MCQs “INDIAN ECONOMY 1950-1990” LESSON-2 CLASS-12 INDIAN ECONOMY

1. Who is the chairperson of the Planning commission?

A. President of India

B. Vice President of India

C. Finance Minister

D. Prime Minister of India

Ans: D

*It was set up in the year 1950

2. Identify the incorrect statement

A. In a market economy only those goods will be produced that are in demand

B. In a capitalist economy goods are produced & distributed on the basis of purchasing power

C. In a socialist economy there is no private property & desires of individuals are not given importance

D. Cuba is an example of a capitalist country

Ans: D

Cuba is an example of a socialist country

3. Fill in the blank with the correct alternative
________________ spells out how the resources of a nation should be put to use

A. Economic Survey

B. CAG report

C. Plan

D. Budget

Ans: C

4. The idea of Five-year plans was taken from which country?

A. UK

B. America

C. Soviet Union

D. Germany

Ans: C

5. Fill in the blank with correct alternative

__is a long term plan, specifies what is to be achieved over 20 years

A. Perspective Plans

B. Long term Plans

C. Twenty Year Plans

D. Five Year Plans

Ans: A

6. Read the following statements – Assertion (A) and Reason (R):

Assertion (A): The goals of five-year plans are growth, modernisation, self-reliance & equity

Reason (R): Due to limited resources all the plans have not been able to give importance to all these goals

From the given alternatives choose the correct one:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

c) Assertion (A) is true but Reason (R) is false.

d) Assertion (A) is false but Reason (R) is true

Ans: b)

7. From the given alternatives choose the correct one:

Statement 1-Growth refers to an increase in a country’s capacity to produce the output of goods & services within the country

Statement 2- Growth implies large stock of productive capital or a large size of supporting services

Alternatives:

a) Both the statements are true.

b) Both the statements are false.

c) Statement 1 is true and Statement 2 is false

d) Statement 2 is true and Statement 1 is false

Ans: a)

*Good indicator of economic growth is a rise in GDP

8. The contribution made by each sector of the economy makes up the _______ of the economy

A. Economic composition

B. Structural composition

C. Occupational composition

D. Size of the labour force in a country

Ans: B

9. Identify the incorrect statement

A. P.C. Mahalanobis is regarded as the architect of Indian planning

B. First Five year Plan was based on the ideas of Mahalanobis

C. He established the Indian Statistical Institute in Calcutta

D. He started a journal named ‘Sankhya’

Ans: B

II FYP was based on his ideas

10. From the given alternatives choose the correct one:

Statement 1 – Modernisation refers to the adoption of new technology to increase the production of goods & services
Statement 2- Modernisation only refer to the use of new technology, not to changes in social outlook

Alternatives:

a) Both the statements are true.

b) Both the statements are false.

c) Statement 1 is true and Statement 2 is false

d) Statement 2 is true and Statement 1 is false.

Ans: c)

11. Read the following statements – Assertion (A) and Reason (R):

Assertion (A): First seven five year plans gave importance to self reliance

Reason (R): Self reliance means importing goods which could be
produced in India itself

From the given alternatives choose the correct one:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the
correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not
the correct explanation of Assertion (A).

c) Assertion (A) is true but Reason (R) is false.

d) Assertion (A) is false but Reason (R) is true

Ans: c)

12. From the given alternatives choose the correct one:

Assertion (A): Self reliance was a necessity to reduce our dependence on foreign countries especially for food

Reason (R): It was feared, dependence on imported goods would lead to interference in policies by foreign nations
From the given alternatives choose the correct one:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

(b) Assertion (A) is false but Reason (R) is true.

c) Assertion (A) is true but Reason (R) is false.

d) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

Ans: a)

13. From the given alternatives choose the correct one:

Statement 1- Equity means benefits of economic prosperity reach the poor sections as well as the rich

Statement 2- The land ceiling was the policy to promote equity in agriculture

Alternatives:

a) Both the statements are true.

b) Both the statements are false.

c) Statement 1 is true and Statement 2 is false

d) Statement 2 is true and Statement 1 is false

Ans: a)

Land ceiling-fixing maximum size of land which could be owned by an individual

14. From the given alternatives choose the correct one:

Assertion (A): Steps were taken to abolish intermediaries and to make tillers owners of land

Reason (R): Ownership of land would give incentives to tillers in making improvements on the soil

From the given alternatives choose the correct one:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Assertion (A) is false but Reason (R) is true.

c) Assertion (A) is true but Reason (R) is false.

d) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

Ans: A

15. Match the following-

Ans: 1-b, 2-e, 3-d, 4-c, 5-a

16. Identify the incorrect statement

A. Equity in agriculture was fully served by the abolition of intermediaries

B. In some areas zamindars continued to own large areas of land

C. Landowners exploited the loopholes of the legislation

D. Land reforms were successful in Kerala & West Bengal

Ans: A

17. From the given alternatives choose the correct one:

Statement 1 – Green revolution refers to increase in production of food grains from HYV seeds

Statement 2- The use of HYV seeds was universal in India

Alternatives:

a) Both the statements are true.

b) Both the statements are false.

c) Statement 1 is true and Statement 2 is false

d) Statement 2 is true and Statement 1 is false

Ans: c)

HYV seeds were restricted to affluent states such as Punjab, Andhra Pradesh, & Tamil Nadu

18. Before the advent of Green Revolution in 1960’s, India was primarily dependent on _________ for the supply of food grains.(Fill in the blank with correct alternative)

a) USA

b) Britain

c) Mexico

d) Union of Soviet Socialist Republics (USSR)

Ans: a)

Green Revolution enabled the govt. to procure buffer stock.

19. ____is the portion of agricultural produce which is sold in the market by the farmers, after meeting their self consumption requirements.

(Fill in the blank with correct alternative)

a) Trade Surplus

b) Marketable Surplus

c) Producer Surplus

d) Consumer Surplus

Ans: b)

20. From the given alternatives choose the correct one:

Assertion (A): Green revolution benefitted the small as well as rich farmers

Reason (R): Government provided loans at low interest rate & subsidies on feritlisers to the small farmers

From the given alternatives choose the correct one: a) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

b) Assertion (A) is false but Reason (R) is true.

c) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

d) Assertion (A) is true but Reason (R) is false.

Ans: c)

21. Read the following statements carefully and choose the correct alternatives given below:

Statement 1- Subsidies do not add any burden on the financial health of a nation.

Statement 2- Complete removal of subsidies may violate the aim of equitable distribution of income.

Alternatives:

a) Both the statements are true.

b) Both the statements are false.

c) Statement 1 is true and Statement 2 is false

d) Statement 2 is true and Statement 1 is false

Ans: d)

22. From the given alternatives choose the correct one:
Assertion (A): Proportion of GDP contributed by agriculture declined but not the population depending on it
Reason (R): Industrial sector and service sector did not absorb the people working in agricultural sector

From the given alternatives choose the correct one:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

b) Assertion (A) is false but Reason (R) is true.

c) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

d) Assertion (A) is true but Reason (R) is false.

Ans: c)

23. The policy of ___________ is based on the idea that cultivators will take more interest in increasing output if they are the owners of the land

Ans: land to the tiller

24. Private Industries didn’t take interest in direct participation in industrial development due to:

A. Limited market size

B. Lack of capital

C. Lack of demand

D. All of the above

Ans: D

25. Policy of controlling the commanding heights of the economy means-

A. State would have 50% stakes in the industries that were vital for the economy

B. State would have complete control over industries that are vital for the economy

C. Private enterprises would have complete control over industries that were vital for the economy

D. Central Bank would have complete control over industries that were vital for the economy

Ans: B

26. Consider these statements regarding Industrial Policy Resolution 1956

I. It was adopted with the goal of the state controlling the commanding heights of the economy

II. It formed the basis of II FYP

III. It classified industries into three categories

IV. No new industry was allowed unless a license was obtained from the govt.

V. Aim of this policy was to promote regional equality

Which of these statements is/are correct?

A. I,II & III only

B. III,V & II only

C. All of these

D. III only

Ans: C

27. In 1955, Karve Committee (Village & Small scale committee) was constituted for –

A. Using SSI for rural development

B. Using SSI for urban development

C. Using large scale industries for development

D. Both A & B

Ans: A

*SSI are more labour-intensive

28. From the given alternatives choose the correct one:

Assertion (A): In the first seven plans trade was characterized by inward-looking trade strategy or import substitution

Reason (R): Govt. protected domestic industries by tariffs & quotas

From the given alternatives choose the correct one: a) Assertion (A) is false but Reason (R) is true.

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

c) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

d) Assertion (A) is true but Reason (R) is false

Ans: c)

29. Which of the following statement is/are incorrect?

I. Achievements of India’s industrial sector during the first seven plans are impressive

II. There was a rise in the industry’s share of GDP, there was a 6% growth rate of this sector during the period

III. Industrial sector became diversified, indigenous industries in automobiles & electronics developed

IV. Promotion of SSI’s gave opportunities to people who did not have large capital

A. I,II only

B. III & IV only

C. I,II,III & IV

D. None of these

Ans: D

30. Read the following statements carefully and choose the correct alternatives given below:

Statement 1 – The need to obtain a license to start an industry was misused by industrial houses

Statement 2- A big industrialist would get a license not for starting new firm but to prevent competitors from starting new firms

Alternatives:

a) Both the statements are true.

b) Both the statements are false.

c) Statement 1 is true and Statement 2 is false

d) Statement 2 is true and Statement 1 is false

Ans. a)

31. Read the following statements – Assertion (A) and Reason (R):

Assertion (A) – Major policy initiatives (land reforms and Green Revolution) helped India to become self-sufficient in food grains production.

Reason(R) – The proportion of people depending on agriculture did not decline as expected after the Green Revolution. From the given alternatives choose the correct one:

Alternatives:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

c) Assertion (A) is true but Reason (R) is false.

d) Assertion (A) is false but Reason (R) is true

Ans: b)

32. Read the following statements – Assertion (A) and Reason (R):

Assertion (A) – The goal of equitable distribution of land was fully served by the abolition of intermediaries, in post-independence India.

Reason(R) – Big landlords challenged the land ceiling legislation, delaying the implementation and subsequently escaping from the legislation

From the given alternatives choose the correct one:

Alternatives:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

c) Assertion (A) is true but Reason (R) is false. d) Assertion (A) is
false but Reason (R) is true.

d) Assertion (A) is false but Reason (R) is true

Ans: d)

33. Read the following statements – Assertion (A) and Reason (R):

Assertion (A) – Competition from imports forces our producers to be more efficient

Reason (R) – Due to restrictions on imports Indian consumers were free to purchase the commodities they wished for

From the given alternatives choose the correct one: Alternatives:

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

c) Assertion (A) is true but Reason (R) is false.

d) Assertion (A) is false but Reason (R) is true

Ans: c)

34. Policy of import substitution was adopted with which of the following reasons?

A. Saving foreign exchange

B. Achieving self-reliance

C. Industrialisation

D.All of the above

Ans: D

35. Which of the following statements are not true?

A. SSIs were given protection from big industries

B. Concessions were given to SSI

C. Govt. allowed SSI & large industries to produce any type of goods

D.None

Ans: C

Govt. reserved production of a number of goods by SSI which cannot be produced by other industry

36. Fill in the blank

Excessive regulation came to be known as ______

Ans: Permit License Raj

*Prevented certain firms from becoming efficient

37. From the given alternatives choose the correct one:

Assertion (A): Five year plans place a lot of emphasis on industrial development

Reason (R): Industry provides employment that is more stable than employment in agriculture

From the given alternatives choose the correct one: a) Assertion (A) is false but Reason (R) is true.

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

c) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

d) Assertion (A) is true but Reason (R) is false

Ans: c)

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