The term 'Non-Performing Asset' (NPA) in banking refers to: MCQ with Answer and Explanation

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The term 'Non-Performing Asset' (NPA) in banking refers to:

A. A loan on which interest or principal is overdue for a specified period

B. Government securities held by banks

C. Cash reserves of the bank

D. An asset that generates income regularly

Answer: Option A

Solution (By JKSSB Mock Tests)

An NPA is a loan or advance where interest or principal remains overdue for a period of more than 90 days (as per RBI norms for term loans).

This question belongs to: Economy GK Economy Set 1

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Question #1

In the context of Indian planning, the first Five Year Plan was based on which model?

A. Solow model

B. Lewis model

C. Mahalanobis model

D. Harrod-Domar model

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Correct Answer: Option D

Explanation:
The First Five Year Plan (1951-56) was based on the Harrod-Domar model which emphasised the role of savings and investment in economic growth.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'headline inflation' is the measure that:

A. includes all items in the price index

B. only includes services

C. excludes all food items

D. excludes fuel

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Correct Answer: Option A

Explanation:
Headline inflation includes all items in the price index.

This question belongs to: Economy GK Economy Set 1

Question #3

In the theory of international trade, the Heckscher-Ohlin theorem states that a country will export goods that:

A. Require the most labour regardless of endowment

B. Use its scarce factors intensively

C. Have the highest absolute advantage

D. Use its abundant factors intensively

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Correct Answer: Option D

Explanation:
According to the Heckscher-Ohlin theorem, a country exports goods that intensively use its relatively abundant factors of production and imports goods that intensively use its scarce factors.

This question belongs to: Economy GK Economy Set 1

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