CURRENT AFFAIRS-VALUE ADDITION (CA-VA)

PRELIMS MICRO TEST (PMT) - 21

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1. Consider the following statements regarding Select the answer using the codes given
Permanent Account Numbers (PAN) 2.0: below:
1. It aims to introduce a unified tax (a) 1 and 2 only
identifier by integrating PAN, TAN, and (b) 2 and 3 only
TIN into a single system for businesses. (c) 3 and 4 only
2. It features a digitally signed QR code (d) 1 and 3 only
for real-time verification of taxpayer 4. Consider the following statements regarding
details. cotton production in India:
3. It eliminates the requirement for 1. India is a net exporter of cotton due to an
Aadhaar-PAN linkage, as real-time increase in productivity with Bt Cotton
authentication is introduced. hybrids.
2. The Cotton Corporation of India (CCI)
Which of the statement(s) given above is/are
can procure an unlimited quantity of
correct?
cotton at MSP from farmers.
(a) 1 and 2 only 3. The mobile app “Cott-Ally” assists
(b) 2 and 3 only farmers in finding global markets for
(c) 1, 2 and 3 only cotton export.
(d) 3 only
How many of the above statement(s) is/are
2. The relationship between human capital correct?
formation and economic growth is most (a) Only one
accurately characterized by: (b) Only two
(a) Increased human capital leads to (c) All three
proportional economic growth (d) None
(b) Human capital is both an input and an 5. Consider the following pairs:
outcome of economic development
(c) Economic growth determines the Item Major Export Hub
capacity for human capital formation 1. Leather A. Kanpur, Uttar
(d) Both variables are influenced by Products Pradesh
institutional quality. 2. Textiles & B. Nashik,
3. The depreciation of Indian Rupee is likely to Garments Maharashtra
be impacted by which of the following ? 3. Handicrafts & C. Coimbatore, Tamil
1. Higher Import Costs Artifacts Nadu
2. Lower Remittance Value 4. Organic D. Moradabad, Uttar
3. Higher Inflation Products Pradesh
4. Decreased cost of foreign debt (Fruits, Veg)

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 How many of the pair(s) given above is/are (c) Statement I is correct, but Statement II
correctly matched? is incorrect
(a) Only one (d) Statement I is incorrect, but Statement II
(b) Only two is correct
(c) Only three 8. Which of the following kinds of Government
(d) All four securities can be invested through the Retail
6. Consider the following criteria which must Direct platform of RBI?
be fulfilled for an entity to be recognized as 1. Government of India dated securities
a Farmer Producer Organization (FPO) in (dated G-Sec)
India: 2. Sovereign Gold Bonds (SGB)
1. It must be a legally registered entity 3. Commercial Papers (CPs)
under either the Companies Act, 2013, 4. Corporate Bonds
or the Cooperative Societies Act.
Select the answer using the codes given
2. At least 75% of its revenue should come
below:
from agricultural activities undertaken
by its members. (a) 1 and 4 only
3. It is required to operate in a single (b) 2 and 3 only
agricultural commodity and cannot (c) 1 and 2 only
engage in multiple value chain activities. (d) 2, 3 and 4 only
4. It is eligible for government assistance 9. Which of the following is the most likely
only if it has been operational for a effect of the implementation of the Goods and
minimum of three years. Services Tax (GST) on the MSME sector in
Which of the statement(s) given above is/are India?
correct? (a) Increasing compliance costs for
(a) 1 and 4 only MSMEs, leading to a rise in informal
(b) 3 only sector activities.
(c) 1 and 2 only (b) Encouraging MSMEs to transition into
(d) None of the above the formal sector due to simplified
7. Consider the following statements: tax procedures and access to input tax
credits.
Statement-I: (c) Exerting minimal impact on MSMEs,
The Preston Curve suggests countries in the as many remain below the tax slab
Middle-Income Trap may struggle to achieve threshold.
further health and social gains without (d) Hindering MSME growth due to a
structural economic transformation. higher tax burden, particularly on small-
scale service industries.
Statement-II:
10. With reference to Digital Lending Models in
No country has been able to sustain a position India, consider the following statements:
on the upper end of the Preston Curve without
1. Balance Sheet Lending (BSL) is where
first overcoming the Middle-Income Trap.
lending entities assume full credit risk.
Which one of the following is correct in 2. Peer-to-Peer (P2P) lending platforms act
respect of the above statements? as financial intermediaries by providing
(a) Both Statement I and Statement II are direct loans from their own balance
correct, and Statement II is the correct sheets to individuals.
explanation for Statement I 3. Under the Buy Now Pay Later (BNPL)
(b) Both Statement I and Statement II model, the cost to the borrower remains
are correct, but Statement II is not the unchanged irrespective of the repayment
correct explanation for Statement I schedule.

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 Which of the statement(s) given above is/are How many of the pair(s) is/ are correctly
correct? matched?
(a) 1 only (a) Only one
(b) 1 and 3 only (b) Only two
(c) 2 and 3 only (c) Only three
(d) All four
(d) 1, 2, and 3
13. Country X imposes a high import tariff
11. With reference to the Financial Services
on rice to safeguard its agricultural sector.
Institutions Bureau (FSIB), consider the
Neighboring Country Y, with abundant
following statements: water resources and modernized farming
1. FSIB was established by an executive techniques, produces rice at significantly
order of the Central Government and lower costs. Due to a regional trade agreement
operates under the Department of that permits duty-free movement of goods
Financial Services. within a special economic corridor, traders
2. The final authority for appointments purchase rice from Country Y and transport it
recommended by FSIB rests with the to Country X through this corridor, selling it
at prices below the domestic market but above
Reserve Bank of India (RBI).
their purchase price, without modifying the
3. It oversees the recapitalization process
product or violating any regulations.
of weak Public Sector Banks by directly
allocating funds from the government’s This trading behavior is best described as:
capital infusion plans. (a) Hedging
(b) Arbitrage
Select the correct answer using the code given
(c) Dumping
below. (d) Speculation
(a) 1 and 2 only
14. Consider the following statements with
(b) 2 only
respect to the Systemically Important Banks:
(c) 1 and 3 only
1. All Domestic Systemically Important
(d) 1, 2 and 3 Banks (D-SIBs) are required to maintain
12. Consider the following pairs: an additional Common Equity Tier
1 (CET1) capital surcharge, uniform
Financial Issuing Authority/ across all.
Instrument Market Association 2. The Financial Stability Board, in
A. Participatory 1. Indian consultation with the Basel Committee
Notes (P-Notes) Corporations on Banking Supervision, identifies
& International Global Systemically Important Banks
Capital Markets (G-SIB).
B. Masala Bonds 2. RBI & Authorized Which of the statement(s) given above is/are
Dealers (AD correct?
Category-I Banks) (a) 1 Only
C. Foreign 3. RBI, SEBI, (b) 2 Only
Currency and Ministry of (c) Both 1 and 2
Convertible Finance (d) Neither 1 nor 2
Bonds (FCCBs)
15. Consider the following statements regarding
D. External 4. Foreign Portfolio the Export-Import Bank of India (EXIM
Commercial Investors (FPIs) & Bank):
Borrowings SEBI
1. It was established by the Government of
(ECBs)
India, after the LPG Reforms of 1991​.

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 2. It provides financial assistance only in 18. With reference to the Wholesale Price Index
Indian Rupees. (WPI) and Consumer Price Index (CPI) in
3. It supports the Government of India’s India, consider the following statements:
Lines of Credit (LoC) extended to 1. An increase in WPI generally leads to
developing countries. a proportionate rise in CPI, reflecting a
Select the correct answer using the code given direct impact on retail inflation.
below. 2. WPI is more sensitive to changes in
global commodity prices than CPI.
(a) 1 and 2 only
3. Subsidies and price caps impact CPI
(b) 2 only
more than WPI.
(c) 3 only 4. CPI influences monetary policy
(d) 1, 2 and 3 decisions, while WPI is used for
16. Consider the following statements: industrial and economic trend analysis.
Statement I: How many of the above statement(s) is/are
correct?
An interest coverage ratio of less than 1
(a) Only one
indicates that the firm is struggling to generate
(b) Only two
enough cash to repay its interest obligations. (c) Only three
Statement II: (d) All four

The interest coverage ratio is calculated by 19. Which of the following are not correct
dividing Earnings before Interest and Taxes regarding Primary Agricultural Credit
(EBIT) by the Interest Expense. Societies (PACS) in India?
1. Regulated by the Reserve Bank of India
Which one of the following is correct in (RBI) under the Banking Regulation
respect of the above statements? Act, 1949.
(a) Both Statement-I and Statement-II are 2. Provide long-term credit for the
correct, and Statement-II is the correct Agriculture Infrastructure Fund (AIF).
explanation for Statement-I 3. Undertake non-agricultural activities
(b) Both Statement-I and Statement-II like running fair price shops and
are correct, but Statement-II is not the providing consumer goods.
correct explanation for Statement-I Select the correct answer using the codes
(c) Statement-I is correct, but Statement-II given below:
is incorrect (a) 1 only
(d) Statement-I is incorrect, but Statement- (b) 2 only
II is correct (c) 3 only
17. The “Mar-a-Lago Accord,” sometimes (d) 1, 2 and 3
mentioned in the context of international 20. Which institution in India is primarily
economics, is primarily associated with which responsible for the collection and
of the following? dissemination of trade statistics, including
(a) Currency manipulation and trade export and import data?
imbalance discussions (a) Central Board of Indirect Taxes and
(b) Establishment of a new global financial Customs (CBIC)
reserve currency (b) Directorate General of Foreign Trade
(c) Reform of the International Monetary (DGFT)
Fund’s voting rights (c) Directorate General of Commercial
(d) Creation of a common digital currency Intelligence and Statistics (DGCIS)
for global trade settlements (d) National Statistical Office (NSO)

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21. Consider the following factors: (b) An agreement between two countries
1. Appreciation of the US Dollar to eliminate tariffs on all products,
2. Increase in interest rates in developed leading to a comprehensive free trade
economies agreement.​
3. Strong corporate earnings in emerging (c) A strategy where two countries mutually
markets agree to eliminate tariffs on specific
4. Higher inflation in developed economies product categories, without engaging in
5. Decline in crude oil prices a full-scale trade agreement.​
(d) A global initiative under the World
How many of the factors given above are Trade Organization (WTO) where all
likely to result in Foreign Portfolio Investors member countries agree to reduce their
(FPIs) outflows from emerging markets like tariffs to zero simultaneously.​
India and China?
24. In India, which of the following can be
(a) Only two
considered as public investment in agriculture?
(b) Only three
(c) Only four 1. Fixing Minimum Support Price for
(d) All five agricultural produce of all crops.
2. Computerization of Primary Agricultural
22. Consider the following statements regarding Credit Societies
the Central Electricity Authority (CEA): 3. Social Capital development
1. It acts as the regulator for determining 4. Free electricity supply to farmers
electricity tariffs across states. 5. Waiver of agricultural loans by the
2. It prepares and monitors the National banking system
Electricity Plan. 6. Setting up of cold storage facilities by
3. It issued a national-level roadmap for the governments.
co-locating Battery Energy Storage Select the correct answer using the code given
Systems (BESS) with renewable energy below.
projects.
(a) 1, 2 and 5 only
4. It is the nodal agency for the
(b) 1, 3, 4 and 5 only
implementation of the Revamped
(c) 2, 3 and 6 only
Distribution Sector Scheme (RDSS).
(d) 1, 2, 3, 4, 5 and 6
Which of the following statement(s) is/are not
25. The term ‘Domestic Content Requirement’ is
correct?
sometimes seen in the news with reference to
(a) 1 and 3 only
(a) Developing solar power production in
(b) 2 and 4 only
our country
(c) 2 and 3 only (b) Granting licenses to foreign T.V.
(d) 1 and 4 only channels in our country
23. Which of the following accurately describes a (c) Exporting our food products to other
‘zero-for-zero’ tariff strategy? countries
(a) A policy where a country unilaterally (d) Permitting foreign educational
reduces all its tariffs to zero to promote institutions to set up their campuses in
free trade.​ our country

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 Space for Rough Work

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