How to Use This Practice Set
35 minutes for 50 questions. Economy questions often have current figures — where numbers appear, check the latest data before exam. The questions here use data current to 2025–26.
Set 1 — Indian Economy & Planning (10 Questions)
1. As of 2024–25, what is the approximate share of the Services sector in India's GDP?
- a) 40%
- b) 50%
- c) ~55–57% ✓
- d) 65%
India's GDP breakdown (approx 2024–25): Agriculture ~18%, Industry ~26%, Services ~56%. Services is the largest sector and employs ~30% of workforce.
2. The NITI Aayog replaced the Planning Commission in:
- a) 2013
- b) 2014
- c) 2015 (January 1, 2015) ✓
- d) 2016
3. India's GDP growth contracted by what percentage in FY 2020–21 (COVID year)?
- a) -4.2%
- b) -5.8%
- c) -7.3% ✓
- d) -6.6%
4. Which of the following correctly describes the difference between GDP and GNP?
- a) GDP includes foreign income; GNP does not
- b) GNP = GDP + Net income from abroad (factor income earned by residents abroad minus factor income earned by foreigners in India) ✓
- c) GDP is at market prices; GNP is at factor cost
- d) GNP measures only goods; GDP measures goods and services
5. The "Aspirational Districts Programme" launched by NITI Aayog aims to:
- a) Develop smart cities across India
- b) Promote industrial investment in backward areas
- c) Transform 112 most underdeveloped districts into developed ones using convergence, collaboration, and competition ✓
- d) Provide direct income support to farmers in 112 districts
6. Which index measures the ease of doing business in India, published annually?
- a) Human Development Index (UNDP)
- b) Global Innovation Index (WIPO)
- c) World Bank's Ease of Doing Business Index ✓
- d) Corruption Perception Index (Transparency International)
India improved from rank 142 (2014) to rank 63 (2019) in the World Bank Ease of Doing Business before the index was discontinued in 2021.
7. India's current account deficit (CAD) is primarily driven by:
- a) High services imports
- b) High crude oil imports and gold imports ✓
- c) Large defence equipment purchases
- d) Food grain imports
8. The Goods and Services Tax (GST) replaced how many indirect taxes?
- a) 12
- b) 17 ✓
- c) 21
- d) 8
GST subsumed 17 central and state indirect taxes including Central Excise, Service Tax, VAT, CST, Octroi, Entertainment Tax, etc.
9. The Insolvency and Bankruptcy Code (IBC) 2016 mandates time-bound resolution within:
- a) 90 days + 30-day extension
- b) 180 days with no extension
- c) 180 days + 90-day extension (270 days total) ✓
- d) 365 days
10. Which of the following is a LEADING economic indicator?
- a) Unemployment rate
- b) GDP growth rate
- c) PMI (Purchasing Managers' Index) ✓
- d) Inflation rate
Leading indicators predict future economic activity. PMI above 50 = expansion, below 50 = contraction. GDP, unemployment are lagging indicators.
Set 2 — Banking, RBI & Financial Sector (15 Questions)
11. The Reserve Bank of India was established in:
- a) 1934 — as a private entity
- b) 1935 ✓
- c) 1947 — nationalised
- d) 1949 — nationalised
RBI established April 1, 1935 (RBI Act 1934). Nationalised January 1, 1949.
12. The "Repo Rate" is the rate at which:
- a) Banks borrow from each other overnight
- b) RBI borrows from commercial banks
- c) RBI lends to commercial banks (against securities) ✓
- d) Government borrows from RBI
13. Cash Reserve Ratio (CRR) requires banks to keep a certain percentage of their Net Demand and Time Liabilities (NDTL) as:
- a) Government securities
- b) Gold reserves
- c) Cash with RBI (no interest paid) ✓
- d) Foreign currency reserves
14. The Statutory Liquidity Ratio (SLR) requires banks to maintain a portion of NDTL in:
- a) Cash with RBI only
- b) Cash, gold, or government-approved securities ✓
- c) Government securities only
- d) Foreign exchange only
15. Which of the following is NOT a function of the Reserve Bank of India?
- a) Issue of currency notes
- b) Banker to the Government
- c) Lender of last resort
- d) Direct lending to private companies ✓
RBI does not directly lend to private companies — that is commercial banking. RBI is the central bank: currency issuer, banker to government, regulator, lender of last resort to banks.
16. Priority Sector Lending (PSL) norms require banks to lend what percentage of Adjusted Net Bank Credit (ANBC) to priority sectors?
- a) 30%
- b) 35%
- c) 40% ✓
- d) 45%
40% of ANBC to priority sectors — agriculture (18%), micro enterprises, weaker sections, exports, education, housing. Foreign banks with fewer than 20 branches: 40% of ANBC.
17. The Pradhan Mantri Jan Dhan Yojana (PMJDY), launched in 2014, achieved:
- a) 10 crore bank accounts
- b) 30 crore bank accounts
- c) 53+ crore bank accounts (as of 2024) ✓
- d) 75 crore bank accounts
18. The "JAM Trinity" in India's financial inclusion refers to:
- a) Jan Dhan, Aadhaar, Mobile
- b) Jan Dhan, Aadhaar, Mobile ✓
- c) Jobs, Agriculture, Manufacturing
- d) Jan Dhan, Aadhaar, MNREGS
19. UPI (Unified Payments Interface) is operated by:
- a) Reserve Bank of India
- b) Ministry of Finance
- c) National Payments Corporation of India (NPCI) ✓
- d) State Bank of India
20. NABARD (National Bank for Agriculture and Rural Development) was established in:
- a) 1975
- b) 1980
- c) 1982 ✓
- d) 1985
NABARD was established on July 12, 1982 under the NABARD Act 1981. It replaced the Agriculture Credit Department of RBI. Headquarters: Mumbai.
21. The Small Industries Development Bank of India (SIDBI) provides:
- a) Large-scale industrial finance
- b) Refinance and development finance to MSMEs ✓
- c) Housing loans to rural areas
- d) Export financing
22. What is the full form of SARFAESI Act (2002)?
- a) Security Asset Reconstruction and Financial Security Interest Enforcement Act
- b) Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act ✓
- c) Scheduled Asset Restructuring Financial Enforcement Security Interest
- d) Security Reconstruction Finance Asset Enforcement Scheme Interest Act
23. Inflation measured by the Consumer Price Index (CPI) is called:
- a) Wholesale price inflation
- b) Retail inflation ✓
- c) Core inflation
- d) Headline inflation
CPI = retail prices paid by consumers = retail inflation. WPI = wholesale price index = wholesale inflation. RBI's inflation target uses CPI.
24. The RBI's Monetary Policy Committee (MPC) has how many members?
- a) 4 members (2 RBI + 2 government)
- b) 6 members (3 RBI + 3 external) ✓
- c) 5 members
- d) 8 members
MPC = 6 members: RBI Governor (Chair) + 2 RBI Deputy Governors + 3 external members appointed by government. Decisions by majority; Governor has casting vote.
25. India's foreign exchange reserves are managed by:
- a) Ministry of Finance
- b) Reserve Bank of India ✓
- c) State Bank of India
- d) EXIM Bank
Set 3 — Government Schemes & Agriculture (15 Questions)
26. MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) guarantees employment for:
- a) 100 days per worker per year
- b) 100 days per rural household per year ✓
- c) 120 days per rural household per year
- d) 100 days per Below Poverty Line family per year
The guarantee is per HOUSEHOLD (not per individual worker), 100 days of unskilled manual work per financial year.
27. The National Food Security Act (2013) entitles what percentage of India's population to subsidised food grain?
- a) 50%
- b) 67% (2/3) ✓
- c) 75%
- d) 80%
NFSA 2013: 75% of rural population and 50% of urban population — approximately 67% overall — eligible for 5 kg/person/month at ₹1–3/kg.
28. PM-KISAN Samman Nidhi provides annual income support of ₹6,000 to farmers in how many instalments?
- a) 2 instalments of ₹3,000
- b) 3 instalments of ₹2,000 ✓
- c) 4 instalments of ₹1,500
- d) 6 instalments of ₹1,000
29. Ayushman Bharat — PM Jan Arogya Yojana (PM-JAY) provides health cover of:
- a) ₹2 lakh per family per year
- b) ₹3 lakh per family per year
- c) ₹5 lakh per family per year ✓
- d) ₹10 lakh per family per year
PM-JAY = ₹5 lakh/year for secondary and tertiary hospitalisation. In 2024, extended to all citizens above 70 years regardless of income.
30. The Swaminathan Commission (2004–06) recommended MSP should be set at:
- a) A2 + FL (actual cost + imputed family labour)
- b) 150% of A2 cost
- c) C2 + 50% (comprehensive cost including land rent + capital, plus 50% profit margin) ✓
- d) Market price minus 10%
31. e-NAM (National Agriculture Market) connects mandis across India through:
- a) Physical unified market
- b) Online trading platform ✓
- c) Government procurement centres
- d) FCI warehouses
e-NAM launched April 2016. Online platform for agricultural commodity trading, enabling price discovery. Connected 1,000+ APMC mandis across 18+ states.
32. The Pradhan Mantri Fasal Bima Yojana (PMFBY) caps premium at what percentage for Kharif crops?
- a) 1%
- b) 1.5%
- c) 2% ✓
- d) 5%
PMFBY premium caps: 2% for Kharif, 1.5% for Rabi, 5% for commercial/horticulture crops. Balance premium paid by Centre + State governments.
33. Operation Flood (White Revolution) was implemented by:
- a) Ministry of Agriculture
- b) National Dairy Development Board (NDDB) ✓
- c) NABARD
- d) Food Corporation of India (FCI)
Operation Flood (1970–96) was the world's largest dairy development programme. Implemented by NDDB under Dr. Verghese Kurien ("Father of White Revolution").
34. The Kisan Credit Card (KCC) scheme provides short-term credit at a subsidised interest rate of:
- a) 2% per annum
- b) 3% per annum
- c) 4% per annum (for loans up to ₹3 lakh) ✓
- d) 7% per annum
35. Which of the following bodies recommends MSP to the government?
- a) NABARD
- b) Finance Commission
- c) Commission for Agricultural Costs and Prices (CACP) ✓
- d) Food Corporation of India (FCI)
CACP recommends MSP → Cabinet Committee on Economic Affairs (CCEA) announces final MSP.
36. The PM Gati Shakti National Master Plan aims to:
- a) Provide free internet to rural areas
- b) Create an integrated multi-modal connectivity infrastructure for economic zones ✓
- c) Build highways connecting all state capitals
- d) Digitise all government services by 2025
37. The National Infrastructure Pipeline (NIP) announced in 2019 aims for infrastructure investment of:
- a) ₹50 lakh crore over 5 years
- b) ₹75 lakh crore over 5 years
- c) ₹111 lakh crore over FY 2020–25 ✓
- d) ₹200 lakh crore over 10 years
38. The Production Linked Incentive (PLI) scheme provides incentives based on:
- a) Number of workers employed
- b) Land acquired for production
- c) Incremental sales from manufacturing over a base year ✓
- d) Export value of products
39. Under India's current tax structure, Goods and Services Tax (GST) does NOT apply to:
- a) Banking services
- b) Restaurant services
- c) Petroleum products (crude, petrol, diesel, ATF, natural gas) ✓
- d) Healthcare services provided by private hospitals
Petroleum products are OUTSIDE GST — they are still under central excise and VAT. This is a major pending GST reform.
40. The "Direct Benefit Transfer" (DBT) system transfers subsidies directly to beneficiaries using:
- a) Post office money orders
- b) Cheques to beneficiaries
- c) Aadhaar-linked bank accounts ✓
- d) Food ration cards
Set 4 — Tamil Nadu Economy & Current Affairs (10 Questions)
41. Tamil Nadu's GSDP (Gross State Domestic Product) makes it which rank among Indian states?
- a) 1st
- b) 2nd (after Maharashtra) ✓
- c) 3rd (after Maharashtra and UP)
- d) 4th
42. Tamil Nadu is the leading state in India for: 1. Automobile manufacturing (Chennai = "Detroit of Asia") 2. Leather exports 3. Textile exports (Tiruppur knitwear) 4. Petrochemical industry
- a) 1 and 2 only
- b) 1, 2, 3 and 4 ✓
- c) 1, 2 and 3 only
- d) 2, 3 and 4 only
43. The "Kalaignar Magalir Urimai Thittam" provides monthly support of ₹1,000 to:
- a) All women above 18 in Tamil Nadu
- b) Women self-help group members only
- c) Women heads of eligible families ✓
- d) Women below poverty line only
44. TIDCO (Tamil Nadu Industrial Development Corporation) promotes:
- a) Agricultural development in Tamil Nadu
- b) Tourism infrastructure
- c) Industrial investment and joint ventures in Tamil Nadu ✓
- d) IT exports from Tamil Nadu
45. Tamil Nadu's textile hub Tiruppur contributes approximately what percentage of India's total knitwear exports?
- a) 30%
- b) ~50% ✓
- c) 65%
- d) 20%
46. The Tamil Nadu Urban Finance and Infrastructure Development Corporation (TUFIDCO) provides:
- a) Housing loans to urban poor
- b) Financial assistance to urban local bodies for infrastructure projects ✓
- c) Urban employment guarantee
- d) Smart city funding
47. SIPCOT (State Industries Promotion Corporation of Tamil Nadu) is primarily responsible for:
- a) Setting up cooperative industries
- b) Developing industrial parks and promoting investment ✓
- c) Providing agricultural credit
- d) Managing Tamil Nadu's exports
48. Tamil Nadu's 'Amma Unavagam' (subsidised canteen scheme) was launched by:
- a) DMK government under M. Karunanidhi
- b) AIADMK government under J. Jayalalithaa ✓
- c) Congress government
- d) INC-DMK coalition
49. The Tamil Nadu Green Climate Fund focuses on:
- a) Expanding forest cover in the Nilgiris
- b) Solar energy subsidies for farmers
- c) Climate-resilient development, renewable energy, and adaptation measures ✓
- d) Funding coastal protection in delta districts
50. Which district in Tamil Nadu is known as the "Detroit of South Asia" for automobile manufacturing?
- a) Coimbatore
- b) Hosur
- c) Chennai (Kancheepuram/Sriperumbudur corridor) ✓
- d) Tiruvallur
Chennai's industrial corridor (Sriperumbudur–Oragadam) hosts Hyundai, Ford (now closed), BMW, Royal Enfield, TVS, Ashok Leyland — making it India's largest automobile production hub.
Board Exam Tips — Economy
- RBI: Repo rate = RBI lends to banks; Reverse Repo = banks lend to RBI; CRR = cash with RBI; SLR = liquid assets
- MPC = 6 members (3 RBI + 3 external); inflation target = 4% ±2%
- MGNREGA = 100 days per HOUSEHOLD (not per person)
- CACP recommends MSP → CCEA announces; only wheat and rice actually procured
- Swaminathan formula = C2 + 50% (not yet adopted)
- PM-JAY = ₹5 lakh/family; 55 crore beneficiaries; extended to 70+ in 2024
- GST = 101st Amendment; Art 279A = GST Council; Petroleum outside GST
- TN = 2nd largest state economy (after Maharashtra); Chennai = auto hub
- NABARD = 1982; NDDB = White Revolution; KCC = 4% for ₹3 lakh