SSC CGL Tier-I Exam: Economics Quiz!

The Human Development Index (HDI) is a measure of human development that takes into account various factors such as literacy rate and life expectancy at birth. One of the components of HDI is the standard of living, which is measured by real GDP per capita. This means that the level of economic output per person is considered as an indicator of the overall standard of living in a country. This measure takes into account the purchasing power of the GDP, providing a more accurate reflection of the economic well-being of individuals in a country.

The Millennium Development Goals (MDGs) are a set of global targets established by the United Nations to address key social and economic challenges. These goals are primarily set for developing countries, as they aim to reduce poverty, improve education, promote gender equality, combat diseases, and ensure environmental sustainability in these nations. Developed countries, least developed countries, and OECD countries may have their own specific goals and targets, but the MDGs specifically target the development needs and challenges faced by developing countries.

The service sector in India has the largest contribution to national income. This is because the service sector includes industries such as banking, telecommunications, healthcare, tourism, and IT services, which are major contributors to the country's GDP. The service sector has experienced significant growth in recent years due to increasing urbanization, rising disposable incomes, and the expansion of the middle class. Additionally, the service sector is highly labor-intensive and has a high potential for job creation, further contributing to its significant role in India's national income.

Inflation occurs when there is an increase in the overall price level of goods and services in an economy. This can be caused by an increase in the money supply, as more money in circulation leads to more spending and demand, which can drive up prices. Additionally, a fall in production can also contribute to inflation, as a decrease in the supply of goods and services can lead to scarcity and higher prices. Therefore, the combination of an increase in money supply and a fall in production can be a cause of inflation.

The Central Statistical Organization in India is responsible for estimating the National income. This organization collects data from various sources, conducts surveys, and analyzes the information to calculate the country's national income. They use statistical methods and techniques to ensure accuracy and reliability in their estimates. The Central Statistical Organization plays a crucial role in providing important economic data and insights that help in policy-making and planning for the country's development.

The objective of "Garibi Hatao" (eradicate poverty) was introduced in the Fifth Five-Year Plan. This plan, implemented from 1974 to 1979, aimed to focus on poverty alleviation and improving the standard of living for the underprivileged sections of society. The introduction of this objective highlighted the government's commitment to addressing poverty and inequality in the country during this specific period.

If the Cash Reserve Ratio (CRR) is lowered by the Reserve Bank of India (RBI), it means that banks will be required to keep a lower percentage of their deposits as reserves with the central bank. This will result in an increase in the amount of funds available with the banks for lending and investment purposes. As a result, banks will have more money to lend to borrowers, leading to an increase in credit creation. Therefore, the correct answer is "Increase."

Per capita real income is the most appropriate measure of a country's economic growth because it takes into account the average income of individuals in the country, adjusted for inflation. This measure provides a more accurate reflection of the standard of living and economic well-being of the population. Gross domestic product (GDP), gross national product (GNP), and net national product (NNP) are also indicators of economic activity, but they do not consider the distribution of income or account for changes in the cost of living. Therefore, per capita real income is a more comprehensive measure of economic growth.

When the RBI buys securities from the market, it increases the liquidity in the economy. This is because when the RBI purchases securities, it injects money into the market, increasing the supply of money available for lending and spending. This increase in liquidity can help stimulate economic activity as there is more money available for businesses and individuals to borrow and spend.

The finance ministry formulates fiscal policy. As the governing body responsible for managing the country's finances, the finance ministry plays a crucial role in formulating and implementing fiscal policies. This includes making decisions regarding government spending, taxation, borrowing, and budgeting. The finance ministry works closely with other government departments and agencies to ensure the effective implementation of fiscal policies and to promote economic stability and growth.

Import duty is an indirect tax because it is imposed on the importation of goods into a country. It is not directly paid by the consumer or the importer, but is included in the price of the imported goods. The burden of the tax is ultimately passed on to the consumer through higher prices. In contrast, wealth tax, estate duty, and corporation tax are direct taxes as they are levied directly on individuals or entities and are not related to the purchase or importation of goods.

Land revenue is considered a direct tax because it is levied directly on the income or wealth of individuals or entities who own or possess land. Unlike indirect taxes such as sales tax, value-added tax, and customs duties, which are imposed on the sale or consumption of goods and services, land revenue is specifically targeted at landowners and is based on the value of their land or the income generated from it. Therefore, land revenue fits the definition of a direct tax as it is directly imposed on the taxpayer.

Y.V. Reddy is the correct answer for the chairman of the fourteenth finance commission.

The Shivaraman committee is associated with the establishment of NABARD (National Bank for Agriculture and Rural Development). The committee was formed in 1979 under the chairmanship of M. Narasimham and its primary objective was to review and restructure the country's financial system. It recommended the establishment of NABARD as an apex institution for agricultural and rural development, which was subsequently set up in 1982. The committee's recommendations played a crucial role in the establishment and functioning of NABARD, making it the correct answer to the question.

Consumption of fixed capital refers to the depreciation of physical assets used in production over a given period of time. It represents the value of the wear and tear or obsolescence of capital goods. Gross National Product (GNP) is the total value of goods and services produced by a country's residents, including both domestic and foreign production. Net National Product (NNP) is the GNP minus the consumption of fixed capital. Therefore, the difference between GNP and NNP is the amount deducted for the depreciation of capital goods.

The question is asking about the number of members in the Planning Commission of India. However, the Planning Commission of India was replaced by the NITI Aayog in 2015. Therefore, the correct answer is "None of these" as the Planning Commission no longer exists.

'Open market operation' is a tool used by central banks to control the money supply and interest rates in an economy. It involves buying or selling government securities in the open market. This tool falls under the purview of the credit policy, which is aimed at regulating the availability and cost of credit in the economy. By conducting open market operations, central banks can influence the liquidity in the banking system, thereby impacting interest rates and credit availability. Therefore, the correct answer is Credit policy.

The correct answer is Frankfurt because it is the stock market of Germany. Frankfurt is home to the Frankfurt Stock Exchange, which is one of the largest stock exchanges in the world. It is also known as Deutsche Börse and is an important financial center in Europe.

If savings exceed investment, it means that there is excess saving in the economy. This excess saving will not be used for investment purposes, which could lead to a decrease in investment and potentially slower economic growth. However, it does not necessarily mean that national income will decrease. Other factors such as government spending, exports, and consumption can still contribute to maintaining a constant level of national income. Therefore, the effect on national income would be constant.