Industrial Policy Multiple Choice Questions :- MCQs
1. Socialism is opposed to
a) Social security scheme
b) Equal distribution of wealth
c) Unrestricted competition
d) Collective ownership and management
Answer : c
2. The concept of mixed economy relates to
a) The coexistence of rural sector and urban sector
b) The coexistence of public sector and private sector
c) The coexistence of small-scale sector and large-scale sector
d) The coexistence of service sector and manufacturing sector
3. An “open economy ” is an economy in which
a) Foreign investment is allowed
b) Foreigners can stay for an indefinite time period
c) License is not required to start a business
d) Exports as well as imports take place
4. Economic liberalization in India started with
a) Substantial changes in industrial licensing policy
b) The convertibility of Indian rupee
c) Doing away with procedural formalities for foreign direct investment
d) Significant reduction in tax rates
5. SAMPADA scheme is related to
a) Empowering women through microfinance
b) Agricultural credit to small farmers
c) Agro-food processing industry
d) Providing loans fr development of textile industries
6. Regional disparity in per capita income in India has increased in the post-reform period due to many factors. Which among the following factors has not contributed to the growth in such disparity ?
a) Decline in the share of public investment
b) Change in policy regime regulating investment location
c) Poor governance and poor infrastructure
d) Allocation of funds by the central government
7. The notion that trade between nations can be profitable even if one of the two nations can produce both the commodities more efficiently than the other nation’ is the gist of
a) Absolute cost advantage theory
b) Comparative cost advantage theory
c) Opportunity cost theory
d) Factor-endowment theory
8. Tourism industry in India is quite small compared to many other countries in terms of India’s potential and size. Which one of the following statements is the most appropriate answer ?
a) Distance in India are too far apart, and its luxury hotels are too expensive for western tourists.
b) For most of the months, India is too hot for western tourists to feel comfortable.
c) Most of the picturesque resorts in India such as in the North East and Kashmir are, for all practical purposes, out of bounds.
d) In India, the infrastructure required for attracting tourists is inadequate.
9. In the context of the micro, small, and medium enterprises (MSME) sector in India, which among the following is/are the correct criteria for declaring n enterprise “micro” ?
- The investment in plant and machinery does not exceed Ruppes 25 lakh.
- The enterprise should fall in the category of manufacturing sector and not in service sector.
- Select the correct answer using the codes given below :
a) 1 only
b) 2 only
c) Both 1 and 2
d) Neither 1 nor 2
10. Consider the following statements regarding arguments for free trade :
- Free trade leads to specialization in production.
- Free trade prevents monopoly.
- Free trade protects domestic industries.
- Which of the statements given above is/are correct ?
a) 1 only
b) 1 and 2 only
c) 2 and 3 only
d) 1, 2, and 3
11. Division of labour often involves
- Specialized economic activity
- Highly distinct productive roles
- Employment roles for every individual
- Individuals engage in only a single activity and are dependent on others to meet their various needs
- Select the correct answer using the codes given below :
a) 1, 3 and 4 only
b) 1, 2, and 4 only
c) 1 and 3 only
d) 2 and 4 only
12. Consider the following statements :
Small-scale industries are, in most cases, not as efficient and competitive as the large-scale ones. Yet the government provides preferential treatment and reservations in a range of products to small firms because they
- Provide higher employment on a unit of capital
- Promote a regional dispersion of industries and economic activities
- Have performed better in export af manufactures products than the large-scale ones
- Provide jobs to low-skill workers, who otherwise may not find employment avenues elsewhere.
Which of the statements given above is/are correct ?
a) 1 and 4
b) 1 and 2
c) 2 and 3
d) 3 and 4
13. Market failure can occur because of
- External factors
- Unequal information to consumers
- Perfect competition among businesses
Select the correct answer using the codes given below :
a) 1, 2 and 3
b) 1 only
c) 1 and 2 only
d) 2 and 3 only
14. Which of the following factors hamper the development of food-processing industry in India ?
- Lack of organized retail sector in India
- Lack of entrepreneur skills among the people of rural area
- Lack of support services for food-processing units
- Adverse government policy towards food-processing units
Select the correct answer using the codes given below :
a) 1, 2 and 3 only
b) 1, 3, and 4 only
c) 2 and 3 only
d) 1, 2, 3, and 4
15. Consider the following statements about national manufacturing and investment zones (NMIZs) :
- NMIZs have been set up to increase the share of manufacturing in GDP to 30% by 2022.
- NMIZs also seek to enhance the skills of workers and incorporate technology in manufacturing.
- The industrial units in NMILs will be provided world-class infrastructure and tax exemptions.
Select the correct answer using the codes given below :
a) 1, 2 and 3
b) 1 only
c) 1 and 2 only
d) 2 and 3 only
16. Consider the following statements and identify the right ones.
- The Industrial Policy of 1948 was the first industrial policy statement by the Government
- It gave leading role to the private sector
a. I only
b. 2 only
c. both
d. none
17. Consider the following statements and identify the right ones.
i. As per the 1948 policy, six industries were under the mixed sector
ii. New units could be set up by the private sector
a. i only
b. ii only
c. both
d. none
18. Which of the following was not an objective of the 1956 industrial policy?
a. Development of cooperative sector
b. Expansion of public sector
c. Develop heavy and machine making industries
d. None of the above
19. Consider the following statements and identify the right ones.
- The 1980 industrial policy emphasized “economic federalism”
- Liberal license policies were advocated for agro-based industries
a. I only
b. 2 only
c. both
d. none
20. Consider the following statements and identify the right ones.
- The 1991 industrial reforms exempted all industries from compulsory licensing
- There are six industries under compulsory licensing today
a. 1 only
b. 2 only
c. both
d. none
21. Which of the following industries are to be given compulsory licensing?
a. Alcohol
b. Tobacco
c. D–gs and pharmaceuticals
d. All the above
22. Which of the following industries was de-reserved in 1993?
a. Atomic energy
b. Atopic minerals
c. Mining of copper and zinc
d. Railways
23. Consider the following statements and identify the right ones.
i. The Board for Reconstruction of Public Sector Enterprises is an advisory body for strengthening public sector units
ii. It comprises of a chairman, 3 official and 3 non official members and 3 permanent invitees.
a. i only
b. ii only
c. both
d. none
24. Which of the following is not a Maha-Ratna industry?
a. GAIL
b. Coal India Limited
c. SAIL
d. Airports Authority of India
25. Which of the following is a nav Ratna category unit?
a. HAL
b. Oil India Limited
c. MTNL
d. All the above