If crude oil price goes up in the international market, what impact will it have on India?
1. Increase in trade deficit
2. Decrease in GDP (gross domestic product)
3. Rise in inflation 
  • a)
    1 and 3 only
  • b)
    1 and 2 only
  • c)
    2 and 3 only
  • d)
    1, 2 and 3
Correct answer is option 'D'. Can you explain this answer?

UPSC Question

By Avinash Sangur · 2 weeks ago ·UPSC
Anchal Thakur answered Feb 19, 2020
It is due to when price of crude oil increase than the price of petroleum products increase. Therefore their is low demand. So GDP rate decrease. India is major importer of petroleum products, therefore India trade affect and also rise in inflation.

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