Practice Test: Full Length - 2 - UPSC MCQ

The e-auction platform has also now been linked to the Indian Banks Auctions Mortgaged Properties Information (IBAPI) portal and guidelines have been made available

Netting can involve more than two parties, called multilateral netting, and generally involves a central exchange or clearinghouse.

Bilateral netting:

Bilateral netting is the process of consolidating all swap agreements between two parties into one single, or master, agreement. As a result, instead of each swap agreement leading to a stream of individual payments by either party, all of the swaps are netted together so that only one net payment stream is made to one party based on the flows of the combined swaps. Hence, option a is correct.

India-US in defence Agreements: - The signing of the Logistics Exchange Memorandum of Agreement (LEMOA) in 2016 and the Helicopter Operations from Ships Other Than Aircraft Carriers (HOSTAC) earlier this year were important steps in this direction. The signing of the Communications Compatibility and Security Agreement (COMCASA) will enable India to access advanced technologies from the US and enhance India's defence preparedness.

KB: Netting is very common in advanced economies where the settlement is based on net positions in bilateral or multilateral financial arrangements rather than by gross positions. A strong netting system generally gives rise to a thriving derivatives market, as it provides the most accurate picture of a company’s financial position, solvency and liquidity risk.

In the absence of bilateral netting, India’s central bank regulations require banks to measure credit exposure to a counterparty for OTC derivative contracts based on gross marked-to-market (MTM) exposure instead of net MTM exposure. This increases credit risk for financial market participants, especially in the event of insolvency of a counterparty, which could then raise systemic risk, according to the latest Economic Survey. The current system of higher obligations requires banks to divert more capital toward collateral requirements than what would be required if bilateral netting is permitted.

Multilateral Netting: Multilateral netting is a payment arrangement among multiple parties that transactions be summed, rather than settled individually. Multilateral netting can take place within a single organization or among two or more parties. The netting activity is centralized in one area, obviating the need for multiple invoicing and payment settlements among various parties. When multilateral netting is being used to settle invoices, all parties to the agreement send payments to a single netting center, and that netting center sends payments from that pool to those parties to which they are owed. Therefore, multilateral netting can be thought of as a way to pool funds to simplify the payment of invoices between parties to the arrangement.

A recurring high fiscal deficit means that the government has been spending beyond its means.

Likely outcomes of widening fiscal deficit:

(i) Slowdown in economy

(ii) Increase in revenue expenditure

(iii) Decrease in capital expenditure. Hence, statement 2 is correct.

(iv) Decrease in revenue collection - especially tax revenue

A government experiences a fiscal deficit when it spends more money than it takes in from taxes and other revenues excluding debt over some time period. This gap between income and spending is subsequently closed by government borrowing, increasing the national debt. An increase in the fiscal deficit, in theory, can boost a sluggish economy by giving more money to people who can then buy and invest more. Long term fiscal deficit in a country can be detrimental for economic growth and stability. Hence, statement 1 is correct.

Option a is correct. El Nino is accompanied by warmer waters in the Eastern Pacific ocean and comparatively cooler waters in western Pacific. This results in high air pressure in the western Pacific and low air pressure in the eastern Pacific.

Option b is correct. During El Nino, severe droughts occur in Australia, Indonesia, India and southern Africa. High air pressure in the western Pacific is the cause behind Australian droughts in El Nino conditions.

Option c is correct. Increased concentration of Carbon Dioxide in the atmosphere has caused global warming and impending climate change. IPCC in its multiple reports has found increased frequency and intensity of El Nino phenomena caused by Global warming.

Option d is incorrect. The warmer waters during El Nino, have a devastating effect on marine life existing off the coast of Peru and Ecuador. Fish catches off the coast of South America are lower than in the normal year as the upwelling stops, reducing the supply of fresh nutrients to marine life.

Indian Standard Meridian (82.5' E meridian) passes through UP, MP, Chhattisgarh, Odisha and Andhra Pradesh. (5 states)

Hence, both the Tropic of Cancer and the Indian Standard Meridian pass through Madhya Pradesh and Chhattisgarh

Statement 2 is incorrect. 44th Amendment of the Constitution amended the provisions of Article 22. Article 22 after amendment provides that a person arrested under preventive detention cannot be detained for more than two months unless there is a threat to internal security of any state. The Original Constitution provided a time period of three months in place of two months. Presently, the provision of Original Constitution is under effect and not that of the 44th Amendment.

Option b is correct: Treasury Bills are financial instruments issued by the Reserve bank of India (RBI) acting on the behalf of the central government. These bills are issued when there is a shortage of funds, or when the RBI wants to control the cash liquidity in the market.

Option c is correct: Loans and advances are the principal profit earning assets of the commercial banks. They composed mainly of customers’ overdrafts whereby in return for interest being paid on the amount actually drawn, banks agree to customers over-drawing their accounts, running into debt, up to stated amounts. These facilities are usually limited to relatively short periods of time 6 to 12 months, but they are renewable by agreement.

Options d is incorrect: Public Provident Fund (India) The Public Provident Fund is a savings-cum-tax- saving instrument in India, introduced by the National Savings Institute of the Ministry of Finance in 1968.

Statement 2 is correct. National Medical Devices Promotion Council (NMDPC) will support domestic manufacturing, reduce dependence on imports to meet local demand and boost exports. It aims to give a fillip to the medical device sector, which is a sunrise sector.

Statement 2 is correct. The coral reefs are destroyed by biomagnification of cyanide, which is used in leaching gold and in fishing. The reefs provide for spawning, feeding, and dwelling grounds for numerous sea creatures. When destroyed, the survival of aquatic creatures is highly compromised.

Statement 3 is correct. Biomagnification can also lead to the accumulation of various toxic chemicals and elements in the vital organs of the various aquatic creatures affecting their reproduction and development. For instance, seabird eggs are laid with thinner shells than normal, and can result in the birds crushing their eggs instead of incubating them. Selenium and heavy metals such as mercury also affect the reproduction of aquatic creatures such as fish as it destroys their reproductive organs.

Statement 2 is correct. The Global Environment Facility (GEF) serves as a financial mechanism to five conventions: Convention on Biological Diversity (CBD), United Nations Framework Convention on Climate Change (UNFCCC), Stockholm Convention on Persistent Organic Pollutants (POPs), UN Convention to Combat Desertification (UNCCD), and Minamata Convention on Mercury.

Statement 3 is correct. Stockholm Convention aims to eliminate or restrict the production and use of persistent organic pollutants whereas Minamata Convention was designed to protect human health and the environment from anthropogenic emissions and releases of mercury and mercury compounds.

Option b is incorrect. Very high Sea Surface Temperature is associated with the formation of Tropical cyclones.

Option c and d are incorrect. Formation of Polar Stratospheric clouds and creation of thunderstorms have no association with the formation of wave cyclones. The cold front within the cyclones, however, can witness thunderstorms. But it is not the cause, rather the effect of cyclone formation.

Kulpakji Temple is also called Kolanupaka Temple is a Jain Temple in Yadadri district, Telangana. The principal deity is Rishabhnatha who is the first Tirthankara. The temple also houses idols of Lord Neminatha and Lord Mahavira.

Shikharji Temple is located in Giridih district, Jharkhand. It is the most important Jain pilgrimage site. According to ancient Jain Text Nirvana Kanda this is the place where 20 Tirthankar attained Moksha.

Statement 1 is correct: the demand for temple entry was first started in Vaikom, Kerala. This Vaikom Satyagraha gave inspiration to Tamils to fight against Caste Hindus. In South India Nadars were among the first people to fight for temple entry.

Statement 2 is correct: K Kelappan was the lead figure of congress in Kerala and popularly called Kerala Gandhi. He fought against untouchability and caste-based discrimination. He was also the leader of the Guruvayur Satyagraha in 1932

Statement 3 is incorrect: The movement got support from many nationalist leaders including gandhi and agitation against untouchability spread in other states of South India also.

Statement 2 is correct. Colistin has been used in veterinary medicine for treatment and prevention of bacterial infections and as antibiotic growth promoter for better feed conversion.

Statement 3 is incorrect. The Ministry of Health and Family Welfare has issued an order prohibiting the manufacture, sale and distribution of colistin and its formulations for food-producing animals, poultry, aqua farming and animal feed supplements.

Statement 2 is incorrect. It is classified as vulnerable in the IUCN red list.

Statement 3 is correct. The major threat to the successful breeding of black-necked cranes is the damage to the eggs and chicks, caused by feral dogs. These dogs are owned both by armed forces as well as by the local nomads. Another threat to the bird is the loss of habitat. The human pressure on the wetlands, the primary habitat of cranes, has increased tremendously over the last decade. The increased grazing pressure on the limited pastures near the wetlands is also leading to the degradation of the wetland habitat.

Muhammad Ali Jinnah was elected as a Muslim member for Bombay in the Central Legislative Assembly in September 1923.

Subhash Chandra Bose was an Indian Nationalist who has been a leader of the radical wing of the Congress. He resigned from Civil services and in 1921 worked under Chitranjan Das. Later he started his own newspaper Swaraj. In 1923 he became President of All India Youth Congress. He was also elected as President of Congress in 1938 and 1939. He also formed All India Forward Bloc, a faction within Congress.

Option c is incorrect: World Bank Released the following index Global Economic Prospects, World Development Report and Ease of Doing Business and International Debt statistics

Option d is incorrect: International Monetary Fund (IMF) released Global financial stability report (SGRF) and World Economic Outlook report

Option b is correct: The RBI, cut the repo rate and reserve repo rate by 75 basis points and 90 bps, respectively (100 basis points/bps = 1 percent). The repo rate now stands at 4.4 per cent and reserve repo rate at 4 percent. Impact of the rate cut on borrowers, the unexpected rate cut is likely to reduce equated monthly instalments (EMIs) of borrowers, and also make it cheaper to take new loans.

Option c is incorrect: No relation between two things, RBI decides both two things separately.

Option d is incorrect: When the Reserve bank of India reduces the Repo Rate by 75 basis points then decreases in the cost of borrowing.

Statement 2 is incorrect. Bioinks may be made from natural or synthetic biomaterials alone, or a combination of the two as hybrid materials. In certain cases, cell aggregates without any additional biomaterials can also be adopted for use as a bioink for bioprinting processes.

Option b is incorrect: Epidemic Diseases Act 1897, when the state government is satisfied that the state or any part thereof is visited by or threatened with an outbreak of any dangerous epidemic disease; and if it thinks that the ordinary provisions of the law are insufficient for the purpose, then the state may take, or require or empower any person to take some measures and by public notice prescribe such temporary regulations to be observed by the public. The state government may prescribe regulations for inspection of persons travelling by railway or otherwise, and the segregation, in hospital, temporary accommodation or otherwise, of persons suspected by the inspecting officer of being infected with any such disease.

Option c is incorrect: The Agricultural Produce (Grading and Marking) Act, 1937 provides for the grading and marking of agricultural and other allied commodities with the objectives of making avail- able quality agricultural produce including horticulture and livestock produce to the consumers.

Option d is correct: Under the EC Act of 1955, if the Central government thinks that it is necessary to maintain or increase supplies of any essential commodity or make it available at fair prices, it can regulate or prohibit the production, supply, distribution and sale of that commodity. Some of the essential commodities listed out in the schedule to this Act are foodstuffs including edible oils and oilseeds, drugs, fertilisers, petroleum and petroleum products. The Centre has the power to add or remove any commodity. Kb)

In recent years, there has been an argument that the EC Act was draconian and not suited for times when farmers face problems of plenty rather than scarcity. The Economic Survey 2019-20 argued that it hampered remunerative prices for farmers and discouraged investment in storage infrastructure.

Statement 3 is correct: After Tilak left for England the movement was left leaderless. Annie Besant was satisfied by the promise of the reforms proposed by the 1917 August Declaration. After the Montagu declaration the League agreed to put a halt on their movement and all the moderate members gave up their membership of the league. The league believed in the promises of the British government that it will gradually reform the administration. The rise of Gandhi and his Satyagraha also provided for the dissolution of the league.

Statement 3 is correct. Parliament is empowered to make amendments to the list only through law. Only Parliament has the power to amend. (Article 342 (2)

The act also provided for the establishment of new Legislative Councils for Bengal, NWFP and Punjab. Before the 1861 act, the Executive council had little or no representation of the people and there was demand for representation. Therefore, a fifth finance member was added, and provision was made for addition of 6 to 12 members to the Executive council.

The 1858 Act made Governor General the Viceroy. Now onwards India was to be governed by and in the name of the crown through secretary of state and council of 15 members.

Indian Council Act 1892 enlarged the Legislative council of Governor General. A principle of representation was introduced along with elements of indirect election.

The Indian Council Act 1909 or Morley Minto reforms provided first time entry of an Indian in the Executive Council of the Governor General. It also introduced a separate electorate for the Muslims.

Statement 2 is incorrect. The HAL Advanced Medium Combat Aircraft (AMCA) is an Indian programme to develop a fifth-generation fighter aircraft. AMCA will be a single-seat, twin-engine, stealth all-weather multirole fighter aircraft, feasibility study on AMCA and the preliminary design stage have been completed, and the project entered the detailed design phase in February 2019. It is expected to make its first flight in 2032.

Statement 3 is correct. Project 17 was conceptualized by the Indian Navy to design and build stealth frigates indigenously. In 1997, the Indian Government approved the order for three frigates.