UPSC Exam  >  UPSC Questions  >  Read the following passageand answer the item... Start Learning for Free
Read the following passage and answer the item that follow. Your answer to these item should be based on the passage only.
Passage-1
Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).
The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.
With reference to the above passage, the following assumptions have been made:
1. Relying on foreign investment in the long run is not an economically sound policy.
2. Policies must be undertaken to reduce volatility in foreign private investment.
3. Policies must be undertaken to strengthen domestic private investment.
4. Public investment should be given priority over private investment.
5. Substantial public investment in education and health should be undertaken.
Which of the above assumptions is/are valid?
  • a)
    1, 2 and 4
  • b)
    1, 3 and 5
  • c)
    2, 4 and 5
  • d)
    3 only
Correct answer is option `D`. Can you explain this answer?
Verified Answer
Read the following passageand answer the itemthat follow. Your answert...
- Statement 3 is correct, the author is stating the general volatility of the private investment; however, he is more critical about foreign direct investment. Hence it can be assumed that the policies must be undertaken to strengthen domestic investment to avoid the volatility of foreign direct investment.
- Statement 2 is not correct, from the passage it can be deduced that foreign direct investment has innate nature of volatility and can not be rectified by the adoption of policies.
- Statement 1 is not correct, the author is not talking about the economic policy rather he is talking about the volatility over the time and across sectors and regions.
- Statement 4 is not correct, public investment is nowhere mentioned in the passage.
- Statement 5 is not correct, again the passage does not talk anything about the public investment in health and education.
View all questions of this test
Most Upvoted Answer
Read the following passageand answer the itemthat follow. Your answert...
Explanation:

Assumption 1: Relying on foreign investment in the long run is not an economically sound policy.
- This assumption is valid because the passage highlights the volatility of foreign private investment and its adverse consequences such as unstable employment and income inequalities.
- Depending solely on foreign investment for economic growth may not be sustainable in the long run.

Assumption 3: Policies must be undertaken to strengthen domestic private investment.
- This assumption is valid as the passage suggests that relying solely on foreign investment for providing employment is not advisable.
- Strengthening domestic private investment can help in reducing the reliance on volatile foreign investments and promoting stable economic growth.

Assumption 5: Substantial public investment in education and health should be undertaken.
- This assumption is not explicitly mentioned in the passage but can be inferred from the discussion on the inadequacy of physical and human capital for technology diffusion.
- Investing in education and health can improve the skills and productivity of the workforce, making them more capable of absorbing new technologies.
Therefore, based on the information provided in the passage, assumptions 1, 3, and 5 are valid.
Explore Courses for UPSC exam

Top Courses for UPSC

Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer?
Question Description
Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer?.
Solutions for Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? in English & in Hindi are available as part of our courses for UPSC. Download more important topics, notes, lectures and mock test series for UPSC Exam by signing up for free.
Here you can find the meaning of Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer?, a detailed solution for Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? has been provided alongside types of Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Read the following passageand answer the itemthat follow. Your answerto these itemshould be based on the passageonly.Passage-1Private investment in general is volatile. Foreign private investment is more volatile because the available investment avenues are significantly greater (i.e., the entire world). Therefore, the responsibility of providing employment cannot be left to Foreign Direct investment (FDl).The current FDI inflows are volatile over time and across sectors and regions, which is a necessary consequence of their search for the highest returns. The adverse consequences are unstable employment and an accentuation of income and regional inequalities. A probable positive consequence of foreign investment is the inflow of new technology and its subsequent diffusion. However, the technology diffusion is not at all certain because the existing state of physical and human capital in India may prove inadequate for the diffusion.With reference to the above passage, the following assumptions have been made:1. Relying on foreign investment in the long run is not an economically sound policy.2. Policies must be undertaken to reduce volatility in foreign private investment.3. Policies must be undertaken to strengthen domestic private investment.4. Public investment should be given priority over private investment.5. Substantial public investment in education and health should be undertaken.Which of the above assumptions is/are valid?a) 1, 2 and 4b) 1, 3 and 5c) 2, 4 and 5d) 3 onlyCorrect answer is option `D`. Can you explain this answer? tests, examples and also practice UPSC tests.
Explore Courses for UPSC exam

Top Courses for UPSC

Explore Courses
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev