Static Quiz 26 August 2024 (Economy)
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Static Quiz 26 August 2024 (Economy)
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- Question 1 of 5
1. Question
With reference to the National Income accounting, consider the following statements:
1) Net national product (NNP) is the market value of a nation’s goods and services (GNP) minus depreciation
2) Net National Product (NNP) is always lower than the Net Domestic Product (NDP)
3) The rise in GDP guarantees the welfare of the masses.
Which of the above statements is/are correct?CorrectNNP=NDP+NFIA
If NFIA is positive, that is, the inflow of factor income from abroad is more than the outflow; NNP will be more than NDP. Conversely, if NFIA is negative, NNP will be less than NDP and it would be equal to NDP in case the NFIA is zero.GDP stands for gross domestic product and represents the total production of a nation within its domestic borders. But the rise in GDP doesn’t guarantee the welfare of the masses. This is because the rise in GDP may be concentrated in the hands of very
few individuals or fi rms. In such a case the welfare of the entire country cannot be said to have increased.IncorrectNNP=NDP+NFIA
If NFIA is positive, that is, the inflow of factor income from abroad is more than the outflow; NNP will be more than NDP. Conversely, if NFIA is negative, NNP will be less than NDP and it would be equal to NDP in case the NFIA is zero.GDP stands for gross domestic product and represents the total production of a nation within its domestic borders. But the rise in GDP doesn’t guarantee the welfare of the masses. This is because the rise in GDP may be concentrated in the hands of very
few individuals or fi rms. In such a case the welfare of the entire country cannot be said to have increased. - Question 2 of 5
2. Question
Consider the following statements regarding capital market and money market.
1) Money market is a market for short term funds with maturities ranging from overnight to one year.
2) Treasury bills are the instruments of money market whereas Commercial Papers are the instruments of capital market.
Which of the above statements is/are correct?CorrectCapital Market is an institutional arrangement for borrowing medium and long-term funds and which provides facilities for marketing and trading of securities. Statement 2 is incorrect: Commercial Papers are the instruments of money market.
IncorrectCapital Market is an institutional arrangement for borrowing medium and long-term funds and which provides facilities for marketing and trading of securities. Statement 2 is incorrect: Commercial Papers are the instruments of money market.
- Question 3 of 5
3. Question
Consider the following statements regarding Purchasing Power Parity (PPP):
1) Its exchange rates are calculated by comparing the prices of the same basket of goods and services in different countries.
2) PPP compares economic productivity and standards of living between countries.
3) In terms of PPP, India is the 3rd largest economy in the world.
Select the correct answer using the code given below.CorrectIndia is at 3rd position in the world in terms of PPP It is a measurement of prices in different countries that uses the prices of specific goods to compare the absolute purchasing power of the countries’ currencies.
Finance Minister Nirmala Sitharaman recently tabled the Economic Survey 2022-23 in Parliament. In one of the key takeaways of the survey, India is now the third-largest economy in the world in PPP (purchasing power parity) terms and; the 5th largest in terms of the exchange rate. Only US and China are ahead of India when it comes to purchasing power parity (PPP), the survey highlighted.
IncorrectIndia is at 3rd position in the world in terms of PPP It is a measurement of prices in different countries that uses the prices of specific goods to compare the absolute purchasing power of the countries’ currencies.
Finance Minister Nirmala Sitharaman recently tabled the Economic Survey 2022-23 in Parliament. In one of the key takeaways of the survey, India is now the third-largest economy in the world in PPP (purchasing power parity) terms and; the 5th largest in terms of the exchange rate. Only US and China are ahead of India when it comes to purchasing power parity (PPP), the survey highlighted.
- Question 4 of 5
4. Question
Consider the following statements about Retrospective Taxation:
1) It helps in dealing with tax evasion by companies if they exploit any legal loophole.
2) India is doing away with Retrospective Taxation.
Select the correct statements:CorrectIt allows a country to pass a rule on taxing certain products, items or services and deals and charge companies from a time behind the date on which the law is passed. Countries use this route to correct any anomalies in their taxation policies that have, in the past, allowed companies to take advantage of such loopholes. Hence Statement 1 is correct.
Retrospective Taxation hurts companies that had knowingly or unknowingly interpreted the tax rules differently. Apart from India, many countries including the USA, the UK, the Netherlands, Canada, Belgium, Australia and Italy have retrospectively taxed companies. Government of India has introduced The Taxation Laws (Amendment) Bill, 2021 in the Lok Sabha. The bill seeks to withdraw tax demands made using a 2012 retrospective legislation to tax the indirect transfer of Indian assets. Hence Statement 2 is correct.IncorrectIt allows a country to pass a rule on taxing certain products, items or services and deals and charge companies from a time behind the date on which the law is passed. Countries use this route to correct any anomalies in their taxation policies that have, in the past, allowed companies to take advantage of such loopholes. Hence Statement 1 is correct.
Retrospective Taxation hurts companies that had knowingly or unknowingly interpreted the tax rules differently. Apart from India, many countries including the USA, the UK, the Netherlands, Canada, Belgium, Australia and Italy have retrospectively taxed companies. Government of India has introduced The Taxation Laws (Amendment) Bill, 2021 in the Lok Sabha. The bill seeks to withdraw tax demands made using a 2012 retrospective legislation to tax the indirect transfer of Indian assets. Hence Statement 2 is correct. - Question 5 of 5
5. Question
Consider the following statements with reference to Combined Index of Eight Core Industries (ICI):
1) The Index is released by the Ministry of Statistics and Program Implementation
2) The Eight Core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).
3) The combined Index of Eight Core Industries (ICI) increased by 3.6 percent in March 2023 as compared to the Index of March 2022.
Select the correct answer using the code given below.CorrectIndex of Eight Core Industries (ICI)
• ICI measures combined and individual performance of the production of eight core industries viz. Coal, Crude Oil, Natural Gas, Refinery Products, Fertilizers, Steel, Cement, and Electricity.
• The Eight Core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).
• The Office of Economic Adviser, Department for Promotion of Industry and Internal Trade (DPIIT) releases the Index of Eight Core Industries (ICI).
• Base year: 2011-2012
• The combined Index of Eight Core Industries (ICI) increased by 3.6 percent (provisional) in March 2023 as compared to the Index of March 2022.
• The production of Coal, Fertilizers, Steel, Natural Gas, and Refinery Products increased in March 2023 over the corresponding month of last year(2022).IncorrectIndex of Eight Core Industries (ICI)
• ICI measures combined and individual performance of the production of eight core industries viz. Coal, Crude Oil, Natural Gas, Refinery Products, Fertilizers, Steel, Cement, and Electricity.
• The Eight Core Industries comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).
• The Office of Economic Adviser, Department for Promotion of Industry and Internal Trade (DPIIT) releases the Index of Eight Core Industries (ICI).
• Base year: 2011-2012
• The combined Index of Eight Core Industries (ICI) increased by 3.6 percent (provisional) in March 2023 as compared to the Index of March 2022.
• The production of Coal, Fertilizers, Steel, Natural Gas, and Refinery Products increased in March 2023 over the corresponding month of last year(2022).
