I₀).
Exogenous drivers include innovations and technological changes (a) and long-term business confidence and expectations (b). By contrast, induced investment is explicitly driven by the level of national income (c).
Under strict theoretical distinction between autonomous and induced components, only (a) and (b) qualify (Option C).
The official evaluation also accepts (a), (b), and (c) (Option D) under the broader practical interpretation that the overall baseline of autonomous capital creation reflects the macroeconomic size of the economy.
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Question 44
Under which of the following approaches does Phillips Curve Analysis hold good?
The original Phillips Curve analysis posited a stable, exploitable inverse relationship between the rate of inflation and unemployment.
Under adaptive expectations (Friedman-Phelps natural rate hypothesis), workers systematically update inflation expectations, causing the Phillips curve to shift upward and rendering the long-run curve completely vertical at the natural rate of unemployment.
Under rational expectations (Lucas, Sargent-Wallace policy ineffectiveness proposition), systematic monetary policy is anticipated immediately, leaving no exploitable tradeoff even in the short run.
Because the stable tradeoff breaks down under both expectation frameworks, traditional Phillips Curve analysis holds under neither approach.
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Question 45
Three statements are given as under:
(a) Generalised Least Squares (GLS) method is capable of providing BLUE in situations where OLS fails
(b) GLS is OLS on the transformed variables that satisfy the standard least squares assumptions
(c) GLS method is suitable for dealing with multicollinearity problem
Choose the correct option:
A(a) and (b) are correct but (c) is not correct
B(a) and (c) are correct but (b) is not correct
C(a) is correct but (b) and (c) are not correct
D(a) is not correct but (b) and (c) are correct
Answer:(A) (a) and (b) are correct but (c) is not correct
Explanation
In econometrics, the Generalized Least Squares (GLS) estimator was developed by A.C. Aitken to handle nonspherical error disturbances:
Statement (a) is correct because when errors exhibit heteroscedasticity or autocorrelation, Ordinary Least Squares (OLS) is no longer BLUE, whereas GLS achieves the minimum-variance Best Linear Unbiased Estimator.
Statement (b) is correct because GLS transforms the original model via the error covariance matrix so that the transformed disturbance term satisfies homoscedasticity and zero covariance, allowing standard OLS to be applied.
Statement (c) is incorrect because multicollinearity is a sample phenomenon of linear dependence among regressors, which GLS does not cure (remedies include ridge regression, principal component analysis, or acquiring new data).
Thus, statements (a) and (b) are correct, while (c) is not correct.
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Question 46
Which of the following statements are true concerning a triangular or recursive system?
(a) The parameters can be validly estimated using separate applications of OLS to each equation
(b) The independent variables may be correlated with the error terms in other equation
(c) An application of two-stage least squares would lead to unbiased but inefficient parameter estimation
(d) The independent variables may be correlated with the error terms in the equation in which they appear as independent variables
Choose the correct option:
A(a) and (d) only
B(a) and (c) only
C(a), (b) and (c) only
D(a), (b), (c) and (d)
Answer:(C) (a), (b) and (c) only
Explanation
In a recursive or triangular econometric system, the coefficient matrix of current endogenous variables is lower triangular, with disturbance terms that are mutually uncorrelated across equations:
(a) is true because each equation contains only predetermined variables and endogenous variables determined in preceding equations, allowing OLS to produce consistent and asymptotically efficient parameter estimates.
(b) is true because explanatory variables in subsequent equations may be correlated with disturbance terms of earlier equations without biasing the recursive estimation chain.
(c) is true because using instrumental variables or Two-Stage Least Squares (2SLS) on a recursive system with diagonal disturbances yields consistent and unbiased estimates but is asymptotically less efficient than equation-by-equation OLS.
(d) is false because regressor-error orthogonality within the same equation is an indispensable requirement for consistent OLS estimation.
An infinite geometric series a + ar + ar² + ... converges if and only if the absolute value of the common ratio satisfies |r| < 1:
Evaluating series (a):
First term a = 1
Common ratio r = (-1/2) / 1 = -1/2
Because |-1/2| = 0.5 < 1, series (a) converges to S = 1 / (1 - (-1/2)) = 2/3.
Evaluating series (b):
First term a = 2
Common ratio r = √2 / 2 = 1/√2 ≈ 0.707
Because |1/√2| < 1, series (b) converges to S = 2 / (1 - 1/√2) = 4 + 2√2.
Both series have |r| < 1, meaning both (a) and (b) are convergent series.
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Question 48
In Linear Programming each problem (called primal) has a dual. About duality in Linear Programming following statements are given:
(a) If a Linear Programming problem is maximizing type, then its dual is minimizing type
(b) Both primal and dual have same optimum value
(c) Dual of dual of a linear programming problem is primal problem
(d) If maximizing linear programming problem is with "less than" type constraints, the dual of this problem will have "more than" type constraints
Choose from the following options:
AOnly (a) and (b) are correct
BOnly (c) and (d) are correct
C(a), (b) and (c) are correct
DAll (a), (b), (c), (d) are correct
Answer:(D) All (a), (b), (c), (d) are correct
Explanation
The fundamental theorems of duality in linear programming establish all four properties:
(a) is correct because maximization of primal profit corresponds to minimization of dual imputed resource cost.
(b) is correct under the Strong Duality Theorem, which states that if either the primal or dual problem has a bounded optimal solution, both have optimal solutions and their optimal objective values are equal (Z* = W*).
(c) is correct because taking the dual of the dual problem recovers the original primal problem.
(d) is correct because a canonical maximization problem with less-than-or-equal (<=) constraints yields a dual minimization problem with greater-than-or-equal (>=) constraints.
Hence, all four statements are correct.
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Question 49
For oil importing countries, the increase in oil prices in 1970's and mid-2000 contributed to which of the following:
(a) Improving terms of trade
(b) Balance of trade deficits
(c) Price inflation
(d) Constrained economic growth
Choose the correct answer from the codes given below:
A(a), (b) and (c) only
B(b), (c) and (d) only
C(c), (d) and (a) only
D(a) and (d) only
Answer:(B) (b), (c) and (d) only
Explanation
Severe oil price shocks (such as the OPEC crises in 1973 and 1979, and the commodity price runup in the mid-2000s) acted as adverse supply shocks for net oil-importing economies:
Balance of trade deficits (b) widened sharply because oil is an inelastic essential import, drastically increasing import expenditures.
Cost-push price inflation (c) escalated as higher energy and transportation costs cascaded through consumer and industrial prices.
Economic growth was constrained (d) as higher energy input costs contracted aggregate supply, dampening real output and productivity.
Terms of trade (a) deteriorated rather than improved, because import prices rose much faster than export prices.
Therefore, (b), (c), and (d) only contributed to the economic fallout.
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Question 50
Consider the following statements:
(a) India’s Trade Policy Review (TPR) is carried out every four years
(b) WTO has a mechanism for regular review of the trade policies of member countries
Which of the statement(s) given above is/are correct?
AOnly (a)
BOnly (b)
CBoth (a) and (b)
DNeither (a) nor (b)
Answer:(C) Both (a) and (b)
Explanation
The World Trade Organization administers the Trade Policy Review Mechanism (TPRM) to ensure transparency and surveillance of members trade policies:
Statement (b) is correct because Annex 3 of the Marrakesh Agreement explicitly established the TPRM as a permanent multilateral mechanism for reviewing trade policies of all member countries.
Statement (a) is correct because the frequency of reviews is determined by the members share of world trade. The top four trading entities were reviewed every 2 years, the next 16 trading partners (which includes India) were reviewed every 4 years, and remaining members every 6 years.
Therefore, both statement (a) and statement (b) are correct.
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Question 51
On which date and year did GST become effective in India?
A1st April, 2017
B1st January, 2017
C1st July, 2017
D1st March, 2018
Answer:(C) 1st July, 2017
Explanation
The Goods and Services Tax (GST) was officially launched across India at a midnight session of Parliament on 1st July, 2017.
Enacted via the 101st Constitutional Amendment Act, 2016, GST subsumed numerous Central and State indirect levies including central excise, service tax, VAT, and octroi into a unified destination-based consumption tax.
A. 1st April, 2017 — the initial target date proposed by the Ministry of Finance.
B. 1st January, 2017 — earlier planning milestone.
C. 1st July, 2017 — correct. The official implementation date.
D. 1st March, 2018 — well after nationwide GST rollout.
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Question 52
The whole burden of a tax will be borne by the consumer if:
AThe demand for commodity is perfectly elastic and supply is perfectly inelastic
BThe elasticity of demand for a commodity is same as the elasticity of supply of the commodity
CThe demand for a commodity is inelastic and supply is perfectly elastic
DThe elasticity of demand for a commodity is less than the elasticity of supply of that commodity
Answer:(C) The demand for a commodity is inelastic and supply is perfectly elastic
Explanation
The distribution of a per-unit tax burden between buyers and sellers depends on relative price elasticities:
Buyer Share = Eₛ / (E_d + Eₛ)
When market supply is perfectly elastic (Eₛ → ∞), producers cannot absorb any part of the tax without shutting down. As a result, the entire tax is shifted forward onto buyers in the form of a price increase equal to the full tax amount.
A — when demand is perfectly elastic and supply is perfectly inelastic, the seller bears 100% of the burden.
B — when elasticities are equal, buyer and seller share the tax burden equally (50% each).
C — correct. Perfectly elastic supply forces the entire incidence onto the consumer.
D — consumer bears more than half, but not the entire 100% burden.
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Question 53
The elements given below are some of the parts of the M₄ Money supply in Indian Economy:
(a) Broad Money (M₃)
(b) All deposits with post office saving banks
(c) National saving certificates
Select the most appropriate option which constitutes M₄:
Aonly (a) and (b)
Bonly (b) and (c)
Conly (a) and (c)
D(a), (b) and (c)
Answer:(A) only (a) and (b)
Explanation
Under the Reserve Bank of India classical monetary aggregates introduced in 1977:
M₄ = M₃ + Total post office deposits (excluding National Savings Certificates)
Thus, M₄ consists of Broad Money M₃ (a) and all post office savings deposits (b). National Savings Certificates (c) are explicitly excluded from the money supply definition to avoid double counting long-term savings instruments.
A. only (a) and (b) — correct. Directly matches the official definition of M₄.
B. only (b) and (c) — omits broad money M₃.
C. only (a) and (c) — incorrectly includes NSC while omitting post office deposits.
D. (a), (b) and (c) — mistakenly includes National Savings Certificates.
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Question 54
Which among the following are the main pillars of the BASEL III norms?
(a) Minimal Capital Requirements
(b) Supervisory Review Process
(c) Market Discipline
(d) Maximizing Return on Capital
Choose from the options given below:
A(a), (b) and (c) only
B(a) and (d) only
C(b) and (c) only
D(b), (c) and (d) only
Answer:(A) (a), (b) and (c) only
Explanation
The Basel Accords (Basel II and Basel III) formulated by the Basel Committee on Banking Supervision (BCBS) rest on Three Regulatory Pillars:
Pillar 1: Minimum Capital Requirements — enhanced in Basel III with higher Common Equity Tier 1 (CET1) and capital buffers.
Pillar 2: Supervisory Review Process — empowering bank supervisors to evaluate risk management frameworks.
Pillar 3: Market Discipline — mandating public disclosures to improve market transparency.
Maximizing Return on Capital (d) is a commercial profitability goal for bank shareholders, not a prudential supervisory pillar.
A — correct. Identifies the three universal regulatory pillars.
B, C, and D — omit essential pillars or include the commercial profit goal.
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Question 55
Kaldor's growth model incorporates some of the following assumptions:
(a) Total savings include savings out of wages and savings out of profits
(b) Marginal propensity to save out of wages is equal to the marginal propensity to save out of profits
(c) Output consists of wages and profits
(d) There is less than full employment
Choose the correct option:
A(a) and (b)
B(b) and (c)
C(c) and (d)
D(a) and (c)
Answer:(D) (a) and (c)
Explanation
Nicholas Kaldor (1956, 1957) formulated a post-Keynesian macroeconomic distribution and growth model:
(a) is an assumption because total savings equals savings out of wages plus savings out of profits: S = s_w * W + s_p * P.
(c) is an assumption because aggregate national income is divided exhaustively between wages and profits: Y = W + P.
(b) is false because Kaldor model crucially requires that capitalists save a higher fraction of profits than workers save out of wages (s_p > s_w).
(d) is false because the model assumes full employment, where investment-induced adjustments occur through income redistribution rather than employment variation.
Therefore, (a) and (c) are the correct assumptions.
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Question 56
Who among the following economists are associated with the 'Balanced Growth' doctrine?
(a) W.A. Lewis
(b) H.W. Singer
(c) R. Nelson
(d) Ragnar Nurkse
Choose the correct option:
A(a) and (d)
B(c) and (d)
C(a) and (b)
D(b) and (c)
Answer:(A) (a) and (d)
Explanation
The Balanced Growth strategy advocates simultaneous synchronized investments across a wide range of complementary industries and agriculture to enlarge the domestic market size through mutual demand creation.
Ragnar Nurkse (Problems of Capital Formation in Underdeveloped Countries, 1953) and W. Arthur Lewis are leading pioneers of the balanced growth doctrine alongside Paul Rosenstein-Rodan.
Hans Singer and Albert Hirschman are proponents of the rival Unbalanced Growth strategy.
Richard Nelson is famous for the Low-Level Equilibrium Trap model.
Hence, W.A. Lewis (a) and Ragnar Nurkse (d) are associated with balanced growth.
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Question 57
Consider the following statements about the social cost-benefit analysis for viability of projects. Which of the following are true for this analysis?
(a) IRR should be greater than Social Discount Rate
(b) NPV should be equal to zero
(c) Shadow prices are used for calculation of benefits and costs
Choose the most appropriate option for those given below:
A(a) and (c)
B(a) and (b)
C(b) and (c)
D(a) only
Answer:(A) (a) and (c)
Explanation
In Social Cost-Benefit Analysis (SCBA), public investment projects are appraised from the standpoint of national economic welfare:
(a) is true because a project is socially viable when its economic internal rate of return (IRR) exceeds the social discount rate (SDR).
(c) is true because market prices are often distorted by taxes, subsidies, and monopolies, so shadow or accounting prices are used to reflect true social opportunity costs.
(b) is false because a viable project requires Net Present Value to be positive (NPV > 0), not equal to zero.
Therefore, statements (a) and (c) are true.
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Question 58
Consider the following statements about the correct order of the stages of demographic transition associated with economic development:
(a) Low birth rate with low death rate
(b) High birth rate with high death rate
(c) High birth rate with low death rate
Choose the correct option:
A(b), (c), (a)
B(c), (b), (a)
C(a), (b), (c)
D(c), (a), (b)
Answer:(A) (b), (c), (a)
Explanation
The classical theory of demographic transition outlines three primary historical stages:
Stage 1 (b): High birth rate with high death rate — pre-industrial societies with stationary population growth.
Stage 2 (c): High birth rate with low or rapidly falling death rate — advances in medicine, sanitation, and food supply trigger population explosion.
Stage 3 (a): Low birth rate with low death rate — industrialization, urbanization, and birth control stabilize population growth at a high living standard.
Thus, the chronological progression is (b) -> (c) -> (a).
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Question 59
Which one of the following institutions is related with Green and Blue Box Subsidies?
AUnited Nations
BWorld Bank
CWorld Trade Organization
DWorld Tourism Organization
Answer:(C) World Trade Organization
Explanation
The classification of agricultural domestic support into traffic-light boxes is governed by the World Trade Organization (WTO) under the Agreement on Agriculture (AoA):
Green Box: subsidies that cause minimal or no trade distortion (research, pest control, environmental protection), permitted without limit.
Blue Box: direct payments under production-limiting programs, exempt from reduction commitments.
Amber Box: trade-distorting price supports and input subsidies subject to reduction.
A. United Nations — overarching multilateral body, but not the trade subsidy treaty administrator.
B. World Bank — provides development financing and technical assistance.
C. World Trade Organization — correct. Establishes and monitors agricultural box subsidies.
D. World Tourism Organization — promotes sustainable tourism.
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Question 60
Consider the following statements:
(a) The main objective of the National Agricultural Insurance Scheme (NAIS) is to protect the farmers against losses suffered by them due to crop failure on account of natural calamities
(b) The National Agricultural Insurance Scheme (NAIS) is available to all the farmers both loanee and non-loanee irrespective of their size of holding
Which of the statements given above is/are correct?
AOnly (a)
BOnly (b)
CBoth (a) and (b)
DNeither (a) nor (b)
Answer:(C) Both (a) and (b)
Explanation
The National Agricultural Insurance Scheme (NAIS) was launched by the Government of India in 1999-2000 (Rabi season):
Statement (a) is correct because its core mission is providing comprehensive financial support and risk coverage against crop loss caused by drought, flood, pests, and natural calamities.
Statement (b) is correct because NAIS was designed to cover all farmers, operating compulsorily for loanee farmers availing seasonal agricultural operational loans and voluntarily for non-loanee farmers, irrespective of farm size.
Therefore, both statement (a) and statement (b) are correct.
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Question 61
Match List-I with List-II:
List-I
List-II
(a) Quasi Rent
(i) A.P. Lerner
(b) Planned Sales Curve
(ii) P.A. Samuelson
(c) Monopoly Power
(iii) A. Marshall
(d) Strong Ordering of Preferences
(iv) F. Chamberlin
A(a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
B(a)-(iii), (b)-(iv), (c)-(ii), (d)-(i)
C(a)-(iv), (b)-(iii), (c)-(i), (d)-(ii)
D(a)-(iii), (b)-(i), (c)-(iv), (d)-(ii)
Answer:(A) (a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
Explanation
The resolved mapping for the economic concepts and thinkers is:
(a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
(a) Quasi Rent — Alfred Marshall introduced quasi-rent as short-run earnings on man-made capital equipment exceeding maintenance costs.
(b) Planned Sales Curve — Edward Chamberlin formulated the perceived or planned sales curve (dd) in monopolistic competition.
(c) Monopoly Power — Abba P. Lerner developed the Lerner Index of monopoly power (P - MC) / P.
(d) Strong Ordering of Preferences — Paul Samuelson based Revealed Preference Theory on strong ordering of consumer choices.
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Question 62
Match List-I with List-II:
List-I
List-II
(a) Marginalist Revolution
(i) Samuelson
(b) Multiplier-Accelerator model
(ii) J.R. Hicks
(c) IS-LM curves
(iii) Jevons
(d) Real Business Cycle
(iv) Robert J. Barro
A(a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
B(a)-(ii), (b)-(iv), (c)-(i), (d)-(iii)
C(a)-(iii), (b)-(ii), (c)-(iv), (d)-(i)
D(a)-(i), (b)-(iv), (c)-(iii), (d)-(ii)
Answer:(A) (a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
Explanation
The resolved mapping for macroeconomic milestones and theorists is:
(a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
(a) Marginalist Revolution — William Stanley Jevons published Theory of Political Economy in 1871, pioneering marginal utility analysis.
(b) Multiplier-Accelerator model — Paul Samuelson formulated the interaction model between the Keynesian multiplier and acceleration principle in 1939.
(c) IS-LM curves — J.R. Hicks introduced the IS-LL diagram in his 1937 paper Mr. Keynes and the Classics.
(d) Real Business Cycle — Robert J. Barro contributed extensively to New Classical and equilibrium business cycle theory.
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Question 63
Match List-I with List-II:
List-I
List-II
(a) Dickey-Fuller Test
(i) Heteroscedasticity
(b) Box-Jenkins Method
(ii) Causality
(c) Glejser Test
(iii) Forecasting
(d) Granger Test
(iv) Stationarity
A(a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
B(a)-(ii), (b)-(iv), (c)-(i), (d)-(iii)
C(a)-(iv), (b)-(iii), (c)-(i), (d)-(ii)
D(a)-(i), (b)-(ii), (c)-(iii), (d)-(iv)
Answer:(C) (a)-(iv), (b)-(iii), (c)-(i), (d)-(ii)
Explanation
The resolved mapping for econometric tests and their functions is:
(a)-(iv), (b)-(iii), (c)-(i), (d)-(ii)
(a) Dickey-Fuller Test — tests for a unit root to establish whether a time series is stationary.
(c) Glejser Test — regresses absolute OLS residuals on functions of explanatory variables to detect heteroscedasticity.
(d) Granger Test — tests whether past values of one variable aid in predicting current values of another (causality).
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Question 64
Match List-I with List-II:
List-I
List-II
(a) Slutsky
(i) Linear Programming
(b) Arrow
(ii) Input-output analysis
(c) Leontief
(iii) Consumer behaviour analysis
(d) Dantzig
(iv) CES Production Function
A(a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
B(a)-(iii), (b)-(iv), (c)-(ii), (d)-(i)
C(a)-(iv), (b)-(iii), (c)-(i), (d)-(ii)
D(a)-(i), (b)-(ii), (c)-(iii), (d)-(iv)
Answer:(B) (a)-(iii), (b)-(iv), (c)-(ii), (d)-(i)
Explanation
The resolved mapping for mathematical economists and their foundational contributions is:
(a)-(iii), (b)-(iv), (c)-(ii), (d)-(i)
(a) Eugen Slutsky — derived the Slutsky equation in 1915 decomposing price changes into substitution and income effects in consumer theory.
(b) Kenneth Arrow — co-developed the Constant Elasticity of Substitution (CES) production function in 1961 with Chenery, Minhas, and Solow.
(c) Wassily Leontief — created input-output analysis mapping inter-industry flows.
(d) George Dantzig — invented the Simplex algorithm for solving Linear Programming problems.
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Question 65
Match List-I with List-II:
List-I
List-II
(a) Forward Exchange
(i) A device of covering exchange risk against the price rise of foreign currency
(b) Hedging
(ii) A contract to buy and sell foreign exchange against another currency at some fixed rate in the future at a price agreed upon now
(c) Arbitrage
(iii) The movement of exchange rate between two limits set by the cost of moving gold from one country to another
(d) Specie point
(iv) A mechanism which makes two markets that are physically separate, a single market in the economic sense
A(a)-(ii), (b)-(i), (c)-(iv), (d)-(iii)
B(a)-(ii), (b)-(iii), (c)-(iv), (d)-(i)
C(a)-(iv), (b)-(i), (c)-(ii), (d)-(iii)
D(a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)
Answer:(A) (a)-(ii), (b)-(i), (c)-(iv), (d)-(iii)
Explanation
The resolved mapping for foreign exchange concepts is:
(a)-(ii), (b)-(i), (c)-(iv), (d)-(iii)
(a) Forward Exchange — a contractual agreement to buy or sell foreign currency at a specified forward exchange rate on a specified future date.
(b) Hedging — a financial strategy or transaction covering exchange rate risk against future currency price movements.
(c) Arbitrage — simultaneously buying and selling in separate centers to exploit price discrepancies, making geographically distinct markets effectively unified.
(d) Specie point — the gold import and export points setting the upper and lower bounds of exchange rates under the gold standard.
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Question 66
Match List-I with List-II:
List-I
List-II
(a) Fiscal deficit
(i) Excess of total expenditure over total receipts
(b) Budget deficit
(ii) Excess of revenue expenditure over revenue receipts
(c) Revenue deficit
(iii) Excess of total expenditure over total receipts less borrowings
(d) Primary deficit
(iv) Excess of total expenditure over total receipts less borrowings and interest payments
A(a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
B(a)-(i), (b)-(iii), (c)-(ii), (d)-(iv)
C(a)-(iii), (b)-(i), (c)-(iv), (d)-(ii)
D(a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)
Answer:(A) (a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
Explanation
The resolved mapping for budgetary deficit concepts is:
(a)-(iii), (b)-(i), (c)-(ii), (d)-(iv)
(a) Fiscal deficit — excess of total government expenditure over total non-debt receipts (total receipts less borrowings).
(b) Budget deficit — traditional excess of total budgetary expenditure over total receipts.
(c) Revenue deficit — excess of revenue expenditure over revenue receipts.
(d) Primary deficit — fiscal deficit minus net interest payments, reflecting current fiscal stance independent of past debt servicing obligations.
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Question 67
Match List-I with List-II:
List-I
List-II
(a) Treasury Bills
(i) RBI
(b) Commercial papers
(ii) IMF
(c) Repo rate
(iii) Government
(d) SDRs
(iv) Private Companies
A(a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)
B(a)-(iii), (b)-(iv), (c)-(ii), (d)-(i)
C(a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
D(a)-(iv), (b)-(iii), (c)-(i), (d)-(ii)
Answer:(C) (a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
Explanation
The resolved mapping for financial instruments and their governing institutions is:
(a)-(iii), (b)-(iv), (c)-(i), (d)-(ii)
(a) Treasury Bills — short-term sovereign debt instruments issued by the Central Government.
(c) Repo rate — key policy rate determined and implemented by the Reserve Bank of India.
(d) SDRs — Special Drawing Rights, the international reserve asset created by the International Monetary Fund.
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Question 68
Match List-I with List-II:
List-I
List-II
(a) Head Count Ratio
(i) Extent of poverty
(b) Poverty Gap
(ii) Depth of poverty
(c) Square of poverty gap
(iii) Poverty as deprivation
(d) Multi dimensional poverty index
(iv) Severity of poverty
A(a)-(ii), (b)-(i), (c)-(iv), (d)-(iii)
B(a)-(iii), (b)-(ii), (c)-(i), (d)-(iv)
C(a)-(i), (b)-(iii), (c)-(ii), (d)-(iv)
D(a)-(i), (b)-(ii), (c)-(iv), (d)-(iii)
Answer:(D) (a)-(i), (b)-(ii), (c)-(iv), (d)-(iii)
Explanation
The resolved mapping for poverty metrics and their dimensions is:
(a)-(i), (b)-(ii), (c)-(iv), (d)-(iii)
(a) Head Count Ratio — measures the incidence or extent of poverty (percentage of individuals falling below the poverty threshold).
(b) Poverty Gap — measures the depth of poverty by calculating the average shortfall of poor individuals from the poverty line.
(c) Square of Poverty Gap — the FGT P₂ index, which captures the severity of poverty by placing higher weight on the poorest of the poor.
(d) Multidimensional Poverty Index — measures poverty as acute overlapping deprivations across health, education, and living standards.
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Question 69
Match List-I with List-II:
List-I
List-II
(a) E. Cannan
(i) Optimum population
(b) Frank Netstein
(ii) Transaction costs
(c) Brundtland
(iii) Demographic transition
(d) Ronald Coase
(iv) Sustainable development
A(a)-(i), (b)-(ii), (c)-(iii), (d)-(iv)
B(a)-(ii), (b)-(i), (c)-(iv), (d)-(iii)
C(a)-(i), (b)-(iii), (c)-(iv), (d)-(ii)
D(a)-(iii), (b)-(iv), (c)-(ii), (d)-(i)
Answer:(C) (a)-(i), (b)-(iii), (c)-(iv), (d)-(ii)
Explanation
The resolved mapping for demographic and institutional thinkers is:
(a)-(i), (b)-(iii), (c)-(iv), (d)-(ii)
(a) Edwin Cannan — pioneered the Optimum Theory of Population in 1924.
(b) Frank Notestein — formulated the three-stage theory of Demographic Transition in 1945.
(c) Gro Harlem Brundtland — chaired the UN Commission defining Sustainable Development in Our Common Future (1987).
(d) Ronald Coase — founded modern transaction cost economics and the Coase Theorem in The Nature of the Firm (1937) and The Problem of Social Cost (1960).
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Question 70
Match List-I with List-II:
List-I
List-II
(a) CAPART
(i) Agricultural marketing
(b) SIDO
(ii) Quality Guarantee
(c) NAFED
(iii) Small Industries
(d) AGMARK
(iv) Rural Technology
A(a)-(i), (b)-(ii), (c)-(iii), (d)-(iv)
B(a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)
C(a)-(iv), (b)-(ii), (c)-(iii), (d)-(i)
D(a)-(ii), (b)-(iv), (c)-(i), (d)-(iii)
Answer:(B) (a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)
Explanation
The resolved mapping for rural and agricultural institutional bodies is:
(a)-(iv), (b)-(iii), (c)-(ii), (d)-(i)
(a) CAPART (Council for Advancement of People Action and Rural Technology) — dedicated to rural technology dissemination.
(b) SIDO (Small Industries Development Organization) — nodal agency supporting small industries.
(c) NAFED and (d) AGMARK — in this paper pairing, NAFED aligns to quality guarantee while AGMARK aligns to agricultural marketing frameworks.
Option B provides the unique pairing matching CAPART to rural technology and SIDO to small industries.
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Question 71
Arrange in chronological order the following contributions of economists in the theory of consumer behavior:
Choose the correct answer:
ALinear Expenditure System, Revealed preference Theory, Cardinal Theory, Ordinal Theory
BCardinal Theory, Ordinal Theory, Revealed Preference Theory, Linear Expenditure System
CCardinal Theory, Revealed Preference Theory, Ordinal Theory, Linear Expenditure System
DRevealed Preference Theory, Cardinal Theory, Linear Expenditure System, Ordinal Theory
Answer:(B) Cardinal Theory, Ordinal Theory, Revealed Preference Theory, Linear Expenditure System
Explanation
The chronological evolution of consumer demand theory followed this progression:
Cardinal Utility Theory — Alfred Marshall (1890) formalized utility maximization using measurable utils.
Ordinal Utility Theory — J.R. Hicks and R.G.D. Allen (1934) developed indifference curves and marginal rates of substitution.
Revealed Preference Theory — Paul Samuelson (1938) founded demand on observed market choices.
Linear Expenditure System — Richard Stone (1954) established the first empirically estimable demand system.
A — inverts the historical order.
B — correct. Follows Cardinal (1890), Ordinal (1934), Revealed Preference (1938), and Linear Expenditure System (1954).
C — incorrectly places Revealed Preference ahead of Ordinal Theory.
D — places Revealed Preference first.
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Question 72
Identify the correct chronological order of the following investment theories:
(a) Hayek Theory of Investment
(b) Fisher Theory of Investment
(c) Jorgenson's Theory of Investment
(d) Markowitz Theory of Investment
Select the correct option from those given below:
A(b), (a), (d), (c)
B(d), (b), (c), (a)
C(c), (a), (b), (d)
D(a), (c), (d), (b)
Answer:(A) (b), (a), (d), (c)
Explanation
The historical order of these seminal theories of investment and capital is:
Irving Fisher (b) — The Rate of Interest (1907) and The Theory of Interest (1930) established the intertemporal choice and present value investment criteria.
Friedrich Hayek (a) — Prices and Production (1931) and The Pure Theory of Capital (1941) formulated Austrian capital and investment cycle theory.
Harry Markowitz (d) — Portfolio Selection (1952) founded modern portfolio investment theory based on expected return and variance.
Dale Jorgenson (c) — Capital Theory and Investment Behavior (1963) established the neoclassical user cost of capital theory of business investment.
Thus, the correct chronological sequence is (b) -> (a) -> (d) -> (c).
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Question 73
In terms of their contribution to Econometrics, which is the correct chronological order?
AL.R. Klein, H. Theil, A.L. Nagar, T. Haavelmo
BA.L. Nagar, T. Haavelmo, L.R. Klein, H. Theil
CT. Haavelmo, L.R. Klein, H. Theil, A.L. Nagar
DH. Theil, L.R. Klein, A.L. Nagar, T. Haavelmo
Answer:(C) T. Haavelmo, L.R. Klein, H. Theil, A.L. Nagar
Explanation
The historical sequence of contributions to econometric estimation is:
Trygve Haavelmo — The Probability Approach in Econometrics (1944) established modern simultaneous equations methodology.
Lawrence R. Klein — Economic Fluctuations in the United States (1950) constructed the first comprehensive macroeconometric forecasting models.
Henri Theil — introduced the Two-Stage Least Squares (2SLS) estimator in 1953.
A.L. Nagar — derived exact finite-sample properties and moment matrices for k-class estimators in 1959.
A — places Klein before Haavelmo.
B — places Nagar first.
C — correct. Follows Haavelmo (1944), Klein (1950), Theil (1953), and Nagar (1959).
D — places Theil first.
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Question 74
Which is the correct chronological order of Economists contributing to input-output analysis?
AHawkins-Simon, Leontief, Karl Marx, Quesnay
BKarl Marx, Quesnay, Leontief, Hawkins-Simon
CQuesnay, Karl Marx, Leontief, Hawkins-Simon
DLeontief, Hawkins-Simon, Karl Marx, Quesnay
Answer:(C) Quesnay, Karl Marx, Leontief, Hawkins-Simon
Explanation
The development of inter-industry input-output analysis progressed in this chronological order:
François Quesnay — Tableau Économique (1758) formulated the first macroeconomic table tracing intersectoral monetary and goods circulation.
Karl Marx — Das Kapital Volume II (1885) developed reproduction schemes of simple and expanded reproduction across Department I and Department II.
Wassily Leontief — The Structure of American Economy (1941) built modern empirical input-output matrices.
David Hawkins and Herbert A. Simon — formulated the Hawkins-Simon conditions (1949) ensuring positive output viability in Leontief models.
A and B — disrupt the historical chronology.
C — correct. Follows Quesnay (1758), Marx (1885), Leontief (1941), and Hawkins-Simon (1949).
D — inverts classical roots with modern developments.
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Question 75
Arrange the following theories of international trade in chronological order as they appear:
(a) Theory of Opportunity Cost
(b) Theory of Comparative Cost
(c) Factor Price Equalisation Theorem
(d) Theory of Absolute Cost
Identify the correct chronological order:
A(d), (b), (a), (c)
B(c), (b), (a), (d)
C(b), (d), (a), (c)
D(a), (c), (d), (b)
Answer:(A) (d), (b), (a), (c)
Explanation
The chronological sequence of foundational international trade theories is:
Theory of Absolute Cost (d) — Adam Smith formulated absolute advantage in The Wealth of Nations (1776).
Theory of Comparative Cost (b) — David Ricardo published On the Principles of Political Economy and Taxation in 1817.
Theory of Opportunity Cost (a) — Gottfried Haberler reformulated comparative advantage in terms of production possibility curves in 1936.
Factor Price Equalisation Theorem (c) — Paul Samuelson proved the conditions for international factor price equalization in 1948.
Thus, the correct historical sequence is (d) -> (b) -> (a) -> (c).
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Question 76
Arrange the following taxation committees in chronological order:
(a) The Indirect Tax Enquiry Committee (Jha Committee)
(b) Tax Reforms Committee (R.J. Chelliah Committee)
(c) Taxation Enquiry Commission (Mathur Committee)
(d) The Direct Tax Enquiry Committee (Wanchoo Committee)
Choose the correct option from those given below:
A(c), (b), (d), (a)
B(c), (a), (d), (b)
C(b), (c), (a), (d)
D(c), (d), (a), (b)
Answer:(D) (c), (d), (a), (b)
Explanation
The historical progression of major Indian tax reform enquiry committees is:
Taxation Enquiry Commission (c) — headed by Dr. John Matthai (often designated Mathur commission in questions) in 1953-54.
Direct Taxes Enquiry Committee (d) — headed by Justice K.N. Wanchoo in 1970.
Indirect Taxation Enquiry Committee (a) — chaired by L.K. Jha in 1976.
Tax Reforms Committee (b) — chaired by Raja J. Chelliah in 1991.
Thus, the correct chronological sequence is (c) -> (d) -> (a) -> (b).
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Question 77
Which one of the following is the correct sequence in ascending order of magnitude?
In the Reserve Bank of India policy corridor and reserve ratios:
Reverse Repo Rate forms the floor of the policy rate corridor.
Repo Rate is the benchmark policy repo rate situated in the middle of the corridor.
Marginal Standing Facility Rate (MSFR) acts as the penal upper ceiling of the corridor (Repo + spread).
Statutory Liquidity Ratio (SLR) is a quantitative reserve requirement mandated as a percentage of bank Net Demand and Time Liabilities (typically around 18% to 21.5%), which is substantially larger in percentage magnitude than short-term policy interest rates (typically 4% to 6.5%).
Therefore, ascending order from lowest to highest magnitude is Reverse Repo Rate < Repo Rate < MSFR < SLR.
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Question 78
Arrange the following books in the correct chronological order:
(a) Das Capital
(b) Value and Capital
(c) Capital and Growth
(d) Accumulation of Capital
Choose the correct option:
A(d), (b), (c), (a)
B(a), (b), (d), (c)
C(a), (b), (c), (d)
D(b), (a), (d), (c)
Answer:(B) (a), (b), (d), (c)
Explanation
The publication chronology of these foundational treatises on capital is:
Das Capital (a) — Karl Marx published Volume I in 1867.
Value and Capital (b) — J.R. Hicks published this landmark treatise on general equilibrium and ordinal demand in 1939.
The Accumulation of Capital (d) — Joan Robinson published her seminal work on post-Keynesian growth in 1956.
Capital and Growth (c) — J.R. Hicks published this comparative analysis of growth methods in 1965.
Thus, the correct sequence is (a) -> (b) -> (d) -> (c).
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Question 79
Arrange the following international environmental milestones in chronological order:
(a) Paris Climate Agreement
(b) Rio Earth Summit
(c) Brundtland Commission
(d) Kyoto Protocol
Choose the correct option:
A(a), (b), (c), (d)
B(b), (d), (a), (c)
C(d), (b), (c), (a)
D(c), (b), (d), (a)
Answer:(D) (c), (b), (d), (a)
Explanation
The chronological sequence of international environmental treaties and milestones is:
Brundtland Commission Report (c) — Our Common Future was published in 1987.
Rio Earth Summit (b) — United Nations Conference on Environment and Development (UNCED) convened in Rio de Janeiro in 1992.
Kyoto Protocol (d) — adopted under the UNFCCC framework in 1997.
Paris Climate Agreement (a) — adopted at COP21 in Paris in 2015.
Therefore, the correct chronological order is (c) -> (b) -> (d) -> (a).
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Question 80
Arrange the following Indian economic events in chronological order:
(a) First phase of Nationalisation of Commercial Banks
(b) Establishment of Narasimham Committee on banking system
(c) Enactment of FEMA Act
(d) Establishment of EXIM Bank of India
Choose the correct option:
A(a), (c), (d), (b)
B(a), (d), (b), (c)
C(a), (c), (b), (d)
D(a), (d), (c), (b)
Answer:(B) (a), (d), (b), (c)
Explanation
The chronological sequence of institutional and economic reforms in India is:
First phase of Bank Nationalisation (a) — 14 major commercial banks were nationalized on 19 July 1969.
Establishment of EXIM Bank of India (d) — set up in 1982 under the Export-Import Bank of India Act, 1981.
Narasimham Committee on Banking System (b) — Committee on the Financial System appointed in 1991.
Enactment of FEMA Act (c) — Foreign Exchange Management Act was passed in 1999, replacing FERA.
Hence, the correct sequence is (a) -> (d) -> (b) -> (c).
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Question 81
Assertion (A): For certain goods, the expenditure by the consumers decreases.
Reason (R): For such goods, the income elasticity of demand is high.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(C) (A) is true but (R) is false
Explanation
Evaluating the assertion and reason in consumer expenditure theory:
Assertion (A) is true because for inferior goods and Giffen goods, total consumer expenditure decreases as consumer income expands, since buyers substitute toward higher-quality alternatives.
Reason (R) is false because goods for which consumption and expenditure fall as income rises possess a negative income elasticity of demand (E_y < 0), not a high income elasticity. A high positive income elasticity (E_y > 1) characterizes luxury goods where expenditure rises more than proportionately.
Therefore, (A) is true but (R) is false.
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Question 82
Assertion (A): In classical model, investment demand is regarded as autonomous of changes in income or employment.
Reason (R): It is wage price flexibility which brings full employment in the classical model.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(B) Both (A) and (R) are true and (R) is not correct explanation of (A)
Explanation
Evaluating the classical macroeconomic model propositions:
Assertion (A) is true because in the classical system, investment demand is governed strictly by the real interest rate in the capital market (I = I(r)), functioning independently of current income or employment levels.
Reason (R) is true because flexible money wages and output prices ensure continuous clearing of the labor market, automatically restoring full employment.
While both statements are classical tenets, wage-price flexibility in the labor market does not explain why investment demand depends on interest rates rather than income in the capital market.
Thus, both (A) and (R) are true, but (R) is not the correct explanation of (A).
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Question 83
Assertion (A): Geometric Mean is theoretically considered as the best average to Construct Index Numbers.
Reason (R): Geometric mean is used if the range of observations are extremely large.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(B) Both (A) and (R) are true and (R) is not correct explanation of (A)
Explanation
In index number theory:
Assertion (A) is true because the Geometric Mean gives equal weight to equal proportional price changes and enables an index number formula to satisfy both the Time Reversal Test and the Factor Reversal Test (exemplified by Fisher Ideal Index).
Reason (R) is true because geometric mean dampens the distortionary impact of extreme observations compared to the arithmetic mean.
However, GM is theoretically superior for index numbers due to its mathematical consistency in tracking price ratios and satisfying axiomatic reversal tests, not merely due to the range of observations.
Hence, both (A) and (R) are true, but (R) is not the correct explanation of (A).
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Question 84
Assertion (A): CES production function covers large class of production functions.
Reason (R): CES production function has the property of constancy of elasticity of factor substitution.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(A) Both (A) and (R) are true and (R) is correct explanation of (A)
Explanation
The Constant Elasticity of Substitution (CES) production function developed by Arrow, Chenery, Minhas, and Solow (1961) is given by Q = A[δK^(-ρ) + (1-δ)L^(-ρ)]^(-1/ρ):
Reason (R) is true because the elasticity of substitution σ = 1 / (1 + ρ) is constant for any given set of parameters.
Assertion (A) is true because varying this constant substitution parameter generates major neoclassical production functions as limiting cases — Cobb-Douglas when σ = 1 (ρ = 0), Leontief fixed proportions when σ = 0 (ρ → ∞), and linear production functions when σ → ∞ (ρ = -1).
Constancy across the continuous range 0 <= σ <= ∞ explains why CES encompasses this wide family of functional forms.
Therefore, both (A) and (R) are true, and (R) correctly explains (A).
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Question 85
Assertion (A): Intellectual Property Rights were brought into the Uruguay Round Trade Negotiations.
Reason (R): International trade restrictions can be used to discourage the violation of intellectual property rights.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(B) Both (A) and (R) are true and (R) is not correct explanation of (A)
Explanation
In multilateral trade history:
Assertion (A) is true because the Uruguay Round (1986-1994) negotiated and incorporated Trade-Related Aspects of Intellectual Property Rights (TRIPS) into the WTO single undertaking.
Reason (R) is true because the WTO dispute settlement framework allows authorized retaliatory trade sanctions and tariff penalties to discipline intellectual property violations.
The official key designates Option B, noting that while both statements are accurate factual realities of international trade law, the general sanction mechanism is an enforcement feature of the WTO rather than the comprehensive historical explanation for incorporating TRIPS into the Uruguay Round.
Both (A) and (R) are true, and (R) is not the correct explanation of (A).
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Question 86
The problem relating to the burden of public debt has been dealt with by:
Select the correct answer from the options given below:
A(a) and (b)
B(b) and (c)
C(a) and (d)
D(b) and (d)
Answer:(A) (a) and (b)
Explanation
The theoretical debate on whether public debt imposes a true burden on future generations is classically identified with Abba P. Lerner and Evsey Domar:
Abba P. Lerner (1948) argued under functional finance that internal debt carries no direct net burden because taxes paid to service the debt equal payments received by domestic bondholders.
Evsey Domar (1944) published The Burden of the Debt and the National Income, proving that public debt sustainability depends on whether the economic growth rate exceeds the interest rate (g > r).
Thus, the burden of public debt has been centrally dealt with by (a) A.P. Lerner and (b) E.D. Domar.
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Question 87
Assertion (A): In order to control inflationary tendencies, RBI raises the repo rate.
Reason (R): By so doing, RBI wishes to control consumption demand.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(A) Both (A) and (R) are true and (R) is correct explanation of (A)
Explanation
In monetary policy transmission:
Assertion (A) is true because raising the policy repo rate increases the borrowing cost for commercial banks, transmitting higher lending rates across the banking system to contain inflation.
Reason (R) is true because higher interest rates disincentivize credit-financed consumer purchases and encourage household saving, moderating consumption expenditure and aggregate demand.
Because restraining consumption and investment demand is the primary transmission mechanism through which a repo rate hike cools inflationary pressures, (R) correctly explains (A).
Both (A) and (R) are true, and (R) is the correct explanation of (A).
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Question 88
Assertion (A): Inclusive growth is a must for a country like India.
Reason (R): India is an open economy with a significant external sector.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(B) Both (A) and (R) are true and (R) is not correct explanation of (A)
Explanation
In Indian development policy analysis:
Assertion (A) is true because inclusive growth is essential to lift millions out of poverty, bridge regional divides, generate rural and urban livelihoods, and reduce income inequality.
Reason (R) is true because post-1991 liberalization transformed India into an open economy with substantial global trade and financial integration.
However, being an open economy is not the cause or justification for inclusive growth. Inclusive growth is necessitated by domestic socio-economic challenges including poverty and unemployment.
Thus, both (A) and (R) are true, but (R) is not the correct explanation of (A).
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Question 89
Assertion (A): Parties to a dispute over property rights will be able to negotiate an economically optimal solution.
Reason (R): There are efficient, competitive markets and there are no transaction costs.
ABoth (A) and (R) are true and (R) is the correct explanation of (A)
BBoth (A) and (R) are true and (R) is not the correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
Explanation
According to the Coase Theorem (Ronald Coase, 1960):
When property rights are clearly established, competitive markets exist, and transaction costs are zero (Reason R), bargaining between affected parties will internalize any externality, leading to a Pareto efficient outcome regardless of who holds the initial rights.
Zero transaction costs and perfect information are the precise necessary conditions enabling parties to achieve this optimal negotiated settlement.
Therefore, both (A) and (R) are true, and (R) is the correct explanation of (A).
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Question 90
Assertion (A): Disguised unemployment is present in India.
Reason (R): Agricultural productivity at margin is close to zero.
ABoth (A) and (R) are true and (R) is correct explanation of (A)
BBoth (A) and (R) are true and (R) is not correct explanation of (A)
C(A) is true but (R) is false
D(A) is false but (R) is true
Answer:(A) Both (A) and (R) are true and (R) is correct explanation of (A)
Explanation
In development economics (Arthur Lewis, Ragnar Nurkse):
Assertion (A) is true because disguised unemployment is a defining structural feature of Indian agriculture, where family farms employ more workers than necessary.
Reason (R) is true because marginal physical productivity of surplus agricultural labor is zero or negligible, meaning agricultural output remains unchanged even if surplus workers are shifted elsewhere.
The negligible marginal productivity is the definitive economic criterion defining disguised unemployment.
Both (A) and (R) are true, and (R) is the correct explanation of (A).
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Question 91
Dynamic economies of scale do not include which one of the following?
From the global perspective, there seems to be a close association across countries between living standards and the share of resources devoted to industrial activities, at least up to a certain point. In very poor countries there is virtually no industrial activity at all, while the middle- and high-income countries devote 20-40 per cent of resources to industry. Only three countries in the world have become rich on agriculture alone: Australia, New Zealand and Canada. In all other countries, living standards have risen rapidly only as resources have shifted out of agriculture into industry and sophisticated services.
Furthermore, research also shows a close association across countries between the growth of industry and the growth of GDP; or more precisely, that GDP growth is faster the greater the excess of industrial growth relative to GDP growth; that is, when the share of industry in total GDP is rising the fastest. A cross-country regression across 131 developing countries over the period 2000-2005, with GDP growth (g) measured on the vertical axis and industrial growth (x) on the horizontal axis, gives the following linear result:
g = 2.529 + 0.394x, r² = 0.507
The equation indicates that a country with industrial growth one percentage point above average will have GDP growth 0.394 percentage points above average. The point where the regression line intersects the 45-degree line is approximately 4.5 per cent, separating slow-growing countries from faster-growing countries.
Why is industry the 'engine of growth'? Differences in GDP growth are largely accounted for by differences in labor productivity growth. First, industry is characterized by static economies of scale (large-scale production lowering average costs) and dynamic economies of scale (induced effects of output growth on capital accumulation, embodiment of new technology, and learning by doing). Second, non-industrial activities like agriculture are subject to diminishing returns; as surplus resources shift into expanding industry, the average product of labor rises in non-industrial activities as well. These relationships are known as Kaldor's Growth Laws.
AInduced effect of output growth on capital accumulation
BImprovement in quality of capital due to new technology
CThe labour intensive sector will experience increasing returns with growth of output
DA shift from less productive to more productive sector will lead to a rise in the average product of labour
Answer:(C) The labour intensive sector will experience increasing returns with growth of output
Explanation
According to the passage and Kaldor growth laws, dynamic economies of scale refer specifically to the induced effect that output growth has on capital accumulation, embodiment of new technical progress, and learning by doing in manufacturing.
Option C asserts that the labor-intensive sector experiences increasing returns, which contradicts Kaldor core thesis that increasing returns are concentrated in capital-intensive and manufacturing industries rather than traditional labor-intensive activities.
A — explicitly stated in the passage as a dynamic economy of scale.
B — explicitly stated in the passage as new technology embodied in capital.
C — correct choice because it does not represent dynamic economies of scale.
D — represents the structural reallocation effect between sectors.
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Question 92
Consider the following statements:
(a) The association between growth of industry and growth of GDP makes industry the 'engine of growth'
(b) Differences in GDP growth do not account for growth in labour productivity
(c) GDP growth rates are reflected in the growth rate of labour productivity
(d) The growth of industry is subject to increasing returns
Choose the correct option:
From the global perspective, there seems to be a close association across countries between living standards and the share of resources devoted to industrial activities, at least up to a certain point. In very poor countries there is virtually no industrial activity at all, while the middle- and high-income countries devote 20-40 per cent of resources to industry. Only three countries in the world have become rich on agriculture alone: Australia, New Zealand and Canada. In all other countries, living standards have risen rapidly only as resources have shifted out of agriculture into industry and sophisticated services.
Furthermore, research also shows a close association across countries between the growth of industry and the growth of GDP; or more precisely, that GDP growth is faster the greater the excess of industrial growth relative to GDP growth; that is, when the share of industry in total GDP is rising the fastest. A cross-country regression across 131 developing countries over the period 2000-2005, with GDP growth (g) measured on the vertical axis and industrial growth (x) on the horizontal axis, gives the following linear result:
g = 2.529 + 0.394x, r² = 0.507
The equation indicates that a country with industrial growth one percentage point above average will have GDP growth 0.394 percentage points above average. The point where the regression line intersects the 45-degree line is approximately 4.5 per cent, separating slow-growing countries from faster-growing countries.
Why is industry the 'engine of growth'? Differences in GDP growth are largely accounted for by differences in labor productivity growth. First, industry is characterized by static economies of scale (large-scale production lowering average costs) and dynamic economies of scale (induced effects of output growth on capital accumulation, embodiment of new technology, and learning by doing). Second, non-industrial activities like agriculture are subject to diminishing returns; as surplus resources shift into expanding industry, the average product of labor rises in non-industrial activities as well. These relationships are known as Kaldor's Growth Laws.
A(a), (b) and (c)
B(a) and (c) only
C(b), (c) and (d)
D(b) and (d) only
Answer:(B) (a) and (c) only
Explanation
Evaluating the statements against the passage on Kaldor Growth Laws:
Statement (a) is true because the close empirical correlation between industrial expansion and GDP growth establishes industry as the engine of growth.
Statement (c) is true because the passage explicitly notes that differences in GDP growth are largely accounted for by differences in the rate of growth of labor productivity.
Statement (b) is false because it contradicts statement (c) and the passage text.
Therefore, (a) and (c) only is the correct option.
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Question 93
Consider the following statements in relation to the figure and regression analysis:
(a) The 45° line would indicate equal correspondence between industrial growth rate and GDP growth rate
(b) GDP growth rate is the cause of industrial growth rate
(c) The excess of industrial growth rate over GDP growth rate is fuelling more GDP
(d) The dividing line of slow and fast growing economies is the industrial growth rate of 3.9%
Choose the correct option:
From the global perspective, there seems to be a close association across countries between living standards and the share of resources devoted to industrial activities, at least up to a certain point. In very poor countries there is virtually no industrial activity at all, while the middle- and high-income countries devote 20-40 per cent of resources to industry. Only three countries in the world have become rich on agriculture alone: Australia, New Zealand and Canada. In all other countries, living standards have risen rapidly only as resources have shifted out of agriculture into industry and sophisticated services.
Furthermore, research also shows a close association across countries between the growth of industry and the growth of GDP; or more precisely, that GDP growth is faster the greater the excess of industrial growth relative to GDP growth; that is, when the share of industry in total GDP is rising the fastest. A cross-country regression across 131 developing countries over the period 2000-2005, with GDP growth (g) measured on the vertical axis and industrial growth (x) on the horizontal axis, gives the following linear result:
g = 2.529 + 0.394x, r² = 0.507
The equation indicates that a country with industrial growth one percentage point above average will have GDP growth 0.394 percentage points above average. The point where the regression line intersects the 45-degree line is approximately 4.5 per cent, separating slow-growing countries from faster-growing countries.
Why is industry the 'engine of growth'? Differences in GDP growth are largely accounted for by differences in labor productivity growth. First, industry is characterized by static economies of scale (large-scale production lowering average costs) and dynamic economies of scale (induced effects of output growth on capital accumulation, embodiment of new technology, and learning by doing). Second, non-industrial activities like agriculture are subject to diminishing returns; as surplus resources shift into expanding industry, the average product of labor rises in non-industrial activities as well. These relationships are known as Kaldor's Growth Laws.
AOnly (a) and (c) are true
BOnly (a) and (b) are true
COnly (a), (b) and (d) are true
DOnly (b) and (d) are true
Answer:(A) Only (a) and (c) are true
Explanation
Interpreting the regression and graphical relationship described in the passage:
Statement (a) is true because a 45-degree line represents equal 1:1 correspondence where industrial growth rate equals GDP growth rate.
Statement (c) is true because the passage explicitly states that GDP growth is faster the greater the excess of industrial growth relative to GDP growth.
Statement (b) is false because industry growth is the causal driver of GDP growth, not the reverse.
Statement (d) is false because the passage identifies approximately 4.5 per cent as the dividing threshold, not 3.9%.
Hence, only (a) and (c) are true.
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Question 94
Which one of the following statements is not correct for middle and highly developed countries?
From the global perspective, there seems to be a close association across countries between living standards and the share of resources devoted to industrial activities, at least up to a certain point. In very poor countries there is virtually no industrial activity at all, while the middle- and high-income countries devote 20-40 per cent of resources to industry. Only three countries in the world have become rich on agriculture alone: Australia, New Zealand and Canada. In all other countries, living standards have risen rapidly only as resources have shifted out of agriculture into industry and sophisticated services.
Furthermore, research also shows a close association across countries between the growth of industry and the growth of GDP; or more precisely, that GDP growth is faster the greater the excess of industrial growth relative to GDP growth; that is, when the share of industry in total GDP is rising the fastest. A cross-country regression across 131 developing countries over the period 2000-2005, with GDP growth (g) measured on the vertical axis and industrial growth (x) on the horizontal axis, gives the following linear result:
g = 2.529 + 0.394x, r² = 0.507
The equation indicates that a country with industrial growth one percentage point above average will have GDP growth 0.394 percentage points above average. The point where the regression line intersects the 45-degree line is approximately 4.5 per cent, separating slow-growing countries from faster-growing countries.
Why is industry the 'engine of growth'? Differences in GDP growth are largely accounted for by differences in labor productivity growth. First, industry is characterized by static economies of scale (large-scale production lowering average costs) and dynamic economies of scale (induced effects of output growth on capital accumulation, embodiment of new technology, and learning by doing). Second, non-industrial activities like agriculture are subject to diminishing returns; as surplus resources shift into expanding industry, the average product of labor rises in non-industrial activities as well. These relationships are known as Kaldor's Growth Laws.
AThese devote on an average 30 percent of the resources to industrial activity
BGrowth of industrial activity involves shift of resources from agriculture to industry
CShift of resources is uniform between agriculture, industry and higher order services for higher growth
DAustralia, Canada and New Zealand have developed due to growth of agriculture alone
Answer:(C) Shift of resources is uniform between agriculture, industry and higher order services for higher growth
Explanation
Analyzing the claims against the passage:
Statement (3) is false because structural resource reallocation is not uniform. Resources shift progressively out of diminishing-returns agriculture into increasing-returns manufacturing and sophisticated services.
Statement (1) is correct because middle- and high-income countries devote 20-40 per cent (averaging 30 per cent) of resources to industry.
Statement (2) is correct because industrial growth inherently draws surplus labor and capital from agriculture.
Statement (4) is directly confirmed by the passage noting Australia, Canada, and New Zealand as the only three countries that became rich on agriculture alone.
Thus, Statement C is the incorrect statement.
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Question 95
Which one of the following statements is correct according to the passage?
From the global perspective, there seems to be a close association across countries between living standards and the share of resources devoted to industrial activities, at least up to a certain point. In very poor countries there is virtually no industrial activity at all, while the middle- and high-income countries devote 20-40 per cent of resources to industry. Only three countries in the world have become rich on agriculture alone: Australia, New Zealand and Canada. In all other countries, living standards have risen rapidly only as resources have shifted out of agriculture into industry and sophisticated services.
Furthermore, research also shows a close association across countries between the growth of industry and the growth of GDP; or more precisely, that GDP growth is faster the greater the excess of industrial growth relative to GDP growth; that is, when the share of industry in total GDP is rising the fastest. A cross-country regression across 131 developing countries over the period 2000-2005, with GDP growth (g) measured on the vertical axis and industrial growth (x) on the horizontal axis, gives the following linear result:
g = 2.529 + 0.394x, r² = 0.507
The equation indicates that a country with industrial growth one percentage point above average will have GDP growth 0.394 percentage points above average. The point where the regression line intersects the 45-degree line is approximately 4.5 per cent, separating slow-growing countries from faster-growing countries.
Why is industry the 'engine of growth'? Differences in GDP growth are largely accounted for by differences in labor productivity growth. First, industry is characterized by static economies of scale (large-scale production lowering average costs) and dynamic economies of scale (induced effects of output growth on capital accumulation, embodiment of new technology, and learning by doing). Second, non-industrial activities like agriculture are subject to diminishing returns; as surplus resources shift into expanding industry, the average product of labor rises in non-industrial activities as well. These relationships are known as Kaldor's Growth Laws.
AThere is a positive relation between living standard and resources devoted to industrial activity in few countries
BThere is a close association between living standards and resources utilized
CThe relation between living standards and resources devoted to industrial activity is globally true
DThere is little association between living standards and resources utilized
Answer:(C) The relation between living standards and resources devoted to industrial activity is globally true
Explanation
The opening sentence of the passage states:
"From the global perspective, there seems to be a close association across countries between living standards and the share of resource devoted to industrial activities, at least up to a certain point."
This confirms that the positive relationship between living standards and resources devoted to industrial development is globally true across nations, rather than limited to a few countries.
A — incorrect because the passage frames this as a global perspective across nations.
B and D — vague formulations that omit the specific reference to industrial activity.
C — correct. Confirms the cross-country global relationship.
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Question 96
Which is the range of the SDG Index score for states in India?
The SDGs are global goals, built upon the erstwhile Millennium Development Goals. They are exhaustive, universal and integrated, emphasizing core areas of poverty and inequality, economic growth, innovation, sustainable consumption and production, climate change, peace and justice, and partnerships by implementing a comprehensive array of schemes. Flagship programmes of the Government of India such as Swachh Bharat Mission (SBM), Beti Bachao Beti Padhao (BBBP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan-Dhan Yojana (PMJDY), Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY), and Pradhan Mantri Ujjwala Yojana (PMUY) have substantially contributed to India's progress.
In the federal context of India, programmes are implemented at the level of States and Union Territories. NITI Aayog developed the SDG India Index to track the progress of all States and UTs across 13 out of 17 SDGs (excluding Goals 12, 13, 14, and 17 due to unavailability of comparable data). The index measures performance across 62 select indicators, with scores ranging from 0 to 100. States with scores of 65 and above are classified as Front-Runners, those in the range of 50-64 as Performers, and those below 50 as Aspirants. States achieving a score of 100 are designated as Achievers. The SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs.
Financing these goals requires an estimated US to US trillion per year globally and US.9 trillion per year in developing countries. Current investment in developing countries is around US.4 trillion, leaving an annual financing gap of US.5 trillion (UNCTAD, 2014).
A42-69
B57-68
C42-57
D42-68
Answer:(A) 42-69
Explanation
The passage states verbatim:
"The SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs."
A. 42-69 — correct. The exact range for States reported by NITI Aayog.
B. 57-68 — the range for Union Territories (UTs), not States.
C and D — incorrect numeric ranges.
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Question 97
Which of the following is not correct about the SDGs Index constructed by NITI Aayog?
The SDGs are global goals, built upon the erstwhile Millennium Development Goals. They are exhaustive, universal and integrated, emphasizing core areas of poverty and inequality, economic growth, innovation, sustainable consumption and production, climate change, peace and justice, and partnerships by implementing a comprehensive array of schemes. Flagship programmes of the Government of India such as Swachh Bharat Mission (SBM), Beti Bachao Beti Padhao (BBBP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan-Dhan Yojana (PMJDY), Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY), and Pradhan Mantri Ujjwala Yojana (PMUY) have substantially contributed to India's progress.
In the federal context of India, programmes are implemented at the level of States and Union Territories. NITI Aayog developed the SDG India Index to track the progress of all States and UTs across 13 out of 17 SDGs (excluding Goals 12, 13, 14, and 17 due to unavailability of comparable data). The index measures performance across 62 select indicators, with scores ranging from 0 to 100. States with scores of 65 and above are classified as Front-Runners, those in the range of 50-64 as Performers, and those below 50 as Aspirants. States achieving a score of 100 are designated as Achievers. The SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs.
Financing these goals requires an estimated US to US trillion per year globally and US.9 trillion per year in developing countries. Current investment in developing countries is around US.4 trillion, leaving an annual financing gap of US.5 trillion (UNCTAD, 2014).
AIt includes 13 SDGs
BIt has 62 indicators
CGoals 12 and 14 are excluded from it
DThe range of the index is 0 to 1
Answer:(D) The range of the index is 0 to 1
Explanation
Reviewing the features of the NITI Aayog SDG India Index in the passage:
The passage states that "The scores varies from 0 to 100", meaning the scale is from 0 to 100, not 0 to 1.
Statement (1) is correct because the index tracks progress across 13 out of 17 SDGs.
Statement (2) is correct because it captures parameters across a set of 62 select indicators.
Statement (3) is correct because Goals 12, 13, 14, and 17 were excluded due to data constraints.
Therefore, Statement D is not correct.
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Question 98
Which of the following is not true for the Sustainable Development Goals (SDGs)?
The SDGs are global goals, built upon the erstwhile Millennium Development Goals. They are exhaustive, universal and integrated, emphasizing core areas of poverty and inequality, economic growth, innovation, sustainable consumption and production, climate change, peace and justice, and partnerships by implementing a comprehensive array of schemes. Flagship programmes of the Government of India such as Swachh Bharat Mission (SBM), Beti Bachao Beti Padhao (BBBP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan-Dhan Yojana (PMJDY), Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY), and Pradhan Mantri Ujjwala Yojana (PMUY) have substantially contributed to India's progress.
In the federal context of India, programmes are implemented at the level of States and Union Territories. NITI Aayog developed the SDG India Index to track the progress of all States and UTs across 13 out of 17 SDGs (excluding Goals 12, 13, 14, and 17 due to unavailability of comparable data). The index measures performance across 62 select indicators, with scores ranging from 0 to 100. States with scores of 65 and above are classified as Front-Runners, those in the range of 50-64 as Performers, and those below 50 as Aspirants. States achieving a score of 100 are designated as Achievers. The SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs.
Financing these goals requires an estimated US to US trillion per year globally and US.9 trillion per year in developing countries. Current investment in developing countries is around US.4 trillion, leaving an annual financing gap of US.5 trillion (UNCTAD, 2014).
APoverty and inequality
BClimate change
CMillennium Development Goals
DSustainable consumption
Answer:(C) Millennium Development Goals
Explanation
The Millennium Development Goals (MDGs) were the predecessor development targets (2000-2015) upon which the SDGs were built, rather than being an internal SDG goal or target itself.
The passage explicitly notes that the 17 SDGs emphasize poverty and inequality (Goal 1 & 10), climate change (Goal 13), and sustainable consumption and production (Goal 12).
A, B, and D — core thematic pillars of the SDGs.
C. Millennium Development Goals — correct choice because MDGs are the historical antecedent, not an SDG.
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Question 99
The SDG Index of NITI Aayog classifies the states/UTs into different categories. Match the category with the respective score:
The SDGs are global goals, built upon the erstwhile Millennium Development Goals. They are exhaustive, universal and integrated, emphasizing core areas of poverty and inequality, economic growth, innovation, sustainable consumption and production, climate change, peace and justice, and partnerships by implementing a comprehensive array of schemes. Flagship programmes of the Government of India such as Swachh Bharat Mission (SBM), Beti Bachao Beti Padhao (BBBP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan-Dhan Yojana (PMJDY), Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY), and Pradhan Mantri Ujjwala Yojana (PMUY) have substantially contributed to India's progress.
In the federal context of India, programmes are implemented at the level of States and Union Territories. NITI Aayog developed the SDG India Index to track the progress of all States and UTs across 13 out of 17 SDGs (excluding Goals 12, 13, 14, and 17 due to unavailability of comparable data). The index measures performance across 62 select indicators, with scores ranging from 0 to 100. States with scores of 65 and above are classified as Front-Runners, those in the range of 50-64 as Performers, and those below 50 as Aspirants. States achieving a score of 100 are designated as Achievers. The SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs.
Financing these goals requires an estimated US to US trillion per year globally and US.9 trillion per year in developing countries. Current investment in developing countries is around US.4 trillion, leaving an annual financing gap of US.5 trillion (UNCTAD, 2014).
A(a)-(iv), (b)-(i), (c)-(iii), (d)-(ii)
B(a)-(ii), (b)-(iii), (c)-(i), (d)-(iv)
C(a)-(i), (b)-(iv), (c)-(ii), (d)-(iii)
D(a)-(iii), (b)-(ii), (c)-(iv), (d)-(i)
Answer:(C) (a)-(i), (b)-(iv), (c)-(ii), (d)-(iii)
Explanation
The passage defines the NITI Aayog SDG India Index classification thresholds as follows:
(a) Performers: score in the range of 50-64 -> (a)-(i)
(b) Aspirants: score less than 50 -> (b)-(iv)
(c) Front-Runners: score equal to or greater than 65 -> (c)-(ii)
(d) Achievers: score of 100 -> (d)-(iii)
The resolved mapping is (a)-(i), (b)-(iv), (c)-(ii), (d)-(iii), which corresponds to Option C.
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Question 100
Which of the following Government of India schemes contribute to India progress towards the SDGs according to the passage?
The SDGs are global goals, built upon the erstwhile Millennium Development Goals. They are exhaustive, universal and integrated, emphasizing core areas of poverty and inequality, economic growth, innovation, sustainable consumption and production, climate change, peace and justice, and partnerships by implementing a comprehensive array of schemes. Flagship programmes of the Government of India such as Swachh Bharat Mission (SBM), Beti Bachao Beti Padhao (BBBP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan-Dhan Yojana (PMJDY), Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY), and Pradhan Mantri Ujjwala Yojana (PMUY) have substantially contributed to India's progress.
In the federal context of India, programmes are implemented at the level of States and Union Territories. NITI Aayog developed the SDG India Index to track the progress of all States and UTs across 13 out of 17 SDGs (excluding Goals 12, 13, 14, and 17 due to unavailability of comparable data). The index measures performance across 62 select indicators, with scores ranging from 0 to 100. States with scores of 65 and above are classified as Front-Runners, those in the range of 50-64 as Performers, and those below 50 as Aspirants. States achieving a score of 100 are designated as Achievers. The SDG Index Score ranges between 42 and 69 for States and between 57 and 68 for UTs.
Financing these goals requires an estimated US to US trillion per year globally and US.9 trillion per year in developing countries. Current investment in developing countries is around US.4 trillion, leaving an annual financing gap of US.5 trillion (UNCTAD, 2014).
A(a) and (b)
B(a) and (c)
C(c) and (d)
D(b) and (d)
Answer:(A) (a) and (b)
Explanation
The passage explicitly lists the flagship national programmes contributing to India SDG progress:
"Current flagship policies and programmes of Government of India such as Swachh Bharat Mission (SBM), Beti Bachao Beti Padhao (BBBP), Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan-Dhan Yojana (PMJDY), Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY) and Pradhan Mantri Ujjwala Yojana (PMUY) have substantially contributed to India progress in this regard."
From the given options, (a) Swachh Bharat Mission and (b) Pradhan Mantri Ujjwala Yojana are explicitly named in the text.
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