20 Economy questions from the official UPSC 2019 Prelims paper, each with the verified answer key and an explanation.
1–20 of 20
Q1·Economy·2019·Public Finance and Banking
What is Cas9 protein that is often mentioned in news?
Correct: A
Cas9 is an enzyme used with CRISPR as molecular scissors for targeted gene editing.
Q2·Economy·2019·Money, Banking and Financial Markets
The money multiplier in an economy increases with which one of the following?
Correct: B
A higher banking habit lowers cash held by the public and increases deposits, raising the money multiplier. Higher CRR or SLR reduces the multiplier.
Q3·Economy·2019·Money, Banking and Financial Markets
Consider the following statements The Reserve Bank of India's recent directives relating to Storage of Payment System Data', popularly known as data diktat, command the payment system providers that 1. they shall ensure that entire data relating to payment systems operated by them are stored in a system only in India 2. they shall ensure that the systems are owned and operated by public sector enterprises 3. they shall submit the consolidated system audit report to the Comptroller and Auditor General of India by the end of the calendar year Which of the statements given above is/are correct?
Correct: A
RBI's payment data localization directive required payment system data to be stored only in India. It did not require systems to be public-sector owned or audit reports to be submitted to CAG.
Q4·Economy·2019·Public Finance and Banking
Which one of the following is not the most likely measure the Government/RBI takes to stop the slide of Indian rupee?
Correct: D
Expansionary monetary policy would generally increase liquidity and may weaken the rupee, so it is not a likely measure to stop rupee depreciation. The other measures can support foreign currency inflows or reduce outflows.
Q5·Economy·2019·External Sector and International Economy
Among the agricultural commodities imported by India, which one of the following accounts for the highest imports in terms of value in the last five years?
Correct: D
Vegetable oils account for the highest value among India's major agricultural commodity imports listed.
Q6·Economy·2019·Social Capital
In the context of any country, which of the following would be considered as part of its social capital?
Correct: D
Social capital refers to networks, trust, cooperation and social harmony, so mutual trust and harmony in society are part of it.
Q7·Economy·2019·Planning, Industry and Inclusive Growth
In India, extended producer responsibility was introduced as an important feature in which of the following?
Correct: C
Extended Producer Responsibility was introduced prominently in India under the E-Waste (Management and Handling) Rules, 2011.
Q8·Economy·2019·Money, Banking and Financial Markets
Which one of the following is not a sub-index of the World Bank's Ease of Doing Business Index?
Correct: A
Maintenance of law and order is not a sub-index of the World Bank Ease of Doing Business index; paying taxes, registering property and construction permits are sub-indicators.
Q9·Economy·2019·Money, Banking and Financial Markets
The Chairmen of public sector banks are selected by the
Correct: A
The Banks Board Bureau was set up to recommend/select top management including chairmen/managing directors of public sector banks.
Q10·Economy·2019·Money, Banking and Financial Markets
What was the purpose of Inter-Creditor Agreement signed by Indian banks and financial institutions recently?
Correct: D
The Inter-Creditor Agreement was part of stressed-asset resolution for consortium/multiple-lender loans of Rs. 50 crore or more, aiming at faster resolution.
Q11·Economy·2019·Planning, Industry and Inclusive Growth
With reference to Asian Infrastructure Investment Bank (AIIB), consider the following statements: 1. AIIB has more than 80 member nations. 2. India is the largest shareholder in AIIB. 3. AIIB does not have any members from outside Asia. Which of the statements given above is/are correct?
Correct: A
AIIB had more than 80 approved members. China, not India, is the largest shareholder, and AIIB includes non-Asian members as well.
Q12·Economy·2019·Growth, Planning and Inclusive Development
Consider the following statements 1. As per law, the Compensatory Afforestation Fund Management and Planning Authority exists at both National and State levels. 2. People's participation is mandatory in the compensatory afforestation programmes carried out under the Compensatory Afforestation Fund Act, 2016. Which of the statements given above is/are correct?
Correct: A
The Compensatory Afforestation Fund Act provides for National and State authorities. Mandatory people's participation in each programme is not a statutory requirement in the way stated.
Q13·Economy·2019·Money, Banking and Financial Markets
Which of the following is issued by registered foreign portfolio investors to overseas investors who want to be part of the Indian stock market without registering themselves directly?
Correct: D
Participatory Notes are issued by registered foreign portfolio investors to overseas investors who want exposure to Indian securities without direct registration.
Q14·Economy·2019·External Sector
In the context of India, which of the following factors is/are contributor/ contributors to reducing the risk of a currency crisis? 1. The foreign currency earnings of India's IT sector 2. Increasing the government expenditure 3. Remittances from Indians abroad Select the correct answer using the code given below.
Correct: B
IT-sector foreign exchange earnings and remittances increase stable foreign-currency inflows, reducing currency-crisis risk. Increasing government expenditure may worsen macro vulnerabilities.
Q15·Economy·2019·Planning, Industry and Inclusive Growth
Which of the following is not included in the assets of a commercial bank in India?
Correct: B
Deposits are liabilities of a commercial bank, not assets. Advances, investments, and money at call/short notice are assets.
Q16·Economy·2019·External Sector and International Economy
Among the following, which one was the largest exporter of rice in the world in the last five years?
Correct: B
India has been the world's largest rice exporter over the relevant recent five-year period.
Q17·Economy·2019·Public Finance and Banking
Consider the following statements 1. Some species of turtles are herbivores. 2. Some species of fish are herbivores. 3. Some species of marine mammals are herbivores. 4. Some species of snakes are viviparous. Which of the statements given above are correct?
Correct: D
There are herbivorous turtles, herbivorous fish, herbivorous marine mammals such as dugongs/manatees, and viviparous snakes. All statements are correct.
Q18·Economy·2019·Growth, Planning and Inclusive Development
In a given year in India, official poverty lines are higher in some States than in others because
Correct: B
Official poverty lines vary by State because price levels and cost of living differ across States.
Q19·Economy·2019·Growth, Planning and Inclusive Development
Atal Innovation Mission is set up under the
Correct: C
The Atal Innovation Mission (launched 2016) is a flagship initiative of NITI Aayog to promote innovation and entrepreneurship. It runs Atal Tinkering Labs in schools, Atal Incubation Centres for startups, and Atal Community Innovation Centres in underserved districts.
Q20·Economy·2019·Money, Banking and Financial Markets
The Global Competitiveness Report is published by the
Correct: C
The Global Competitiveness Report is published by the World Economic Forum.