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INSTA 75 Days REVISION PLAN 2022
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About Insta 75 days revision plan 2022
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Question 1 of 30
1 points
What do you mean by ‘Demographic Dividend’?
CorrectSolution: A
Demographic dividend, as defined by the United Nations Population Fund, is “the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population is larger than the non-working-age share of the population”.
IncorrectSolution: A
Demographic dividend, as defined by the United Nations Population Fund, is “the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population is larger than the non-working-age share of the population”.
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Question 2 of 30
1 points
Which one of the following equals Personal Disposable Income?
CorrectSolution: A
Disposable income, also known as disposable personal income (DPI), is the amount of money that an individual or household has to spend or save after income taxes have been deducted.
At the macro level, disposable personal income is closely monitored as one of the key economic indicators used to gauge the overall state of the economy.
IncorrectSolution: A
Disposable income, also known as disposable personal income (DPI), is the amount of money that an individual or household has to spend or save after income taxes have been deducted.
At the macro level, disposable personal income is closely monitored as one of the key economic indicators used to gauge the overall state of the economy.
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Question 3 of 30
1 points
Which of the following are components included which calculating GDP?
- The value of the consumption of goods and services acquired and consumed by the country’s households.
- All consumption, investment, and payments made by the government for current use.
- Spending on purchases of fixed assets and unsold stock by private businesses.
- Net exports
Select the correct answer using the code given below:
CorrectSolution: D
All the above statements are correct.
GDP vs. GNP: An Overview
Gross domestic product (GDP) is the value of a nation’s finished domestic goods and services during a specific time period. A related but different metric, the gross national product (GNP), is the value of all finished goods and services owned by a country’s residents over a period of time.
Both GDP and GNP are two of the most commonly used measures of a country’s economy, both of which represent the total market value of all goods and services produced over a defined period.
There are differences between how each one defines the scope of the economy. While GDP limits its interpretation of the economy to the geographical borders of the country, GNP extends it to include the net overseas economic activities performed by its nationals.
Key Takeaways
- Gross domestic product (GDP) and gross national product (GNP) are both widely used measures of a country’s aggregate economic output.
- GDP measures the value of goods and services produced within a country’s borders, by citizens and non-citizens alike.
- GNP measures the value of goods and services produced by only a country’s citizens but both domestically and abroad.
- GDP is the most commonly used by global economies. The United States abandoned the use of GNP in 1991, adopting GDP as its measure to compare itself with other economies.
Calculating GDP includes adding together private consumption or consumer spending, government spending, capital spending by businesses, and net exports—exports minus imports. Here’s a brief overview of each component:
- Consumption: The value of the consumption of goods and services acquired and consumed by the country’s households. This accounts for the largest part of GDP
- Government Spending: All consumption, investment, and payments made by the government for current use
- Capital Spending by Businesses: Spending on purchases of fixed assets and unsold stock by private businesses
Net Exports: Represents the country’s balance of trade (BOT), where a positive number bumps up the GDP as country exports more than it imports, and vice versa
IncorrectSolution: D
All the above statements are correct.
GDP vs. GNP: An Overview
Gross domestic product (GDP) is the value of a nation’s finished domestic goods and services during a specific time period. A related but different metric, the gross national product (GNP), is the value of all finished goods and services owned by a country’s residents over a period of time.
Both GDP and GNP are two of the most commonly used measures of a country’s economy, both of which represent the total market value of all goods and services produced over a defined period.
There are differences between how each one defines the scope of the economy. While GDP limits its interpretation of the economy to the geographical borders of the country, GNP extends it to include the net overseas economic activities performed by its nationals.
Key Takeaways
- Gross domestic product (GDP) and gross national product (GNP) are both widely used measures of a country’s aggregate economic output.
- GDP measures the value of goods and services produced within a country’s borders, by citizens and non-citizens alike.
- GNP measures the value of goods and services produced by only a country’s citizens but both domestically and abroad.
- GDP is the most commonly used by global economies. The United States abandoned the use of GNP in 1991, adopting GDP as its measure to compare itself with other economies.
Calculating GDP includes adding together private consumption or consumer spending, government spending, capital spending by businesses, and net exports—exports minus imports. Here’s a brief overview of each component:
- Consumption: The value of the consumption of goods and services acquired and consumed by the country’s households. This accounts for the largest part of GDP
- Government Spending: All consumption, investment, and payments made by the government for current use
- Capital Spending by Businesses: Spending on purchases of fixed assets and unsold stock by private businesses
Net Exports: Represents the country’s balance of trade (BOT), where a positive number bumps up the GDP as country exports more than it imports, and vice versa
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Question 4 of 30
1 points
Which of the following are parameters used to calculated Human Development Index?
- GNI per capita
- Life expectancy at birth
- Mean years of schooling
- Expected years of schooling
Select the correct answer using the code given below:
CorrectSolution: D
All the above statements are correct.
The HDI was developed to challenge the idea that a nation’s progress could be assessed by its economic growth (usually measure by Gross Domestic Product). Now is not the place to highlight the shortcomings of GDP as a measure of human wellbeing, suffice it to say that Simon Kuznets, the Nobel Prize winning economist who helped develop the concept in the 1930s, explicitly warned the government not to use it as a measure of wellbeing. Yet that is precisely what started to happen around the world.
IncorrectSolution: D
All the above statements are correct.
The HDI was developed to challenge the idea that a nation’s progress could be assessed by its economic growth (usually measure by Gross Domestic Product). Now is not the place to highlight the shortcomings of GDP as a measure of human wellbeing, suffice it to say that Simon Kuznets, the Nobel Prize winning economist who helped develop the concept in the 1930s, explicitly warned the government not to use it as a measure of wellbeing. Yet that is precisely what started to happen around the world.
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Question 5 of 30
1 points
Consider the following statements regarding Index of Industrial Production
- The Index is compiled and released by Office of the Economic Adviser (OEA).
- IIP is a key economic indicator of the manufacturing sector of the economy.
Which of the statements given above is/are correct?
CorrectSolution: B
Index of Industrial Production
What is IIP data? Index of Industrial Production data or IIP as it is commonly called is an index that tracks manufacturing activity in different sectors of an economy. The IIP number measures the industrial production for the period under review, usually a month, as against the reference period. IIP is a key economic indicator of the manufacturing sector of the economy. There is a lag of six weeks in the publication of the IIP index data after the reference month ends. IIP index is currently calculated using 2011-2012 as the base year.
IIP Index Components:
Electricity, crude oil, coal, cement, steel, refinery products, natural gas, and fertilisers are the eight core industries that comprise about 40 percent of the weight of items included in the Index of Industrial Production. Mining, manufacturing, and electricity are the three broad sectors in which IIP constituents fall.
Who releases Index of Industrial Production or IIP data?
In the case of Index of Industrial Production India, IIP data is compiled and published by CSO every month.
CSO or Central Statistical Organisation operates under the Ministry of Statistics and Programme Implementation (MoSPI). The IIP index data, once released, is also available on the PIB website.
IncorrectSolution: B
Index of Industrial Production
What is IIP data? Index of Industrial Production data or IIP as it is commonly called is an index that tracks manufacturing activity in different sectors of an economy. The IIP number measures the industrial production for the period under review, usually a month, as against the reference period. IIP is a key economic indicator of the manufacturing sector of the economy. There is a lag of six weeks in the publication of the IIP index data after the reference month ends. IIP index is currently calculated using 2011-2012 as the base year.
IIP Index Components:
Electricity, crude oil, coal, cement, steel, refinery products, natural gas, and fertilisers are the eight core industries that comprise about 40 percent of the weight of items included in the Index of Industrial Production. Mining, manufacturing, and electricity are the three broad sectors in which IIP constituents fall.
Who releases Index of Industrial Production or IIP data?
In the case of Index of Industrial Production India, IIP data is compiled and published by CSO every month.
CSO or Central Statistical Organisation operates under the Ministry of Statistics and Programme Implementation (MoSPI). The IIP index data, once released, is also available on the PIB website.
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Question 6 of 30
1 points
Arrange the following industries based on the weightage in Index of Eight Core Industries, from highest to lowest?
- Petroleum Refinery
- Fertilizers
- Electricity generation
Select the correct answer using the code given below:
CorrectSolution: B
Eight Core Industries and their weightage in index are:
IncorrectSolution: B
Eight Core Industries and their weightage in index are:
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Question 7 of 30
1 points
Which of the following can be considered as the effects of Inflation?
- Erodes Purchasing Power
- Reduces unemployment
- It lowers the cost of borrowing
Which of the statements given above is/are correct?
CorrectSolution: D
Inflation is an economic term describing the sustained increase in prices of goods and services within a period. To some, it signifies a struggling economy, whereas others see it as a sign of a prospering economy. Here, we examine some of the residual effects of inflation.
- Inflation, the steady rise of prices for goods and services over a period, has many effects, good and bad.
- Inflation erodes purchasing power or how much of something can be purchased with currency.
- Because inflation erodes the value of cash, it encourages consumers to spend and stock up on items that are slower to lose value.
- It lowers the cost of borrowing and reduces unemployment.
IncorrectSolution: D
Inflation is an economic term describing the sustained increase in prices of goods and services within a period. To some, it signifies a struggling economy, whereas others see it as a sign of a prospering economy. Here, we examine some of the residual effects of inflation.
- Inflation, the steady rise of prices for goods and services over a period, has many effects, good and bad.
- Inflation erodes purchasing power or how much of something can be purchased with currency.
- Because inflation erodes the value of cash, it encourages consumers to spend and stock up on items that are slower to lose value.
- It lowers the cost of borrowing and reduces unemployment.
-
Question 8 of 30
1 points
Consider the following statements regarding Accommodative Monetary Policy
- Accommodative monetary policy is when central banks expand the money supply to boost the economy.
- It is generally known as tight monetary policy.
Which of the statements given above is/are correct?
CorrectSolution: A
What Is an Accommodative Monetary Policy?
- Accommodative monetary policy, also known as loose credit or easy monetary policy, occurs when a central bank (such as the Federal Reserve) attempts to expand the overall money supply to boost the economy when growth is slowing (as measured by GDP).
- The policy is implemented to allow the money supply to rise in line with national income and the demand for money.
- Monetary policies that are considered accommodative include lowering the Federal funds rate.
- These measures are meant to make money less expensive to borrow and encourage more spending.
IncorrectSolution: A
What Is an Accommodative Monetary Policy?
- Accommodative monetary policy, also known as loose credit or easy monetary policy, occurs when a central bank (such as the Federal Reserve) attempts to expand the overall money supply to boost the economy when growth is slowing (as measured by GDP).
- The policy is implemented to allow the money supply to rise in line with national income and the demand for money.
- Monetary policies that are considered accommodative include lowering the Federal funds rate.
- These measures are meant to make money less expensive to borrow and encourage more spending.
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Question 9 of 30
1 points
Consider the following statements regarding Revenue receipts
- Revenue receipts creates a liability for the government.
- Revenue receipts do not lead to any reduction in the government’s assets.
- They are regular and recurring in nature.
Which of the statements given above are correct?
CorrectSolution : B
Revenue receipts can be defined as those receipts which neither create any liability nor cause any reduction in the assets of the government. They are regular and recurring in nature and the government receives them in the normal course of activities.
Revenue receipts include the proceeds from taxes and other duties levied by the Centre; the interest and dividend it receives on its investments; and the fees and charges the government receives for its services.
Simply put, revenue receipts must satisfy two basic conditions:
No liability: Revenue receipts do not create any liability for the government. Hence, statement 1 is incorrect.
For example, taxes received by the government, unlike borrowings, do not create any liabilities for it.
No asset reduction: Revenue receipts do not lead to any reduction in the government’s assets. So, the government cannot show its earnings from sale of stake in a public-sector undertaking as revenue receipts because the stake sale resulted in reduction of its assets.
For the government, there are two sources of revenue receipts — tax revenues and non-tax revenues
IncorrectSolution : B
Revenue receipts can be defined as those receipts which neither create any liability nor cause any reduction in the assets of the government. They are regular and recurring in nature and the government receives them in the normal course of activities.
Revenue receipts include the proceeds from taxes and other duties levied by the Centre; the interest and dividend it receives on its investments; and the fees and charges the government receives for its services.
Simply put, revenue receipts must satisfy two basic conditions:
No liability: Revenue receipts do not create any liability for the government. Hence, statement 1 is incorrect.
For example, taxes received by the government, unlike borrowings, do not create any liabilities for it.
No asset reduction: Revenue receipts do not lead to any reduction in the government’s assets. So, the government cannot show its earnings from sale of stake in a public-sector undertaking as revenue receipts because the stake sale resulted in reduction of its assets.
For the government, there are two sources of revenue receipts — tax revenues and non-tax revenues
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Question 10 of 30
1 points
Consider the following statements regarding Money supply
- The total stock of money in circulation among the public at a particular point of time is called money supply.
- M1 and M2 are known as broad money.
Which of the statements given above is/are correct?
CorrectSolution : A
Money supply, like money demand, is a stock variable. The total stock of money in circulation among the public at a particular point of time is called money supply. RBI publishes figures for four alternative measures of money supply, viz. M1, M2, M3 and M4. They are defined as follows
M1 = CU + DD
M2 = M1 + Savings deposits with Post Office savings banks
M3 = M1 + Net time deposits of commercial banks
M4 = M3 + Total deposits with Post Office savings organizations (excluding
National Savings Certificates)
where, CU is currency (notes plus coins) held by the public and DD is net demand deposits held by commercial banks. The word ‘net’ implies that only deposits of the public held by the banks are to be included in money supply. The interbank deposits, which a commercial bank holds in other commercial banks, are not to be regarded as part of money supply.
M1 and M2 are known as narrow money.
M3 and M4 are known as broad money. These measures are in decreasing order of liquidity. M1 is most liquid and easiest for transactions whereas M4 is least liquid of all. M3 is the most commonly used measure of money supply. It is also known as aggregate monetary resources.
IncorrectSolution : A
Money supply, like money demand, is a stock variable. The total stock of money in circulation among the public at a particular point of time is called money supply. RBI publishes figures for four alternative measures of money supply, viz. M1, M2, M3 and M4. They are defined as follows
M1 = CU + DD
M2 = M1 + Savings deposits with Post Office savings banks
M3 = M1 + Net time deposits of commercial banks
M4 = M3 + Total deposits with Post Office savings organizations (excluding
National Savings Certificates)
where, CU is currency (notes plus coins) held by the public and DD is net demand deposits held by commercial banks. The word ‘net’ implies that only deposits of the public held by the banks are to be included in money supply. The interbank deposits, which a commercial bank holds in other commercial banks, are not to be regarded as part of money supply.
M1 and M2 are known as narrow money.
M3 and M4 are known as broad money. These measures are in decreasing order of liquidity. M1 is most liquid and easiest for transactions whereas M4 is least liquid of all. M3 is the most commonly used measure of money supply. It is also known as aggregate monetary resources.
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Question 11 of 30
1 points
Which of the following forms the part of Capital Receipts?
- Recovery of loans
- Sale of shares in Public Sector Undertakings (PSUs)
- Fresh loans given by Government.
Which of the statements given above are correct?
CorrectSolution : A
Fresh loans given by Government forms the part of Capital expenditure. Hence, statement 3 is incorrect.
Capital Receipts: The government also receives money by way of loans or from the sale of its assets. Loans will have to be returned to the agencies from which they have been borrowed. Thus they create liability. Sale of government assets, like sale of shares in Public Sector Undertakings (PSUs) which is referred to as PSU disinvestment, reduce the total amount of financial assets of the government. All those receipts of the government which create liability or reduce financial assets are termed as capital receipts. When government takes fresh loans it will mean that in future these loans will have to be returned and interest will have to be paid on these loans. Similarly, when government sells an asset, then it means that in future its earnings from that asset, will disappear. Thus, these receipts can be debt creating or non-debt creating.
Capital Receipts (a+b+c)
(a) Recovery of loans
(b) Other receipts (mainly PSU disinvestment)
(c) Borrowings and other liabilities
IncorrectSolution : A
Fresh loans given by Government forms the part of Capital expenditure. Hence, statement 3 is incorrect.
Capital Receipts: The government also receives money by way of loans or from the sale of its assets. Loans will have to be returned to the agencies from which they have been borrowed. Thus they create liability. Sale of government assets, like sale of shares in Public Sector Undertakings (PSUs) which is referred to as PSU disinvestment, reduce the total amount of financial assets of the government. All those receipts of the government which create liability or reduce financial assets are termed as capital receipts. When government takes fresh loans it will mean that in future these loans will have to be returned and interest will have to be paid on these loans. Similarly, when government sells an asset, then it means that in future its earnings from that asset, will disappear. Thus, these receipts can be debt creating or non-debt creating.
Capital Receipts (a+b+c)
(a) Recovery of loans
(b) Other receipts (mainly PSU disinvestment)
(c) Borrowings and other liabilities
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Question 12 of 30
1 points
Consider the following statements regarding inflation target
- The Monetary Policy Committee (MPC) constituted by the Central Government determines the policy interest rate required to achieve the inflation target.
- The inflation target is set by the Reserve Bank, once in every five years.
- The current inflation target is 6% Consumer Price Index (CPI) inflation.
Which of the statements given above is/are correct?
CorrectSolution: A
-
- Monetary policy refers to the policy of the central bank with regard to the use of monetary instruments under its control to achieve the goals specified in the Act.
- The Reserve Bank of India (RBI) is vested with the responsibility of conducting monetary policy. This responsibility is explicitly mandated under the Reserve Bank of India Act, 1934.
- The primary objective of monetary policy is to maintain price stability while keeping in mind the objective of growth. Price stability is a necessary precondition to sustainable growth.
- In May 2016, the Reserve Bank of India (RBI) Act, 1934 was amended to provide a statutory basis for the implementation of the flexible inflation targeting framework.
- The amended RBI Act also provides for the inflation target to be set by the Government of India, in consultation with the Reserve Bank, once in every five years. Accordingly, the Central Government has notified in the Official Gazette 4 per cent Consumer Price Index (CPI) inflation as the target for the period from August 5, 2016 to March 31, 2021 with the upper tolerance limit of 6 per cent and the lower tolerance limit of 2 per cent. Hence, both statement 1 and 2 are incorrect.
- The Central Government notified the following as factors that constitute failure to achieve the inflation target:(a) the average inflation is more than the upper tolerance level of the inflation target for any three consecutive quarters; or (b) the average inflation is less than the lower tolerance level for any three consecutive quarters.
- Prior to the amendment in the RBI Act in May 2016, the flexible inflation targeting framework was governed by an Agreement on Monetary Policy Framework between the Government and the Reserve Bank of India of February 20, 2015.
The Monetary Policy Process
The Monetary Policy Committee (MPC) constituted by the Central Government under Section 45ZB determines the policy interest rate required to achieve the inflation target.
The Reserve Bank’s Monetary Policy Department (MPD) assists the MPC in formulating the monetary policy. Views of key stakeholders in the economy, and analytical work of the Reserve Bank contribute to the process for arriving at the decision on the policy repo rate.
The Financial Market Committee (FMC) meets daily to review the liquidity conditions so as to ensure that the operating target of monetary policy (weighted average lending rate) is kept close to the policy repo rate.
IncorrectSolution: A
-
- Monetary policy refers to the policy of the central bank with regard to the use of monetary instruments under its control to achieve the goals specified in the Act.
- The Reserve Bank of India (RBI) is vested with the responsibility of conducting monetary policy. This responsibility is explicitly mandated under the Reserve Bank of India Act, 1934.
- The primary objective of monetary policy is to maintain price stability while keeping in mind the objective of growth. Price stability is a necessary precondition to sustainable growth.
- In May 2016, the Reserve Bank of India (RBI) Act, 1934 was amended to provide a statutory basis for the implementation of the flexible inflation targeting framework.
- The amended RBI Act also provides for the inflation target to be set by the Government of India, in consultation with the Reserve Bank, once in every five years. Accordingly, the Central Government has notified in the Official Gazette 4 per cent Consumer Price Index (CPI) inflation as the target for the period from August 5, 2016 to March 31, 2021 with the upper tolerance limit of 6 per cent and the lower tolerance limit of 2 per cent. Hence, both statement 1 and 2 are incorrect.
- The Central Government notified the following as factors that constitute failure to achieve the inflation target:(a) the average inflation is more than the upper tolerance level of the inflation target for any three consecutive quarters; or (b) the average inflation is less than the lower tolerance level for any three consecutive quarters.
- Prior to the amendment in the RBI Act in May 2016, the flexible inflation targeting framework was governed by an Agreement on Monetary Policy Framework between the Government and the Reserve Bank of India of February 20, 2015.
The Monetary Policy Process
The Monetary Policy Committee (MPC) constituted by the Central Government under Section 45ZB determines the policy interest rate required to achieve the inflation target.
The Reserve Bank’s Monetary Policy Department (MPD) assists the MPC in formulating the monetary policy. Views of key stakeholders in the economy, and analytical work of the Reserve Bank contribute to the process for arriving at the decision on the policy repo rate.
The Financial Market Committee (FMC) meets daily to review the liquidity conditions so as to ensure that the operating target of monetary policy (weighted average lending rate) is kept close to the policy repo rate.
-
Question 13 of 30
1 points
Consider the following statements regarding Government Security (G-Sec)
- A Government Security (G-Sec) is a tradeable instrument issued by the Central Government or the State Governments.
- Treasury bills or T-bills are short term debt instruments issued by the Government of India.
Which of the statements given above is/are correct?
CorrectSolution: C
All the above statements are correct.
What is a Government Security (G-Sec)?
1.2 A Government Security (G-Sec) is a tradeable instrument issued by the Central Government or the State Governments. It acknowledges the Government’s debt obligation. Such securities are short term (usually called treasury bills, with original maturities of less than one year) or long term (usually called Government bonds or dated securities with original maturity of one year or more). In India, the Central Government issues both, treasury bills and bonds or dated securities while the State Governments issue only bonds or dated securities, which are called the State Development Loans (SDLs). G-Secs carry practically no risk of default and, hence, are called risk-free gilt-edged instruments.
- Treasury Bills (T-bills)
1.3 Treasury bills or T-bills, which are money market instruments, are short term debt instruments issued by the Government of India and are presently issued in three tenors, namely, 91 day, 182 day and 364 day. Treasury bills are zero coupon securities and pay no interest. Instead, they are issued at a discount and redeemed at the face value at maturity. For example, a 91 day Treasury bill of ₹100/- (face value) may be issued at say ₹ 98.20, that is, at a discount of say, ₹1.80 and would be redeemed at the face value of ₹100/-.
IncorrectSolution: C
All the above statements are correct.
What is a Government Security (G-Sec)?
1.2 A Government Security (G-Sec) is a tradeable instrument issued by the Central Government or the State Governments. It acknowledges the Government’s debt obligation. Such securities are short term (usually called treasury bills, with original maturities of less than one year) or long term (usually called Government bonds or dated securities with original maturity of one year or more). In India, the Central Government issues both, treasury bills and bonds or dated securities while the State Governments issue only bonds or dated securities, which are called the State Development Loans (SDLs). G-Secs carry practically no risk of default and, hence, are called risk-free gilt-edged instruments.
- Treasury Bills (T-bills)
1.3 Treasury bills or T-bills, which are money market instruments, are short term debt instruments issued by the Government of India and are presently issued in three tenors, namely, 91 day, 182 day and 364 day. Treasury bills are zero coupon securities and pay no interest. Instead, they are issued at a discount and redeemed at the face value at maturity. For example, a 91 day Treasury bill of ₹100/- (face value) may be issued at say ₹ 98.20, that is, at a discount of say, ₹1.80 and would be redeemed at the face value of ₹100/-.
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Question 14 of 30
1 points
Consider the following statements regarding Commercial Paper (CP)
- A CP is a negotiable money market instrument and issued in dematerialized form for funds deposited at a bank for a specified time period.
- A CP is issued in minimum denomination of ₹5 lakh and multiples thereof and shall be issued at a discount to face value.
Which of the statements given above is/are correct?
CorrectSolution: B
Commercial Paper (CP)
Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note and held in a dematerialized form through any of the depositories approved by and registered with SEBI. A CP is issued in minimum denomination of ₹5 lakh and multiples thereof and shall be issued at a discount to face value.
No issuer shall have the issue of CP underwritten or co-accepted and options (call/put) are not permitted on a CP. Companies, including NBFCs and AIFIs, other entities like co-operative societies, government entities, trusts, limited liability partnerships and any other body corporate having presence in India with net worth of ₹100 cr or higher and any other entities specifically permitted by RBI are eligible to issue Commercial papers subject to conditions specified by RBI. All residents, and non-residents permitted to invest in CPs under Foreign Exchange Management Act (FEMA), 1999 are eligible to invest in CPs; however, no person can invest in CPs issued by related parties either in the primary or secondary market. Investment by regulated financial sector entities will be subject to such conditions as the concerned regulator may impose.
Certificate of Deposit (CD)
Certificate of Deposit (CD) is a negotiable money market instrument and issued in dematerialised form or as a Usance Promissory Note, for funds deposited at a bank or other eligible financial institution for a specified time period.
Banks can issue CDs for maturities from 7 days to one year whereas eligible FIs can issue for maturities from 1 year to 3 years.
IncorrectSolution: B
Commercial Paper (CP)
Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note and held in a dematerialized form through any of the depositories approved by and registered with SEBI. A CP is issued in minimum denomination of ₹5 lakh and multiples thereof and shall be issued at a discount to face value.
No issuer shall have the issue of CP underwritten or co-accepted and options (call/put) are not permitted on a CP. Companies, including NBFCs and AIFIs, other entities like co-operative societies, government entities, trusts, limited liability partnerships and any other body corporate having presence in India with net worth of ₹100 cr or higher and any other entities specifically permitted by RBI are eligible to issue Commercial papers subject to conditions specified by RBI. All residents, and non-residents permitted to invest in CPs under Foreign Exchange Management Act (FEMA), 1999 are eligible to invest in CPs; however, no person can invest in CPs issued by related parties either in the primary or secondary market. Investment by regulated financial sector entities will be subject to such conditions as the concerned regulator may impose.
Certificate of Deposit (CD)
Certificate of Deposit (CD) is a negotiable money market instrument and issued in dematerialised form or as a Usance Promissory Note, for funds deposited at a bank or other eligible financial institution for a specified time period.
Banks can issue CDs for maturities from 7 days to one year whereas eligible FIs can issue for maturities from 1 year to 3 years.
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Question 15 of 30
1 points
Which of the following are conditions for Systemically Important Core Investment Company (CIC-ND-SI)?
- It holds less than 90% of its Total Assets in the form of investment in equity shares, preference shares, debt or loans in group companies.
- Its asset size is ₹ 100 crore or above.
- It accepts public funds.
Which of the statements given above are correct?
CorrectSolution: B
Systemically Important Core Investment Company (CIC-ND-SI): CIC-ND-SI is an NBFC carrying on the business of acquisition of shares and securities which satisfies the following conditions:-
(a) it holds not less than 90% of its Total Assets in the form of investment in equity shares, preference shares, debt or loans in group companies; Hence, statement 1 is incorrect.
(b) its investments in the equity shares (including instruments compulsorily convertible into equity shares within a period not exceeding 10 years from the date of issue) in group companies constitutes not less than 60% of its Total Assets;
(c) it does not trade in its investments in shares, debt or loans in group companies except through block sale for the purpose of dilution or disinvestment;
(d) it does not carry on any other financial activity referred to in Section 45I(c) and 45I(f) of the RBI act, 1934 except investment in bank deposits, money market instruments, government securities, loans to and investments in debt issuances of group companies or guarantees issued on behalf of group companies.
(e) Its asset size is ₹ 100 crore or above and
(f) It accepts public funds
IncorrectSolution: B
Systemically Important Core Investment Company (CIC-ND-SI): CIC-ND-SI is an NBFC carrying on the business of acquisition of shares and securities which satisfies the following conditions:-
(a) it holds not less than 90% of its Total Assets in the form of investment in equity shares, preference shares, debt or loans in group companies; Hence, statement 1 is incorrect.
(b) its investments in the equity shares (including instruments compulsorily convertible into equity shares within a period not exceeding 10 years from the date of issue) in group companies constitutes not less than 60% of its Total Assets;
(c) it does not trade in its investments in shares, debt or loans in group companies except through block sale for the purpose of dilution or disinvestment;
(d) it does not carry on any other financial activity referred to in Section 45I(c) and 45I(f) of the RBI act, 1934 except investment in bank deposits, money market instruments, government securities, loans to and investments in debt issuances of group companies or guarantees issued on behalf of group companies.
(e) Its asset size is ₹ 100 crore or above and
(f) It accepts public funds
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Question 16 of 30
1 points
Consider the following statements regarding Bonn Challenge
- It’s a US based initiative to bring 150 million hectares of the world’s deforested and degraded land into restoration.
- India has joined the initiative
- It is legally binding in nature
Which of the statements given above is/are correct?
CorrectSolution: A
Bonn Challenge is a global effort to bring 150 million hectares of the world’s deforested and degraded land into restoration by 2020, and 350 million hectares by 2030.
It is launched by the Government of Germany and IUCN in 2011, the Challenge surpassed the 150-million-hectare milestone for pledges in 2017. At the UNFCCC Conference of the Parties (COP) 2015 in Paris, India also joined the voluntary Bonn Challenge pledge to bring into restoration 13 million hectares of degraded and deforested land by the year 2020, an additional 8 million hectares by 2030.
IncorrectSolution: A
Bonn Challenge is a global effort to bring 150 million hectares of the world’s deforested and degraded land into restoration by 2020, and 350 million hectares by 2030.
It is launched by the Government of Germany and IUCN in 2011, the Challenge surpassed the 150-million-hectare milestone for pledges in 2017. At the UNFCCC Conference of the Parties (COP) 2015 in Paris, India also joined the voluntary Bonn Challenge pledge to bring into restoration 13 million hectares of degraded and deforested land by the year 2020, an additional 8 million hectares by 2030.
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Question 17 of 30
1 points
Consider the following statements regarding Leaf Coalition
- It is an initiative group of governments and big companies
- Leaf coalition aims to mobilize at least $1 billion in finance to supporttropical and subtropical forest countries to move rapidly towards reducing emissions from deforestation.
Which of the statements given above is/are correct?
CorrectSolution: C
LEAF Coalition is launched by an initial group of governments (Norway, UK, US) and leading companies (like Amazon, nestle etc.) to mobilise finance for protection of tropical forest.
LEAF (Lowering Emissions by Accelerating Forest finance) coalition aims to mobilize at least $1 billion in finance to support tropical and subtropical forest countries to move rapidly towards reducing emissions from deforestation.
It is expected to become one of the largest public-private efforts that support countries in achieving their Nationally Determined Contributions (NDCs) under the Paris Agreement and the Reducing Emissions from Deforestation and Forest Degradation (REDD+) mechanism.
The announcement took place during the World Leaders Summit on November 2nd as part of the United Nations Climate Change Conference (COP26). LEAF is on track to become one of the largest-ever public-private efforts to protect tropical forests, with total demand for verified emission reductions from its growing list of participants estimated to potentially reach at least several billion dollars. This ground-breaking public-private finance commitment will provide invaluable support for countries protecting their tropical forests, to the benefit of hundreds of millions of people.
IncorrectSolution: C
LEAF Coalition is launched by an initial group of governments (Norway, UK, US) and leading companies (like Amazon, nestle etc.) to mobilise finance for protection of tropical forest.
LEAF (Lowering Emissions by Accelerating Forest finance) coalition aims to mobilize at least $1 billion in finance to support tropical and subtropical forest countries to move rapidly towards reducing emissions from deforestation.
It is expected to become one of the largest public-private efforts that support countries in achieving their Nationally Determined Contributions (NDCs) under the Paris Agreement and the Reducing Emissions from Deforestation and Forest Degradation (REDD+) mechanism.
The announcement took place during the World Leaders Summit on November 2nd as part of the United Nations Climate Change Conference (COP26). LEAF is on track to become one of the largest-ever public-private efforts to protect tropical forests, with total demand for verified emission reductions from its growing list of participants estimated to potentially reach at least several billion dollars. This ground-breaking public-private finance commitment will provide invaluable support for countries protecting their tropical forests, to the benefit of hundreds of millions of people.
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Question 18 of 30
1 points
Which state in India is calculating Gross Environment Product along with Gross Domestic Product?
CorrectSolution: D
On World Environment Day (June 5), Uttarakhand became the 1st state in India to take into account Gross Environment Product (GEP) while calculating its Gross Domestic Product (GDP). Four critical natural resources- Air, Water, Forest and Soil- were assigned monetary values.
GEP is the total value of final ecosystem services supplied to human well-being in a region annually and can be measured in terms of biophysical value and monetary value.
IncorrectSolution: D
On World Environment Day (June 5), Uttarakhand became the 1st state in India to take into account Gross Environment Product (GEP) while calculating its Gross Domestic Product (GDP). Four critical natural resources- Air, Water, Forest and Soil- were assigned monetary values.
GEP is the total value of final ecosystem services supplied to human well-being in a region annually and can be measured in terms of biophysical value and monetary value.
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Question 19 of 30
1 points
Consider the following statements regarding Operation Olivia
- It is conducted by Wildlife Crime Control Bureau.
- It involves round-the-clock surveillance from November till May of every year
- It aims to protect dugong species
Which of the statements given above is/are correct?
CorrectSolution: B
Operation Olivia is conducted by Indian Coast Guards. It aims to protect turtles as they arrive to nest in Odisha. It is initiated in the early 1980s. It involves round-the-clock surveillance from November till May using fast patrol vessels, air cushion vessels, interceptor craft etc.
Operation Olivia is a project carried out by the Indian Coast Guard to protect the population of Olive Ridley turtles during their nesting seasons from December to May. It is carried out off the coast of Odisha, the primary habitat range of the turtles.
All five species of sea turtles found in India are included in Schedule I of Indian Wildlife Protection Act, 1972.
IncorrectSolution: B
Operation Olivia is conducted by Indian Coast Guards. It aims to protect turtles as they arrive to nest in Odisha. It is initiated in the early 1980s. It involves round-the-clock surveillance from November till May using fast patrol vessels, air cushion vessels, interceptor craft etc.
Operation Olivia is a project carried out by the Indian Coast Guard to protect the population of Olive Ridley turtles during their nesting seasons from December to May. It is carried out off the coast of Odisha, the primary habitat range of the turtles.
All five species of sea turtles found in India are included in Schedule I of Indian Wildlife Protection Act, 1972.
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Question 20 of 30
1 points
Dagmara Hydro Electric Project, sometime seen in the news, is related to
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Question 21 of 30
1 points
Which of the following is /are the left tributaries of Krishna?
- Bhima
- Musi
- Munneru
Which of the statements given above is/are correct?
CorrectSolution: C
Tributaries of Krishna River
Right bank: the Ghatprabha, the Malprabha and the Tungabhadra.
Left Bank: the Bhima, the Musi and the Munneru.
- The Koyna is a small tributary but is known for Koyna Dam. This dam was perhaps the main cause of the devastating earthquake (6.4 on richter scale) in 1967 that killed 150 people.
- The Bhima originates from the Matheron Hills and joins the Krishna near Raichur after for a distance of 861 km.
- The Tungabhadra is formed by the unification of the Tunga and the Bhadra originating from Gangamula in the Central Sahyadri. Its total length is 531 km.
- At Wazirabad, it receives its last important tributary, the Musi, on whose banks the city of Hyderabad is located.
IncorrectSolution: C
Tributaries of Krishna River
Right bank: the Ghatprabha, the Malprabha and the Tungabhadra.
Left Bank: the Bhima, the Musi and the Munneru.
- The Koyna is a small tributary but is known for Koyna Dam. This dam was perhaps the main cause of the devastating earthquake (6.4 on richter scale) in 1967 that killed 150 people.
- The Bhima originates from the Matheron Hills and joins the Krishna near Raichur after for a distance of 861 km.
- The Tungabhadra is formed by the unification of the Tunga and the Bhadra originating from Gangamula in the Central Sahyadri. Its total length is 531 km.
- At Wazirabad, it receives its last important tributary, the Musi, on whose banks the city of Hyderabad is located.
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Question 22 of 30
1 points
Devika river, sometime seen in the news, originates in
CorrectSolution: A
Devika
Udhampur is also well known city for the Devika river. The Devika river is also known as the sister of the river Ganges.
In the Nilmat Puran that was written in the 7th century by Nela Muni, it is mentioned that the Devika River is a manifestation of the mother Goddess Parwati herself to benefit the people of Mader Desha that covers areas between river Ravi and Chenab and the river Devika appeared on Shiv Ratri. Lord Shiva himself remains side by side with his consort Uma manifesting himself in form of Shiv Lingas at 8 places alongside the Devika river.
The river presently runs under its sandy surface.In Devi Mahatmays it is mentioned that there is no need to perform Japa or any ritual for obtaining spiritual benefits at this pilgrim centre, only to touch with the Devika waters or having a bath in its waters is enough to get spiritual benefits. Water comes out by digging about a foot into the sand bed. Cremation on the sands of Devika is considered as meritorious as cremation on the banks of the Ganges at Kashi.
IncorrectSolution: A
Devika
Udhampur is also well known city for the Devika river. The Devika river is also known as the sister of the river Ganges.
In the Nilmat Puran that was written in the 7th century by Nela Muni, it is mentioned that the Devika River is a manifestation of the mother Goddess Parwati herself to benefit the people of Mader Desha that covers areas between river Ravi and Chenab and the river Devika appeared on Shiv Ratri. Lord Shiva himself remains side by side with his consort Uma manifesting himself in form of Shiv Lingas at 8 places alongside the Devika river.
The river presently runs under its sandy surface.In Devi Mahatmays it is mentioned that there is no need to perform Japa or any ritual for obtaining spiritual benefits at this pilgrim centre, only to touch with the Devika waters or having a bath in its waters is enough to get spiritual benefits. Water comes out by digging about a foot into the sand bed. Cremation on the sands of Devika is considered as meritorious as cremation on the banks of the Ganges at Kashi.
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Question 23 of 30
1 points
Consider the following statements regarding Deepor Beel
- It is Assam’s only Ramsar site
- It is an ‘Important Bird Area’ designated under the Ramsar Convention of Wetlands
Which of the statements given above is/are correct?
CorrectSolution: C
Assam’s only Ramsar site. It is an ‘Important Bird Area’ designated under the Ramsar Convention of Wetlands.
It is an open lake basin connected with a set of inflow and outflow channels. Some endangered species, included in IUCN Red List, are also seen here like Spot-billed Pelican, Lesser Adjutant Stork, Baer’s Pochard, White Bellied Eagle, Greater Adjutant Stork, etc
IncorrectSolution: C
Assam’s only Ramsar site. It is an ‘Important Bird Area’ designated under the Ramsar Convention of Wetlands.
It is an open lake basin connected with a set of inflow and outflow channels. Some endangered species, included in IUCN Red List, are also seen here like Spot-billed Pelican, Lesser Adjutant Stork, Baer’s Pochard, White Bellied Eagle, Greater Adjutant Stork, etc
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Question 24 of 30
1 points
Consider the following statements regarding Bureau of Energy Efficiency
- It has been set up under the Energy Conservation Act, 2001
- It works under Ministry of Environment, Forest and Climate Change.
- It is responsible for spearheading the improvement of energy efficiency of the economy through various regulatory and promotional instruments.
Which of the statements given above is/are correct?
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Question 25 of 30
1 points
Consider the following statements regarding Review petition
- Review petition is to be filed within 45 days of the pronouncement of judgment
- Only parties to a case can seek a review of the judgment on it.
- When a review takes place, the Court will take fresh stock of the case.
Which of the statements given above is/are correct?
CorrectSolution: D
Review petition:
-
- Under Article 137, the Supreme Court has the power to review any of its judgments or orders.
- When a review takes place, the law is that it is allowed not to take fresh stock of the case but to correct grave errors that have resulted in the miscarriage of justice.
- The court has the power to review its rulings to correct a “patent error” and not “minor mistakes of inconsequential import”.
- As per the Civil Procedure Code and the Supreme Court Rules, any person aggrieved by a ruling can seek a review. However, the court exercises its discretion to allow a review petition only when it shows the grounds for seeking the review.
A review petition must be filed within 30 days of the date of judgment or order. While a judgment is the final decision in a case, an order is an interim ruling that is subject to its final verdict.
IncorrectSolution: D
Review petition:
-
- Under Article 137, the Supreme Court has the power to review any of its judgments or orders.
- When a review takes place, the law is that it is allowed not to take fresh stock of the case but to correct grave errors that have resulted in the miscarriage of justice.
- The court has the power to review its rulings to correct a “patent error” and not “minor mistakes of inconsequential import”.
- As per the Civil Procedure Code and the Supreme Court Rules, any person aggrieved by a ruling can seek a review. However, the court exercises its discretion to allow a review petition only when it shows the grounds for seeking the review.
A review petition must be filed within 30 days of the date of judgment or order. While a judgment is the final decision in a case, an order is an interim ruling that is subject to its final verdict.
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Question 26 of 30
1 points
The sum of five consecutive numbers is 190. What is the sum of the largest and the smallest numbers?
CorrectAnswer : C
Let the five consecutive numbers are
X – 2, x – 1, x, x + 1, x + 2.
Sum of numbers = 190
∴x – 2 + x – 1 +x +x + 1 + x + 2 = 190
5x = 190
X = 38
Sum of largest and smallest numbers = x + 2 + x -2 = 2x = 2 × 38 = 76
IncorrectAnswer : C
Let the five consecutive numbers are
X – 2, x – 1, x, x + 1, x + 2.
Sum of numbers = 190
∴x – 2 + x – 1 +x +x + 1 + x + 2 = 190
5x = 190
X = 38
Sum of largest and smallest numbers = x + 2 + x -2 = 2x = 2 × 38 = 76
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Question 27 of 30
1 points
The difference between a two-digit number and the number obtained by interchangıng the two digits of the number is 18. The sum of the two digits of the number is 12. What is the product of the digits of two-digit number?
CorrectAnswer : A
Let the unit’s digit be y and ten’s digit be x.
Then, the number = 10x + y
When interchanging the place, the number is 10y + x.
According to the question,
(10x+ y) – (10y + x) = 18
10 x + y -10y – x = 18
9x – 9y=18
X – y = 2
and x+y = 12
On adding Eqs. (1) and (2), We get
x = 7
∴ x = 7 and y = 5
Product = xy = 7 × 5 = 35
IncorrectAnswer : A
Let the unit’s digit be y and ten’s digit be x.
Then, the number = 10x + y
When interchanging the place, the number is 10y + x.
According to the question,
(10x+ y) – (10y + x) = 18
10 x + y -10y – x = 18
9x – 9y=18
X – y = 2
and x+y = 12
On adding Eqs. (1) and (2), We get
x = 7
∴ x = 7 and y = 5
Product = xy = 7 × 5 = 35
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Question 28 of 30
1 points
Passage -1
To overcome or minimize the impacts of climate change, there has been an emphasis on effective mitigation and adaptation strategies. While mitigation strategies can help in absorbing the atmospheric carbon dioxide and locking it away from the atmosphere, it can often be a time-taking process. In recent years, the idea of local-led adaptation has been widely discussed. Local-led adaptation refers to local communities, local governments acting strong in taking effective decisions to tackle climate change. Local-led adaptation is often characterized by indigenous solutions, which are often associated with nature. Given that the most vulnerable populations are the ones that are more dependent on natural resources, it is therefore to be expected that coping solutions also often germinate from the same source. This directs us to Nature-based Solutions.
As a term, Nature-based Solutions is relatively new, but the concept has been practiced for decades. The idea of protecting an ecosystem by restoring it is nothing but an example of Nature-based Solutions.
3-In reference to the above passage, Which of the following assumptions is/are valid?
- Climate change is the greatest challenge to the mankind today.
- Nature-based solutions can help in protecting, conserving and restoring our natural environment.
CorrectAnswer. B.
1st statement is not a correct assumption as passage is talking about climate change as one of the challenge but passage nowhere indicates that it is the greatest challenge to the mankind today.
2nd statement is correct because in the last paragraph, author is discussing about existence and importance of Nature based solutions
IncorrectAnswer. B.
1st statement is not a correct assumption as passage is talking about climate change as one of the challenge but passage nowhere indicates that it is the greatest challenge to the mankind today.
2nd statement is correct because in the last paragraph, author is discussing about existence and importance of Nature based solutions
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Question 29 of 30
1 points
The product of two consecutive odd numbers is 19043. Which is the smaller one?
CorrectAnswer : A
Let the two consecutive odd numbers are x and x+2.
According to the question, x (x+2) = 19043
IncorrectAnswer : A
Let the two consecutive odd numbers are x and x+2.
According to the question, x (x+2) = 19043
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Question 30 of 30
1 points
Let x and y be positive integers such that x˃y. The expression 3x + 2y and 2x +3y, when divided by 5 leave remainders 2 and 3, respectively. What is the remainder when (x-y), is divided by 5?
CorrectAnswer : A
We have, 3x+2y is divided by 5 remainder is 2.
∴3x+2y=5q+2 ……………………..(1)
And 2x +3y is divided by 5 remainder is 3.
∴ 2x + 3y = 5m+3 ……………………..(2)
Subtract Eq. (2 ) from Eq.(1) , we get
x-y = 5(q-m)-1
x-y=5(q-m)-5+4
x-y=5(q-m-1)+4
∴x-y is divided by 5 remainder is 4.
IncorrectAnswer : A
We have, 3x+2y is divided by 5 remainder is 2.
∴3x+2y=5q+2 ……………………..(1)
And 2x +3y is divided by 5 remainder is 3.
∴ 2x + 3y = 5m+3 ……………………..(2)
Subtract Eq. (2 ) from Eq.(1) , we get
x-y = 5(q-m)-1
x-y=5(q-m)-5+4
x-y=5(q-m-1)+4
∴x-y is divided by 5 remainder is 4.
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