UPSC Civil Services Examination (Prelims) Indian Economy MCQ Questions

Consider the following statements about the Non-Banking Financial Companies (NBFCs) in India:
Statement 1. NBFCs cannot accept demand deposits.
Statement 2. All the NBFCs operating in India have to be registered with the RBI.
Statement 3. NBFCs form part of the payment and settlement system and can issue cheque drawn on itself.
Statement 4. Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation (DICGC) is not available to the depositors of deposit taking NBFCs.
Which of the statements given above is/are correct?

Which one of the following correctly represents the three key sub-indices of the Financial Inclusion Index (FI-Index) of the Reserve Bank of India (RBI)?

Consider the following statements:
I. The Reserve Bank of India mandates all the listed companies in India to submit a Business Responsibility and Sustainability Report (BRSR).
II. In India, a company submitting a BRSR makes disclosures in the report that are largely non-financial in nature.

Which of the statements given above is/are correct?

Which one of the following best describes the 'Crowding Out Effect' in the context of fiscal policy?

With reference to investments, consider the following:
I. Bonds
II. Hedge Funds
III. Stocks
IV. Venture Capital

How many of the above are treated as Alternative Investment Funds?

A bond whose proceeds are used only to finance or refinance a combination of both environmental and social projects is called:

Consider the following statements:
Statement I: In India, income from allied agricultural activities like poultry farming and wool production in rural areas is exempted from any tax.
Statement II: In India, rural agricultural land is not considered a capital asset under the provisions of the Income-tax Act, 1961.

Which one of the following is correct about the above statements?

Which of the following is/are the most significant implication(s) of obtaining Oeko-Tex certification for Eri Silk in the global textile industry?

1. It allows Indian exporters to compete in high-end markets that prioritise chemical-free products.
2. It confirms that Eri Silk meets international safety, environmental, and quality standards, enabling its entry into premium eco-conscious markets.
   Select the answer using the code given below:

Which one of the following best describes the key objective of India's 'Open Network for Digital Commerce' (ONDC) initiative?

Which of the following statements about insurance in aviation sector is/are correct?

1. 'Aviation Hull Insurance' covers the physical aircraft, including the body, engine, and on-board equipment.
2. Under the Montreal Convention, adopted in 1999 by over 130 countries, including India, airlines are strictly liable to pay compensation to the family/nominee of every deceased passenger without requiring the family to prove fault.
   Select the answer using the code given below:

Which of the following statements about Crowdfunding is/are correct?

1. Crowdfunding is solicitation of funds (small amount) from multiple investors through a web-based platform or social networking site for a specific project.
2. Small and Medium Enterprises (SMEs) are able to raise funds at lower cost of capital without undergoing rigorous procedures.
   Select the answer using the code given below:

Consider the following statements about Multidimensional Poverty Index (MPI):

Statement 1. MPI is calculated using Alkire-Foster methodology.
Statement 2. MPI calculated by NITI Aayog has a total of twelve indicators.
Statement 3. Maternal Health and Bank Account are common indicators in the MPI of NITI Aayog and MPI of United Nations Development Programme (UNDP).
Which of the statements given above is/are correct?

Which of the following statements about Real-World Assets (RWA) Tokenization are correct?
(1) Tokenization is the process of turning real world assets into digital tokens using blockchain technology.
(2) Tokenization of real world assets offers 24 × 7 access, promoting financial inclusion.
(3) Tokenization of real world assets will allow the access to high growth investment opportunities for individuals in India.
Select the answer using the code given below:

Which of the following are the sources of income for the Reserve Bank of India?
I. Buying and selling Government bonds
II. Buying and selling foreign currency
III. Pension fund management
IV. Lending to private companies
V. Printing and distributing currency notes

Select the correct answer using the code given below.

An e-commerce revenue model where the seller has control over pricing but does not keep products in stock and instead transfers customer orders and shipment details to a third-party supplier, who then ships the goods directly to the customer, is called:

Which of the following statements about M1xchange's role in Micro, Small & Medium Enterprises (MSMEs) financing is/are correct?

(1). M1xchange provides collateral-based loans to MSMEs.
(2). M1xchange facilitates discounting of invoices and Bills of Exchange for MSMEs.
(3). M1xchange functions as a credit rating agency for MSMEs.
Select the answer using the code given below:

In what way(s) does the Vizhinjam International Seaport represent a structural shift in India’s maritime trade and logistics policy?

Statement 1. By functioning exclusively as a domestic cargo hub to reduce reliance on coastal shipping and eliminate the need for foreign collaborations.
Statement 2. By focusing primarily on passenger cruise tourism and heritage shipping to increase Kerala’s profile as a maritime heritage destination.
Statement 3. By leveraging its natural deep draft and strategic location to reduce dependence on foreign trans-shipment ports, enhance revenue retention, and reposition India in regional maritime trade.

Select the answer using the code given below:

Consider the following statements with reference to the Sagarmala Programme of the Government of India:
I. The Sagarmala Programme seeks to achieve port-led economic growth through cost-effective and sustainable coastal infrastructure.
II. The success of the Sagarmala Programme is reflected in significant growth in coastal and inland waterway shipping, along with improved global port rankings.
III. Sagarmala 2.0 aims to position India as a global maritime innovation hub aligned with Atmanirbhar Bharat and Viksit Bharat 2047 visions.
Which of the following relationships among the above statements is/are correct?

1. Statement II validates the effectiveness of the strategies envisioned in statement I.
2. Statement III extends the objectives of statement I by embedding them into a future-oriented innovation framework.
3. Statement I contradicts statement III by focusing only on traditional infrastructure instead of modern innovation.
   Select the answer using the code given below:

Which one of the following statements about Unified Payments Interface (UPI) and Central Bank Digital Currency (Digital Rupee) is not correct?

With reference to different Committees in India, consider the following details and identify in which of the rows all details are correctly matched:

1. R.N. Malhotra Committee — Comprehensive reforms of Insurance sector in India — Insurance Regulatory and Development Authority of India
2. L.C. Gupta Committee — Preparing a roadmap for the introduction of derivatives trading in India — Securities and Exchange Board of India
3. Urjit R. Patel Committee — Preparing a roadmap for reforming bank lending to the Housing sector — Reserve Bank of India
4. Y.H. Malegam Committee — Preparing a roadmap for reforms in Microfinance sector in India — Reserve Bank of India