What is the term for removing government-imposed limits or barriers?
Correct Answer:
(D)
Liberalisation
The term for removing government-imposed limits or barriers is liberalization. It involves reducing or eliminating regulations, restrictions, and controls imposed by the government, often to encourage free markets and trade.
Ques:
12
Which one of the following claims concerning liberalisation is correct?
Correct Answer:
(A)
It entails fewer government regulations and deregulation, as well as more autonomy for private ventures.
Liberalization generally involves a reduction in government regulations and restrictions, leading to greater autonomy for private businesses and enterprises. This process aims to foster economic growth, efficiency, and innovation by allowing businesses more freedom to operate.
Liberalization is the process of reducing government restrictions and regulations on economic activities, typically to promote market competition and private sector involvement. Privatization, on the other hand, might involve contracting out certain functions, but it's a separate process of transferring ownership of public assets to private entities.
Ques:
13
Under the government’s liberalisation program, which one of these economic changes was launched by the government?
Correct Answer:
(A)
Reforms in the industrial and financial sectors
Under India's government liberalization program, significant reforms were introduced in both the industrial and financial sectors. These reforms aimed to reduce government intervention, encourage private sector participation, and open the economy to global competition and investment.
Ques:
14
What does liberalisation aim at?
Correct Answer:
(C)
Economic reforms
Liberalization in economics primarily aims to reduce government restrictions and regulations to promote economic efficiency and growth by encouraging private sector participation and foreign investment. This often involves opening up markets to competition, attracting foreign investment, and encouraging global integration.
Ques:
15
Which of the following is incorrect regarding Liberalisation?
Correct Answer:
(D)
Liberalisation was only in Action for the purpose of promotion of FDI and FII.
While the liberalization of the Indian economy did aim to promote Foreign Direct Investment (FDI) and Foreign Institutional Investments (FII), it was not solely focused on these two. Liberalization encompassed a broader range of economic reforms, including trade liberalization, deregulation, and privatization, all aimed at boosting overall economic growth and development.
Ques:
16
Consider the following statements regarding NEP 1991:
It was aimed at restoring macroeconomic stability.
It was designed to address the crisis of stagflation.
Which of the statements given above is/are correct?
Correct Answer:
(C)
Both 1 and 2
The New Economic Policy, or the NEP, is a policy introduced in India in 1991 aimed at restoring macroeconomic stability. The NEP was designed to address the crisis of stagflation, which was a result of the simultaneous increase in prices for both food and manufactured goods. The NEP consisted of several reforms, including the liberalisation of the financial sector, the reduction of import duties, and the removal of subsidies on food, fuel, and fertilisers.
Ques:
17
Consider the following statements regarding the Multi-Year Program (MAP) of 2001:
MAP was aimed to achieve the greater economic growth.
It failed miserably to achieve even 7% GDP growth.
Which of the statements given above is/are correct?
Correct Answer:
(A)
1 only
The NEP was successful in restoring macroeconomic stability and encouraging economic growth. Between 1991 and 1994, GDP growth averaged 7%. Between 1995 and 2000, GDP growth averaged 9%. In 2001, the government introduced the Multi-Year Programme (MAP) which aimed to achieve even greater economic growth. The MAP was successful in achieving growth rates of 10% to 12%. However, following the global financial crisis of 2007-2008, growth rates declined to 5% in 2009 and 2% in 2010.
Ques:
18
Consider the following statements regarding NEP 1991:
It was announced by P. V. Narasimha Rao government.
Indian economy open up for foreign investment and experienced rapid economic growth.
Which of the statements given above is/are correct?
Correct Answer:
(C)
Both 1 and 2
The current economic policy (NEP) was announced by the P. V. Narasimha Rao government in 1991. The policy responded to an economic crisis that had gripped the country. The goal of the NEP was to open up the Indian economy to foreign investment and promote economic growth. The policy has successfully achieved these goals, and India has experienced rapid economic growth in recent years
Ques:
19
Which of the following is not the goal of NEP 1991:
Correct Answer:
(A)
It was built to increase the rate of inflation.
The new economic policy was made in India through privatisation, liberalisation and globalisation. It refers to the relaxation of many tariffs, opening the market for foreign players. It also refers to lessening the burden of taxes for the economic growth of India.
Goals of the NEP 1991:
The main motto was to boost the Indian economy through globalisation.
The New Economic Policy was built to reduce the rate of inflation
To attain economic stabilisation. To mould existing markets into a market economy by withdrawing unnecessary restrictions.
To allow the international flow of capital, technology, goods, human resources, and services without any limitations.
Ques:
20
Consider the following statements:
Increasing investment limit for small-scale industries to upgrade their machinery and improve their efficiency.
Selling shares of Public Sector Undertakings (PSUs) to public and financial institutions.
Disinvestment in PSUs incurring losses by selling out these industries to the private sector.
Which of the above are the measures taken for privatization under NEP?
Correct Answer:
(B)
2 and 3 only
Following measures were undertaken for privatization-
Selling shares of Public Sector Undertakings (PSUs) to public and financial institutions.
Disinvestment in PSUs incurring losses by selling out these industries to the private sector.
Minimizing the role of the public sector with a view to help in industrialization and economic growth. Industries reserved for the public sector were reduced from 17 to 2.
Liberalization included the following measures:
All commercial Banks become free to determine the rate of interest in the banking system without the influence of RBI.
Increasing investment limit for small-scale industries to upgrade their machinery and improve their efficiency.
Indian industries would have the freedom to import capital goods such as to buy machines and raw materials from foreign nations for their development.
Industries have freedom towards diverse production capacities and reduction in the cost of production.
Doing away with restrictive trade practices, for instance replacing the Monopolies and Restrictive Trade Practices Act 1969 with Competition Act, 2002.