Business Economics MCQ Sem 5: TYBCOM Business Economics

Business Economics MCQ Sem 5 | TYBCOM Business Economics Mumbai University

Since 1951, India has been a                    economy.

  1. Socialist   
  2.  Mixed 
  3. Capitalist     
  4. Feudal

The fiscal crisis faced by the Indian economy in the 1990s was caused primarily by

  1. Widening gap between imports and exports
  2. Difference between savings and investments
  3. Widening gap between government expenditure and revenue
  4. Difference between aggregate demand and aggregate supply

Which of the following factors was one of the primary causes of the balance of payment crisis in 1991?

  1. Low rate of inflation   
  2. Surplus budget
  3. High-interest rate
  4. Rising oil prices and poor remittances

Which of the following sentences would best describe the Indian economy in 1990-91?

  1. High inflation, low foreign exchange reserves
  2. Low inflation, low foreign exchange reserves
  3. Huge current account deficit, fiscal surplus
  4. Current account surplus, huge fiscal deficit

Which of the following measures was adopted in 1991 to stabilize the economy?

  1. Banking sector reforms 
  2. Capital market reforms
  3. Control of inflation
  4. Insurance reforms

One of the measures adopted to control inflation in 1990-91 was

  1. Lowering of CRR and SLR
  2. Lowering of bank rate
  3. Raising CRR and SLR 
  4. Restricting imports of essential commodities

Which of the following measures did not form a part of fiscal correction in 1991?

  1. Increasing tax collection
  2. Cutting Down subsidies
  3. Reducing budgetary support to public enterprises   
  4. Raising tax rates

Which of the following measures was implemented by the government in order to reduce the current account deficit?

  1. Revaluation of the rupee  
  2. Strict exchange control
  3. Devaluation of the rupee
  4. Import restrictions were increased

Structural reforms are________________.

  1. Long-term measures 
  2. Improve the supply side of the economy
  3. Remove growth bottlenecks   
  4.  All the above

 Which of the following was not a feature of the New Industrial Policy 1991?

  1. Abolition of industrial licensing
  2. Setting up of new public sector enterprises
  3. Permitted foreign investment 
  4. Removal of MRTP limit

One of the policies adopted to make the public sector more efficient was______.

  1. Raising fresh equity from the market
  2. Increasing government’s shareholding in public enterprises
  3. Maintaining public sector monopoly
  4. Increasing operational control on public enterprises by the government

Which of the following is an important banking sector reform introduced in 1991?

  1. a)Raising of SLR and CRR 
  2. RBI-determined interest rates
  3. Introduction of prudential norms
  4. Restricting imports of essential commodities

Capital adequacy norms help to_________.

  1. a)Increase bank’s profits
  2. Maintain financial stability 
  3. Control inflation
  4. Reduce balance of payments deficit

Capital market reform includes

  1. Setting up of SEBI
  2. Special recovery tribunals
  3. Introduction of capital adequacy norms
  4. Deregulation of interest rates

The FDI limit in the insurance sector in India is

  1. 100%
  2. 79%
  3. 49%
  4. 26%

Which of the following is true of social infrastructure?

  1. It includes the education and health network
  2. It is aimed at improving quality of life
  3. It is an investment in human capital
  4. All the above

Which of the following describes the change in India after 1991?

  1. Reduced private investment in education and health
  2. Increased job security
  3. Reduced subsidies to the social sector in relative terms
  4. Increased formal jobs creation

According to the Human Development Report 2016, India’s HDI rank is ______among 188 countries.

  1. 131
  2. 125 
  3. 141
  4. 100

Which of the following is not true of the Right to Education Act?

  1. Free education to all children between 6 and 14 years
  2. It was enacted in 2009
  3. It is an adult literacy programme
  4. It is aimed at providing quality elementary education

The scheme for providing residential schools as an elementary level for girls is

  1. National programme for Education of Girls at Elementary Level
  2. Model Schools Scheme
  3. Rashtriya Madhyamik Shisha Abhiyan
  4. Kasturba Gandhi Balika Vidyalaya

The scheme for improving access to secondary education is

  1. National Programme for Education of Girls at Elementary Level
  2. Model Schools Scheme
  3. Rashtriya Madhyamik Shisha Abhiyan
  4. Kasturba Gandhi Balika Vidyalaya

Community Health Centres are located at the________level of public health infrastructure.

  1. Primary
  2. Secondary
  3. Tertiary
  4. None of the above

AIIMS is at the_______level of public health infrastructure.

  1. Primary
  2. Secondary
  3. Tertiary
  4. None of the above

The_______provides a reference point for the functioning of the public health centers.

  1. Indian Public Health Standards 
  2. Indian Public Health Guidelines
  3. Indian public Health Manual    
  4. Indian Public Health Rules

Which of the following is a programme aimed at controlling the spread of communicable diseases?

  1. National Oral Health Programme                              
  2. National Mental Health Programme
  3. National TB Control Programme
  4. National Programme for prevention and Control of Deafness

             is a fund that financially supports poor patients suffering from major life-threatening illnesses.

  1. Rashtriya Swasthya Bima Yojana 
  2. Rashtriya Arogya Nidhi
  3. Pradhan MantriSwasthyaYojana                                
  4. All the above

Rashtriya Swasthya Bima Yojana provides health insurance coverage to_____

  1. Workers in the unorganized sector   
  2. Workers in the organized sector
  3. The entire population 
  4. Only women and children

Which of the following statements best describes economic development?

  1. It always accompanies economic growth
  2. It indicates the increase in GDP
  3. It is reflected in the quality of life of the people
  4. It is a quantitative concept

Which of the following is not included in UNDP’s HDI composite?

  1. Culture
  2. Education 
  3. Health
  4. Standard of living

Does sustainable development include which of the following?

  1. Economic development
  2. Social development
  3. Environmental development
  4. All the above

             is responsible for coordinating the SDG’s in India

  1. Planning Commission
  2. Ministry of Human Resource Development
  3. NITI Aayog
  4. Ministry of Finance

_____is an initiative to make India a manufacturing hub.

  1. Skill India 
  2. NIT Aayog
  3. Invest India 
  4. Make in India

The scheme for skill training of youth to be implemented through the National Skill Development Corporation is_____.

  1. National Skill Development Mission
  2. Pradhan Mantri Kaushal Vikas Yojana
  3. SkillLoanScheme 
  4. All the above

Which of the following statements best defines FDI?

  1. Buying shares of companies in a foreign country without gaining control over management
  2. Loans from multilateral institutions like IMF and World Bank
  3. Investment in foreign assets to acquire lasting business interest
  4. Foreign currency deposits of non-resident citizens

Which of the following constitutes foreign direct investment?

  1. Purchase of stocks
  2. Reinvestment of earning by a wholly-owned subsidiary abroad
  3. The lending of Fund to the foreign subsidiary
  4. All the above

Which of the following best describes horizontal foreign direct investment?

  1. FDI into industry that provide inputs to the firm
  2. FDI into industry that uses the firm’s output
  3. Long term lending to a foreign firm
  4. FDI in the same industry abroad as the foreign investor firm

Which of the following is not one of the benefits of FDI?

  1. Culture of consumerism
  2. Infrastructure development 
  3. Transfer of technology 
  4. Sectoral development

Which of the following are advantages of TNCs?

  1. Direct and Indirect employment generation
  2. Increased competition
  3. Industrial expansion
  4. All the above

The government institution that is responsible for the formulation of FDI policy in India is

  1. Foreign Investment Promotion Board
  2. The department of Industrial Policy and Promotion
  3. The Ministry of External Affairs
  4. The RBI

Which of the following was not a part of the FDI policy 2017?

  1. Strengthening the FIPB
  2. Introduction of Foreign Investment Facilitation Portal
  3. Introduction of Standard Operating Procedures
  4. Issue of Convertible Notes by start-ups

Chapter 2. Agriculture

The objective of National Agriculture Policy 2000 is to achieve an agriculture growth rate of

  1. 3%
  2. 4%
  3. 5%

The new policy aims to_______.

  1. Liberalize internal trade 
  2. exports 
  3. both

The average agricultural growth rate since 2000 is_________

  1. Above 4%
  2. less than 4 percent  
  3. 4 percent

 Agricultural prices in India are________.

  1. Very certain  
  2. uncertain  
  3. very remunerative

Agricultural price policy is required to________

  1. Provide incentives to farmers 
  2. to encourage farmers to spend more
  3. to increase income inequality

Minimum Support Price guarantees the farmers with

  1. High income
  2. Floor price
  3. Competitive price

The issue price is at which the government supplies food grains

  1. In the open market 
  2. to the middleman
  3. to ration shops

Fair price shops protect the interest of_______.

  1. Poor farmers
  2. poor consumers
  3. poor traders

Price policy mainly benefits_______.

  1. Small farmers 
  2. marginal farmers 
  3. large farmers

 The Major part of the agricultural credit is supplied by

  1. Money lenders
  2. Commercial banks
  3. Co-operate banks

RRB’s were established to provide credit to

  1. Only to non-agricultural activities in rural areas
  2. Both agricultural and non-agricultural activities
  3. Only to agricultural activities

Kisan credit card was introduced by

  1. RBI 
  3. Co-operative banks

Non-institutional credit very often leads to________.

  1. Indebtedness 
  2. exploitation of borrowers
  3. Loss of land and property
  4. all the above

 Farmers require long-term credit for______.

  1. Consumption expenditure 
  2. purchase of land
  3. Purchasing seeds and fertilizers

Regional Rural Banks were established to provide finance to_______.

  1. Small and marginal farmers 
  2. village artisans
  3. Agricultural labourers
  4. All the above

 Agricultural market faces the problem of________.

  1. Seasonal price fluctuation 
  2. Low prices when the crop fails
  3. High prices when there is a bumper crop

Demand for agricultural commodities______.

  1. Very elastic 
  2. unit elastic
  3. less elastic

 Regulated markets aim at protecting__________.

  1. Consumers
  2. Farmers 
  3. Traders
  4. Both (a) and (b)

 AGMARK enables to ensure________.

  1. Quality of product 
  2. better price    
  3. both (a) and (b)

Market information reduces exploitation of________.

  1. Farmers
  2. Traders 
  3. Both (a) and (b)

Chapter: 3 The Industry and service sector During Post Reform Period

Which of the following is not an objective of the Competition Act 2002?

  1. Prohibition of anti-competitive agreements 
  2. Regulation of combinations
  3. Control of monopolies    
  4. Prohibition of abuse of dominant position

Competition advocacy refers to_______.

  1. Control of monopolies
  2. Restricting investments through licensing
  3. Control of unreasonable profits
  4. Promoting a competitive culture

Which of the following statements is not true of the PSUs in India?

  1. They have generated large scale employment
  2. They have high returns on investment
  3. They have saved foreign exchange
  4. They have created a diversified industrial base for India

Which of the following is a problem faced by the PSUs in India?

  1. Mounting losses 
  2. Underutilization of capacity c)Administrative defects 
  3. All the above

 The Central Government department responsible for disinvestment is

  1. Department of Investment and Public Asset Management
  2. Department of Commerce
  3. Department of Industrial Policy and Promotion
  4. Department of Revenue

Which of the following is not a function of the DIPAM?

  1. Advising the government of matters related to CPSE
  2. All matters relating to the sale of central government equity through offer for sale or private  placement 
  3. Decisions on the recommendations of Administrative Ministries, NITI Aayog for disinvestment
  4. Promotion of foreign direct investment.

Offer of shares by a listed CPSE or the government out of its shareholding or a combination of both to the public for subscription is done through_____.

  1. Initial Public Offering 
  2. Offer for Sale
  3. Further Public Offering 
  4. Strategic Sale

Only financial institutions can participate in________.

  1. Initial Public Offering   
  2. Offer for Sale
  3. Further Public Offering
  4. Institutional Placement Programme

The MSME Act was passed in________.

  1. 2005
  2. 2002
  3. 2008  
  4. 2006

A separate ministry for small industries was set up in______.

  1. 1991
  2. 1999
  3. 2007
  4. 2005

                is the nodal development agency for the MSME sector.

  1. Divisional Commissioner MSME 
  2. Development Commissioner MSME
  3. Directorate General MSME 
  4. Development Council MSME

The scheme to improve ease of doing business in the MSME sector is________.

  1. SFURTI 
  2. UAM
  3. CLCSS

The law enacted as an outcome of the Bhopal Gas tragedy is_______.

  1. Public Liability Insurance Act
  2. The Environment (Protection) Act
  3. The Air (Prevention and Control of Pollution) Act 
  4. All the above

Which of the following is not true of toxic wastes in India?

  1. There are highly efficient systems for their disposal
  2. They can be caused by e-wastes
  3. Handling them can be fatal at times
  4. These constitute 10-15% of industrial wastes

Bharat Stage IV emission standards were adopted in_______.

  1. 1991
  2. 2001
  3. 2015
  4. 2005

Air pollution is caused by_________.

  1. The release of harmful gases 
  2. Solid and liquid particulate materials
  3. Smoke emission
  4. All the above

Which of the following is not true about global warming?

  1. It is causing glaciers to melt     
  2. It has put human lives at threat
  3. It has prevented the extinction of wildlife
  4. It has resulted in frequent natural calamities

Which of the following is not a characteristic of the services sector?

  1. Output includes intangible products 
  2. Is the fastest-growing sector globally
  3. Produces primary products     
  4. Involves a wide range of activities

Which of the following activities does not belong to the services sector in India?

  1. Retail trade 
  2. Real estate
  3. Insurance 
  4. Automobile

 In 2017-18, the services sector’s contribution to the GVA was______.

  1. 55.2% 
  2. 65.2%
  3. 59%
  4. 45%

The services sector’s contribution to employment as a percentage of total employment, in 2015-16 was 

  1. 40%
  2. 32%
  3. 50%
  4. 25%

The FDI limit in multi-brand retailing is________.

  1. 49%
  2. 74
  3. 100% 
  4. 51%

 The FDI limit in single-brand retailing is_______.

  1. 49%
  2. 74%
  3. 100%
  4. 51%

The healthcare industry includes______.

  1. Hospitals 
  2. Health insurance
  3. Pharmaceutical companies     
  4. All the above

 The FDI limit permitted for all health-related services under automatic route is 

  1. 51% 
  2. 100%
  3. 74%
  4. 26%

Which of the following is not a characteristic of the Indian health care industry?

  1. Every citizen has access to high-quality services
  2. Inadequate infrastructure
  3. High incidence of diseases
  4. Inadequate insurance coverage

Which of the following is growth potential in the healthcare industry in India?

  1. Growing insurance market
  2. Expanding medical tourism
  3. Telemedicine
  4. All the above

The type of tourism that helps conserve natural diversity is_______.

  1. Ecotourism   
  2. Heritage tourism
  3. Adventure tourism     
  4. Medical tourism

The IRDA Act was passed in the year_____.

  1. 1999
  2. 1998     
  3. 2000
  4. None of the above

Insurance Regulatory and Development Authority was established in which of the following year?

  1. 1999
  2. 2000
  3. 2001
  4. None of the above

How much FDI is allowed in the Insurance companies?

  1. 26%
  2. 49%  
  3. 51%   
  4. 75%

Which of the following committee was established to suggest insurance sector reforms?

  1. Malhotra Committee  
  2. Rangarajan Committee
  3. Narashimham committee
  4. Strategic Sale

Chapter 4: Banking and Financial market

A scheduled bank is one which has________.

  1. Paid-up capital and reserve not less than Rs. 5 lakh
  2. Term deposit of Rs. 5 lakh
  3. Demand deposit of Rs. 5 lakh

Public sector banks include________

  1. only the State bank of India    
  2. only nationalized banks
  3. only Regional Rural Banks 
  4. all the above

The population for every bank branch in 2015 was______.

  1. 64,000
  2. 16,000
  3. 10,300

To promote financial inclusion, on 28th August 2014, the following new scheme was introduced____.

  1. GaribiHatao
  2. The Pradhan Mantri Jan Dhan Yojana(PMJDY)
  3. Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA)

Which one of the following schemes were introduced under operational technology?

  1. ATMs 
  2. Mobile banking
  3. Electronic Fund Transfer (EFT)  
  4. All the above

Since 1991 commercial banks have succeeded in_______.

  1. expanding branches 
  2. deposit mobilization
  3. increase in lending
  4. all the above

In 2017 advances of commercial banks to the priority, the sector was____.

  1. 40%  
  2. less than 40%
  3. more than 40%

Financial inclusion aims at providing financial services to______.

  1. Industrialists
  2. Poor people
  3. Indian investors abroad

In recent years Indian banks have increased their efficiency by

  1. using information technology
  2. by reducing the number of employees
  3. by increasing the number of branches

In recent years the number of RRBs has_____.

  1. increased
  2. decreased 
  3. remained constant

Virtual banking aims at rendering banking services through_____.

  1. branch expansion
  2. advancing cheap credit 
  3. use of IT services

The IRDA Act was passed in the year______.

  1. 1999
  2. 1998
  3. 2000
  4. None of the above

Insurance Regulatory and Development Authority was established in which of the following year? 

  1. 1999 
  2. 2000
  3. 2001
  4. None of the above

How much FDI is allowed in the Insurance Companies?

  1. 26%
  2. 49%
  3. 51%
  4. 75%

Which of the following committee was established to suggest insurance sector reforms?

  1. Malhotra Committee  
  2. Rangarayan Committee
  3. Narashimham Committee
  4. Raja Chelliah committee

Which of the following is a part of the organized sector of the Indian money market?

  1. Indigenous bankers   
  2. Loan companies
  3. Call money market  
  4. Moneylenders

Which of the following is not the main player in the Indian money market?

  1. Government   
  2. RBI
  3. Commercial banks   
  4. Over the Counter Exchange of India

Which of the following are the main participants in the call money market?

  1. Commercial banks   
  2. Co-operative banks
  3. Primary dealers  
  4. All the above

Which of the following is not the feature of commercial bills?

  1. Short term 
  2. Trade bills
  3.  Issued by RBI     
  4. The high degree of liquidity

Which of the following money market instrument is issued by commercial banks?

  1. CPs 
  2. Commercial bills
  3. CDs 
  4. Treasury bills

Which of the following measures absorb liquidity from the financial system?

  1. Repo
  2. Reverse repo
  3. MSF
  4. Buying of securities under OMO

Capital market is a market for______.

  1. Short term funds 
  2. Long term funds
  3. Medium-term funds  
  4. Medium and long term funds

Which of the following does not constitute the structure of the capital market in India?

  1. Gilt-edged market
  2. Industrial securities market
  3. RBI
  4. Mutual funds

The primary market does not include_______.

  1. Equity issues   
  2. GDR issues
  3. Screen-based trading 
  4. Debt issues

Which of the following measures constitute primary market reforms?

  1. Abolition of the controller of capital issues
  2. Setting up of NSE
  3. Setting up of OTCEI
  4. None of the above

Secondary market reform does not include_____.

  1. Screen-based trading    
  2. LAF
  3. Depository system
  4. Rolling settlement

Foreign Institutional Investors (FIIs) are allowed to invest in_______.

  1. only equity shares   
  2. only debt market 
  3. both the above markets

 The Over the Counter Exchange of India(OTCEI) allows the companies to register only in____.

  1. OTCEI   
  2. OTCEI and NSE
  3. OTCEI and BSE

Mutual Funds play an important role in the Indian capital market as_____.

  1. A speculator in the stock market
  2. Investment avenue for small investors
  3. The promoter of large scale industries

Business Economic Notes Click Here

Reference: Manan Prakashan, Smart Notes


business economics mcq


  1. Excellent teaching.I thoroughly grasp what u taught .tysm for your helpful teaching .completely worth learning

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