The Indian economy is a mixed developing social market economy, currently ranked as the fifth-largest in the world by nominal GDP and the third-largest by purchasing power parity (PPP). For competitive exams like UPSC, SSC, and banking, the Indian Economy syllabus encompasses crucial macroeconomic indicators, the banking sector regulated by the Reserve Bank of India (RBI), and fiscal policies managed by the Ministry of Finance. Key areas of study include the transition from Five-Year Plans to NITI Aayog, taxation structures like the Goods and Services Tax (GST), and poverty alleviation metrics. Mastery of these concepts, alongside foreign trade dynamics, unemployment types, and inflation measurement (CPI and WPI), is essential for clearing the General Studies and General Awareness sections of major government examinations.
1. The Planning Commission of India was replaced by which of the following institutions?
Correct Answer: b) NITI Aayog
Explanation:
The Planning Commission was replaced by the National Institution for Transforming India (NITI) Aayog on January 1, 2015, to foster cooperative federalism.
2. Who serves as the ex-officio Chairman of NITI Aayog?
Correct Answer: c) Prime Minister of India
Explanation:
The Prime Minister of India is the ex-officio Chairman of NITI Aayog, leading its governing council.
3. The First Five Year Plan of India was based on which model?
Correct Answer: b) Harrod-Domar Model
Explanation:
The First Five Year Plan (1951-1956) was based on the Harrod-Domar model with a few modifications, focusing heavily on agricultural development.
4. The Second Five Year Plan laid heavy emphasis on which sector?
Correct Answer: c) Heavy Industries
Explanation:
Based on the Mahalanobis model, the Second Five Year Plan (1956-1961) prioritized the development of the public sector and rapid industrialization, particularly heavy industries.
5. Which period is referred to as the 'Plan Holiday' in the Indian economic history?
Correct Answer: a) 1966 to 1969
Explanation:
Due to the failure of the Third Plan, the Indo-Pak war, and severe droughts, the government declared a 'Plan Holiday' from 1966 to 1969, executing three annual plans instead.
6. The concept of the 'Rolling Plan' was introduced by which government?
Correct Answer: b) Janata Party Government
Explanation:
The Janata Party government terminated the Fifth Five Year Plan in 1978 and introduced a new Sixth Plan called the 'Rolling Plan' for 1978-1983.
7. What does NITI stand for in NITI Aayog?
Correct Answer: b) National Institution for Transforming India
Explanation:
NITI stands for National Institution for Transforming India, serving as the premier policy think tank of the Government of India.
8. What was the duration of India's Twelfth Five Year Plan?
Correct Answer: b) 2012-2017
Explanation:
The Twelfth Five Year Plan spanned from 2012 to 2017. It was the last Five Year Plan of India before NITI Aayog replaced the Planning Commission.
9. The concept of Five Year Plans in the Indian Constitution was borrowed from which country?
Correct Answer: c) USSR
Explanation:
India adopted the concept of economic planning and Five Year Plans from the erstwhile Soviet Union (USSR).
10. The National Development Council (NDC) was established in which year?
Correct Answer: c) 1952
Explanation:
The National Development Council was set up on August 6, 1952, to strengthen and mobilize the efforts and resources of the nation in support of the Five Year Plans.
11. Which organization is primarily responsible for estimating National Income in India?
Correct Answer: b) National Statistical Office (NSO)
Explanation:
The National Statistical Office (NSO), formed by merging the CSO and NSSO under the Ministry of Statistics and Programme Implementation, calculates India's National Income.
12. What is the current base year used for calculating India's GDP?
Correct Answer: c) 2011-12
Explanation:
In 2015, the Central Statistics Office (now NSO) changed the base year for GDP calculation from 2004-05 to 2011-12.
13. Who made the first attempt to calculate National Income in India?
Correct Answer: b) Dadabhai Naoroji
Explanation:
Dadabhai Naoroji made the first attempt to calculate India's national income in 1867-68, publishing it in his book 'Poverty and Un-British Rule in India'.
14. The term 'Hindu Rate of Growth' was coined by which Indian economist?
Correct Answer: b) Raj Krishna
Explanation:
Indian economist Raj Krishna coined the term 'Hindu Rate of Growth' in 1978 to describe the low annual growth rate of the Indian economy (around 3.5%) before 1991.
15. Which sector is the largest contributor to India's Gross Domestic Product (GDP)?
Correct Answer: c) Services Sector
Explanation:
The Services sector (tertiary sector) is the largest contributor to India's GDP, accounting for over 50% of the total economic output.
16. Gross Value Added (GVA) at basic prices is calculated as GDP at market prices minus:
Correct Answer: c) Net taxes on products
Explanation:
GVA at basic prices = GDP at market prices - Taxes on products + Subsidies on products (which equals GDP minus Net taxes on products).
17. How is Per Capita Income calculated?
Correct Answer: a) National Income / Total Population
Explanation:
Per Capita Income is calculated by dividing the total national income of a country by its total population, reflecting the average income per person.
18. Which of the following activities belongs to the Primary Sector of the economy?
Correct Answer: c) Mining and Quarrying
Explanation:
The primary sector involves the extraction and harvesting of natural resources. Agriculture, forestry, fishing, and mining belong to this sector.
19. What is the difference between Gross Domestic Product (GDP) and Gross National Product (GNP)?
Correct Answer: c) Net Factor Income from Abroad
Explanation:
GNP equals GDP plus Net Factor Income from Abroad (NFIA). It accounts for the income earned by citizens overseas minus the income earned by foreign residents within the country.
20. Pensions, scholarships, and unemployment allowances are examples of:
Correct Answer: b) Transfer Payments
Explanation:
Transfer payments are one-way payments made by the government for which no goods or services are exchanged, such as pensions and welfare benefits. They are not included in National Income.
21. In which year was the Reserve Bank of India (RBI) nationalized?
Correct Answer: c) 1949
Explanation:
The RBI was established in 1935 but was nationalized on January 1, 1949, transferring its ownership fully to the Government of India.
22. What was the earlier name of the State Bank of India (SBI) before it was nationalized in 1955?
Correct Answer: b) Imperial Bank of India
Explanation:
The Imperial Bank of India, formed in 1921 by amalgamating three presidency banks, was nationalized and renamed the State Bank of India in 1955.
23. How many major commercial banks were nationalized during the first phase of nationalization in 1969?
Correct Answer: c) 14
Explanation:
On July 19, 1969, the Government of India nationalized 14 major commercial banks that had deposits of over Rs. 50 crores.
24. Which institution acts as the 'Lender of Last Resort' in India?
Correct Answer: c) Reserve Bank of India
Explanation:
The RBI acts as the lender of last resort, providing liquidity to banks facing financial crises when they cannot borrow from anywhere else.
25. The rate at which the RBI lends short-term money to commercial banks against government securities is called:
Correct Answer: c) Repo Rate
Explanation:
The Repo Rate (Repurchase Agreement Rate) is the rate at which the central bank lends money to commercial banks in the event of any shortfall of funds.
26. What does CRR stand for in the Indian banking system?
Correct Answer: a) Cash Reserve Ratio
Explanation:
CRR stands for Cash Reserve Ratio, which is the specified minimum fraction of the total deposits of customers that commercial banks have to hold as reserves with the RBI.
27. Statutory Liquidity Ratio (SLR) requires banks to maintain a certain percentage of their Net Demand and Time Liabilities (NDTL) in the form of:
Correct Answer: c) Liquid assets like cash, gold, and approved securities
Explanation:
SLR is the minimum percentage of deposits that a commercial bank has to maintain in the form of liquid cash, gold, or other government-approved securities before providing credit to customers.
28. Open Market Operations (OMO) by the RBI refers to:
Correct Answer: b) Buying and selling of government securities in the open market
Explanation:
Open Market Operations refer to the buying and selling of government securities in the open market by the central bank to control money supply in the economy.
29. How many members are there in the Monetary Policy Committee (MPC) of India?
Correct Answer: c) 6
Explanation:
The MPC consists of 6 members: 3 from the RBI (including the Governor as the ex-officio chairperson) and 3 external members appointed by the Government of India.
30. NABARD was established in 1982 on the recommendation of which committee?
Correct Answer: b) B. Sivaraman Committee
Explanation:
The National Bank for Agriculture and Rural Development (NABARD) was established on July 12, 1982, based on the recommendations of the B. Sivaraman Committee.
31. The Export-Import (EXIM) Bank of India was set up in which year?
Correct Answer: b) 1982
Explanation:
EXIM Bank was established in 1982 under the Export-Import Bank of India Act 1981, as the premier export finance institution of the country.
32. Which is the largest Public Sector Bank in India?
Correct Answer: c) State Bank of India
Explanation:
The State Bank of India (SBI) is the largest public sector bank in India in terms of assets, branches, and customer base.
33. Regional Rural Banks (RRBs) in India were first set up in the year:
Correct Answer: b) 1975
Explanation:
Regional Rural Banks were established on October 2, 1975, under the provisions of an ordinance, later replaced by the RRB Act of 1976, to develop the rural economy.
34. A bank is classified as a 'Scheduled Bank' in India if it is included in the:
Correct Answer: b) Second Schedule of the Reserve Bank of India Act, 1934
Explanation:
Scheduled Banks in India are those banks that are listed in the Second Schedule of the RBI Act, 1934, meeting specific criteria set by the central bank.
35. Which index is primarily used by the RBI for inflation targeting in India?
Correct Answer: b) Consumer Price Index (CPI)
Explanation:
Since 2014, the RBI has adopted the Consumer Price Index (CPI - Combined) as the key measure for its inflation targeting framework.
36. What is the current base year for the Wholesale Price Index (WPI) in India?
Correct Answer: b) 2011-12
Explanation:
In 2017, the Office of the Economic Adviser (OEA) revised the base year of the Wholesale Price Index (WPI) from 2004-05 to 2011-12.
37. A situation characterized by high inflation combined with high unemployment and stagnant economic demand is known as:
Correct Answer: c) Stagflation
Explanation:
Stagflation occurs when an economy experiences stagnant economic growth, high unemployment, and high price inflation simultaneously.
38. Core inflation differs from headline inflation because it excludes:
Correct Answer: c) Food and Energy prices
Explanation:
Core inflation excludes highly volatile components such as food and energy prices from the inflation basket to capture the underlying trend of long-term inflation.
39. The Phillips Curve illustrates the inverse relationship between:
Correct Answer: b) Inflation and Unemployment
Explanation:
The Phillips Curve, developed by A.W. Phillips, shows an inverse, trade-off relationship between the rates of inflation and unemployment in an economy.
40. Which of the following is a primary cause of Demand-pull inflation?
Correct Answer: c) Increase in money supply and consumer spending
Explanation:
Demand-pull inflation occurs when aggregate demand exceeds aggregate supply, often caused by increased money supply, government spending, or consumer spending ('too much money chasing too few goods').
41. Cost-push inflation is primarily caused by:
Correct Answer: c) An increase in the cost of production (like wages and raw materials)
Explanation:
Cost-push inflation happens when the overall price levels go up due to increases in the cost of wages, raw materials, or supply chain disruptions.
42. What is 'Disinflation'?
Correct Answer: b) A decrease in the rate of inflation
Explanation:
Disinflation is a temporary slowing of the pace of price inflation. Prices are still rising, but at a slower rate than before (e.g., inflation dropping from 6% to 4%).
43. Who among the following generally benefits during a period of unanticipated inflation?
Correct Answer: c) Debtors / Borrowers
Explanation:
Debtors benefit during unexpected inflation because the real value of the money they owe decreases; they pay back their loans with money that is worth less than when they borrowed it.
44. Fiscal Deficit is defined as:
Correct Answer: b) Total Expenditure minus Total Receipts (excluding borrowings)
Explanation:
Fiscal deficit indicates the total borrowing requirements of the government. It is the excess of total expenditure over total non-debt creating receipts.
45. How is the Primary Deficit calculated?
Correct Answer: b) Fiscal Deficit minus Interest Payments
Explanation:
Primary Deficit is calculated by subtracting the interest payments on previous borrowings from the current year's fiscal deficit.
46. Which Article of the Indian Constitution mandates the presentation of the 'Annual Financial Statement' (Budget)?
Correct Answer: b) Article 112
Explanation:
Article 112 of the Constitution requires the government to present an Annual Financial Statement, popularly known as the Union Budget, before Parliament every financial year.
47. The Goods and Services Tax (GST) was introduced in India by which Constitutional Amendment Act?
Correct Answer: c) 101st Amendment Act
Explanation:
GST was introduced in India on July 1, 2017, through the 101st Constitutional Amendment Act, 2016.
48. Who acts as the Chairperson of the GST Council?
Correct Answer: b) Union Finance Minister
Explanation:
Under Article 279A of the Constitution, the GST Council is a joint forum of the Centre and the States, chaired by the Union Finance Minister.
49. What is the maximum tax slab rate currently applicable under the GST regime in India?
Correct Answer: b) 28%
Explanation:
The current standard GST slabs in India are 5%, 12%, 18%, and 28%. The maximum slab rate is 28% (excluding any additional cess applied to luxury/demerit goods).
50. Which of the following is an example of a Direct Tax in India?
Correct Answer: c) Corporate Tax
Explanation:
A direct tax is levied directly on a taxpayer's income or wealth. Corporate tax and Income tax are prime examples. GST and Customs are indirect taxes.
51. Which of the following is an Indirect Tax?
Correct Answer: c) Customs Duty
Explanation:
Customs duty is an indirect tax levied on goods imported into or exported out of the country. The tax burden can be passed on to the final consumer.
52. The Finance Commission of India is constituted under which Article of the Constitution?
Correct Answer: c) Article 280
Explanation:
Article 280 provides for the constitution of a Finance Commission every five years to recommend the distribution of tax revenues between the Union and the States.
53. The FRBM Act, which aims to bring fiscal discipline to the Indian economy, was enacted in which year?
Correct Answer: c) 2003
Explanation:
The Fiscal Responsibility and Budget Management (FRBM) Act was passed in 2003 to institutionalize financial discipline and reduce fiscal and revenue deficits.
54. The Laffer Curve is a theoretical representation of the relationship between:
Correct Answer: b) Tax rates and Tax revenue
Explanation:
The Laffer Curve illustrates that increasing tax rates beyond a certain point will lead to lower tax revenues because higher taxes discourage the taxed activity.
55. What differentiates a 'Cess' from a 'Surcharge' in Indian taxation?
Correct Answer: b) A cess is levied for a specific purpose, whereas a surcharge is a general 'tax on tax'.
Explanation:
A cess is collected for a specific purpose (e.g., Education Cess) and must be used for that alone. A surcharge is an additional tax on tax for general revenue. Neither is shareable with states under the divisible pool.
56. Which of the following is considered a 'Capital Receipt' for the government?
Correct Answer: c) Proceeds from Disinvestment
Explanation:
Capital receipts either create a liability (like borrowing) or reduce an asset (like disinvestment). Tax revenues and dividends are revenue receipts.
57. What is 'Zero-Based Budgeting' (ZBB)?
Correct Answer: b) A budgeting method where every expense must be justified for each new period, starting from a 'zero base'.
Explanation:
In Zero-Based Budgeting, historical spending is ignored, and all departmental expenditures must be rigorously justified from scratch (base zero) for every new budget cycle.
58. Who is known as the 'Father of the Green Revolution' in India?
Correct Answer: b) M.S. Swaminathan
Explanation:
M.S. Swaminathan introduced high-yielding varieties of wheat and rice in India during the 1960s, leading the Green Revolution in the country.
59. Which organization recommends the Minimum Support Price (MSP) for agricultural commodities in India?
Correct Answer: b) Commission for Agricultural Costs and Prices (CACP)
Explanation:
The CACP, an attached office of the Ministry of Agriculture, recommends MSPs for mandated crops to the Cabinet Committee on Economic Affairs (CCEA).
60. The 'Blue Revolution' is associated with the growth of which sector?
Correct Answer: c) Aquaculture and Fish Production
Explanation:
The Blue Revolution relates to the intense growth and development of the aquaculture and fishing industry.
61. Operation Flood, launched in 1970, was a major initiative associated with the:
Correct Answer: b) White Revolution
Explanation:
Operation Flood, pioneered by Dr. Verghese Kurien, was the world's largest dairy development program and is synonymous with the White Revolution in India.
62. Which of the following is a 'Kharif' crop?
Correct Answer: c) Rice
Explanation:
Kharif crops are monsoon crops sown in June-July. Rice, maize, cotton, and soybean are major Kharif crops. Wheat, mustard, and barley are Rabi crops.
63. Rabi crops are typically sown during which months in India?
Correct Answer: b) October to November
Explanation:
Rabi crops (winter crops) are sown around October to November and harvested in the spring (March to May).
64. Which sector employs the highest percentage of the workforce in India?
Correct Answer: c) Agriculture
Explanation:
Despite its declining share in the GDP, the agricultural sector continues to employ the largest segment (around 40-45%) of the Indian workforce.
65. What does e-NAM stand for in the context of Indian agriculture?
Correct Answer: a) Electronic National Agriculture Market
Explanation:
e-NAM is a pan-India electronic trading portal that networks existing APMC mandis to create a unified national market for agricultural commodities.
66. The Kisan Credit Card (KCC) scheme was introduced in which year to provide adequate and timely credit to farmers?
Correct Answer: b) 1998
Explanation:
The KCC scheme was introduced in August 1998, based on the recommendations of the R.V. Gupta Committee, to provide short-term formal credit to farmers.
67. APMC Acts passed by various state governments deal with:
Correct Answer: b) Agricultural marketing
Explanation:
The Agricultural Produce Market Committee (APMC) Acts establish statutory market boards to regulate the agricultural markets (mandis) to protect farmers from exploitation by large retailers.
68. The terms Maharatna, Navratna, and Miniratna are used to classify which of the following?
Correct Answer: b) Central Public Sector Enterprises (CPSEs)
Explanation:
These are statuses conferred by the Government of India on profitable CPSEs to grant them varying degrees of financial and operational autonomy.
69. The first Industrial Policy Resolution in independent India was announced in:
Correct Answer: b) 1948
Explanation:
The Industrial Policy Resolution of 1948 laid the foundation of a mixed economy, delineating the roles of the public and private sectors.
70. The New Economic Policy (NEP) implementing LPG (Liberalization, Privatization, Globalization) reforms was introduced in the year:
Correct Answer: b) 1991
Explanation:
Facing a severe Balance of Payments crisis, the Indian government under PM P.V. Narasimha Rao and Finance Minister Manmohan Singh introduced the landmark LPG reforms in 1991.
71. Under the revised MSME classification in India (2020), a 'Micro' enterprise is one where investment in plant and machinery does not exceed:
Correct Answer: b) Rs. 1 Crore and turnover up to Rs. 5 Crore
Explanation:
The revised 2020 MSME criteria define a Micro enterprise as having an investment up to Rs. 1 Crore and an annual turnover up to Rs. 5 Crore.
72. The Special Economic Zones (SEZ) Act was passed in India in which year?
Correct Answer: b) 2005
Explanation:
The SEZ Act was passed in 2005 (and came into effect in 2006) to drive economic growth, boost exports, and attract FDI by providing tax holidays and relaxed regulations.
73. What is the current maximum limit of Foreign Direct Investment (FDI) allowed under the automatic route in the Insurance sector in India?
Correct Answer: c) 74%
Explanation:
The FDI limit in the insurance sector was raised from 49% to 74% under the automatic route in 2021 to attract more foreign capital.
74. The 'Make in India' initiative was launched by the Government of India in which year?
Correct Answer: b) 2014
Explanation:
The Make in India initiative was launched in September 2014 to facilitate investment, foster innovation, and build best-in-class manufacturing infrastructure.
75. The Balance of Payments (BoP) of a country consists of which two main accounts?
Correct Answer: b) Current Account and Capital Account
Explanation:
The BoP is broadly divided into the Current Account (trade in goods, services, and transfers) and the Capital Account (investments, loans, and capital transfers).
76. In which year did the Indian Rupee become fully convertible on the Current Account?
Correct Answer: c) 1994
Explanation:
India accepted Article VIII of the IMF agreement in August 1994, making the Rupee fully convertible on the current account (for trade and invisible payments).
77. Which of the following committees is associated with poverty estimation in India?
Correct Answer: b) Tendulkar Committee
Explanation:
The Suresh Tendulkar Committee (2009) and the C. Rangarajan Committee (2014) are prominent committees constituted to review the methodology for poverty estimation in India.
78. When the marginal productivity of labor is zero or negative, it is a case of:
Correct Answer: d) Disguised Unemployment
Explanation:
Disguised unemployment occurs when more people are employed in an activity than necessary. If some are removed, total production does not fall (marginal productivity is zero). It is very common in Indian agriculture.
79. Unemployment resulting from industrial reorganization or technological change that makes workers' skills obsolete is called:
Correct Answer: b) Structural Unemployment
Explanation:
Structural unemployment happens when there is a mismatch between the skills of the unemployed workers and the skills needed for available jobs, often due to technological advancements.
80. Unemployment that occurs temporarily when workers are transitioning between jobs is known as:
Correct Answer: a) Frictional Unemployment
Explanation:
Frictional unemployment is the short-term unemployment that occurs while workers are actively searching for a new job or transitioning from one job to another.
81. The Lorenz Curve is a graphical representation used to measure:
Correct Answer: c) Income or wealth inequality
Explanation:
The Lorenz Curve graphs the cumulative percentage of income against the cumulative percentage of the population to illustrate the degree of income inequality.
82. A Gini Coefficient of '0' (zero) represents:
Correct Answer: b) Perfect equality
Explanation:
The Gini Coefficient ranges from 0 to 1. A value of 0 indicates perfect equality (everyone has the same income), while a value of 1 indicates maximal inequality (one person has all the income).
83. Under the MGNREGA scheme, how many days of guaranteed wage employment are provided in a financial year to a rural household?
Correct Answer: b) 100 days
Explanation:
The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) guarantees at least 100 days of unskilled manual wage employment to adult members of any rural household.
84. Which institution publishes the 'National Multidimensional Poverty Index' (MPI) in India?
Correct Answer: c) NITI Aayog
Explanation:
NITI Aayog publishes the National MPI, which captures overlapping deprivations in health, education, and standard of living, based on the global MPI framework.
85. Which of the following is NOT an indicator used to calculate the Human Development Index (HDI)?
Correct Answer: d) Infant Mortality Rate
Explanation:
The HDI is based on three dimensions: a long and healthy life (Life expectancy), access to knowledge (years of schooling), and a decent standard of living (GNI per capita). It does not directly use IMR as an independent index parameter.
86. Poverty measured in relation to the general standard of living in a particular society is known as:
Correct Answer: b) Relative Poverty
Explanation:
Relative poverty defines poverty in relation to the economic status of other members of the society (income inequality), whereas absolute poverty refers to a lack of basic necessities (a fixed poverty line).
87. The 'Bretton Woods Twins' refers to which two international organizations?
Correct Answer: b) IMF and World Bank
Explanation:
The International Monetary Fund (IMF) and the World Bank (formally IBRD) were both created at the Bretton Woods Conference in 1944 and are referred to as the Bretton Woods Twins.
88. The World Trade Organization (WTO) was established in 1995 to replace which international agreement?
Correct Answer: b) GATT
Explanation:
The WTO officially commenced on January 1, 1995, replacing the General Agreement on Tariffs and Trade (GATT), which had been in existence since 1947.
89. Special Drawing Rights (SDR), also known as 'paper gold', is an international reserve asset created by:
Correct Answer: b) International Monetary Fund (IMF)
Explanation:
The SDR is an international reserve asset created by the IMF in 1969 to supplement its member countries' official reserves.
90. The New Development Bank (NDB) was established by the BRICS states. Where is its headquarters located?
Correct Answer: b) Shanghai
Explanation:
The New Development Bank (NDB), formerly referred to as the BRICS Development Bank, is headquartered in Shanghai, China.
91. Where is the headquarters of the Reserve Bank of India (RBI) located?
Correct Answer: c) Mumbai
Explanation:
Initially established in Calcutta, the headquarters of the RBI was permanently moved to Mumbai in 1937.
92. The Financial Year in India officially runs from:
Correct Answer: b) April 1 to March 31
Explanation:
The Indian government and corporate sector follow a financial year that begins on April 1 and ends on March 31 of the following year.
93. The Securities and Exchange Board of India (SEBI) was given statutory powers in which year?
Correct Answer: b) 1992
Explanation:
SEBI was initially formed as a non-statutory body in 1988 and was given statutory status through the SEBI Act on January 30, 1992.
94. IRDAI is the regulatory body for which sector in India?
Correct Answer: c) Insurance
Explanation:
The Insurance Regulatory and Development Authority of India (IRDAI) regulates and promotes the insurance and re-insurance industries in India.
95. What is 'Gresham's Law' in economics?
Correct Answer: b) Bad money drives out good money.
Explanation:
Gresham's Law is a monetary principle stating that 'bad money drives out good'. If two forms of commodity money in circulation have the same face value, people will hoard the more valuable one and spend the less valuable one.
96. The term 'Demographic Dividend' refers to:
Correct Answer: b) Economic growth potential resulting from a shift in a population's age structure, where the working-age population is larger than the non-working-age population.
Explanation:
A demographic dividend occurs when a country's birth rate and death rate fall, leading to a bulge in the working-age population (15-59 years), driving accelerated economic growth.
