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With reference to the Sovereign Gold Bond (SGB), consider the following statements:
1. It is issued by Reserve Bank on behalf of the Government of India.
2. In cases of premature redemption, the investor receives the ongoing market price.
3. Joint holding is not allowed under this scheme.
Which of the statements given above is/are correct?
Correct Answer: A
Explanation:
• Statement 1 is correct. The Sovereign Gold Bond (SGB) is issued by Reserve Bank on behalf of the Government of India. They are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity.
• Statement 2 is correct. Under this scheme, the quantity of gold for which the investor pays is protected, since he receives the ongoing market price at the time of redemption/ premature redemption.
• Statement 3 is incorrect. Joint holding is not allowed under the Sovereign Gold Bond (SGB) scheme. Minors can invest in SGB; but the application on behalf of the minor has to be made by his/her guardian.
Correct Answer: A
Explanation:
• Statement 1 is correct. The Sovereign Gold Bond (SGB) is issued by Reserve Bank on behalf of the Government of India. They are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity.
• Statement 2 is correct. Under this scheme, the quantity of gold for which the investor pays is protected, since he receives the ongoing market price at the time of redemption/ premature redemption.
• Statement 3 is incorrect. Joint holding is not allowed under the Sovereign Gold Bond (SGB) scheme. Minors can invest in SGB; but the application on behalf of the minor has to be made by his/her guardian.
Consider the following assets:
1. Demand deposits with the banks
2. Currency
3. Time deposits with the banks
4. Savings deposits with the banks
Which of the following is the increasing order of liquidity of the above-mentioned assets?
Correct Answer: B
Explanation:
The sequence of these increasing order of liquidity is:
• Time deposits with the banks:A time deposit or term deposit account is used to hold money for a fixed period of time. In return for this, the bank pays interest. However, it is not allowed to withdraw the money before expiry of the fixed duration. For example, A fixed deposit (FD).
• Savings deposits with the banks: Saving accounts are used to meet daily on-demand requirements of cash. For example, a saving bank account with the bank having cheque book facility. The bank asks to maintain a minimum balance (i.e. Rs 1000). In return, the bank pays an interest at the rate of 4% per annum.The account holder can operate the saving account using an ATM card also. Banks impose limits on the frequency and amount of withdrawal using ATMs.
• Demand deposits with the banks:The sum of money that is given to a bank but can be withdrawn as per the requirement of the depositor. Amounts that are lying in the savings and current accounts are known as demand deposits because they can be used at any point of time.
• Currency:It includes money in the form of paper or coins.
Correct Answer: B
Explanation:
The sequence of these increasing order of liquidity is:
• Time deposits with the banks:A time deposit or term deposit account is used to hold money for a fixed period of time. In return for this, the bank pays interest. However, it is not allowed to withdraw the money before expiry of the fixed duration. For example, A fixed deposit (FD).
• Savings deposits with the banks: Saving accounts are used to meet daily on-demand requirements of cash. For example, a saving bank account with the bank having cheque book facility. The bank asks to maintain a minimum balance (i.e. Rs 1000). In return, the bank pays an interest at the rate of 4% per annum.The account holder can operate the saving account using an ATM card also. Banks impose limits on the frequency and amount of withdrawal using ATMs.
• Demand deposits with the banks:The sum of money that is given to a bank but can be withdrawn as per the requirement of the depositor. Amounts that are lying in the savings and current accounts are known as demand deposits because they can be used at any point of time.
• Currency:It includes money in the form of paper or coins.
With reference to the Indian economy, which of the following would likely to occur if there is a rising inflow of funds?
1. Rupee will appreciate
2. Exports will become more profitable
3. Rise in foreign exchange reserves
Select the correct answer using the code given below:
Correct Answer: C
Explanation:
Recently, India's foreign exchange reserves surged $3.43 billion to an all-time high of $493.48 billion for the week ended May 29(2020) on the back of strong inflow of funds by foreign portfolio investors. In May alone, forex reserves jumped by a sharp $12.4 billion.
Correct Answer: C
Explanation:
Recently, India's foreign exchange reserves surged $3.43 billion to an all-time high of $493.48 billion for the week ended May 29(2020) on the back of strong inflow of funds by foreign portfolio investors. In May alone, forex reserves jumped by a sharp $12.4 billion.
Consider the following statements:
1. Higher the tax to GDP ratio the better financial position the country will be in.
2. A higher tax to GDP ratio means that an economy's tax buoyancy is strong.
Which of the statements given above is/are correct
Correct Answer: C
Explanation:
• Statement 1 is correct. Higher the tax to GDP ratio the better financial position the country will be in. The ratio represents that the government is able to finance its expenditure. A higher tax to GDP ratio means that the government is able to cast its fiscal net wide. It reduces a government's dependence on borrowings
• Statement 2 is correct. A higher tax to GDP ratio means that an economy's tax buoyancy is strong as the share of tax revenue rises in sync with the rise in the country's GDP. Lower tax-to-GDP ratio constrains the government to spend on infrastructure and puts pressure on the government to meet its fiscal deficit targets.
• Tax-to-GDP ratio represents the size of a country's tax kitty relative to its GDP. It is a representation of the size of the government's tax revenue expressed as a percentage of the GDP.
• Tax buoyancy is an indicator to measure efficiency and responsiveness of revenue mobilization in response to growth in the Gross domestic product or National income. A tax is said to be buoyant if the tax revenues increase more than proportionately in response to a rise in national income or output.
Correct Answer: C
Explanation:
• Statement 1 is correct. Higher the tax to GDP ratio the better financial position the country will be in. The ratio represents that the government is able to finance its expenditure. A higher tax to GDP ratio means that the government is able to cast its fiscal net wide. It reduces a government's dependence on borrowings
• Statement 2 is correct. A higher tax to GDP ratio means that an economy's tax buoyancy is strong as the share of tax revenue rises in sync with the rise in the country's GDP. Lower tax-to-GDP ratio constrains the government to spend on infrastructure and puts pressure on the government to meet its fiscal deficit targets.
• Tax-to-GDP ratio represents the size of a country's tax kitty relative to its GDP. It is a representation of the size of the government's tax revenue expressed as a percentage of the GDP.
• Tax buoyancy is an indicator to measure efficiency and responsiveness of revenue mobilization in response to growth in the Gross domestic product or National income. A tax is said to be buoyant if the tax revenues increase more than proportionately in response to a rise in national income or output.
With reference to the National Biofuels Policy, 2018, consider the following statements:
1. It targets 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel by 2030.
2. Biodiesel produced from Municipal Solid Waste (MSW) has been categorized as one of the "Basic Biofuels".
3. Biofuel derived from Algae has been categorized as 'Advanced Biofuels'.
Which of the statements given above is/are correct?
Correct Answer: B
Explanation:
• Statement 1 is correct. The Goal of the National Policy on Biofuels-2018 is to enable availability of biofuels in the market thereby increasing its blending percentage. An indicative target of 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel is proposed by 2030. This goal is to be achieved by
Correct Answer: B
Explanation:
• Statement 1 is correct. The Goal of the National Policy on Biofuels-2018 is to enable availability of biofuels in the market thereby increasing its blending percentage. An indicative target of 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel is proposed by 2030. This goal is to be achieved by