Monetization of deficit refers to: MCQ with Answer and Explanation

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Monetization of deficit refers to:

A. reducing fiscal deficit

B. RBI directly purchasing government securities, increasing money supply

C. government selling securities to banks and public

D. increasing foreign aid

Answer: Option B

Solution (By JKSSB Mock Tests)

Monetization of deficit occurs when the central bank directly purchases government securities, creating money.

This question belongs to: Economy GK Economy Set 1

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Practice More Economy Set 1 Questions

Question #1

The 'Bali Package' of WTO was adopted in which year?

A. 2015

B. 2017

C. 2013

D. 2011

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Correct Answer: Option C

Explanation:
The Bali Package was adopted in 2013.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'Goods and Services Tax' on passenger transport by air-conditioned buses is:

A. 5%

B. 12%

C. 18%

D. 0%

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Correct Answer: Option A

Explanation:
AC bus passenger transport attracts 5% GST.

This question belongs to: Economy GK Economy Set 1

Question #3

The term 'Gross Fixed Capital Formation' includes:

A. Only inventory investment

B. Only construction of buildings

C. Only financial investments

D. Investment in fixed assets such as machinery, buildings and infrastructure

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Correct Answer: Option D

Explanation:
Gross Fixed Capital Formation refers to the net addition to the stock of fixed assets such as plant, machinery, buildings and infrastructure during a period.

This question belongs to: Economy GK Economy Set 1

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