Q1.Which of the following best distinguishes Foreign Direct Investment (FDI) from Foreign Portfolio Investment (FPI) in India?
- FDI involves ownership and control, while FPI is primarily financial investment without managerial control.
- FDI is long-term, while FPI is always short-term.
- FDI is governed by FEMA, while FPI is governed by SEBI regulations only.
Select the correct answer using the code below:
A. 1 only
B. 1 and 2 only
C. 1 and 3 only
D. 1, 2 and 3
Correct Answer: A
Explanation:
- Statement 1 ✔ Correct: The defining feature of FDI is lasting interest and managerial control (usually ≥10% equity), whereas FPI is purely financial with no control.
- Statement 2 ✘ Incorrect: Investment horizon is not decisive—FPIs can stay invested long-term, while FDI can exit quickly.
- Statement 3 ✘ Incorrect: Both FDI and FPI fall under FEMA; FPI is additionally regulated by SEBI for market conduct.
Q2. With reference to Magnetic Resonance Imaging (MRI), consider the following statements:
- MRI uses strong magnetic fields and radiofrequency waves to generate images.
- MRI uses ionising radiation similar to X-rays.
Which of the statements given above is/are correct?
A. Only One
B. Only Two
C. Both
D. None
Correct Answer: A
Explanation:
- Statement 1 ✔ Correct: MRI aligns hydrogen nuclei using strong magnetic fields and detects radiofrequency signals during relaxation.
- Statement 2 ✘ Incorrect: MRI does not use ionising radiation, making it safer for repeated scans compared to X-ray or CT imaging.
Q3. With reference to the Economic Survey of India, consider the following statements:
- It is prepared under the supervision of the Chief Economic Adviser.
- It is presented to Parliament one day before the Union Budget.
- It has statutory force similar to the Finance Act.
How many of the statements given above are correct?
A. Only one
B. Only two
C. All three
D. None
Correct Answer: B
Explanation:
- Statement 1 ✔ Correct: The Survey is authored by the Economics Division under the Chief Economic Adviser (CEA).
- Statement 2 ✔ Correct: It is traditionally tabled a day before the Budget to provide macroeconomic context.
- Statement 3 ✘ Incorrect: It is an analytical and advisory document, not a law passed by Parliament.
Q4. The National Health Policy (NHP), 2017 envisaged which of the following by 2025?
- Public health expenditure at 2.5% of GDP
- Union government share at 40% of total public health spending
- Elimination of out-of-pocket expenditure
How many of the statements given above are correct?
A. Only one
B. Only two
C. All three
D. None
Correct Answer: B
Explanation:
- Statement 1 ✔ Correct: Raising public health spending to 2.5% of GDP was a core quantitative target.
- Statement 2 ✔ Correct: The policy envisaged a larger Union role to support States financially.
- Statement 3 ✘ Incorrect: The goal was reduction, not elimination, of out-of-pocket expenditure.
Q5. With reference to local government expenditure, consider the following statements:
- India’s local government expenditure is below 3% of GDP.
- Many OECD countries spend between 8–15% of GDP at local levels.
Which of the statements given above is/are correct?
A. Only one
B. Only two
C. Both
D. None
Correct Answer: C
Explanation:
- Statement 1 ✔ Correct: India exhibits weak fiscal decentralisation despite constitutional Panchayati Raj.
- Statement 2 ✔ Correct: OECD countries empower local governments fiscally, enabling effective service delivery and accountability.
