A current account surplus occurs when: MCQ with Answer and Explanation

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A current account surplus occurs when:

A. imports exceed exports

B. capital outflows exceed inflows

C. foreign exchange reserves fall

D. exports of goods, services and income exceed imports

Answer: Option D

Solution (By JKSSB Mock Tests)

A current account surplus occurs when exports of goods, services and income exceed imports.

This question belongs to: Economy GK Economy Set 1

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Question #1

The 'base effect' in inflation refers to:

A. the effect of changing the base year of GDP

B. inflation measured against a low or high price level in the previous year

C. the effect of exchange rate on imports

D. the effect of money supply on prices

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Correct Answer: Option B

Explanation:
Base effect refers to the influence of the previous year's price level on the current inflation rate.

This question belongs to: Economy GK Economy Set 1

Question #2

Which of the following is a major objective of the Reserve Bank of India?

A. Collection of direct taxes

B. Maintaining monetary stability and regulating the financial system

C. Formulation of Five Year Plans

D. Formulation of the Union Budget

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Correct Answer: Option B

Explanation:
The RBI's primary responsibilities include maintaining price and financial stability, regulating banks and the financial system, and managing the currency and foreign exchange.

This question belongs to: Economy GK Economy Set 1

Question #3

In the context of the Indian economy, the demographic dividend can be harnessed through:

A. Investing in education, skill development and job creation for the working-age population

B. Raising the fertility rate continuously

C. Increasing the dependency ratio

D. Reducing the labour force participation rate

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Correct Answer: Option A

Explanation:
To realise the demographic dividend, a country must invest in human capital and create productive employment opportunities for its large working-age population.

This question belongs to: Economy GK Economy Set 1

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