CDS Indian Economy 2 — Questions and Answers
Question 1: Which organisation replaced the Planning Commission of India in 2015?
- Economic Advisory Council
- NITI Aayog (Correct answer)
- Finance Commission
- National Development Council
Correct answer: NITI Aayog
NITI Aayog (National Institution for Transforming India) replaced the Planning Commission on 1 January 2015.
Question 2: The Goods and Services Tax (GST) was implemented in India on which date?
- 1 April 2016
- 1 January 2017
- 1 July 2017 (Correct answer)
- 15 August 2017
Correct answer: 1 July 2017
GST was rolled out on 1 July 2017, replacing a complex multi-layered indirect tax structure with a unified tax system.
Question 3: Which Indian bank was the first to be nationalised in 1969?
- State Bank of India
- Punjab National Bank
- Central Bank of India
- 14 major commercial banks simultaneously (Correct answer)
Correct answer: 14 major commercial banks simultaneously
In July 1969, 14 major commercial banks with deposits above ₹50 crore were nationalised simultaneously under Prime Minister Indira Gandhi.
Question 4: What is the primary objective of monetary policy in India?
- Maximising government revenue
- Maintaining price stability while keeping growth in mind (Correct answer)
- Controlling fiscal deficit
- Expanding import-export trade
Correct answer: Maintaining price stability while keeping growth in mind
The RBI's primary monetary policy objective, mandated by the RBI Act, is maintaining price stability (controlling inflation) while keeping growth in mind.
Question 5: Which index measures inflation at the wholesale level in India?
- Consumer Price Index (CPI)
- Wholesale Price Index (WPI) (Correct answer)
- Sensex
- Human Development Index (HDI)
Correct answer: Wholesale Price Index (WPI)
The Wholesale Price Index (WPI) tracks price changes at the wholesale level, measuring inflation from the producer's perspective in India.
Question 6: The term 'Disinvestment' in the Indian economy refers to:
- Government investing in new public sector enterprises
- Sale of government equity in public sector undertakings (Correct answer)
- Banning foreign direct investment
- Withdrawal of private firms from market
Correct answer: Sale of government equity in public sector undertakings
Disinvestment refers to the sale or liquidation of government equity (assets) in public sector undertakings, used to raise revenue and improve efficiency.
Question 7: Which of the following is a direct tax in India?
- Goods and Services Tax
- Customs Duty
- Income Tax (Correct answer)
- Excise Duty
Correct answer: Income Tax
Income Tax is a direct tax levied directly on an individual's or entity's income, collected by the Central Board of Direct Taxes (CBDT).
CDS Indian Economy 2
Which organisation replaced the Planning Commission of India in 2015?