1. Which of the following statements best describes the "K-shaped recovery" witnessed in the Indian economy post-pandemic?
A slow and gradual recovery across all sectors equally.
A sharp decline in the economy followed by a stagnant flatline.
Different sectors of the economy recovering at significantly different rates, with some growing and others declining.
All sectors of the economy recovering at a uniform fast pace.
Explanation:
A K-shaped recovery occurs when different parts of the economy recover at different rates, times, or magnitudes. For instance, technology and large corporate sectors grew, while MSMEs and contact-intensive sectors struggled.
2. Which of the following is NOT a characteristic of a "Mixed Economy" like India?
Social welfare motive along with profit motive
Government regulation of private sector
Co-existence of public and private sectors
Complete state ownership of all resources
Explanation:
A mixed economy involves both public and private sectors. "Complete state ownership" is a characteristic of a Socialist/Command economy, not a mixed one.
3. The current "Flexible Inflation Targeting" framework in India requires the RBI to maintain CPI inflation at:
Between 0% and 4%
4% with a tolerance band of +/- 2%
2% fixed
5% with a tolerance band of +/- 1%
Explanation:
The RBI Act was amended in 2016 to provide a statutory basis for this framework. The target is 4% Consumer Price Index (CPI) inflation, with an upper limit of 6% and a lower limit of 2%.
4. Which term describes the phenomenon where a country’s working-age population grows larger than the dependent population, creating a potential for economic growth?
Malthusian Trap
Brain Drain
Population Explosion
Demographic Dividend
Explanation:
Demographic Dividend is the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population (15 to 64) is larger than the non-working-age share of the population (14 and younger, and 65 and older). India is currently passing through this phase.