ECONOMY

Question 1

WHAT ARE POLITICALLY EXPOSED PERSONS (PEPs) AS PER RBI?

Answer 1

INDIVIDUALS WHO ARE OR HAVE BEEN ENTRUSTED WITH PROMINENT PUBLIC FUNCTIONS BY A FOREIGN COUNTRY, INCLUDING THE HEADS OF STATES/GOVERNMENTS, SENIOR POLITICIANS, SENIOR GOVERNMENT OR JUDICIAL OR MILITARY OFFICERS, SENIOR EXECUTIVES OF STATE OWNED CORPORATIONS AND IMPORTANT POLITICAL PARTY OFFICIALS.

Question 2

RBI HAS TIGHTENED RULES FOR THE ISSUANCE OF SHORT TERM COMMERCIAL PAPERS (CPs) AND NON CONVERTIBLE DEBENTURES (NCDs), WITH AN INITIAL MATURITY OF UP TO ONE YEAR. WHAT ARE THE KEY CHANGES?

Answer 2

THE NEW NORMS, WHICH COME INTO EFFECT FROM APRIL 1, INVOLVE SIX KEY CHANGES.
1. THE TENOR OF SUCH SHORT TERM CPs CANNOT BE LESS THAN SEVEN DAYS OR EXCEED A YEAR, WHILE THOSE OF NCDs CANNOT BE LESS THAN 90 DAYS OR MORE THAN ONE YEAR, THE RBI SAID.
2. AS PER THE REVISED NORMS, CPs AND NCDs ISSUED FROM APRIL 1 ONWARDS WILL HAVE A MINIMUM DENOMINATION OF RS 5 LAKH AND IN MULTIPLES OF Rs 5 LAKH THEREAFTER.
3. BOTH THESE DEBT INSTRUMENTS CANNOT BE ISSUED WITH OPTIONS, WHILE THE SETTLEMENT MUST BE DONE WITHIN A PERIOD NOT EXCEEDING T+4 WORKING DAYS, AS PER THE NEW RULES ISSUED ON THURSDAY.
4. CPs AND NCDs SHALL BE ISSUED ONLY IN DEMATERIALISED FORM AND HELD WITH A DEPOSITORY REGISTERED WITH SEBI. THEY CANNOT BE PERMITTED TO BE UNDERWRITTEN OR CO-ACCEPTED.
5. THE CENTRAL BANK HAS MADE IT MANDATORY FOR THE ISSUER TO DISCLOSE THE END USE OF THE MONEY RAISED THROUGH THESE INSTRUMENTS.
6. ACCORDING TO RBI, TOTAL SUBSCRIPTION BY ALL INDIVIDUALS IN ANY PRIMARY ISSUANCE OF CPs OR NCDs SHALL NOT EXCEED 25 PERCENT OF THE TOTAL AMOUNT ISSUED.

Question 3

DEFINE CURRENT ACCOUNTS AND WHAT ARE IT’S COMPONENTS?

Answer 3

THE CURRENT ACCOUNT IS THE ACCOUNT THAT RECORDS THE GOODS EXPORTS AND IMPORTS, AS WELL AS TRADE IN SERVICES AND TRANSFER PAYMENTS.
COMPONENTS:-
1 VISIBLE TRADE (GOODS)
2 INVISIBLE TRADE (SERVICES)
3 TRANSFER PAYMENTS
4 NET FACTOR INCOME
5 REMITTANCES

Question 4

DEFINE CAPITAL ACCOUNTS AND WHAT ARE IT’S COMPONENTS?

Answer 4

CAPITAL ACCOUNT IS THE ACCOUNT THAT KEEPS TRACK OF BORROWING AND LENDING OF CAPITAL ASSETS AND NON FINANCIAL ASSETS BETWEEN THE COUNTRIES.
COMPONENTS:-
1 BORROWINGS
2 LENDINGS
3 INVESTMENTS

Question 5

WHAT ARE ZERO COUPON ZERO PRINCIPLE INSTRUMENTS?

Answer 5

THESE ARE FINANCIAL INSTRUMENTS THAT A NON PROFIT ORGANIZATION MAY USE TO RAISE FUNDS. WHEN AN ENTITY ISSUES THESE SECURITIES AND RAISES MONEY, IT IS NOT A LOAN BUT A DONATION.

Question 6

DO BORROWING ENTITIES HAVE TO PAY INTEREST ON ZERO COUPON ZERO PRINCIPLE INSTRUMENTS?

Answer 6

THE BORROWING ENTITY DOES NOT HAVE TO PAY INTEREST- THEREFORE ZERO COUPON- AND DOES NOT HAVE TO PAY THE PRINCIPAL (ZERO PRINCIPAL) EITHER.
LIKE ANY OTHER DEBT INSTRUMENT, IT WILL COME WITH A TIME DURATION.

Question 7

WHO CAN BUY THE ZERO COUPON ZERO PRINCIPLE INSTRUMENTS?

Answer 7

ANY INDIVIDUAL OR CORPORATE CAN BUY THE SECURITY THROUGH SOCIAL STOCK EXCHANGE (SSE) ONCE THEY ARE OPEN FOR BUSINESS.

Question 8

WHO HAD DECLARED ZERO COUPON ZERO PRINCIPAL INSTRUMENTS (ZCZP) AS SECURITIES FOR THE SECURITIES CONTRACTS (REGULATION) ACT, 1956?

Answer 8

FINANCE MINISTRY.

Question 9

ZERO COUPON ZERO PRINCIPLE INSTRUMENTS WILL BE GOVERNED BY?

Answer 9

SEBI.

Question 10

NORMS FOR ZERO COUPON ZERO PRINCIPLE INSTRUMENTS?

Answer 10

1 NOT TRANSFERABLE- SUCH INSTRUMENTS WILL BE ISSUED IN DEMATERIALIZED FORM ONLY AND ARE NOT TRANSFERABLE.
2 MINIMUM SIZE- THE MINIMUM ISSUE SIZE HAS BEEN SET AT RS 50 LAKH.
3 MINIMUM APPLICATION SIZE AT RS 10,000.
4 MINIMUM SUBSCRIPTION REQUIRED TO BE ACHIEVED WILL BE 75 % OF THE FUNDS PROPOSED TO BE RAISED THROUGH ISSUING SUCH INSTRUMENTS. THE FUNDS WILL BE REFUNDED IF THE SUBSCRIPTION IS LESS THAN 75 PERCENT OF ISSUE SIZE (UNDER SUBSCRIPTION).

Question 11

WHAT IS REMISSION OF DUTIES AND TAXES ON EXPORTED PRODUCTS (RoDTEP) SCHEME?

Answer 11

THE SCHEME PROVIDES FOR REFUND OF TAXES, DUTIES AND LEVIES THAT EXPORTERS INCUR IN THE PROCESS OF MANUFACTURING AND DISTRIBUTION OF GOODS.
UNDER THIS, A REBATE IS PROVIDED FOR ALL HIDDEN TAXES AT EVERY LEVEL ON THE EXPORTED PRODUCT THAT HAS NOT BEEN REFUNDED UNDER ANY OTHER EXISTING SCHEME.
UNION GOVERNMENT WILL EXTEND EXPORT BENEFITS TO E-COMMERCE EXPORTS.

Question 12

TAX RANGE UNDER Remission of Duties and Taxes on Exported Products (RoDTEP)?

Answer 12

THE REFUND RATE UNDER THE SCHEME RANGES FROM 0.5% TO 4.3% OF THE PRODUCT’S VALUE AND IT VARIES DEPENDING ON THE PRODUCT AND THE COUNTRY OF EXPORT.
1 TEXTILES- 2.4% FOR EXPORTS TO US
2 MACHINERY- 1.0% FOR EXPORTS TO ALL COUNTRIES.
3 AGRICULTURAL PRODUCTS-0.5% FOR EXPORTS TO ALL COUNTRIES.

Question 13

FOREIGN TRADE POLICY OF 2023, HAS RAISED THE LIMIT PER CONSIGNMENT OF GOODS THROUGH E- COMMERCE TO RS_____ FROM _____.

Answer 13

TO RS 10 LAKH FROM RS 5 LAKH.

Question 14

NODAL MINISTRY OF BHARATMALA PARIYOJANA PROJECT?

Answer 14

MINISTRY OF ROAD TRANSPORT AND HIGHWAYS.

Question 15

IMPLEMENTING AGENCY OF BHARATMALA PARIYOJANA PROJECT?

Answer 15

1 NATIONAL HIGHWAYS AUTHORITY OF INDIA (NHAI)
2 NATIONAL HIGHWAYS AND INFRASTRUCTURE DEVELOPMENT CORPORATION LIMITED (NHIDCL)
3 STATE PUBLIC WORKS DEPARTMENT

Question 16

QUANTITATIVE CRITERION FOR DOMESTIC SYSTEMICALLY IMPORTANT BANKS (D-SIBs)?

Answer 16

BANKS WHOSE ASSETS EXCEED 2% OF GDP ARE CONSIDERED PART OF THIS GROUP.

Question 17

MAJOR PORTS AND MINOR PORTS IN INDIA ARE MANAGED BY?

Answer 17

MAJOR BY UNION MINISTRY OF SHIPPING.
MINOR BY STATE GOVERNMENTS.

Question 18

WHAT IS ‘CONCEPT OF STAKEHOLDER CAPITALISM’?

Answer 18

IT IS A FORM OF CAPITALISM IN WHICH COMPANIES DO NOT ONLY OPTIMISE SHORT TERM PROFITS FOR SHAREHOLDERS BUT SEEK LONG TERM VALUE CREATION, BY TAKING INTO ACCOUNT THE NEEDS OF ALL THEIR STAKEHOLDERS, AND SOCIETY AT LARGE.

Question 19

CONCEPT OF STAKEHOLDER CAPITALISM’ IS RELATED TO WHICH ORGANIZATION?

Answer 19

WORLD ECONOMIC FORUM.

Question 20

TOP 5 LARGEST STOCK MARKETS OF WORLD?

Answer 20

1 USA 🇺🇸
2 CHINA 🇨🇳
3 JAPAN
4 INDIA 🇮🇳
5 HONG KONG 🇭🇰
6 FRANCE 🇫🇷
7 UK 🇬🇧

Question 21

DEPOSIT COMPARISON BETWEEN PAYMENT BANK AND COMMERCIAL BANK?

Answer 21

PAYMENT BANK- MAXIMUM LIMIT IS UP TO RS 2 LAKH.
COMMERCIAL BANK- NO RESTRICTIONS.

Question 22

MINIMAL CAPITAL COMPARISON BETWEEN PAYMENT BANK AND COMMERCIAL BANK?

Answer 22

PAYMENT BANK- MINIMUM CAPITAL OF RS 100 CRORE WITH PROMOTERS CONTRIBUTING AT LEAST 40% OF THE CAPITAL.
COMMERCIAL BANK- COMMERCIAL BANKS MEANWHILE NEED TO HAVE RS 500 CRORE AS ITS PAID UP VOTING EQUITY CAPITAL.

Question 23

MINIMAL BALANCE COMPARISON BETWEEN PAYMENT BANK AND COMMERCIAL BANK?

Answer 23

PAYMENT BANK- THERE ARE ZERO BALANCE ACCOUNTS THERE IS NO MINIMUM BALANCE REQUIRED.
COMMERCIAL BANK- MANY COMMERCIAL BANKS REQUIRE YOU TO HAVE A MINIMUM BALANCE IN YOUR ACCOUNT. FAILURE TO DO SO MAY RESULT IN A PENALTY.

Question 24

LOANS AND CREDIT COMPARISON BETWEEN PAYMENT BANK AND COMMERCIAL BANK?

Answer 24

A PAYMENT BANK IS NOT ALLOWED TO GIVE ANY FORM OF LOAN OR ISSUE A CREDIT CARD, WHICH IS ALSO A FORM OF UNSECURED PERSONAL LOAN.
COMMERCIAL BANK HAS NO SUCH RESTRICTIONS.

Question 25

GOVERNMENT SECURITIES COMPARISON BETWEEN PAYMENT BANK AND COMMERCIAL BANK?

Answer 25

PAYMENT BANK- 75% OF TOTAL DEMAND DEPOSITS NEEDS TO BE INVESTED IN GOVERNMENT SECURITIES.
COMMERCIAL BANK- MAXIMUM 22% NEEDS TO INVEST IN GOVERNMENT SECURITIES.

Question 26

EXAMPLES OF DIRECT TAXES?

Answer 26

1 INCOME TAX.
2 CORPORATE TAX.
3 SECURITIES TRANSACTION TAX.
4 CAPITAL GAINS TAX.
5 GIFT TAX.
6 WEALTH TAX.

Question 27

EXAMPLES OF INDIRECT TAX?

Answer 27

1 SALES TAX.
2 SERVICE TAX.
3 OCTROI DUTY.
4 CUSTOM DUTY.
5 VALUE ADDED TAX (VAT).
6 GOODS AND SERVICE TAX (GST).

Question 28

Fixing of Wage Rates in MGNREGA Scheme is done in response to?

Answer 28

Wage Rates are set in response to changes in the CPI-AL (Consumer Price Index-Agriculture Labourer), which measures inflation in rural areas.

Question 29

CPI-(AL) is published by?

Answer 29

The Labour Bureau.

Question 30

What is piece rate method?

Answer 30

Piece rate (piece-meal) pay occurs when workers are paid by the unit performed (e.g. the number of tee shirts or bricks produced) instead of being paid on the basis of time spent on the job.
Piece rate method is used to determine MGNREGA Wage rates.

Question 31

Is MGNREGA payment same across the country?

Answer 31

No, the rates vary from state to state.

Question 32

Nodal Ministry of MGNREGA?

Answer 32

Ministry of Rural Development (MRD).

Question 33

Mandate of MGNREGA?

Answer 33

To provide at least 100 days of guaranteed employment each fiscal year to every rural household whose adult members agree to conduct unskilled manual labour at the statutory minimum wage.

Question 34

Marine Products Exports Development Authority (MPEDA) comes under which ministry?

Answer 34

Ministry of Commerce and Industry.

Question 35

What is “Peace Clause”?

Answer 35

It was established in 2013 under the Bali Agreement.
It permits developing nations to exceed the 10 percent ceiling without facing legal action by the other members temporarily. (WTO) Food procurement program.

Question 36

What is CDP-SURAKSHA?

Answer 36

CDP-SURAKSHA– stands for “System for United Resource Allocation, Knowledge, and Secure Horticulture Assistance” is essentially a digital platform that will allow an instant disbursal of subsidies to farmers in their bank account by utilizing the e-RUPI voucher from the National Payments Corporation of India (NPCI).

Question 37

Criteria for classification to Navratna Status?

Answer 37

• A company must first attain the Miniratna category-I designation and be included in Schedule A of Central Public Sector Enterprises (CPSEs).

Question 38

Which agency recently got the Navratna status?

Answer 38

IREDA (Indian Renewable Energy Development Agency).

Question 39

Benefits of Navratna status?

Answer 39

• They can execute significant investments of up to Rs 1,000 crore without requiring approval from the central authority.
• These firms are permitted to allocate up to 30% of their net worth annually, provided it remains under Rs 1,000 crore.
• They have the option to participate in joint ventures, forge partnerships, and set up overseas subsidiaries.
• The status give the Board of Directors of these CPSEs the power to allow mergers and acquisitions in India and abroad.
• However, they need approval from the Cabinet Committee on Economic Affairs (CCEA) to make investments abroad.

Question 40

What is a Goldilock economy?

Answer 40

It is a state wherein, the economy is not expanding or contracting by a large margin.