Dear friends, Are you preparing for the JKSSB and SSC exams in 2025? Boost your chances of success with our comprehensive collection of over 100 important Multiple Choice Questions (MCQs) on Indian Economy. This set of MCQs covers key concepts and topics that are frequently asked in both exams. Whether you’re a beginner or looking to revise, these questions will help you to strengthen your understanding of economics and enhance your exam preparation.
100+ Indian Economy MCQs
Q1. The value of NNP at Consumer Point is?
a) NNP at factor cost
b) GNP at market price
c) NNP at market price
d) GNP at factor cost
The right Answer is: c) NNP at market price
Brief Explanation:
NNP at market price includes indirect taxes and excludes subsidies. It reflects the actual income received by the nation from all goods and services at market prices.
Q2. The net value of GDP after deducting depreciation from GDP is?
a) Net Domestic Product
b) Gross National Product
c) Net National Product
d) Disposable Income
The right Answer is: a) Net Domestic Product
Brief Explanation:
Net Domestic Product (NDP) is GDP minus depreciation. It shows the net value of goods and services after accounting for capital wear and tear in the production process.
Q3. Money market is a market for?
a) Short term fund
b) Long term fund
c) Negotiable instruments
d) Sale of shares
The right Answer is: a) Short term fund
Brief Explanation:
Money market deals with short-term borrowing and lending, typically under one year. It includes instruments like treasury bills, commercial paper, and certificates of deposit.
Q4. The operational period of the 12th Five Year Plan is?
a) 2007–12
b) 2012–17
c) 2015–20
d) 2005–10
The right Answer is: b) 2012–17
Brief Explanation:
The 12th Five Year Plan in India ran from 2012 to 2017, aiming at inclusive growth, sustainable development, and improving infrastructure, education, and employment opportunities.
Q5. What is an Octroi?
a) Tax
b) Tax collection centre
c) Tax processing centre
d) Tax information centre
The right Answer is: a) Tax
Brief Explanation:
Octroi was a local entry tax levied on goods entering a municipal area. It has now been replaced by the GST system in most parts of India.
Q6. Which one of the following is not an instrument of fiscal policy?
a) Open market operation
b) Taxation
c) Public borrowings
d) Public expenditure
The right Answer is: a) Open market operation
Brief Explanation:
Open market operation is a monetary policy tool used by central banks. Fiscal policy includes taxation, public borrowing, and expenditure to manage the country’s economy.
Q7. Lorenz Curve shows?
a) Inflation
b) Unemployment
c) Income distribution
d) Poverty
The right Answer is: c) Income distribution
Brief Explanation:
The Lorenz Curve is a graphical representation used to show the distribution of income or wealth within a population. It helps in measuring inequality in income distribution.
Q8. If Cash Reserve Ratio (CRR) decreases, credit creation will?
a) Increase
b) Decrease
c) Does not change
d) First decreases then increases
The right Answer is: a) Increase
Brief Explanation:
When CRR is reduced, banks are required to keep less cash with the RBI. This increases their lending capacity, leading to greater credit creation in the economy.
Q9. Which among the following sponsors Regional Rural Banks?
a) RBI
b) National Commercial Banks
c) Foreign Banks
d) Co-operative Banks
The right Answer is: b) National Commercial Banks
Brief Explanation:
Regional Rural Banks (RRBs) are sponsored by National Commercial Banks. These banks provide financial services in rural areas, supporting agriculture and small industries.
Q10. Which among the following is not an account under B.O.P (Balance of Payments)?
a) Current Account
b) Capital Account
c) Official Reserves Account
d) Financial Account
The right Answer is: d) Financial Account
Brief Explanation:
Balance of Payments includes the current, capital, and official reserves accounts. Financial account is not part of BOP structure; it’s more relevant in broader macroeconomic analysis.
Q11. Under which Five Year Plan was Blue Revolution started in India?
a) 5th
b) 4th
c) 7th
d) 6th
The right Answer is: c) 7th
Brief Explanation:
The Blue Revolution, aimed at increasing fish production, was launched during the 7th Five Year Plan (1985–1990) to improve aquaculture and the fisheries sector in India.
Q12. The basic objective of 8th Five-Year Plan was?
a) Poverty removal
b) Reforms in PDS
c) Inclusive growth
d) Exclusive growth
The right Answer is: c) Inclusive growth
Brief Explanation:
The 8th Five-Year Plan (1992–1997) focused on inclusive growth, aiming to reduce poverty and unemployment while promoting economic development that benefits all sections of society.
Q13. Demand-pull inflation may be caused by?
a) An increase in costs
b) A reduction in interest
c) A reduction in government spending
d) An outward shift in aggregate supply
The right Answer is: b) A reduction in interest
Brief Explanation:
Lower interest rates make borrowing cheaper, increasing consumer spending and investment. This raises overall demand in the economy, leading to demand-pull inflation when supply can’t keep up.
Q14. Which groups are not protected from inflation?
a) Industrial workers
b) Agricultural farmers
c) Saving bank account holders
d) Govt. pensioners
The right Answer is: c) Saving bank account holders
Brief Explanation:
Inflation reduces the real value of money. Saving bank account holders with fixed interest returns lose purchasing power as inflation rises, unlike others who may get inflation-adjusted incomes.
Q15. Cost-push inflation is?
a) Increasing money supply
b) Increasing indirect tax
c) Population increase
d) None of these
The right Answer is: b) Increasing indirect tax
Brief Explanation:
Cost-push inflation occurs when production costs rise due to higher indirect taxes (like GST), wages, or raw material costs, pushing up prices even if demand remains unchanged.
Q16. Most effective quantitative method to control inflation in the economy?
a) Bank rate policy
b) Selective credit control
c) Cash reserve ratio
d) Both a and b
The right Answer is: c) Cash reserve ratio
Brief Explanation:
CRR is a powerful tool where the central bank controls inflation by reducing money supply. A higher CRR means banks have less money to lend, reducing inflationary pressure.
Q17. Inflation is measured on the basis of?
a) WPI
b) CPI
c) Marshall’s index
d) All of these
The right Answer: b) CPI
Explanation:
Inflation is mainly measured using the Consumer Price Index (CPI), which tracks the price changes of essential goods and services used by households.
Q18. An inflation caused by an enhanced wage of labour is?
a) Demand pull inflation
b) Cost push inflation
c) Stagflation
d) Hyper inflation
The right Answer: b) Cost push inflation
Explanation:
When wages increase, production costs rise, leading to cost-push inflation. It pushes product prices up even without a rise in demand.
Q19. According to Keynes, inflationary gap is caused by?
a) Excess supply
b) Excess demand
c) Deficiency of demand
d) Deficiency of supply
The right Answer: b) Excess demand
Explanation:
An inflationary gap happens when the demand for goods is more than what the economy can produce. This excess demand leads to inflation.
Q20. During inflation who suffers the most?
a) Creditors
b) Debtors
c) Wage and salary earners
d) Businessman
The right Answer: c) Wage and salary earners
Explanation:
Inflation reduces purchasing power. People with fixed incomes, like salaried workers, suffer the most as their income doesn’t increase with rising prices.
Q21. Deficit financing is an instrument of?
a) Tax policy
b) Credit policy
c) Monetary policy
d) Fiscal policy
The right Answer: d) Fiscal policy
Explanation:
Deficit financing means the government spends more than it earns, borrowing the rest. It is a tool of fiscal policy used to boost growth.
Q22. The most appropriate measure of a country’s growth is?
a) GDP
b) GNP
c) PCP
d) NDP
The right Answer: a) GDP
Explanation:
Gross Domestic Product (GDP) is the most widely used measure of a country’s growth, showing the total value of goods and services produced in a year.
Q23. After deducting grants for the creation of capital assets from revenue deficit, we arrive at?
a) Fiscal deficit
b) Effective revenue deficit
c) Budgetary deficit
d) Primary deficit
The right answer is: b) Effective revenue deficit
Brief Explanation:
Effective revenue deficit is calculated by subtracting capital asset grants from revenue deficit. It shows the actual shortfall in revenue after excluding productive grants.
Q24. Effective revenue budget was introduced in the Union Budget of?
a) 2011–2012
b) 2009–10
c) 2010–11
d) 2012–2013
The right answer is: a) 2011–2012
Brief Explanation:
The effective revenue budget was first presented in the 2011–12 Union Budget to show a clearer picture of actual revenue deficit.
Q25. Fiscal Responsibility and Budget Management Act was enacted in the year?
a) 2011
b) 2003
c) 2002
d) 2001
The right answer is: d) 2001
Brief Explanation:
The FRBM Act was passed in 2001 to ensure financial discipline, reduce fiscal deficit, and improve the management of public funds.
Q26. In which of the following budgets was the Railway Budget merged with the Union Budget in India?
a) 2019–20
b) 2018–2019
c) 2017–18
d) 2016–17
The right answer is: d) 2016–17
Brief Explanation:
The Railway Budget was merged with the Union Budget in 2016–17 to streamline the budgeting process and reduce duplication.
Q27. The tax on import and export is known as?
a) Custom duty
b) Income duty
c) Excise duty
d) None of the above
The right answer is: a) Custom duty
Brief Explanation:
Custom duty is a tax imposed on goods imported into or exported from the country. It helps protect domestic industries and earn revenue.
Q28. Which of the following does not mainly form a part of tax revenue of state governments in India?
a) Land revenue
b) Custom duty
c) Registration fee
d) Commercial tax
The right answer is: b) Custom duty
Brief Explanation:
Custom duty is collected by the central government, not the states. State revenues come mainly from land revenue, registration fees, and commercial taxes.
Q29. Rolling Plan was introduced by?
a) Indira Gandhi
b) NITI Aayog
c) Janata Govt.
d) Rajiv Gandhi
The right answer is: c) Janata Govt.
Brief Explanation:
The Rolling Plan was introduced by the Janata Government in 1978. Unlike fixed five-year plans, it allowed flexibility by revising targets annually.
Q30. In which of the following years was the Rolling Plan in operation in India?
a) 1968–69
b) 1978–79
c) 1988–89
d) 1990–91
The right answer is: b) 1978–79
Brief Explanation:
The Rolling Plan was operational from 1978 to 1980 after the Janata Party replaced the Fifth Five-Year Plan with a more flexible approach.
Q31. What did the Eleventh Five-Year Plan emphasize on?
a) Rapid industrial growth
b) Increasing rate of investment
c) Faster, sustainable, and more inclusive growth
d) Accelerating employment growth
The right answer is: c) Faster, sustainable, and more inclusive growth
Brief Explanation:
The Eleventh Plan (2007–2012) aimed to achieve inclusive development by focusing on health, education, and equitable opportunities for all sections of society.
Q32. Second Five-Year Plan was based on which model?
a) Solow model
b) Mahalanobis model
c) Donor model
d) Robinson model
The right answer is: b) Mahalanobis model
Brief Explanation:
The Second Plan (1956–1961) used the Mahalanobis model, which focused on developing heavy industries and capital goods for long-term economic growth.
Q33. The objective of self-sustaining development in India was first adopted in?
a) First FYP
b) Fourth FYP
c) Third FYP
d) Fifth FYP
The right answer is: b) Fourth FYP
Brief Explanation:
The Fourth Plan (1969–1974) aimed at making the economy self-sustaining by reducing dependence on imports and promoting domestic industries.
Q34. During the planning period, the highest growth rate was achieved during?
a) 8th Plan
b) 9th Plan
c) 10th Plan
d) 11th Plan
The right answer is: a) 8th Plan
Brief Explanation:
The Eighth Plan (1992–1997) achieved the highest growth rate of over 6.5% due to liberalization, economic reforms, and strong industrial growth.
Q35. During which Five-Year Plan did India achieve the maximum growth rate?
a) 8th
b) 9th
c) 10th
d) 11th
The right answer is: d) 11th
Brief Explanation:
India achieved its highest growth rate of around 7.9% during the Eleventh Five-Year Plan (2007–2012), driven by inclusive and sustainable growth strategies.
Q36. The period of Plan Holiday in India was:
a) 1962–65
b) 1966–69
c) 1969–71
d) 1972–75
The right answer is: b) 1966–69
Brief Explanation:
Due to economic crisis and droughts, no Five-Year Plan was implemented from 1966 to 1969. This period is known as the “Plan Holiday,” during which annual plans were followed.
Q37. In India, the currency note issue system is based on:
a) Minimum reserve system
b) Full convertibility system
c) Proportional reserve system
d) Fixed exchange rate system
The right answer is: a) Minimum reserve system
Brief Explanation:
The Reserve Bank of India (RBI) follows the Minimum Reserve System since 1956, maintaining a minimum of ₹200 crore in gold and foreign securities to issue currency.
Q38. Who among the following benefits most from inflation?
a) Creditors
b) Debtors
c) Savings account holders
d) Government pensioners
The right answer is: b) Debtors
Brief Explanation:
Debtors benefit during inflation as they repay loans with money that is worth less than when they borrowed it, reducing the real value of their debt.
Q39. Which of the following is not a nationalized bank?
a) Bank of Baroda
b) Canara Bank
c) ICICI Bank
d) PNB
The right answer is: c) ICICI Bank
Brief Explanation:
ICICI Bank is a private sector bank, unlike Bank of Baroda, Canara Bank, and PNB, which are nationalized public sector banks.
Q40. When was the State Bank of India (SBI) established?
a) 1954
b) 1955
c) 1957
d) 1956
The right answer is: b) 1955
Brief Explanation:
SBI was established on July 1, 1955, after the nationalization of the Imperial Bank of India under the State Bank of India Act, 1955.
Q41. District Credit Planning is done under:
a) Under Lead Bank
b) Under NABARD
c) Under District Magistrate
d) Under SBI
The right answer is: a) Under Lead Bank
Brief Explanation:
District Credit Plans are prepared by the Lead Bank in each district to ensure adequate credit flow to priority sectors and for coordinated banking development.
Q42. Which among the following is an asset for a commercial bank?
a) Credit to farmers
b) Deposit of public
c) Borrowing from RBI
d) Demand deposit of industries
The right answer is: a) Credit to farmers
Brief Explanation:
Loans and advances like credit to farmers are assets for banks because they generate income through interest.
Q43. Which of the following is not an objective of monetary policy?
a) Foreign exchange rate stability
b) Economic stability
c) Price stability
d) Equitable distribution of money and stock
The right answer is: d) Equitable distribution of money and stock
Brief Explanation:
Monetary policy focuses on price stability, economic growth, and exchange rate stability, not wealth distribution.
Q44. Which of the following is not a method of Quantitative Credit Control?
a) Bank rate
b) Variable reserve ratio
c) Rationing of credit
d) Open market operations
The right answer is: c) Rationing of credit
Brief Explanation:
Rationing of credit is a qualitative control method. Quantitative methods include Bank Rate, Open Market Operations, and Reserve Ratios.
Q45. The rate at which banks lend to RBI is known as:
a) Bank rate
b) Reverse repo rate
c) Repo rate
d) Interest rate
The right answer is: b) Reverse repo rate
Brief Explanation:
Reverse Repo Rate is the rate at which the RBI borrows money from commercial banks.
Q46. What is the financial year of the RBI?
a) January–December
b) April–March
c) October–September
d) July–June
The right answer is: b) April–March
Brief Explanation:
RBI follows the same financial year as the Indian Government, which is April 1 to March 31.
Q47. Which among the following is not a speculator in stock exchange?
a) Broker
b) Bull
c) Bear
d) Stag
The right answer is: a) Broker
Brief Explanation:
A broker is a middleman who facilitates trades, while Bulls, Bears, and Stags are types of market speculators.
Q48. NABARD came into existence in the year?
a) 1979
b) 1980
c) 1981
d) 1982
The right answer is: d) 1982
Brief Explanation:
NABARD (National Bank for Agriculture and Rural Development) was established in 1982 to promote sustainable and equitable agriculture and rural development.
Q49. Rangarajan Committee was constituted for?
a) Disinvestment
b) Tax reforms
c) Foreign trade
d) Banking reform
The right answer is: b) Tax reforms
Brief Explanation:
The Rangarajan Committee was formed to suggest tax reforms and improve the Indian tax system.
Q50. Phillips Curve represents the relationship between
a) Deflation and unemployment
b) Inflation and unemployment
c) Inflation and disguised unemployment
d) Deflation and cyclical unemployment
The right answer is: b) Inflation and unemployment
Brief Explanation:
The Phillips Curve shows an inverse relationship between inflation and unemployment.
Q51. Swachh Bharat Mission (Gramin) has been launched in India in?
a) Sept 2014
b) Oct 2014
c) Nov 2014
d) Aug 2014
The right answer is: b) Oct 2014
Brief Explanation:
The Swachh Bharat Mission (Gramin) was launched on 2nd October 2014 to improve rural sanitation.
Q52. Which among the following methods is not used to decide poverty line?
a) Average per capita income
b) Calories in food
c) Literacy
d) H.C.R.
The right answer is: c) Literacy
Brief Explanation:
Literacy is not a direct criterion for determining the poverty line; it’s usually based on income, calorie intake, and HCR (Head Count Ratio).
Q53. Indian Rupee was made fully convertible on Current Account in?
a) 1994
b) 1995
c) 1996
d) 1997
The right answer is: a) 1994
Brief Explanation:
India made the rupee fully convertible on the current account in 1994 as part of economic liberalization.
Q54. In which year the rupee was devalued for the first time in India?
a) 1949
b) 1966
c) 1991
d) 1971
The right answer is: a) 1949
Brief Explanation:
The Indian Rupee was first devalued in 1949 due to balance of payment issues after independence.
Q60. Rupee was devalued by what percent in July 1991?
a) 18%
b) 22%
c) 19%
d) 16%
The right answer is: b) 22%
Brief Explanation:
In July 1991, the Indian rupee was devalued by about 22% as part of economic reforms to address the balance of payments crisis.
Q61. The Government amended the RBI Act to hand over the job of monetary policymaking in India to?
a) Monetary Policy Committee
b) Tax Reform Committee
c) Selection Committee
d) Financial Strategy Committee
The right answer is: a) Monetary Policy Committee
Brief Explanation:
The Monetary Policy Committee (MPC) was formed in 2016 to decide key policy interest rates to achieve the inflation target.
Q62. Contractionary fiscal policy is used to?
a) Reduce govt debt
b) Combat recession
c) Increase inflation
d) Stimulate consumer spending
The right answer is: a) Reduce govt debt
Brief Explanation:
Contractionary fiscal policy involves reducing government spending or increasing taxes to decrease the fiscal deficit and control inflation.
Q63. Among the following options, which of these is a capital receipt?
a) Tax received
b) Disinvestment
c) External grants
d) Dividend received
The right answer is: b) Disinvestment
Brief Explanation:
Capital receipts are funds received by the government which either create liability or reduce assets. Disinvestment reduces government assets and is a capital receipt.
Q64. What is referred to as a primary deficit?
a) Interest payments
b) Borrowings
c) Both a & b
d) Borrowing minus interest payments
The right answer is: d) Borrowing minus interest payments
Brief Explanation:
Primary deficit = Fiscal deficit – Interest payments. It shows the shortfall in government’s current year income and expenditure, excluding interest payments.
Q65. The borrowings under the government budget constitute?
a) Primary deficit
b) Fiscal deficit
c) Tax deficit
d) Revenue deficit
The right answer is: b) Fiscal deficit
Brief Explanation:
Fiscal deficit is the total borrowing requirement of the government, representing the difference between total expenditure and total revenue (excluding borrowings).
Q66. Which of these measures primary deficit accurately?
a) Revenue deficit – interest payments
b) Fiscal deficit – revenue deficit
c) Fiscal deficit – interest payments
d) Capital deficit – revenue expenditure
The right answer is: c) Fiscal deficit – interest payments
Brief Explanation:
Primary deficit shows the actual borrowing requirement of the government excluding interest payments on previous loans.
Q67. Which of the following counts under SLR?
a) Cash in hand
b) Gold owned by the bank
c) Balance with RBI
d) All of the above
The right answer is: d) All of the above
Brief Explanation:
Statutory Liquidity Ratio (SLR) includes cash in hand, gold, and balance with RBI that commercial banks must maintain.
Q68. What distinguishes a bank from other financial institutions?
a) Accepting time deposits as a company
b) Accepting demand deposits
c) Lending
d) Accepting loans and borrowings
The right answer is: b) Accepting demand deposits
Brief Explanation:
Only banks can accept demand deposits, which can be withdrawn anytime by the depositor, distinguishing them from other financial institutions.
Q69. Domestic income is?
a) GDPmp
b) NDPfc
c) NNPmp
d) GNPfc
The right answer is: b) NDPfc
Brief Explanation:
Domestic income refers to Net Domestic Product at factor cost (NDPfc), excluding income from abroad and including all production within the country.
Q70. The difference between gross and net is?
a) Depreciation
b) NFIA
c) Net indirect tax
d) Subsidies
The right answer is: a) Depreciation
Brief Explanation:
The difference between gross and net is depreciation. Net = Gross – Depreciation.
Q71. Market price includes?
a) NFIA
b) Depreciation
c) Net indirect tax
d) None of the above
The right answer is: c) Net indirect tax
Brief Explanation:
Market price includes indirect taxes minus subsidies. It differs from factor cost, which excludes taxes and subsidies.
Q72. If NFIA is positive?
a) NDPfc = NNPfc
b) NDPfc < NNPfc
c) NDPfc > NNPfc
d) None of the above
The right answer is: b) NDPfc < NNPfc
Brief Explanation:
If Net Factor Income from Abroad (NFIA) is positive, then National Income (NNPfc) is greater than Domestic Income (NDPfc).
Q73. Income method is also known as?
a) Factor payment method
b) Factor output method
c) Factor service method
d) All of the above
The right answer is: a) Factor payment method
Brief Explanation:
The income method is called the factor payment method because it calculates national income by summing all incomes earned by factors of production.
Q74. Expenditure method is also known as?
a) Net output method
b) Factor payment method
c) Income disposable method
d) None of the above
The right answer is: d) None of the above
Brief Explanation:
The expenditure method is distinct from the options listed. It calculates national income by adding up all expenditures made in an economy.
Q75. The output at current year prices is called?
a) Nominal GDP
b) Real GDP
c) National GDP
d) All of the above
The right answer is: a) Nominal GDP
Brief Explanation:
Nominal GDP is the value of all final goods and services produced within a country at current market prices.
Q76. Nominal GDP shows?
a) Change in price only
b) Change in output only
c) Both a and b
d) None of the above
The right answer is: c) Both a and b
Brief Explanation:
Nominal GDP reflects changes in both price levels and the volume of output.
Q77. The BOP account records the inflow of foreign exchange on the?
a) Debit side
b) Credit side
c) Both a and b
d) None of the above
The right answer is: b) Credit side
Brief Explanation:
In the Balance of Payments (BOP), inflows of foreign exchange are recorded on the credit side.
Q78. BOP is a ______ concept as compared to BOT?
a) Similar
b) Broader
c) Narrower
d) None
The right answer is: b) Broader
Brief Explanation:
The Balance of Payments (BOP) is a broader concept than the Balance of Trade (BOT) because it includes all transactions, not just exports and imports.
Q79. Oudh Commercial Bank was founded in?
a) 1870
b) 1881
c) 1882
d) 1884
The right answer is: b) 1881
Brief Explanation:
Oudh Commercial Bank, established in 1881 in Faizabad, was one of the first commercial banks of India set up with Indian capital and managed by Indians.
Q80. Which was the second bank in India with limited liability?
a) PNB
b) Imperial Bank of India
c) New Bank
d) SBI
The right answer is: a) PNB
Brief Explanation:
Punjab National Bank (PNB) was the second bank in India to be established with limited liability, founded in 1894. It was managed entirely by Indians.
Q81. In which year was the Banking Regulation Act passed?
a) 1949
b) 1955
c) 1959
d) 1969
The right answer is: a) 1949
Brief Explanation:
The Banking Regulation Act was passed in 1949, giving the Reserve Bank of India (RBI) the power to regulate and supervise banks in India.
Q82. The approval to the Appraisal of projects is given by?
a) NITI Aayog
b) President
c) NDC
d) Ministry of Finance
The right answer is: c) NDC
Brief Explanation:
The National Development Council (NDC) used to approve key developmental projects in India. However, NDC has been replaced by NITI Aayog in recent times.
Q83. Main source of indirect tax?
a) Service Tax
b) Excise Duty
c) Value Added Tax
d) Gross Receipts Tax
The right answer is: b) Excise Duty
Brief Explanation:
Before the introduction of GST, excise duty was a major source of indirect tax revenue for the government, levied on the manufacture of goods.
Q84. To prevent the cascading effect, which tax was introduced?
a) Value Added Tax
b) Service Tax
c) Gross Receipts
d) Excise Duty
The right answer is: a) Value Added Tax
Brief Explanation:
Value Added Tax (VAT) was introduced to prevent the cascading effect of tax on tax by allowing tax credits at each stage of production.
Q85. If the deficit is financed through printing of money, it is known as?
a) Monetization of deficit
b) Monetised deficit
c) Both a and b
d) None of the above
The right answer is: c) Both a and b
Brief Explanation:
When a government prints money to finance its deficit, it is referred to as the monetization of the deficit or monetised deficit. Both terms are used interchangeably.
Q86. What is the animal on the insignia of the RBI?
a) Lion
b) Tiger
c) Elephant
d) Panther
The right answer is: b) Tiger
Brief Explanation:
The logo of the Reserve Bank of India features a tiger standing in front of a palm tree, symbolizing strength and authority in monetary matters.
Q87. The number of banks nationalized since 1969?
a) 11
b) 13
c) 14
d) 15
The right answer is: d) 15
Brief Explanation:
In 1969, 14 banks were nationalized, and in 1980, 6 more were added. However, some mergers reduced the count later. The total number of banks nationalized was 20, but 15 were major at the time of early nationalizations.
Q88. Which of the following is not an asset held by commercial banks?
a) Bills of exchange
b) Current account deposits
c) Money lent at short notice
d) Credit balances with RBI
The right answer is: b) Current account deposits
Brief Explanation:
Current account deposits are liabilities for a bank, as these are funds deposited by customers that the bank owes. The rest are assets.
Q89. Which one of the following banking banks is not a nationalised bank?
a) Federal Bank
b) Vijaya Bank
c) Corporation Bank
d) Dena Bank
The right answer is: a) Federal Bank
Brief Explanation:
Federal Bank is a private sector bank, while Vijaya Bank, Corporation Bank, and Dena Bank were nationalised and later merged into other public sector banks.
Q90. Stagflation implies a case of?
a) Galloping inflation
b) Recession plus inflation
c) Adverse balance of trade
d) Rising wages and employment
The right answer is: b) Recession plus inflation
Brief Explanation:
Stagflation is a situation where the economy experiences stagnant growth, high unemployment, and high inflation simultaneously, making it very difficult to manage.
Q91. India’s economic planning cannot be said to be?
a) Indicative
b) Imperative
c) Limited
d) Democratic
The right answer is: b) Imperative
Brief Explanation:
India follows a mixed economy model where planning is indicative and not imperative. This means that planning provides direction but is not strictly enforced.
Q92. The Economic Survey is published by?
a) Finance Commission
b) RBI
c) Govt. of India
d) Indian Statistical Org.
The right answer is: c) Govt. of India
Brief Explanation:
The Economic Survey is prepared by the Department of Economic Affairs under the Ministry of Finance and presented before the Union Budget.
Q93. What is the “Slack season” in Indian economy?
a) Sept – Dec
b) Jan – June
c) March – April
d) Feb – May
The right answer is: b) Jan – June
Brief Explanation:
The slack season refers to a period of low demand in the Indian economy, typically from January to June, when industrial and agricultural activities slow down.
Q94. The term ‘cyclical unemployment’ refers to?
a) Unemployment during recession
b) Seasonal unemployment
c) Disguised unemployment
d) Voluntary unemployment
The right answer is: a) Unemployment during recession
Brief Explanation:
Cyclical unemployment occurs when there is a lack of demand for goods and services in the economy, usually during periods of recession.
Q95. Unemployment mostly found in India can be characterised as?
a) Disguised
b) Cyclical
c) Frictional
d) Structural
The right answer is: a) Disguised
Brief Explanation:
Disguised unemployment is common in India, especially in agriculture, where more people are employed than actually needed, resulting in low productivity.
Conclusion
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