Indian Economy

Previous Years Questions Compilation

UPSC CSE PRELIMS 2020

Q.1) What is the importance of the term “Interest Coverage Ratio” of a firm in India?
1. It helps in understanding the present risk of a firm that a bank is going to give a loan to.
2. It helps in evaluating the emerging risk of a firm that a bank is going to give a loan to.
3. The higher a borrowing firm’s level of Interest Coverage Ratio, the worse is its ability to service its
debt.
Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.2) Which of the following factors/policies were affecting the price of rice in India in the recent
past?
1. Minimum Support Price
2. Government’s trading
3. Government’s stockpiling
4. Consumer subsidies
Select the correct answer using the code given below:
(a) 1, 2 and 4 only
(b) 1, 3 and 4 only
(c) 2 and 3 only
(d) 1, 2, 3 and 4

Q.3) Under the Kisan Credit Card scheme, short-term credit support is given to farmers for which of
the following purposes?
1. Working capital for maintenance of farm assets harvesters.
2. Purchase of combine tractors and mini trucks requirements of farm
3. Consumption households
4. Post-harvest expenses
5. Construction of family house and setting up of village cold storage facility
Select the correct answer using the code given below:
(a) 1, 2 and 5 only
(b) 1, 3 and 4 only
(c) 2,3,4 and 5 only

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(d) 1, 2, 3, 4 and 5

Q.4) Consider the following statements :

1. The weightage of food in Consumer Price Index (CPI) is higher than that in Wholesale Price Index
(WPI).
2. The WPI does not capture changes in the prices of services, which CPI does.
3. The Reserve Bank of India has now adopted WPI as its key measure of inflation and to decide on
changing the key policy rates.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 2 only
(c) 3 only
(d) 1, 2 and 3

Q.5) In India, which of the following can be considered as public investment in agriculture ?
1. Fixing Minimum Support Price for agricultural produce of all crops
2. Computerization of Primary Agricultural Credit Societies
3. Social Capital development
4. Free electricity supply to farmers
5. Waiver of agricultural loans by the banking system Setting up of cold storage facilities by the
governments.
Select the correct answer using the code given below:
(a) 1, 2 and 5 only
(b) 1, 3, 4 and 5 only
(c) 2, 3 and 6 only
(d) 1, 2, 3, 4, 5 and 6

Q.6) With reference to the Indian economy, consider the following statements :
1. Commercial Paper is a short-term unsecured promissory note.
2. Certificate of Deposit is a long-term Instrument issued by RBI to a corporation.
3. ‘Call Money’ is short-term finance used for interbank transactions.
4. “Zero-Coupon Bonds’ are the interest-bearing short-term bonds issued by the Scheduled
Commercial Banks to corporations.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 4 only
(c) 1 and 3 only
(d) 2, 3 and 4 only

Q.7) With reference to the international trade of India at present, which of the following statements
is/are correct?
1. India’s merchandise exports are less than its merchandise imports.
2. India’s imports of iron and steel, chemicals, fertilizers and machinery have decreased in recent
years.
3. India’s exports of services are more than its imports of services.
4. India suffers from an overall trade/current account deficit.

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Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 2 and 4 only
(c) 3 only
(d) 1, 3 and 4 only

Q.8) In the context of the Indian economy, non-financial debt includes which of the following?
1. Housing loans owed by households
2. Amounts outstanding on credit cards
3. Treasury bills
Select the correct answer using the code given below:
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 1, 2 and 3

Q.9) With reference to Trade-Related Investment Measures (TRIMS), which of the following
statements is/are correct?
1. Quantitative restrictions on imports by foreign investors are prohibited.
2. They apply to investment measures related to trade in both goods and services.
3. They are not concerned with the regulation of foreign investment.
Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.10) If the RBI decides to adopt an expansionist monetary policy, which of the following would it not
do?
1. Cut and optimize the Statutory Liquidity Ratio
2. Increase the Marginal Standing Facility Rate
3. Cut the Bank Rate and Repo Rate
Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.11) With reference to the Indian economy after the 1991 economic liberalization, consider the
following statements:
1. Worker productivity (Rs per worker at 2004-05 prices) increased in urban areas while it decreased
in rural areas.
2. The percentage share of rural areas in the workforce steadily increased.
3. In rural areas, the growth in the non-farm economy increased.
4. The growth rate in rural employment decreased.

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Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 3 and 4 only
(c) 3 only
(d) 1, 2 and 4 only

Q.12) With reference to the Indian economy after the 1991 economic liberalization, consider the
following statements:
1. Worker productivity (Rs per worker at 2004-05 prices) increased in urban areas while it decreased
in rural areas.
2. The percentage share of rural areas in the workforce steadily increased.
3. In rural areas, the growth in the non-farm economy increased.
4. The growth rate in rural employment decreased.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 3 and 4 only
(c) 3 only
(d) 1, 2 and 4 only

Q.13) If another global financial crisis happens in the near future, which of the following
actions/policies are most likely to give some immunity to India?
1. Not depending on short-term foreign borrowings
2. Opening up to more foreign banks
3. Maintaining full capital account convertibility
Select the correct answer using the code given below:
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 1, 2 and 3

Q.14) If you withdraw 1,00,000 in cash from your Demand Deposit Account at your bank, the
immediate effect on aggregate money supply in the economy will be
(a) to reduce it by 1,00,000
(b) to increase it by 1,00,000
(c) to increase it by more than 1,00,000
(d) to leave it unchanged

Answers:
1. C 2. D 3. B 4. A 5. C 6. C 7. D 8. D 9. C 10. B 11. B 12. B 13. A 14. C

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 UPSC CSE PRELIMS 2019
Q.1) In a given year in India, official poverty lines are higher in some states than in others because
(a) poverty rates vary from State to State
(b) price levels vary from State to State
(c) Gross State Product varies from State to State
(d) quality of public distribution varies from State to State

Q.2) The money multiplier in an economy increases with which one of the following?
(a) Increase in the cash reserve ratio
(b) Increase in the banking habit of the population
(c) Increase in the statutory liquidity ratio
(d) Increase in the population of the country

Q.3) Consider the following statements:

The Reserve Bank of India’s recent directives relating to ‘Storage of Payment System Data’, popularly
known as data diktat, command the payment system providers that
1. they shall ensure that entire data relating to payment systems operated by them are stored
in a system only in India
2. they shall ensure that the systems are owned and operated by public sector enterprises
3. they shall submit the consolidated system audit report to the Comptroller and Auditor
General of India by the end of the calendar year
Which of the statements given above is/are correct?
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 1, 2 and 3

Q.4) Which one of the following is not the most likely measure the Government/RBI takes to stop
the slide of Indian rupee?
(a) Curbing imports of non-essential goods and promoting exports
(b) Encouraging Indian borrowers to issue rupee-denominated Masala Bonds
(c) Easing conditions relating to external commercial borrowing
(d) Following an expansionary monetary policy
Q.5) Consider the following statements
1. Purchasing Power Parity (PPP) exchange rates are calculated by comparing the prices of the
same basket of goods and services in different countries.
2. In terms of PPP dollars, India is the sixth-largest economy in the world.
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

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Q.6) With reference to India’s Five-Year Plans, which of the following statements is/are correct?
1. From the Second Five-Year Plan, there was a determined thrust towards substitution of basic
and capital good industries.
2. The Fourth Five-Year Plan adopted the objective of correcting the earlier trend of increased
concentration of wealth and economic power.
3. In the Fifth Five-Year Plan, for the first time, the financial sector was included as an integral
part of the Plan.
Select the correct answer using the code given below.
(a) 1 and 2 only
(b) 2 only
(c) 3 only
(d) 1, 2 and 3

Q.7) Which of the following is issued by registered foreign portfolio investors to overseas investors
who want to be part of the Indian stock market without registering themselves directly?
(a) Certificate of Deposit
(b) Commercial Paper
(c) Promissory Note
(d) Participatory Note

Q.8) In the context of India, which of the following factors is/are contributors to reducing the risk of a
currency crisis?
1. The foreign currency earnings of India’s IT sector
2. Increasing the government expenditure
3. Remittances from Indians abroad
Select the correct answer using the code given below.
(a) 1 only
(b) 1 and 3 only
(c) 2 only
(d) 1, 2 and 3

Q.9) Which of the following is not included in the assets of a commercial bank in India?
(a) Advances
(b) Deposits
(c) Investments
(d) Money at call and short notice

Q.10) Consider the following statements:

1. Most of India’s external debt is owed by governmental entities.
2. All of India’s external debt is denominated in US dollars.
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

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Q.11) The economic cost of food grains to the Food Corporation of India is Minimum Support Price
and bonus (if any) paid to the farmers plus:
(a) transportation cost only
(b) interest cost only
(c) procurement incidentals and distribution cost
(d) procurement incidentals and charges for godowns

Q.12) The Chairman of public sector banks are selected by the

(a) Banks Board Bureau
(b) Reserve Bank of India
(c) Union Ministry of Finance
(d) Management of concerned bank

Q.13) What was the purpose of the Inter Creditor Agreement signed by Indian banks and financial
institutions recently?
(a) To lessen the Government of India’s perennial burden of fiscal deficit and current account deficit
(b) To support the infrastructure projects of Central and State Governments
(c) To act as independent regulator in case of applications for loans of Rs. 50 crore or more
(d) To aim at faster resolution of stressed assets of Rs. 50 crore or more which are-under consortium
lending"

Answer:
1. B 2. B 3. A 4. D 5. A 6. A 7. D 8. B 9. B 10. D 11. C 12. A 13. D

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 UPSC CSE PRELIMS 2018
Q.1) Which one of the following best describes the term “Merchant Discount Rate” sometimes seen
in the news?
(a) The incentive given by a bank to a merchant for accepting payments through debit cards
pertaining to that bank.
(b) The amount paid back by banks to their customers when they use debit cards for financial
transactions for purchasing goods or services.
(c) The charge to a merchant by a bank for accepting payments from his customers through the
bank’s debit cards.
(d) The incentive given by the Government, to merchants for promoting digital payments by their
customers through Point of Sale (PoS) machines and debit cards.

Q.2) Consider the following statements

1. The Fiscal Responsibility and Budget Management (FRBM) Review Committee Report has
recommended a debt to GDP ratio of 60% for the general (combined) government by 2023,
comprising 40% for the Central Government and 20% for the State Governments.
2. The Central Government has domestic liabilities of 21% of GDP as compared to that of GDP of
the State Governments.
3. As per the Constitution of India, it is mandatory for a State to take the Central Government’s
consent for raising any loan if the former owes any outstanding liabilities to the latter.
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.3) Consider the following statements

1. The quantity of imported edible oils is more than the domestic production of edible oils in
the last five years.
2. The Government does not impose any customs duty on all the imported edible oils a special
case.
Which of two statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Q.4) Which one of the following links all the ATMs in India ?
(a) Indian banks’ Association
(b) National Securities Depository Limited
(c) National Payments Corporation of India
(d) Reserve Bank of India

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Q.5) Which one of the following statements correctly describes the meaning of legal tender money ?
(a) The money which is tendered in courts of law to defray the fee of legal cases
(b) The money which a creditor is under compulsion to accept in settlement of his claims
(c) The bank money in the form of cheques, drafts, bills of exchange, etc.
(d) The metallic money in circulation in a country

Q.6) If a commodity is provided free to the public by the Government, then

(a) the opportunity cost is zero.
(b) the opportunity cost is ignored.
(c) the opportunity cost is transferred from the consumers of the product to the tax-paying public.
(d) the opportunity cost is transferred from the consumers of the product to the Government.

Q.7) Increase in absolute and per capita real GNP do not connote a higher level of economic
development, if
(a) industrial output fails to keep pace with agricultural output.
(b) agricultural output fails to keep pace with industrial output.
(c) poverty and unemployment increase.
(d) imports grow faster than exports.

Q.8) Human capital formation as a concept is better explained in terms of a process, which enables
1. individuals of a country to accumulate more capital.
2. increasing the knowledge, skill levels and capacities of the people of the country.
3. accumulation of tangible wealth.
4. accumulation of intangible wealth.
Which of the statements given above is/are correct?
(a) 1 and 2
(b) 2 only
(c) 2 and 4
(d) 1, 3 and 4

Q.9) Despite being a high saving economy, capital formation may not result in significant increase
in output due to:
(a) weak administrative machinery
(b) illiteracy
(c) high population density
(d) high capital-output ratio

Q.10) Consider the following statements:

1. The Reserve Bank of India manages and services Government of India Securities but not any
State Government Securities.
2. Treasury bills are issued by the Government of India and there are no treasury bills issued by
the State Governments.
3. Treasury bills offered are issued at a discount from the par value.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 3 Only

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

Q.11) Consider the following statements:

1. Capital Adequacy Ratio (CAR) is the amount that banks have to maintain in the form of their
own funds to offset any loss that banks incur if the account-holders fail to repay dues.
2. CAR is decided by each individual bank.
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

Q.12) With reference to digital payments, consider the following statements:

1. BHIM app allows the user to transfer money to anyone with a UPI-enabled bank account.
2. While a chip-pin debit card has four factors of authentication, BHIM app has only two factors
of authentication.
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

Q.13) With reference to the governance of public sector banking in India, consider the following
statements
1. Capital infusion into public sector banks by the Government of India has steadily increased in
the last decade.
2. To put the public sector banks in order, the merger of associate banks with the parent State
Bank of India has been affected.
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

Answers:
1. C 2. C 3. A 4. C 5. B 6. D 7. C 8. B 9. D 10. C 11. A 12. A 13. C

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 UPSC CSE PRELIMS 2017
Q.1) With reference to ‘National Investment and Infrastructure Fund’, which of the following
statements is/are correct?
1. It is an organ of NITI Aayog.
2. It has a corpus of Rs. 4, 00,000 crore at present.
Select the correct answer using the code given below:
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Q.2) What is/are the most likely advantages of implementing ‘Goods and Services Tax (GST)’?
1. It will replace multiple taxes collected by multiple authorities and will thus create a single
market in India.
2. It will drastically reduce the ‘Current Account Deficit’ of India and will enable it to increase its
foreign exchange reserves.
3. It will enormously increase the growth and size of the economy of India and will enable it to
overtake China in the near future.
Select the correct answer using the code given below:
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.3) Consider the following statements:

1. Tax revenue as a percent of GDP of India has steadily increased in the last decade.
2. Fiscal deficit as a percent of GDP of India has steadily increased in the last decade.
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

Q.4) What is the purpose of setting up Small Finance Banks (SFBs) in India?
1. To supply credit to small business units
2. To supply credit to small and marginal farmers
3. To encourage young entrepreneurs to set up business particularly in rural areas.
Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

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Q.5) Which of the following is the most likely consequence of implementing the ‘Unified Payments
Interface (UPI)’?
(a) Mobile wallets will not be necessary for online payments.
(b) Digital currency will totally replace the physical currency in about two decades.
(c) FDI inflows will drastically increase.
(d) Direct transfer of subsidies to poor people will become very effective.

Q.6) Which of the following statements is/are correct regarding the Monetary Policy Committee
(MPC)?
1. It decides the RBI’s benchmark interest rates.
2. It is a 12-member body including the Governor of RBI and is reconstituted every year.
3. It functions under the chairmanship of the Union Finance Minister.
Select the correct answer using the code given below:
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 2 and 3 only

Answers:
1. D 2. A 3. D 4. A 5. A 6. A

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 UPSC CSE PRELIMS 2016
Q.1) The term ‘Core Banking Solutions’ is sometimes seen in the news. Which of the following
statements best describes/describe this term?
1. It is a networking of a bank’s branches that enables customers to operate their accounts
from any branch of the bank on its network regardless of where they open their accounts.
2. It is an effort to increase RBI’s control over commercial banks through computerization.
3. It is a detailed procedure by which a bank with huge non-performing assets is taken over by
another bank.
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.2) With reference to pre-packaged items in India, it is mandatory to the manufacturer to put
which of the following information on the main label, as per the Food Safety and Standards
(Packaging and Labelling) Regulations, 2011?
1. List of ingredients including additives
2. Nutrition information
3. Recommendations, if any, made by the medical profession about the possibility of any
allergic reactions
4. Vegetarian/non-vegetarian
Select the correct answer using the code given below.
(a) 1, 2 and 3
(b) 2, 3 and 4
(c) 1, 2 and 4
(d) 1 and 4 only

Q.3) India’s ranking in the ‘Ease of Doing Business Index’ is sometimes seen in the news. Which of
the following has declared that ranking?
(a) Organization for Economic Cooperation and Development (OECD)
(b) World Economic Forum
(c) World Bank
(d) World Trade Organization (WTO)

Q.4) What is/are the purpose/purposes of the `Marginal Cost of Funds based Lending Rate (MCLR)’
announced by RBI?
1. These guidelines help improve the transparency in the methodology followed by banks for
determining the interest rates on advances.
2. These guidelines help ensure availability of bank credit at interest rates which are fair to the
borrowers as well as the banks.
Select the correct answer using the code given below:

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

Q.5) With reference to ‘Financial Stability and Development Council’, consider the following
statements :
1. It is an organ of NITI Aayog.
2. It is headed by the Union Finance Minister.
3. It monitors macroprudential supervision of the economy.
Which of the statements given above is/are correct?
(a) 1 and 2 only
(b) 3 only
(c) 2 and 3 only
(d) 1, 2 and 3

Q.6) The term ‘Base Erosion and Profit Shifting’ is sometimes seen in the news in the context of
(a) mining operation by multinational companies in resource-rich but backward areas
(b) curbing of the tax evasion by multinational companies
(c) exploitation of genetic resources of a country by multinational companies
(d) lack of consideration of environmental costs in the planning and implementation of
developmental projects

Q.7) Recently, India’s first ‘National Investment and Manufacturing Zone’ was proposed to be set up
in:
(a) Andhra Pradesh
(b) Gujarat
(c) Maharashtra
(d) Uttar Pradesh

Q.8) With reference to ‘Bitcoins’, sometimes seen in the news, which of the following statements
is/are correct?
1. Bitcoins are tracked by the Central Banks of the countries.
2. Anyone with a Bitcoin address can send and receive Bitcoins from anyone else with a Bitcoin
address.
3. Online payments can be sent without either side knowing the identity of the other.
Select the correct answer using the code given below.
(a) 1 and 2 only
(b) 2 and 3 only
(c) 3 only
(d) 1, 2 and 3

Q.9) What is/are the purpose/purposes of the Government’s ‘Sovereign Gold Bond Scheme’ and
‘Gold Monetization Scheme’?
1. To bring the idle gold lying with Indian households into the economy
2. To promote FDI in the gold and jeweler sector

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 3. To reduce India’s dependence on gold imports
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.10) ‘Global Financial Stability Report’ is prepared by the

(a) European Central Bank
(b) International Monetary Fund
(c) International Bank for Reconstruction and Development
(d) Organization for Economic Cooperation and Development

Q.11) The term ‘Regional Comprehensive Economic Partnership’ often appears in the news in the
context of the affairs of a group of countries known as
(a) G20
(b) ASEAN
(c) SCO
(d) SAARC

Q.12) On which of the following can you find the Bureau of Energy Efficiency Star Label?
1. Ceiling fans
2. Electric geysers
3. Tubular fluorescent lamps
Select the correct answer using the code given below.
(a) 1 and 2 only
(b) 3 only
(c) 2 and 3 only
(d) 1, 2 and 3

Q.13) ‘European Stability Mechanism’, sometimes seen in the news, is an

(a) agency created by EU to deal with the impact of millions of refugees arriving from Middle East
(b) agency of EU that provides financial assistance to eurozone countries
(c) agency of EU to deal with all the bilateral and multilateral agreements on trade
(d) agency of EU to deal with the conflicts arising among the member countries

Q.14) There has been a persistent deficit budget year after year. Which action/actions of the
following can be taken by the Government to reduce the deficit?
1. Reducing revenue expenditure
2. Introducing new welfare schemes
3. Rationalizing subsidies
4. Reducing import duty
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only

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(d) 1, 2, 3 and 4

Q.15) The establishment of ‘Payment Banks’ is being allowed in India to promote financial inclusion.
Which of the following statements is/are correct in this context?
1. Mobile telephone companies and supermarket chains that are owned and controlled by
residents are eligible to be promoters of Payment Banks.
2. Payment Banks can issue both credit cards and debit cards.
3. Payment Banks cannot undertake lending activities.
Select the correct answer using the code given below.
(a) 1 and 2 only
(b) 1 and 3 only
(c) 2 only
(d) 1, 2 and 3

Q.16) With reference to `IFC Masala Bonds’, sometimes seen in the news, which of the statements
given below is/are correct?
1. The International Finance Corporation, which offers these bonds, is an arm of the World
Bank.
2. They are the rupee-denominated bonds and are a source of debt financing for the public and
private sector.
Select the correct answer using the code given below.
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Q.17) Which of the following is/are included in the capital budget of the Government of India?
1. Expenditure on acquisition of assets like roads, buildings, machinery, etc.
2. Loans received from foreign governments
3. Loans and advances granted to the States and Union Territories
Select the correct answer using the code given below.
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Q.18) Recently, which one of the following currencies has been proposed to be added to the basket
of the IMF’s SDR?
(a) Rouble
(b) Rand
(c) Indian Rupee
(d) Renminbi

Q.19) With reference to the International Monetary and Financial Committee (IMFC), consider the
following statements:

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 1. IMFC discusses matters of concern affecting the global economy and advises the
International Monetary Fund (IMF) on the direction of its work.
2. The World Bank participates as an observer in IMFC’s meetings.
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

Q.20) Which of the following best describes the term ‘import cover’, sometimes seen in the news?
(a) It is the ratio of value of imports to the Gross Domestic Product of a country
(b) It is the total value of imports of a country in a year
(c) It is the ratio between the value of exports and that of imports between two countries
(d) It is the number of months of imports that could be paid for by a country’s international reserves

Answers:
1. A 2. C 3. C 4. C 5. C 6. B 7. A 8. B 9. C 10. B 11. B 12. D 13. B 14. C 15. B 16. C 17. D 18. D 19. C 20. D

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