Test 1

Question 1

Forex reserves= —-+ —-+—-+—.

They require high maintenance costs so, can also result in increasing —.

Answer 1

Foreign currency assets+ gold reserves+ SDRs+ Reserve tranche in IMF.
Inflation

Question 2

Consumer food price index is released by — for – categories namely— on ALL INDIA basis from—. It measures change in — of food, in specific time, area and pop. Calculated on — basis with base year— ( changed form 2010 in —). Highest weightage is given to — followed by —.

Answer 2

CSO, MOSPI- 3 categories- Rural, urban, combined- retail prices of food- Monthly- 2012- 2015- cereals and products- milk and products.

Question 3

Food price index by -

Calculated —– and considers – commodities-

Answer 3

• FAO- Monthly -5 -Cereal, Vegetable Oil, Dairy, Meat and Sugar

Question 4

—- pull inflation occurs when there is an increase in the flow of money in market. for eg- Increase in per capita income, Deficit financing.

Answer 4

Demand pull

Question 5

—- decrease in the rate of inflation. —– is a general decline in prices due to contraction of money supply or —- and —.

Answer 5

Disinflation- Deflation- Increased productivity and tech improvements.

Question 6

Transfer payments are —- of income and wealth —- goods and services in return. they are — coz they dont — absorb resources or — output. Are not included in — calculation because these are not payments to g and s they dont represent a form of — or –. ALL subsidies are — included such as subsidies given to —,— and —-.

Answer 6

Redistribution- without- non exhaustive- directly- create- GDP- final demand or gdp- NOT- domestic farmers, manufacturers and exporters.

Question 7

Indirect taxes lead to —— inflation.

Answer 7

Cost push Inflation

Question 8

—– - It is the most widely used inflation in India.
Published by-
— transactions at the—— are included i.e. —- stage of transaction is included. Thus these prices are paid by –
The base year of ALL INDIA level has been revised from 2004-05 to —-. Data released- Primary articles, fuel, and power on — & overall —– since —.Measures prices of —–. Items covered—–. Manufacturing inputs and intermediate goods like minerals, machinery basic metals etc.

Answer 8

WPI- The Office of Economic Adviser, Ministry of Commerce and Industry- ALL- first point of bulk sale in the domestic market-The first stage of the transaction- Manufacturers and wholesalers- 2011-12 in 2017- Weekly basis-Monthly basis since 2012- Goods only- 697 (Primary, fuel & power and manufactured products)

Question 9

— measures price changes from the perspective of a retail buyer. Published by—. Measures prices of—-. Measurement of Inflation at —— stage of the transaction. Prices are paid by——. Items covered —-. This also used by many countries unlike the — which is used only in few countries and is published —- with the base year —. —— are the – groups for which the CPI is measured.

Answer 9

CPI-Central Statistics Office (Ministry of Statistics and Programme Implementation)- Goods and Services both- The final stage of the transaction- Consumers- 448(Rural Basket) and 460 (Urban Basket)- WPI- Monthly- 2012- Education, communication, transportation, recreation, apparel, foods and beverages, housing and medical care - 8 groups.

Question 10

There are – types of CPI- Those released by —– are —. And those released by —– are —. From —, — has adopted CPI(—-) as the measure of inflation. Besides —- also indicate inflation.

Answer 10

4- Released by Labour Bureau in the Ministry of Labour and Employment are: CPI for Industrial Workers (IW), CPI for Agricultural Labourer (AL), CPI for Rural Labourer (RL). And CPI (Rural/Urban/Combined) is released by Central Statistical Organisation (CSO) in the Ministry of Statistics and Programme Implementation- 2014- RBI- Producer Price Index (PPI), Commodity Price Index, Cost of Living Index, Capital Goods Price Index and GDP Deflator.

Question 11

The Index of Industrial Production (IIP) is an indicator that measures the changes in the —- of production of industrial products during a given period. It calculates the data of —– sectors. IIP’s current base year is—- since —-. The —- is responsible for the compilation and publication of the Index of Industrial Production (IIP) since —. IIP is published —-, — weeks after the reference month ends.

Answer 11

Volume- eight core- 2011-12 since May 2017, was changed to bring it on par with the GDP data- Central Statistical Organisation (CSO) under the “Ministry of Statistics and Programme Implementation”- 1950- Monthly, six weeks-

Question 12

8 core industries weightage- Highest—–. Lowest to —. The eight-core sectors comprise —- of the weight of items included in the Index of Industrial Production (IIP). —– have the highest weight of 34% and —- have the least weight i.e. 8.22%.

Answer 12

Highest- Refinery products and Lowest - Fertilizers
RESCo CONCeF
1. Refinery products: Its total weightage is 28.04% in the core sectors
2. Electricity: Its total weightage is 19.85% in the core sectors
3. Steel: Its total weightage is 17.92% in the core sectors
4. Coal: Its total weightage is 10.33% in the core sectors
5. Crude: Its total weightage is 8.98% in the core sectors
6. Natural gas: Its total weightage is 6.88% in the core sectors
7. Cement: Its total weightage is 5.37% in the core sectors
8. Fertilizers: Its total weightage is 2.63% in the core sectors
-40.27% weight of items- Primary goods- capital goods .

Question 13

Department of Industrial Policy & Promotion (DIPP) has been renamed to the —– under the Ministry —-. The renamed body will also be in charge of — new categories of responsibilities:
Earlier internal trade was under ——. And DIPP was in-charge of — admin and — trade. With this both external and internal trade will come under one ministry.

Answer 13

Department for Promotion of Industry and Internal Trade (DPIIT)- Min of Commerce and Industry- four- 1)Promotion of INTERNAL TRADE (including retail trade)

2) The WELFARE of traders and their employees.
3) Facilitating EASE OF DOING BUSINESS.
4) START-UPS
- Consumer affairs ministry- FDI admin and external trade.

Question 14

Confederation of All India Traders (CAIT)
CAIT is the —– of trading community of India at National Level.
It is headquartered at Vyapar Bhawan in —–.

Answer 14

Non-governmental apex body- New Delhi.

Question 15

Core inflation shows price rise in everything except—–. It is calculated using —-. Excludes temporary —–. Has been used in India since —-. AKA —— inflation. Overall inflation in the economy is ——.

Answer 15

Energy and food items- CPI excluding these items- shocks and volatility- 2000-01- Non food manufacturing inflation or underlying inflation- Headline inflation.

Question 16

—– explains the reltnshp betw the level of investment made in the econ and the consequent rise in the GDP. Inverse reltnshp betw — and efficiency. Thus, it indicates additional unit of capital or additional amnt of investment needed to produce an additional unit of —-.

Answer 16

ICOR- ICOR- Output. Thus, lower the value of ICOR higher the efficiency.

Question 17

Total production in econ=—+—. Therefore both — and —- goods are considered as final goods.

Answer 17

Consumption( consumer goods)+ Investment (capital goods). Therefore there is the trade off between the two. Consumer and capital.

Question 18

—– are aka intermediate goods, durable goods or economic capital. most common of them are —-,—-,—- i.e. —–. —– are aka final goods coz they end up in the hands of consumers and they generally fall into 3 categories- —–.

Answer 18

Capital goods- Property, plant and equipment aka PPE- Consumer goods- Durable goods, non-durable goods, services.

Question 19

—- changes with the changing volume of production of goods and services. It is country’s total —— adjusted for —-. It shows comparison of both the — and —- of g and s. Calculated-

Answer 19

Real GDP- Total economic output- price changes- Quantity and value- Real GDP is calculated by dividing nominal GDP over a GDP deflator.

Question 20

—- at — is used as a measure to obtain national income of India. It is GNP- —–. It is a measure of —-.
GNP= —
NNP=
NNP is evaluated at market prices which include —–. And we can get —– if we deduct net indirect taxes from NNP at —.

Answer 20

NNP at factor cost- Depreciation- aggregate national income- GNP= GDP+ net factor income form abroad- NNP=(GDP+ net factor income form abroad)- depreciation.- Indirect taxes- NNP at factor cost- market cost.

Question 21

—- is an INDEX representing the ratio of nominal gdp to real gdp. Gives an idea about how prices have moved from — to —. —– is considered as constant while calculating it.

Answer 21

GDP deflator- base year to current year- Volume of production.
GDP deflator= Nominal gdp/ real gdp* 100

Question 22

Decrease in Tax to GDP ratio can be due to- —- and —.

Answer 22

Inefficient tax administration and tax evasion and slowing down econ growth rate.

Question 23

—- provides constant rate of return irrespective of the level of inflation in economy. Provides security against the macroecon risks. It is issued by —.

Answer 23

Inflation indexed bond- Sovereign.

Question 24

Base year change in calculation of GDP has been done on the basis of —-. Therefore in new series GDP is calculated on —-.

Answer 24

International guidelines taken from System of national accounts, 2008 of UN- Market price.

Question 25

• — is caused due to-
  1. Increase in money supply- cheap money policy
  2. Lower int rates.
  3. Increase in the disposable income
  4. Increase in pub expenditure
  5. Repayment of the PUBLIC DEBT
  6. Rising in the real wages.

Answer 25

Demand-pull inflation.