UPDATED NEW QUESTIONS: REVISION TEST for Preliminary Exam 2018: Test – 3

Ans: c

The European Bank for Reconstruction and Development (EBRD) is an international financial institution founded in 1991 head quartered in London. As a multilateral developmental investment bank, the EBRD uses investment as a tool to build market economies. Initially focused on the countries of the former Eastern Bloc it expanded to support development in more than 30 countries from central Europe to central Asia.

Ans: c

The Survey pointed out that low level of tax collections by the local Governments in rural areas is posing challenge in reconciling fiscal federalism and accountability

Ans: D

Judicial pendency has been a major bottleneck for doing business in India. The courts often delay projects through litigation also causing a non-favorable position in Doing Business.

Ans: D

Fiscal activism or stimulus packages are needed only for recovery from depression and recession. The course of extra spending should be strictly regulated to prevent burdening from public debt and high debt service ratios. Burden of interest payments already is very high with up to 25% of revenue expenditure curtailing developmental spending.

Ans: B

Hint: On the financial front, there has been divergence on both income and consumption. There is convergence ie that IMR and life expectancy are trending towards similar goals in various states in India. This is due to catching up of education and health parameters in various states.

Ans: c

The Gender Parity Index (GPI) is a socioeconomic index usually designed to measure the relative access to education of males and females. … In its simplest form, it is calculated as the quotient of the number of females by the number of males enrolled in a given stage of education (primary, secondary, etc.).

Ans: D
The economic crises here was primarily a balance of payment crises and at the same time there was a significant increase in oil prices due to the Gulf war. Also, low foreign exchange reserves meant India had to mortgage gold to sustain critical imports such as oil. Import substitution policy meant that quotas and strict FERA made flow of foreign funds into India difficult.

Ans: D

‘The people who are always poor’ and those whose are usually poor but who may sometimes have a little more money are called chronic poor. Another group is called the churning(transient) poor because they keep moving in and out of the poverty segment( small scale workers). There are a segment of people who are occasionally poor meaning they are rich most of the time but due to bad luck turn poor for a while.

Ans: A

Foreign trade is part of current account whereas dealings in the financial sector are largely covered under capital account.

Ans: C

India was called emerging market due to its fast growth in GDP. Per capita shows us the purchasing power of people and their welfare.

Ans: D

Need for zero-based budgeting

1. Low priority programs can be eliminated or reduced.
2. Effectiveness of programmes can be dramatically improved.
3. Programmes of high priority can obtain increased funding by shifting resources within an agency.
4. The government need not increase the tax revenue as ZBB can to do a more effective job with existing revenues.

Solution: a.

Ans: A

Capital gains tax will boost consumption in present as savings will be taxed later and also slow down investments. Y=C+S. therefore, if consumption increases saving would fall. Also S=I so investments would also reduce.

Ans: B

Drain of wealth is a concept before independence. Western paradigm model shows dependence on foreign nations for everything from teachers, science and Machines. Population explosion reduced availability of resources per capita and agriculture could not sustain demand due to its low elasticity of income demand.

Ans: B

The New International Economic Order (NIEO) was a set of proposals put forward during the 1970s by some developing countries through the United Nations Conference on Trade and Development to promote their interests by improving their terms of trade, increasing development assistance, developed-country tariff reductions

Ans: c

The DTAA, or Double Taxation Avoidance Agreement is a tax treaty signed between India and another country (or any two/multiple countries) so that taxpayers can avoid paying double taxes on their income earned from the source country as well as the residence country.

Ans: A

The Nature Index tracks the affiliations of high-quality scientific articles. Updated monthly, the Nature Index presents research outputs by institution and country.

Ans: C

India has been ranked 132nd among 152 nations in a new index tracking commitment to reducing income inequality, Sweden led the index while Nigeria remained the worst performer

Ans: C

The ease of doing business index is an index created by Simeon Djankov at the World Bank Group. The academic research for the report was done jointly with professors Oliver Hart and Andrei Shleifer. Higher rankings (a low numerical value) indicate better, usually simpler, regulations for businesses and stronger protections of property rights. Empirical research funded by the World Bank to justify their work show that the economic growth impact of improving these regulations is strong.

Ans: C

The Global Innovation Index (GII) is an annual ranking of countries by their capacity for, and success in, innovation. It is published by Cornell University, INSEAD, and the World Intellectual Property Organization, in partnership with other organisations and institutions, and is based on both subjective and objective data derived from several sources, including the International Telecommunication Union, the World Bank and the World Economic Forum. The index was started in 2007 by INSEAD and World Business, a British magazine. The GII is commonly used by corporate and government officials to compare countries by their level of innovation.

Solution: a)

GTA is conferred with administrative, executive and financial power on the transfer subject but it does not enjoy legislative power.

GTA sabha consists of 50 members among which 45 are elected and 5 are nominated by the governor.

Source: http://www.darjeeling.gov.in/notification/GTA_ACT.pdf

Solution: c)

Source: http://bscpcr.org/pocso_faq.html

Solution: c)

Wassenaar Arrangement is a multilateral export control regime which aims for export controls for conventional arms and dual use good and technologies.

Source: https://www.bis.doc.gov/index.php/policy-guidance/multilateral-export-control-regimes

Solution: c)

Source: https://www.livemint.com/Education/GPOOGmaS6DXpsxisMqHevO/Govt-constitutes-K-Kasturirangan-committee-to-prepare-New-E.html

Solution: b)

M777 Ultra-light howitzers artillery guns inducted in Indian army which are imported from US.