1. The year of ‘Great Divide’ in Indian demography is

(a) 1905
(b) 1921
(c) 1947
(d) 1965

Show Answer
1921 

2. The rate of inflation in India is measured generally in respect of movement of ? [UPSC CAPF 2013]

(a) consumer price index
(b) wholesale price index
(c) cost of living index for agricultural labour
(d) money supply

Show Answer
Consumer price index 

3. Which one among the following items has maximum weight in wholesale price index in India? [UPSC CAPF 2013]

(a) Primary article
(b) Fuel and power
(c) Manufactured product
(d) Food item

Show Answer
Manufactured product 

4. Which of the following goods are included to estimate food inflation in India ? [UPSC CAPF 2020]

1. Wheat
2. Paddy
3. Tobacco
4. Sugar

Select the correct answer using the code given below: [UPSC CAPF 2020]

(a) 1, 2 and 3
(b) 2, 3 and 4
(c) 1, 3 and 4
(d) 1, 2 and 4

Show Answer
1, 2, and 4 

5. The amount by which the equilibrium level of real GDP exceeds the full employment level of GDP is called [UPSC CAPF 2021]

(a) recessionary gap
(b) inflationary gap
(c) income multiplier
(d) automatic stabilizer

Show Answer
Inflationary gap 

6.With reference to inflation in India, which of the following statements is correct? [UPSC CSE 2015]

(a) Controlling the inflation in India is the responsibility of the Government of India only
(b) The Reserve Bank of India has no role in controlling the inflation
(c) Decreased money circulation helps in controlling the inflation
(d) Increased money circulation helps in controlling the inflation

Show Answer
Decreased money circulation helps in controlling the inflation 

7. Which of the following brings out the Consumer Price Index Number for Industrial Workers? [UPSC CSE 2015]

(a) The Reserve Bank of India
(b) The Department of Economic Affairs
(c) The Labour Bureau
(d) The Department of Personnel and Training

Show Answer
The Labour Bureau 

8. Supply of money remaining the same when there is an increase in demand for money, there will be [UPSC CSE 2013]

(a) a fall in the level of prices
(b) an increase in the rate of interest
(c) a decrease in the rate of interest
(d) an increase in the level of income and employment

Show Answer
An increase in the rate of interest 

9. Which one of the following is likely to be the most inflationary in its effect? [UPSC CSE 2013]

(a) Repayment of public debt
(b) Borrowing from the public to finance a budget deficit
(c) Borrowing from banks to finance a budget deficit
(d) Creating new money to finance a budget deficit

Show Answer
Creating new money to finance a budget deficit 

10. A rise in general level of prices may be caused by [UPSC CSE 2013]

1. an increase in the money supply
2. a decrease in the aggregate level of output
3. an increase in the effective demand

Select the correct answer using the codes given below.

(a) 1 only
(b) 1 and 2 only
(c) 2 and 3 only
(d) 1, 2 and 3

Show Answer
1, 2 and 3 

11. Consider the following statements : [UPSC CSE 2013]

1. Inflation benefits the debtors.
2. Inflation benefits the bond-holders.

Which of the statements given above is/are correct?

(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Show Answer
1 only 

12. Which of the following measures would result in an increase in the money supply in the economy? [UPSC CSE 2012]

1. Purchase of government securities from the public by the Central Bank
2. Deposit of currency in commercial banks by the public
3. Borrowing by the government from the Central Bank
4. Sale of government securities to the public by the Central Bank

Select the correct answer using the codes given below :

(a) 1 only
(b) 2 and 4 only
(c) 1 and 3
(d) 2, 3 and 4

Show Answer
1 and 3 

13. A rapid increase in the rate of inflation is sometimes attributed to the “base effect”. What is “base effect”? [UPSC CSE 2011]

(a) It is the impact of drastic deficiency in supply due to failure of crops
(b) It is the impact of the surge in demand due to rapid economic growth
(c) It is the impact of the price levels of previous year on the calculation of inflation rate
(d) None of the statements (a), (b) and (c) given above is correct in this context

Show Answer
It is the impact of the price levels of previous year on the calculation of inflation rate 

14. India has experienced persistent and high food inflation in the recent past. What could be the reasons? [UPSC CSE 2011]

1. Due to a gradual switchover to the cultivation of commercial crops, the area under the cultivation of food grains has steadily decreased in the last five years by about 30%.
2. As a consequence of increasing incomes, the consumption patterns of the% people have undergone a significant change.
3. The food supply chain has structural constraints.

Which of the statements given above are correct?

(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Show Answer
2 and 3 only 

UPSC CSE Prelims

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TSPSC Group-2 Exam

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