Indian Economy and Finance Mock Test

Altogether, around 22 percent of the Indian population is carrying out its livelihood, while being below the poverty line.

The Insurance Regulatory and Development Authority of India (IRDA) is a regulatory body under the jurisdiction of Ministry of Finance, Government of India and is tasked with regulating and licensing the insurance and re-insurance industries in India.

Disinvestment is when governments or organizations sell or liquidate assets or subsidiaries. Disinvestment in India is a policy of the Government of India, wherein the Government liquidates its assets in the Public sector Enterprises partially or fully.

Antyodaya Anna Yojana (AAY) is the sponsored scheme of Government of India to provide highly subsidised food to millions of the poorest families. The scheme was implemented in 2000. AAY scheme covers the poorest of the poor by supply of food and other important commodities for their daily needs.

Monopolistic competition is a type of imperfect competition such that there are many producers competing against each other, but selling products that are differentiated from one another and hence are not perfect substitutes.

RBI is required to maintain a Gold and Foreign Exchange Reserves of ₹200 Crore of which at least ₹115 Crore should be in Gold. This is called Minimum Reserve System.

A closed economy is one that has no trading activity with outside economies. The closed economy is therefore entirely self-sufficient, which means no imports come into the country and no exports leave the country.

The term merchant bank refers to a financial institution that conducts underwriting, loan services, financial advising, fundraising services and finances to international trade for large corporations and high-net-worth individuals (HWNIs). Unlike retail or commercial banks, merchant banks do not provide financial services to the general public.

Saving is closely related to physical investment, in that the former provides a source of funds for the latter. Consumers decide to save more, and spend less, the fall in demand would lead to an increase in business inventories. The change in inventories brings savings and investment into balance without any intention by the business to increase investment.

The Centre earns money through several taxes, such as corporate tax, income tax, goods and services tax, Union excise duty and customs duty. A part of the taxes is shared with state governments. The taxes, which are not shared with states include a surcharge on income tax, some cesses like education and road.