Social Sector of Indian Economy – Exercise – 1

6. Consider the following factors :

1. Deficit financing
2. Black money in an economy
3. High rate of population growth

Which of the factors given above are responsible for the Demand-Pull inflation in an economy ?

(a)  1 and 2

(b)  1 and 3

(c)  2 and 3

(d)  All of these

7. Which one among the following is an appropriate description of deflation ?

(a) It is a sudden fall in the value of a currency against other currencies
(b) It is a persistent recession in the economy
(c) It is a persistent fall in the general price level of goods and services
(d) It is fall in the rate of inflation over a period of time

8. Which one of the following is likely to be the most inflationary, in its effect ?

(a)  Repayment of public debt
(b)  Borrowing from the public to finance a budget deficit
(c)  Borrowing from banks to finance a budget deficit
(d)  Creating new money to finance a budget deficit

9. Consider the following items :
1. Sugar
2. Sugarcane
3. Vegetable oils

Which of the items given above is/are the Essential Commodities under the Essential Commodities Act, 1955 ?

(a)  Only 1
(b)  1 and 3
(c)  2 and 3
(d)  All of these

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