Test 5: Economy

1. Which of the following Industries is considered strategic Public Sector enterprise?

1. Railways

2. Atomic Energy

3. Arms and Ammunition

4. Petroleum Industries

Choose the answer from the following code

(A) Only 1 and 4

(B) Only 1, 2 and 3

(C) Only 2 and 3

(D) Only 2,3 and 4

2. Consider the following statements about Maharatna companies:

1. For Maharatna status, the company should have an average turnover of 25000 crores in last five years

2. A Maharatna Company can take investment decision of up to 10,000 crores without government permission

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

3. Consider the following about Treasury bills (T- Bills):

1. T-Bills are issued by RBI to fulfil its monetary needs

2. T-Bills are sovereign zero risk instruments

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

4. Consider the following statements about External commercial borrowings (ECBs)

1. ECBs are instruments used by Indian corporates to access foreign funding for their enterprise

2. Security and Exchange Board of India (SEBI) regulate ECBs

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

5. Consider the following statement about Non-Banking Financial Companies (NBFCs)

1.  An NBFC is a company registered under companies act 1956

2. NBFCs do not form part of the payment and settlement system and cannot issue cheques drawn on itself

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

6. Consider the following about cash management bills

1. CMBs are instruments to solve temporary cash flow mismatch of Government of India

2. They are similar to Treasury-Bills but have a maturity of less than 14 days

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

7. Consider the following statements about National Investment and Infrastructure Fund

1. NIIF has been set up as a trust under the Indian Trust Act

2. NIIF is regulated by Security Exchange Board of India (SEBI)

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

8. Consider the following statements:

1. Initial Public Offerings (IPOs) can be issued in Primary markets and secondary markets

2. Retail Investors can buy shares in the primary market

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

9. Consider the following statements about Financial Action Task Force (FATF)

1. FATF is responsible for setting a global standard on anti-money laundering and combating the financing of terrorism.

2. FATF is an organization under the aegis of International Monetary fund.

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

10. Consider the following about Masala bond:

1. Masala bonds are rupee-denominated bond used to raise money from the domestic market

2. Masala Bond protects Indian corporations from the risk of currency fluctuation in International market

Choose the correct answer from the following code:

(A) Only 1

(B) Only 2

(C) Both 1 and 2

(D) None of the above

11. Consider the following statements related to BRICS and identify the incorrect statements:

1. Its latest summit was held in Goa, India

2. The Asian infrastructure investment bank is an outcome of this platform

3. It encourages commercial, political and cultural cooperation between the BRICS nations

Choose the correct answer from the following code:

(A) 1 and 2 Only

(B) 1 Only

(C) 2 Only

(D) None of the above.

12. Which of the following organization has launched Peace in the home programme to help member states tackle domestic violence which still remains a stubborn stain on communities, disproportionately impacting women?

(A) African Union

(B) ASEAN

(C) BIMSTEC

(D) Commonwealth of Nations

13. Which of the following countries are not members of East Asia summit:

1. Vanuatu

2. Nauru

3. Russia

4. North Korea

Choose the correct answer from the following code:

(A) 1,2 and 3 only

(B) 1,2,3 and 4

(C) 1,2 and 4 only

(D) 1 and 4 only

14. Consider the following statements:

1. Performance in Health outcomes Index is released by Niti Aayog and Ministry of women and child development

2. States have been ranked in three categories larger States, smaller States and Union Territories to allow for better comparability.

3. Among the larger States, Maharashtra, Bihar and Karnataka have emerged as the top performers.

Choose the correct answer from the following code:

(A) 1 and 3 only

(B) 2 and 3 only

(C) 2 only

(D) 1 and 2 only

15. Which of the following organization releases the world power language index?

(A) United Nations public administration programme

(B) World economic forum

(C) UN Department for Economic and Social Affairs (UN-DESA)

(D) UN Inter-agency Group

ANSWERS

1.B

2.D

• Criteria to become Maharatna company:-
• The CPSEs fulfilling the following criteria are eligible to be considered for grant of Maharatna status.
  1. The CPSE should already be a Navratna company.
  2. The CPSE should have average annual turnover of more than Rs. 25,000 crore, during the last 3 years.
  3. The CPSE’s average annual net profit after tax should be more than Rs. 5,000 crore, during the last 3 years.
  4. The CPSE should be listed on Indian Stock exchange with minimum prescribed public shareholding under SEBI regulations.
  5. The CPSE should have average annual net worth of more than Rs. 15,000 crore, during the last 3 years.
  6. The CPSE should have significant presence globally.

3. B

• When the government is going to the financial market to raise money, it can do it by issuing two types of debt instruments – treasury bills and government bonds. Treasury bills are issued when the government need money for a shorter period while bonds are issued when it need debt for more than say five years.

4.A

• External commercial borrowing (ECBs) are loans in India made by non-resident lenders in foreign currency to Indian borrowers. They are used widely in India to facilitate access to foreign money by Indian corporations and PSUs (public sector undertakings).
• The DEA (Department of Economic Affairs), Ministry of Finance, Government of India along with Reserve Bank of India, monitors and regulates ECB guidelines and policies.

5.C

• A Non-Banking Financial Company (NBFC) is a company registered under the Companies Act, 1956 engaged in the business of loans and advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local authority or other marketable securities of a like nature, leasing, hire-purchase, insurance business, chit business but does not include any institution whose principal business is that of agriculture activity, industrial activity, purchase or sale of any goods (other than securities) or providing any services and sale/purchase/construction of immovable property.
• A non-banking institution which is a company and has principal business of receiving deposits under any scheme or arrangement in one lump sum or in installments by way of contributions or in any other manner, is also a non-banking financial company (Residuary non-banking company)
• NBFCs lend and make investments and hence their activities are akin to that of banks; however there are a few differences as given below:
• NBFC cannot accept demand deposits;
• NBFCs do not form part of the payment and settlement system and cannot issue cheques drawn on itself;
• Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation is not available to depositors of NBFCs, unlike in case of banks.

6.A

• In 2010, Government of India, in consultation with RBI introduced a new short-term instrument, known as Cash Management Bills (CMBs), to meet the temporary mismatches in the cash flow of the Government of India. The CMBs have the generic character of Tbills but are issued for maturities less than 91 days.

7. C

• NIIF has been set up as a Trust registered under the Indian Trust Act. The activities of NIIF will be overseen by a Governing Council, which is to be headed by Finance Minister and which has been formed to oversee the activities of NIIF. NIIF has been structured as a fund of funds and set up as Category II Alternate Investment Fund(AIF) under the Securities and Exchange Board of India (SEBI) Regulations.

8. B

9. A

10.B

• Masala bond are rupee denominated bond used to raise money from international market.

11. A

• The 2018 BRICS summit is the tenth annual BRICS summit, an international relations conference attended by the heads of state or heads of government of the five member states Brazil, Russia, India, China and South Africa. The summit was held in Johannesburg, South Africa, the second time the South Africa has hosted the summit after the 2013 summit
• New Development Bank is an outcome of this platform

12. D

13. C

• East Asia Summit:
• It is a forum of East Asian, South East Asian and South Asian nations.
• It has 18 members:
• 10 ASEAN nations
• China, Japan and South Korea (ASEAN + 3)
• Australia
• New Zealand
• India
• Russia
• USA

14. C

• The NITI Aayog in collaboration with the ministry of health and family welfare (MoHFW) and World Bank released the Performance in Health Outcomes Index. It uses 24 different indicators to rank the states. States have been ranked in three categories larger States, smaller States and Union Territories to allow for better comparability. The overall objective of the index is to highlight the top performers and States that are making significant improvements.
• Among the larger States, Kerala, Punjab and Tamil Nadu have emerged as the top performers, whereas Jharkhand, Uttar Pradesh and Jammu & Kashmir have shown the maximum improvement in annual performance.

15. B

• World Power language Index: It is released by WEF. It measures the usefulness of a language to a representative human being and is not meant to apply to any particular person with their own set of conditions, preferences and geography.
• The Power Language Index (PLI) uses 20 indicators to measure the influence on language. Neither is the index a measure of the beauty/merit of a language or its associated cultures. It measures the usefulness of a language to a representative human being