Question 1

The Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched to achieve which primary objective?

Accepted Answer

PMJDY is a national mission for financial inclusion aimed at ensuring access to financial services, particularly banking services, to all households in the country.

Question 2

What is the primary difference between Fiscal Deficit and Revenue Deficit in a government budget?

Accepted Answer

Fiscal Deficit = Total Expenditure - Total Revenue. Revenue Deficit = Revenue Expenditure - Revenue Receipt. Revenue Deficit is a subset of Fiscal Deficit and indicates structural imbalance in day-to-day operations.

Question 3

In which year was the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme launched, and which ministry oversees it?

Accepted Answer

PM-KISAN was launched in February 2019 by the Ministry of Agriculture & Farmers Welfare. It provides direct income support of ₹6,000 per year to eligible farmers in three installments.

Question 4

Which of the following best describes the Cash Reserve Ratio (CRR) as a monetary policy tool?

Accepted Answer

CRR is the percentage of deposits that commercial banks must maintain with the RBI as cash reserves. It is used to control money supply and liquidity in the economy.

Question 5

The Pradhan Mantri Mudra Yojana (PMMY) was launched to provide loans to which category of borrowers?

Accepted Answer

PMMY was launched in April 2015 to provide collateral-free loans to micro and small enterprises and individuals engaged in business activities, particularly those without access to formal credit.

Question 6

Which of the following best describes Fiscal Deficit in the context of India's Union Budget?

Accepted Answer

Fiscal deficit is the difference between total government expenditure and total government revenue (excluding borrowing). It represents the amount the government needs to borrow to meet its spending obligations.

Question 7

The Pradhan Mantri Jan Dhan Yojana (PMJDY) primarily aims to achieve financial inclusion by providing which of the following?

Accepted Answer

PMJDY, launched on 28 August 2014, aims to ensure universal access to banking services through zero-balance bank accounts, overdraft facilities, and insurance coverage. It is one of the world's largest financial inclusion programs.

Question 8

The Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme was launched in which year?

Accepted Answer

PM-KISAN was launched on 24 February 2019 by the Government of India to provide direct income support to all landholding farmer families. It is administered by the Department of Agriculture & Cooperation under the Ministry of Agriculture & Farmers Welfare.

Question 9

Which of the following best describes Fiscal Deficit in a government budget?

Accepted Answer

Fiscal deficit is the difference between total government expenditure and total government revenue (excluding borrowing). It represents the amount the government needs to borrow to meet its spending obligations.

Question 10

The Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme was launched in which year?

Accepted Answer

PM-KISAN is a central sector scheme that provides direct income support to all landholding farmer families across the country. It was launched on 24 February 2019.

Question 11

What is the primary function of the Reverse Repo Rate set by the RBI?

Accepted Answer

The Reverse Repo Rate is the rate at which the RBI borrows money from commercial banks. It acts as a floor for short-term interest rates and is used to absorb excess liquidity from the banking system.

Question 12

Which of the following best describes Fiscal Deficit in the context of India's Union Budget?

Accepted Answer

Fiscal deficit is the difference between total government expenditure and total government revenue (excluding borrowing). It indicates the amount the government needs to borrow to meet its spending obligations.

Question 13

Revenue Deficit in a government budget refers to which of the following?

Accepted Answer

Revenue Deficit occurs when revenue receipts (tax and non-tax revenue) fall short of revenue expenditure (salaries, interest payments, subsidies, etc.). It excludes capital transactions.

Question 14

Which of the following is the primary objective of the Reverse Repo Rate set by the RBI?

Accepted Answer

The Reverse Repo Rate is the rate at which the RBI borrows money from commercial banks. It is used to absorb liquidity from the banking system and control inflation.

Question 15

Which of the following best describes the relationship between the Repo Rate and Reverse Repo Rate set by the RBI?

Accepted Answer

The Repo Rate is the rate at which the RBI lends money to commercial banks, while the Reverse Repo Rate is the rate at which the RBI borrows money from commercial banks. The Reverse Repo Rate is always lower than the Repo Rate, creating a corridor that influences money supply and inflation.

Question 16

Which of the following best describes the relationship between Fiscal Deficit and Revenue Deficit in India's Union Budget?

Accepted Answer

Fiscal Deficit = Total Expenditure − Total Revenue; Revenue Deficit = Revenue Expenditure − Revenue Revenue. Revenue Deficit is a subset of Fiscal Deficit. When Revenue Deficit exists, Fiscal Deficit is always larger because Fiscal Deficit includes capital expenditure (which is productive investment) in addition to revenue expenditure.

Question 17

Which ministry is responsible for implementing the Pradhan Mantri MUDRA Yojana, and what is its primary target group?

Accepted Answer

MUDRA Yojana was launched in 2015 by the Ministry of Finance to provide collateral-free loans to micro and small enterprises, particularly non-corporate, non-farm small/micro enterprises.

Question 18

The Pradhan Mantri Jan Dhan Yojana (PMJDY) aims to provide universal access to banking services. Which of the following is a key feature of PMJDY accounts?

Accepted Answer

PMJDY, launched in August 2014, provides zero-balance bank accounts with basic financial services. A key feature is that accounts can be opened with minimal documentation and no minimum balance requirement.

Question 19

As per RBI's monetary policy framework (2024), what is the primary objective of the Repo Rate?

Accepted Answer

The Repo Rate is the rate at which the RBI lends money to commercial banks against government securities. It is the primary tool used by RBI to control inflation and manage liquidity in the economy.

Question 20

As per the Union Budget 2024-25, what is the primary objective of the Fiscal Deficit target announced by the Government of India?

Accepted Answer

The Union Budget 2024-25 set a fiscal deficit target of 4.9% of GDP for FY 2024-25, with a roadmap to bring it down to 4.5% by FY 2025-26. The fiscal deficit represents the difference between government expenditure and revenue, and controlling it is essential for macroeconomic stability and inflation management.

NDA Budget, Fiscal & Monetary Policy

Budget, Fiscal & Monetary Policy — Practice Questions