Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer?

Explore Courses UPSC Exam UPSC Test Series Free Notes EduRev Infinity

Open App

Class 12 Exam > Class 12 Questions > Indian government initiated many schemes to a...

Join the Discussion on the App

Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from below

a)
It leads to rightward shift in supply curve of foreign exchange
b)
It leads to leftward shift in supply curve foreign exchange
c)
It leads to rightward shift in demand curve of foreign exchange
d)
It leads to leftward shift in demand curve of foreign exchange

Correct answer is option 'A'. Can you explain this answer?

FREE This question is part of

Economics: CUET Mock Test - 4

Attempt Test

Attempt this Test

Most Upvoted Answer

Indian government initiated many schemes to attract foreign investment...

Explanation:

1. Background:
The Indian government has undertaken various initiatives to attract foreign investment in order to stimulate economic growth and development. These initiatives include implementing schemes, policies, and reforms that aim to create a favorable investment climate in the country.

2. Impact on the Foreign Exchange Market:
Foreign investment has a direct impact on the foreign exchange market. When foreign investors invest in a country, they need to convert their currency into the local currency. This creates a demand for the local currency, leading to changes in the supply and demand dynamics of foreign exchange.

3. Rightward Shift in Supply Curve:
When the Indian government initiates schemes to attract foreign investment, it leads to an increase in the supply of foreign exchange. This is because foreign investors bring in their currency and convert it into the local currency. As a result, the supply curve of foreign exchange shifts to the right.

4. Reasons for Rightward Shift:
There are several reasons why the supply curve of foreign exchange shifts to the right when the Indian government attracts foreign investment:

- Increased capital inflows: Foreign investment leads to an increase in capital inflows into the country. This increases the supply of foreign exchange as foreign investors convert their currency into the local currency.

- Improved investor confidence: Initiatives taken by the government to attract foreign investment improve investor confidence in the country's economy. This encourages more foreign investors to invest, leading to an increase in the supply of foreign exchange.

- Economic growth prospects: Foreign investors are attracted to countries that offer favorable economic growth prospects. When the Indian government implements schemes to attract foreign investment, it signals to foreign investors that the country offers profitable investment opportunities. This leads to an increase in the supply of foreign exchange.

Conclusion:
In conclusion, when the Indian government initiates schemes to attract foreign investment, it leads to a rightward shift in the supply curve of foreign exchange. This is because foreign investors bring in their currency and convert it into the local currency, increasing the supply of foreign exchange in the market.

Free Test

FREE

Economics: CUET Mock Test - 4
40 Ques | 45 Min

Start Free Test

View all free Class 12 tests

Community Answer

Indian government initiated many schemes to attract foreign investment...

Due to increase in investment from foreign country, supply of foreign exchange will increase. So, supply curve will shift to the right,

Share via Whatsapp

View all answers Start learning for free

< Previous Question Next Question >

Explore Courses for Class 12 exam

Similar Class 12 Doubts

For an economy that is tottering, a big bang announcement from the government can sometimes work to turn around sentiment. The unveiling by Finance Minister Nirmala Sitharaman on Tuesday of a mega push to infrastructure investment adding up to Rs. 102 lakh crore over the next five years belongs in this category.Projects in energy, roads, railways and urban infrastructure under the National Infrastructure Pipeline (NIP) have been identified by a task force. About 42% of such identified projects are already under implementation, 19% are under development and 31% are at the conceptual stage.The NIP task force appears to have gone project-byproject, assessing each for viability and relevance in consultation with the States. Considering that the NIP will be like a window to the future, a constant review becomes paramount if this is not to degenerate into a mere collation and listing of projects. A periodic review, as promised by the Finance Ministry, is necessary. The governments push on infrastructure development will not only enable ease of living - such as metro trains in cities and towns - but also create jobs and increase demand for primary commodities such as cement and steel. From this perspective, this push to invest in infrastructure is welcome.Identifying the projects to be put on the pipeline is the easy part. Implementing and commissioning them will be the more difficult one. There are a few hurdles that the NIP task force needs to watch out for. First, the financing plan assumes that the Centre and the States will fund 39% each while the private sector will chip in with 22% of the outlay. Going by the present fiscal situation, it will be no small challenge for the Centre to raise Rs.39 lakh crore, even if it is over the next five years.The financial position of States is even more perilous.Second, the Rs.22 lakh crore expected from private investment also looks steep considering the lack of appetite for fresh investment by the private sector in the last few years. In fact, this factor has been a major drag on economic growth. Given the scale of investment, debt will play an important role and it remains to be seen if banks have gotten over their apprehensions on infrastructure financing as a major part of their bad loans originated there. Finally, cooperation from States becomes very important in implementing infrastructure projects. The experience on this count has not been very happy till now. While these are genuine obstacles that the task force needs to manage, these should not detract from the need for a concerted effort to invest in infrastructure. The key will be following up and reviewing the pipeline at regular intervals.Q. The governments investment in infrastructure has been welcomed by the author from which point of view?

View answer

For an economy that is tottering, a big bang announcement from the government can sometimes work to turn around sentiment. The unveiling by Finance Minister Nirmala Sitharaman on Tuesday of a mega push to infrastructure investment adding up to Rs. 102 lakh crore over the next five years belongs in this category.Projects in energy, roads, railways and urban infrastructure under the National Infrastructure Pipeline (NIP) have been identified by a task force. About 42% of such identified projects are already under implementation, 19% are under development and 31% are at the conceptual stage.The NIP task force appears to have gone project-byproject, assessing each for viability and relevance in consultation with the States. Considering that the NIP will be like a window to the future, a constant review becomes paramount if this is not to degenerate into a mere collation and listing of projects. A periodic review, as promised by the Finance Ministry, is necessary. The governments push on infrastructure development will not only enable ease of living - such as metro trains in cities and towns - but also create jobs and increase demand for primary commodities such as cement and steel. From this perspective, this push to invest in infrastructure is welcome.Identifying the projects to be put on the pipeline is the easy part. Implementing and commissioning them will be the more difficult one. There are a few hurdles that the NIP task force needs to watch out for. First, the financing plan assumes that the Centre and the States will fund 39% each while the private sector will chip in with 22% of the outlay. Going by the present fiscal situation, it will be no small challenge for the Centre to raise Rs.39 lakh crore, even if it is over the next five years.The financial position of States is even more perilous.Second, the Rs.22 lakh crore expected from private investment also looks steep considering the lack of appetite for fresh investment by the private sector in the last few years. In fact, this factor has been a major drag on economic growth. Given the scale of investment, debt will play an important role and it remains to be seen if banks have gotten over their apprehensions on infrastructure financing as a major part of their bad loans originated there. Finally, cooperation from States becomes very important in implementing infrastructure projects. The experience on this count has not been very happy till now. While these are genuine obstacles that the task force needs to manage, these should not detract from the need for a concerted effort to invest in infrastructure. The key will be following up and reviewing the pipeline at regular intervals.Q. Which of the following factor has been a major cause of the derailment of economic growth?

View answer

Read the following statements carefully and choose the correct alternative from the following:Statement 1: Demonetization was the step taken by the Government of India in order to tackle the problems of corruption, black money, terrorism and circulation of fake currency in the Indian Economy.Statement 2: Demonetization has ensured improved tax compliance in India over the period of time.

View answer

Read the following statements carefully and choose the correct alternative:Statement 1: Payment of salaries and interest is a revenue expenditure.Statement 2: Revenue expenditure can be defined as the expenditure which leads to neither creation of asset nor reduction in liability of the government.

View answer

Read the following statements carefully and choose the correct alternative from the following: Statement 1: Bank money is a legal tender money. Statement 2: Bank money is repayable by the banks on demand. Alternatives: (

View answer

Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer?

Share with a Friend

Answer this doubt

Question Description
Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? for Class 12 2024 is part of Class 12 preparation. The Question and answers have been prepared according to the Class 12 exam syllabus. Information about Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer?.

Solutions for Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for Class 12. Download more important topics, notes, lectures and mock test series for Class 12 Exam by signing up for free.

Here you can find the meaning of Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer?, a detailed solution for Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? has been provided alongside types of Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Indian government initiated many schemes to attract foreign investment, which of the following statement is correct from belowa)It leads to rightward shift in supply curve of foreign exchangeb)It leads to leftward shift in supply curve foreign exchangec)It leads to rightward shift in demand curve of foreign exchanged)It leads to leftward shift in demand curve of foreign exchangeCorrect answer is option 'A'. Can you explain this answer? tests, examples and also practice Class 12 tests.

Explore Courses for Class 12 exam