Test: Structure Of The Indian Economy & Demographics - 1 - UPSC MCQ

As per RBI’s directive, payment system providers are required to store the data in India only. Other features are not required by RBI.

PNGRB was constituted under The Petroleum and Natural Gas Regulatory Board Act, 2006.
SEBI was formed in 1988 by an executive order, given statutory status in 1992. Besides, IRDAI and many other regulatory bodies were setup before 2006. So, PNGRB is certainly not the first body to be setup by Govt of India. #1 is wrong, by elimination we are left with answer b.

Bank Board Bureau (BBB) was setup in 2016, BBB selects top officials (MD, CEO, Chairman and full-time Directors) for PSBs, LIC and other public sector financial institutions.

• Currency crisis usually denotes that Indian Rupee is weakening and dollar is strengthening at a rapid level. In ordinary circumstances, rupee dollar exchange rate is determined by the market forces of supply and demand. Therefore we have to encourage the inflow of dollars to reduce the risk of currency crisis. #1 and #3 can help in this regard, #2 is irrelevant. Infact #2 can backfire if raising Government Expenditure results in excessive printing of Rupee currency.
• Thus, by elimination answer is b: 1 and 3.

NCERT Macroeconomics Class12, page 40: observe the table 3.1: Deposits are plotted on the liability side of a commercial bank’s balance sheet.

• Capital Output Ratio (COR) is a measure of the percentage increase in capital formation required to obtain a percentage increase in GDP.
• The capital-output ratio is the relationship between investment and resulting output over a period of time.
• COR is a measure of capital required for producing one unit of output.
• If capital to output ratio is high then capital formation may not result in a significant increase in the output.

Hence, the correct option is 'D'.

This was introduced in 2016, as a separate legislation under Finance Bill, and it doesn't provide tax credit in home country so both wrong.

When client books add in newspaper, he has to pay 18% GST to newspaper owner who deposits it to Government. But when such newspaper is sold to public, they are not required to pay newspaper price + GST. So #4 is exempted from GST. Processed / Canned food (#3) is subject to GST. So, by elimination, we get correct answer C.
Some experts were divided that if eggs are cooked in a 5-star hotel, it'll be subjected to GST however UPSC's official Answer key has kept C is the correct option.

As per Economic Survey, first statement is right but Central Government's domestic liability is ~46% so #2 is wrong. By elimination, we get (C)

CAR is decided by the benchmarks set by BASEL-III Committee on Banking supervision and implemented by the central bank of individual country. So, #2 is right, whereas #1 is correct.

Till 2009, RBI's Institute for Development and Research in Banking Technology (IDRBT) provided the linkages to ATM network in India but afterwards, it was taken over by NPCi's National Financial Switch (NFS).

• BHIM App was launched in 2016, it allows money transfer to UPI-enabled bank accounts so #1 is right.
• The BHIM apps has three levels of authentication. For one, the app binds with a device's ID and mobile number, second a user needs to sync whichever bank account (UPI or non-UPI enabled) in order to the conduct transaction. Third, when a user sets up the app they are asked to create a pin which is needed to log into the app. Hence #2 is wrong.

Merchant Discount Rate (MDR) is the fee borne by the merchant for using credit and debit card payment system. To encourage digital transactions, Ministry of Electronics and information technology (MEITY) had announced that from 1 January 2018 for the next two years, it'll bear the MDR fees of merchants, for payments up-to Rs.2,000/- IF such payment is made via debit card, BHIM or Aadhar enabled payment system.

Due to recession in 2008, the growth rate of the Indian economy had declined for the next few years from 8-9% to 5-6%. Even though the growth rate had declined, it never became negative. So, the GDP at market prices has always increased year on year since last one decade

Marginal Standing Facility  rate is the rate at which banks borrow funds overnight from the Reserve Bank of India (RBI) against approved government securities. Net Demand and time liability  is the sum of demand and time liability of Banks with public and other banks wherein assets with other banks is subtracted to get net liability of other bank.

12th Five Year Plan of the Government of India (2012-17) aims at faster, sustainable and more inclusive growth.

It is an activity by a central bank(RBI) to buy or sell government securities. The aim of open market operations is to manipulate the short term interest rate and the supply of base money in an economy, and indirectly control the total money  supply.

Capital Account comprises of Foreign loans, Foreign Direct Investment and Portfolio Investment. Capital Account is the net result of public and private international investments flowing in and out of a country. Portfolio investment is the buying of shares and bonds. FDI is the investments by foreigners in a country or the citizens investing in foreign countries.

The correct answer is the total value of goods and services produced by the nationals.

• National Income is the total monetary value of goods and services produced within the territory of the country in a given period of time.
• National Income = C+I+G+ (X-M)

Here, 

C stands for Consumption

I stands for Total Investment

G stands for Total Government Expenditure

X stands for Export

M stands for Import

• S. No.Methods of calculating National IncomeMeaning1Income MethodIt is measured by adding four factors of production i.e. land, labour, capital, and entrepreneurship.2Production MethodIt is also known as Value Added Method. In this national income is measured on the value of intermediate goods and final goods.3Expenditure MethodIt is also known as Income Disposal Method. In this method, national income is measured by taking the final expenditure incurred by all sectors of the economy.

Additional Information

• Dadabhai Naroji was the first to estimate the National Income in the year 1867-68.
• V.K.R.V Rao is known as the father of National Income in India. He introduced the first scientific estimate of national income in the year 1931-32. 
• National Income Committee under the chairmanship of P.C Mahalanobis was appointed by the Government of India in 1949

In India’s foreign exchange reserve, it includes foreign currency deposits, bonds, gold reserves, SDRs and IMF reserve position. Foreign exchange reserves are an important part of the international investment position of a country.