Economics Mock Test- 4 - Class 10 MCQ

The correct answer is:

3. A is correct but R is wrong

Explanation:

• Assertion (A): "Until the middle of the 20th century, production was largely organised within countries." This is true. Before the globalization and advancements in communication and transportation, production processes were primarily conducted within national borders.

• Reason (R): "Lack of trade among nations." This is incorrect. While trade among nations was more limited compared to the modern era, it was not the primary reason why production was organized within countries. The organization of production within countries was influenced more by technological limitations, transportation costs, and political factors rather than a complete lack of trade among nations.

Therefore, the assertion is correct, but the reason provided does not accurately explain the assertion.

Improvement in Transport and Promotion of Globalisation

• Increased Connectivity: Improved transport systems have led to increased connectivity between countries, allowing for easier movement of goods, services, and people across borders.



• Facilitation of Trade: Efficient transport networks have facilitated international trade by reducing transportation costs and time, thus promoting globalisation.



• Integration of Markets: Better transport infrastructure has enabled the integration of markets on a global scale, leading to increased competition and efficiency in the global economy.



• Expansion of Cultural Exchange: Improved transport has also facilitated cultural exchange by making it easier for people to travel and share ideas and experiences across different countries.

B is the correct option.The WTO as of November 2006 had 149 members, the latest addition being Vietnam making it 150. As of this date Russia was the largest state that was not yet a member.

FDI (Foreign Direct Investment) attracted by globalization in India belongs to the multinationals.
Foreign Direct Investment (FDI) refers to the investment made by foreign companies or individuals in the domestic market of another country. In the case of India, FDI attracted by globalization primarily belongs to multinational corporations. Here is a detailed explanation:
1. Definition of Foreign Direct Investment:
- FDI is a form of investment where a company or individual from one country invests in businesses or assets in another country.
- It involves a long-term commitment and control over the foreign enterprise.
2. Globalization and FDI in India:
- Globalization refers to the integration of economies and societies through cross-border flows of goods, services, capital, and technology.
- India has been actively involved in globalization, opening up its markets and encouraging foreign investments.
3. Attracting FDI:
- India, being one of the fastest-growing economies and having a large consumer market, attracts FDI from various sources.
- The government of India has implemented policies and reforms to attract foreign investors, such as easing regulations, improving infrastructure, and providing incentives.
4. Multinationals and FDI:
- Multinational corporations (MNCs) are companies that operate in multiple countries, with their headquarters in one country and subsidiaries in others.
- MNCs are major contributors to FDI inflows in India, as they seek to expand their market presence, access resources, and capitalize on the growth opportunities offered by the Indian market.
- Examples of multinational corporations investing in India include Walmart, Samsung, Amazon, and Toyota.
5. Other Sources of FDI:
- While multinationals are the primary source of FDI in India, there are other sources as well, such as foreign governments and sovereign wealth funds.
- Foreign governments may invest in India to strengthen diplomatic relations or support specific sectors.
- However, their contribution to FDI inflows is relatively smaller compared to multinationals.
6. Conclusion:
- In conclusion, FDI attracted by globalization in India primarily belongs to multinationals.
- Multinational corporations invest in India to expand their market reach and take advantage of the country's growing economy.
- The Indian government's efforts to attract FDI have resulted in increased foreign investments, driving economic growth and development in the country.

Carbon credit shows that a country or any entity emits the carbon below the limit prescribed by the government, hence the country or entity can sell it in exchange where carbon credits are traded.

Carbon sequestration may be carried out by pumping carbon into carbon sinks of two types: A. Natural sinks-ocean, forest, soil etc. B. Artificial sink-depleted oil reserve, unminable mines. So statement 1,2 and 3 are correct. And deep Saline Formations, in fact, have the highest capacity for this. So accordingly, the answer is "D".

There were many factors that gave birth to the consumer movement in India. It started as a social force with the need to protect the consumers against unfair and unethical trade practices being followed by many retailers and manufacturers. These included creating artificial shortages, hoarding cereals and other agricultural products, black marketing of goods and adulteration of cooking oils and food items. Till 1986, consumer organizations were highlighting issues by writing articles in newspapers and magazines about these bad practices of merchants.

Fixed deposits for long period means that the bank would be able to use the money for more profit and thus would give a higher rate of interest.

Adulteration is a scientific term which means to decrease the quality of a substance by adding another one in it. Adulteration is a legal term meaning that a food product fails to meet the legal standards.

Manufacturing and Industry sector, also known as the secondary sector, includes all branches of human activities that transform raw materials into products or goods.

Tata Iron and Steel company is an example of Private company.

Public Sector : 
(i) The government owns assets and takes responsibility to deliver services.
(ii) This sector is not guided by profit motive.
(iii) It invests funds to construct structures and infrastructure of public utility e.g. construction of roads, bridges, railways, harbours, generation of electricity, construction of dams, school and college buildings etc.
(iv) All citizens of a country use and obtain services produced by this sector unconditionally.
(v) It collects funds for investment indirectly through taxes on people having certain income and capable to pay them.
Example : Post and telegraph, Railways, C.P.W.D.

Disguised unemployment is a kind of unemployment in which some people look like being employed but are actually not employed fully. This situation is also known as Hidden Unemployment. In such a situation more people are engaged in a work than required. 

Explanation:

• Assertion: Economic activities grouped into three categories are highly dependent.




• Primary, secondary, and tertiary sectors are interlinked and depend on each other for the production and distribution of goods and services.


• Each sector relies on the other for inputs, resources, and markets.


• The primary sector provides raw materials to the secondary sector, which then processes and manufactures goods, and the tertiary sector distributes and sells these goods to consumers.




• Reason: Primary and secondary activities cannot produce a good unless they are aided by the tertiary sector.




• The tertiary sector plays a crucial role in supporting and enhancing the production and distribution processes of the primary and secondary sectors.


• It provides services such as transportation, communication, finance, and marketing, which are essential for the functioning of the other two sectors.


• Without the tertiary sector, the primary and secondary sectors would face challenges in reaching consumers and fulfilling their production goals.




• Conclusion: Both the assertion and reason are true, and the reason correctly explains why economic activities grouped into three categories are highly dependent on each other.

The correct answer is C as System of exchanging goods for goods is called barter system. Moreover this system prevailed in old times

Plastic money is a term used to represent the hard plastic cards used in day to day life in place of actual banknotes. They come in several forms such as debit cards, credit cards, store cards and pre-paid cash cards.

The three main indicators of the Human Development Index (HDI) are life expectancy at birth, gross enrollment ratio, and per capita income. These indicators provide a comprehensive measure of a country's development, encompassing health, education, and economic well-being.

The desire for more income is not the sole determinant of the quality of life. While income is important, other non-material factors also play a crucial role. For example, a job may offer less pay but provide regular employment, enhancing a person's sense of security. This illustrates that the quality of life depends on a combination of material and non-material considerations.

Commercial banks lend money to for-profit companies and other organizations every day. In fact, business lending makes up a large portion of a commercial bank's operations. This makes a commercial bank different from an investment bank, although the same institution can include commercial and investment branches.

The modern currency is used as a medium of exchange because it is accepted and authorized as a medium of exchange by a country’s government.

Explanation:

• Globalization: Globalization refers to the increased interconnectedness and interdependence of countries through the exchange of goods, services, and investments.


• Rapid Movements: The past two decades have seen a significant increase in the speed and volume of goods, services, and investments moving between countries.


• Goods: Globalization has led to the increased trade of physical products such as consumer goods, raw materials, and manufactured goods between countries.


• Services: Along with goods, there has been a rise in the exchange of services such as financial services, telecommunications, and professional services across borders.


• Investments: Globalization has also facilitated the movement of investments, including foreign direct investment (FDI) and portfolio investments, between countries.


• Interconnectedness: This increased movement of goods, services, and investments has led to greater interconnectedness and interdependence among countries in the global economy.

Therefore, option B - goods, services, and investments between countries - is the correct answer as it accurately reflects the key aspects of globalization in the past two decades.

Investments made by MNCs are termed as:

• Foreign Investment: MNCs make investments in countries other than their home country, and these investments are known as foreign investments.

Detailed Explanation:

• Definition: Foreign investment refers to investments made by a company or individual in one country in business interests in another country, in the form of either establishing business operations or acquiring business assets in the other country.



• MNCs: Multinational corporations (MNCs) are companies that operate in multiple countries and have a global presence. These companies often make significant investments in various countries to expand their operations and reach new markets.



• Benefits: Foreign investments by MNCs can bring benefits such as job creation, technology transfer, infrastructure development, and economic growth to the host country.



• Risks: However, there are also risks associated with foreign investments, such as political instability, regulatory changes, currency fluctuations, and cultural differences.



• Regulation: Foreign investments are subject to regulations and restrictions imposed by both the home country and the host country to ensure that the investments are made in compliance with local laws and regulations.

By making foreign investments, MNCs can expand their global footprint, tap into new markets, and diversify their operations, but they must also carefully assess the risks and challenges associated with such investments.

Explanation:

• Gross Domestic Product (GDP): GDP is the total value of all final goods and services produced within a country's borders in a specific time period, usually a year. It is a key indicator of a country's economic health.


• Net Domestic Product (NDP): NDP is calculated by subtracting depreciation from the GDP. Depreciation represents the wear and tear on capital goods over time.


• National Product: National Product is the total value of all goods and services produced by a country's residents, regardless of where the production takes place.


• Production of Tertiary Sector: The Tertiary Sector refers to the service industry, which includes activities like retail, transportation, healthcare, and education.

Therefore, the correct answer is Gross Domestic Product (GDP), which represents the total value of all final goods and services produced within a country during a particular year.

MNC stands for multinational cooperation. Hence, option (d) is considered correct because MNCs increase all of the mentioned options. They surely increase competition. They also increase Price war when competition is increases and as a result every cooperation tries to improve their quality. MNCs always strive to find strategies that will generate unique and expensive products which leads to increased competition in market.

Banks keep only a small proportion of their deposits as cash with themselves because they use the major portion of the deposits to extend loans as there is a huge demand for Loans for various economic activities.

The facility of cheques against demand deposits makes it possible to directly settle payments without the use of cash. Since demand deposits are accepted widely as a means of payment, along with currency, they constitute money in the modern economy.

C is the correct option.The Kisan Credit Card (KCC) scheme was introduced in 1998 for issue of Kisan Credit Cards to farmers on the basis of their holdings for uniform adoption by the banks so that farmers may use them to readily purchase agriculture inputs such as seeds, fertilizers, pesticides etc.

• State with maximum percentage of SHGs in bank credit: Andhra Pradesh


• Explanation:
  
  
  
  • Andhra Pradesh has been a pioneer in promoting self-help groups (SHGs) for women empowerment and poverty alleviation.
  
  
  • These SHGs have been actively involved in accessing bank credit for various income-generating activities.
  
  
  • As a result, Andhra Pradesh accounts for the highest percentage of SHGs in bank credit compared to other states.
  
  
  • The state government and various NGOs have played a significant role in promoting and supporting SHGs in Andhra Pradesh.
  
  
  • Overall, the success of SHGs in Andhra Pradesh can be attributed to strong government support, effective implementation strategies, and active participation of women in these groups.
  
  
  
  

Kuno Palpur Wildlife Sanctuary was a proposal to translocate some of the lions from their natural habitat in Gujarat.

• According to the data released by the Ministry of Commerce and Industry, the eight-core sector industries recorded a growth of 5.5% in February 2020.
• The eight Core Industries in decreasing order of their weightage: Refinery Products> Electricity> Steel> Coal> Crude Oil> Natural Gas> Cement> Fertilizers.