18 Economy questions from the official UPSC 2015 Prelims paper, each with the verified answer key and an explanation.
1–18 of 18
Q1·Economy·2015·Money, Banking and Financial Markets
With reference to the Indian Renewable Energy Development Agency Limited (IREDA), which of the following statements is/are correct? 1. It is a Public Limited Government Company. 2. It is a Non-Banking Financial Company. Select the correct answer using the code given below.
Correct: C
IREDA is a public limited Government company and is registered as a Non-Banking Financial Company financing renewable-energy projects.
Q2·Economy·2015·Geographical Indications
Which of the following has/have been accorded 'Geographical Indication' status? 1. Banaras Brocades and Sarees 2. Rajasthani Daal-Bati-Churma 3. Tirupathi Laddu Select the correct answer using the code given below.
Correct: C
Banaras Brocades and Sarees and Tirupati Laddu have GI status. Rajasthani Daal-Bati-Churma is not the GI item in this list.
Q3·Economy·2015·External Sector and International Economy
The problem of international liquidity is related to the non-availability of
Correct: C
International liquidity refers to availability of internationally acceptable reserve assets and hard currencies such as dollars for settling external payments.
Q4·Economy·2015·Agriculture and Technology
The substitution of steel for wooden ploughs in agricultural production is an example of
Correct: B
Replacing wooden ploughs with steel ploughs makes the capital tool more productive/effective, so it is capital-augmenting technological progress.
Q5·Economy·2015·Money, Banking and Financial Markets
With reference to inflation in India, which of the following statements is correct?
Correct: C
Reducing money circulation or money supply helps control inflation by reducing excess demand. Inflation management involves RBI monetary policy as well as government measures, so the other statements are incorrect.
Q6·Economy·2015·Money, Banking and Financial Markets
With reference to Indian economy, consider the following: 1. Bank rate 2. Open market operations 3. Public debt 4. Public revenue. Which of the above is/are component/components of Monetary Policy?
Correct: C
Bank rate and open market operations are monetary policy instruments. Public debt and public revenue are fiscal/public finance items, not monetary policy components.
Q7·Economy·2015·Money, Banking and Financial Markets
'Basel III Accord' or simply 'Basel III', often seen in the news, seeks to
Correct: B
Basel III is a banking regulatory framework intended to strengthen banks' capital, liquidity, stress resilience and risk management after the global financial crisis.
Q8·Economy·2015·Money, Banking and Financial Markets
'BioCarbon Fund Initiative for Sustainable Forest Landscapes' is managed by the
Correct: D
The BioCarbon Fund Initiative for Sustainable Forest Landscapes is managed by the World Bank.
Q9·Economy·2015·Money, Banking and Financial Markets
Who of the following founded a new city on the south bank of a tributary to river Krishna and undertook to rule his new kingdom as the agent of a deity to whom all the land south of the river Krishna was supposed to belong?
Correct: C
Harihara I, one of the founders of Vijayanagara, is associated with founding the city on the south bank of the Tungabhadra and ruling as the agent of the deity Virupaksha.
Q10·Economy·2015·Public Finance and Banking
The Government of India has established NITI Aayog to replace the
Correct: D
NITI Aayog was created in 2015 to replace the Planning Commission.
Q11·Economy·2015·External Sector
Convertibility of rupee implies
Correct: C
Rupee convertibility means allowing conversion of rupees into foreign currencies and foreign currencies into rupees, subject to the convertibility regime.
Q12·Economy·2015·Money, Banking and Financial Markets
When the Reserve Bank of India reduces the Statutory Liquidity Ratio by 50 basis points, which of the following is likely to happen?
Correct: C
A lower SLR reduces the mandatory share of deposits banks must keep in liquid assets, potentially freeing funds for lending and allowing banks to reduce lending rates. It does not by itself drastically raise GDP or reduce liquidity.
Q13·Economy·2015·Money, Banking and Financial Markets
Which one of the following issues the 'Global Economic Prospects' report periodically?
Correct: D
Global Economic Prospects is a flagship periodic report published by the World Bank.
Q14·Economy·2015·Public Finance and Banking
With reference to 'dugong', a mammal found in India, which of the following statements is/are correct? 1. It is a herbivorous marine animal. 2. It is found along the entire coast of India. 3. It is given legal protection under Schedule I of the Wildlife (Protection) Act, 1972. Select the correct answer using the code given below.
Correct: C
The dugong is a herbivorous marine mammal and is protected under Schedule I of the Wildlife (Protection) Act, 1972. In India it occurs in limited coastal/seagrass habitats, not along the entire coast.
Q15·Economy·2015·Planning, Industry and Inclusive Growth
In the 'Index of Eight Core Industries', which one of the following is given the highest weight?
Correct: B
In the Index of Eight Core Industries, electricity generation has the highest weight among the options listed.
Q16·Economy·2015·Public Finance and Budgeting
A decrease in tax to GDP ratio of a country indicates which of the following? 1. Slowing economic growth rate 2. Less equitable distribution of national income Select the correct answer using the code given below.
Correct: A
A falling tax-to-GDP ratio usually indicates that tax collection is not keeping pace with national income, often reflecting slower growth or weaker tax buoyancy. It does not by itself prove less equitable income distribution.
Q17·Economy·2015·External Sector and International Economy
The 'Fortaleza Declaration', recently in the news, is related to the affairs of
Correct: B
The Fortaleza Declaration was issued at the 2014 BRICS summit in Fortaleza, Brazil, and is associated with BRICS cooperation including the New Development Bank.
Q18·Economy·2015·Public Finance and Banking
With reference to the Fourteenth Finance Commission, which of the following statements is/are correct? 1. It has increased the share of States in the central divisible pool from 32 percent to 42 percent. 2. It has made recommendations concerning sector-specific grants. Select the correct answer using the code given below.
Correct: A
The Fourteenth Finance Commission recommended increasing States' share in the divisible pool from 32% to 42%. It did not make sector-specific grants in the way stated; it emphasized tax devolution and local-body/disaster-related grants.