Crowding out occurs when: MCQ with Answer and Explanation

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Crowding out occurs when:

A. government expenditure increases private investment

B. taxes are reduced

C. government borrowing reduces private investment

D. private investment reduces government spending

Answer: Option C

Solution (By JKSSB Mock Tests)

Crowding out occurs when increased government borrowing raises interest rates and reduces private investment.

This question belongs to: Economy GK Economy Set 1

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Question #1

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Which of the following is a qualitative credit control measure?

A. Margin requirements

B. Bank Rate

C. Cash Reserve Ratio

D. Statutory Liquidity Ratio

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Correct Answer: Option A

Explanation:
Margin requirements (prescribing the difference between loan amount and value of security) is a selective/qualitative credit control measure used by RBI.

This question belongs to: Economy GK Economy Set 1

Question #2

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The 'Make in India' initiative targets increasing the share of manufacturing in GDP to what percentage?

A. 25%

B. 15%

C. 30%

D. 40%

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Correct Answer: Option A

Explanation:
Make in India aims to raise manufacturing's share of GDP to 25%.

This question belongs to: Economy GK Economy Set 1

Question #3

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The 'Goods and Services Tax' is collected by the central government under which component?

A. SGST only

B. UTGST only

C. CGST and IGST

D. SGST

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Correct Answer: Option C

Explanation:
The central government collects CGST and IGST.

This question belongs to: Economy GK Economy Set 1

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