MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Current Challenges Facing Indian Economy Class 12 MCQs Questions with Answers

Question 1.

With which disparity of income and its distribution are associated?

(A) Absolute Poverty
(B) Relative Poverty
(C) Chronic Poverty
(D) All of the above
Answer:
(B) Relative Poverty

Explanation:
Relative poverty means poverty defined in comparison to other people’s standing in the economy.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 2.

Relative Poverty is prevalent in:

(A) Capitalist Countries
(B) Socialist Countries
(C) Communist Countries
(D) Developed Countries
Answer:
(A) Capitalist Countries

Question 3.

Absolute Poverty is prevalent in:

(A) Communist Countries
(B) Developing Economies
(C) Socialist Economies
(D) Developed Countries
Answer:
(B) Developing Economies

Question 4.

Estimation of poverty in rural economies is at per day consumption of calories:

(A) Less than 2,200
(B) Less than 2,100
(C) Less than 2,400
(D) Less than 2,000
Answer:
(C) Less than 2,400

Explanation:
The threshold limit for food consumption has been set to 2,400 calories per day in rural areas below which the individual is considered as poor.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 5.

Estimation of poverty in urban areas is at the consumption of per day calories of:

(A) Less than 2,000
(B) Less than 2,100
(C) Less than 2,400
(D) Less than 2,200
Answer:
(B) Less than 2,100

Explanation:
The threshold limit for food consumption has been set to 2,400 calories per day in rural areas below which the individual is considered as poor.

Question 6.

What is the main reason of poverty in India in urban areas?

(A) Lack of professional education
(B) Unequal distribution of income
(C) Lack of family planning of income facilities
(D) Money inflation
Answer:
(A) Lack of professional education

Question 7.

Identify the correctly matched pair in Column A and Column B from the following:

Column A Column B
(1) Green Revolution (a) 1962
(2) PMJAY (b) 2012
(3) NHMC (c) 1960
(4) MGNREGA (d) 2006

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(D) 4 – (d)

Explanation:
MGNREGA was launched by Govt, of India in 2006, to provide for the enhancement of livelihood security of the households in rural areas.

Explanation:
In 1979, the poverty line was defined by the Task Force on Projection of Minimum Needs and Consumption Demand as per capita cost per day to meet the daily requirement of 2,400 calories per day in rural areas and 2,100 calories per day in urban areas.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 8.

Identify the correctly matched pair in Column A and Column B from the following:

Column A Column B
(1) Study Group (a) 1961
(2) Task Force on Projections of Minimum Needs and Effective Consumption Demand (b) 1979
(3) Expert Group (c) 1982
(4) Swarna Jayanti Shahari Rozgar Yojana (d) 1989

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(B) 2 – (b)

Question 9.

Identify the correctly matched pair in Column A and Column B from the following:

Column A Column B
(1) Indira Gandhi National Widow Pension Scheme (a) Nutritional Programme
(2) National Rural Livelihood Mission (b) Social Assistance Programme
(3) Sampoorna Grameen Rozgaar Yojna (c) Wage Employment Programme
(4) Mid-day Meal Scheme (d) Infrastructure Development Programme

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(C) 3 – (c)

Explanation:
The Sampoorna Grameen
Rozgar Yojana was a scheme launched by the Government of India to gain the objective of providing gainful employment for the rural poor.

Question 10.

In which category, the loan taken for buying agriculture equipment is generally put:

(A) Short-Term Loan
(B) Medium-Term Loan
(C) Long-Term Loan
(D) All of the above
Answer:
(B) Medium-Term Loan

Question 11.

Identify the correctly matched item from Column A to that of Column B:

Column A Column B
(1) Reserve Bank (a) 1969
(2) Regional Rural Bank (b) 1975
(3) NABARD (c) 1971
(4) Development Bank (d) 1980

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(B) 2 – (b)

Question 12.

When was NABARD constituted?

(A) July, 1982
(B) June, 1982
(C) July, 1980
(D) July, 1984
Answer:
(A) July, 1982

Question 13.

Which institute do not provide direct loan to farmers?

(A) NABARD
(B) Commercial Bank
(C) Regional Rural Bank
(D) Primary Agriculture Credit Society
Answer:
(A) NABARD

Explanation:
National Bank for Agriculture and Rural Development is an apex regulatory body for overall regulation and licensing of regional rural banks and apex cooperative banks in India.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 14.

Identify the correctly matched item from Column A to that of Column B:

Column A Column B
(1) NABARD (a) Apex institute for rural credit
(2) RBI (b) Established in 1975
(3) AXIS Bank (c) Established in July 1982
(4) IDBI (d) Not an institution for credit.

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(A) 1 – (a)

Explanation:
National Bank for Agriculture and Rural Development is an apex regulatory body for overall regulation and licensing of regional rural banks and apex cooperative banks in India.

Question 15.

Farmer is forced to sale his products at low price because of:

(A) Ignorance about market information
(B) Financial problems
(C) Both (A) and (B)
(D) None of the above
Answer:
(C) Both (A) and (B)

Question 16.

AGMARK is related with:

(A) Agricultural production in government farms
(B) Standard quality of agricultural produce
(C) Heavy machinery
(D) None of the above
Answer:
(B) Standard quality of agricultural produce

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
AGMARK is a certificate mark used in agricultural products in India, which ensures that it complies with the set of standards approved by the Directorate of Marketing and Inspection, an Indian Government agency.

Question 17.

Which of the following is not an institutional credit agency?

(A) Co-operative Societies
(B) Commercial and Regional Rural Banks
(C) NABARD
(D) Desi Banker
Answer:
(D) Desi Banker

Explanation:
Agriculture credits provided by government institutions are called institutional credit.

Question 18.

Credit that farmers need for consumption purpose such as on birth and death, etc. is called:

(A) Productive credit
(B) Unproductive credit
(C) Both (A) and (B)
(D) None of the above
Answer:
(B) Unproductive credit

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
Unproductive credit refers to the credit taken to meet consumption expenditures for social and religious purposes.

Question 19.

‘TRYSEM’ a programme made for the:

(A) Employment to retired government employees
(B) Employment to rural youths
(C) Employment to urban youths
(D) Credit to rural people
Answer:
(B) Employment to rural youths

Explanation:
Trysem was launched in 1979 as a separate national scheme for training rural youth for self employment.

Question 20.

The Union Government announce KUSUM scheme for promoting solar farming. In the term KUSUM, the letter ‘S’ stands for:

(A) Solar
(B) Suraksha
(C) Samvidhaan
(D) Sarvopari
Answer:
(B) Suraksha

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
KUSUM: Pradhan Mantri Kisan I Urja Suraksha Evam Utthaan Mahabhiyan

Question 21.

Which of the following statements is true?

(A) The need of agriculture credit which is required for the completion of agriculture works is known as agriculture productivity.
(B) Short-term credit is required for a period of 9 to 15 months for buying seeds, tools, manure, fertilizers, etc.
(C) Medium-term credit is required for about one to five years for digging wells, buying machinery, etc.
(D) Rural development is the process of giving employment to the low income group people living in rural areas and making these development efforts permanent.
Answer:
(C) Medium-term credit is required for about one to five years for digging wells, buying machinery, etc.

Explanation:
Classification of Agricultural

Credit:
Short-Term Credit It is required for buying seeds, tools, manure, fertilizers, etc. Medium-Term Credit It is required for digging wells, buying machinery, etc. Long-Term Credit It is required for the purchase of tractors, land, costly equipment, tube wells, etc.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 22.

Active factor in production is:

(A) Physical Capital
(B) Human Capital
(C) Both (A) and (B)
(D) None of the above
Answer:
(B) Human Capital

Explanation:
Since the real work of production is done by labour it is considered as the active factor of production.

Question 23.

Human Development is:

(A) An end
(B) A means
(C) Both (A) and (B)
(D) None of the above
Answer:
(A) An end

Question 24.

Identify the correctly matched pair from Column A to that of Column B:

Column A Column B
1. AICTE (a) All India Council of Techno-logical Education
2. UGC (b) Universal Grant College
3. NCERT (c) National Council for Education Research and Technology
4. ICMR (d) Indian Council for Medical Research

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(D) 4 – (d)

Explanation:
AICTE: All India Council for Technical Education
UGC: University Grant Commission NCERT: National Council for Educational Research and Technology ICMR: Indian Council for Medical Research

Question 25.

Human Capital Formation includes:

(A) Expenditure on education
(B) Expenditure on health
(C) Expenditure on training
(D) All of the above
Answer:
(D) All of the above

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
Human capital formation is a process of adding to human capital over time. Human capital can be developed through the creation of skilled, trained and efficient staff by providing better education, health care facilities, etc. Highly skilled people can create new ideas and new ways to produce. Therefore, spending on education, health and on-the-job training are important resources for building human capital.

Question 26.

A man remains absent from work due to illness. It will affect:

(A) Safety of work
(B) Salary/Income
(C) Productivity
(D) All of the above
Answer:
(D) All of the above

Question 27.

Education increases peoples:

(A) Productivity
(B) Skill
(C) Income
(D) All of the above
Answer:
(D) All of the above

Explanation:
Education enhances productivity and innovation and promotes entrepreneurship and technological advancement. In addition it plays a very important role in protecting economic and social progress and improving income distribution.

Question 28.

Human Capital includes:

(A) Health
(B) Education
(C) Professional Skill
(D) All of the above
Answer:
(D) All of the above

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
Human capital are the amount of knowledge, skills, experience and social attributes that contribute to a person’s ability to perform a function in a way that reflects economic value.

Question 29.

Identify the correctly matched pair from Column A to that of Column B:

Column A Column B
1. Sarva Siksha Ab- hiyan (a) Rural Education
2. National Council of Educational Re-search and Training (b) Adult Education
3. Indira Gandhi National Open University (c) Higher Education
4. Kendra Vidhyalaya (d) Elementary Education

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(C) 3 – (c)

Question 30.

Which of the following statements is not true with respect to the problems in Human Development in India?

(A) Problem of estimation of total stock of human capital.
(B) Problem of estimation of growth rate of hu-man capital formation.
(C) Problem of migration from one place to an-other.
(D) Neglect of on-the-job training programme.
Answer:
(C) Problem of migration from one place to an-other.

Question 31.

Which of the following statements is true with respect to education in India?

(A) An essential element of human resource development.
(B) All the Indians are highly educated.
(C) There is no problem of drop-outs from school.
(D) The examination system is the best in the world.
Answer:
(A) An essential element of human resource development.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 32.

The difference between labour force and work force is:

(A) Total employed labour
(B) Disguised unemployed labour
(C) Unemployed labour
(D) Seasonal unemployed labour
Answer:
(C) Unemployed labour

Question 33.

In an economy, labour force and work force are equal in a situation when the:

(A) Population grows at slower rate
(B) No growth in population
(C) No unemployment
(D) Growth rate of population is greater than growth rate of employment
Answer:
(C) No unemployment

Explanation:
The labour force equals the I employed plus the unemployed members the I civilian non-institutional population.

Question 34.

A kind of unemployment in which workers seems to be working but its contribution to production is negligible is called:

(A) Seasonal Unemployment
(B) Disguised Unemployment
(C) Industrial Unemployment
(D) Educated Unemployment
Answer:
(B) Disguised Unemployment

Explanation:
Disguised unemployment means that number of workers employed in a job are much more than actually required. It is invisible in nature but when some workers are withdrawn from work, total production remains unchanged. It is said to be disguised unemployment.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 35.

Disguised unemployment is a characteristic of:

(A) Industry
(B) Trade
(C) Agriculture
(D) Transport
Answer:
(C) Agriculture

Explanation:
Disguised unemployment is more common in developing countries with overcrowding. It can be characterized by low productivity and is often associated with informal labour markets and agricultural labour markets, which can hold large numbers of workers.

Question 36.

Workers who own and operate an enterprise to earn their livelihood are called:

(A) Ministers
(B) Public servant
(C) Self employed
(D) Government doctor
Answer:
(C) Self employed

Explanation:
Persons who own and run a business to earn a living are known as self- employed.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 37.

Urban people are mainly engaged in the:

(A) Primary sector
(B) Service sector
(C) Training
(D) Agriculture
Answer:
(B) Service sector

Question 38.

India is an:

(A) Industrial country
(B) Scientifically developed country
(C) Agrarian nation
(D) Service developed country
Answer:
(C) Agrarian nation

Explanation:
India is an agrarian economy, as it is called the backbone of Indian economy. About 60% to 70% of India’s population depends upon agriculture for their livelihood.

Question 39.

Those who are working in the formal sector enjoy:

(A) Economic benefits
(B) Social security benefits
(C) Education advantages
(D) Cultural benefits
Answer:
(B) Social security benefits

Explanation:
Social security benefits are payments made to qualified retirees and disabled people, and to their spouses, children, and survivors.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 40.

Owing to the efforts of the following organisation, Indian government initiated modernisation and also provision of social security measures to informal sector workers:

(A) GNP
(B) NSSO
(C) ILO
(D) LPG
Answer:
(C) ILO

Explanation:
ILO stands for International Labour Organization that is committed to the promotion of social justice and human and labour rights, pursuing its mission of establishing that workers’ peace is essential for prosperity.

Question 41.

Identify the correctly matched pair from Column A to that of Column B:

Group A Group B
(1) Beginning of Swama Jayanti Gram Swarojgar Yojna (SJGSY) (a) 2006
(2) Beginning of Sampoorna Grameen Rozgar Yojana (b) 2001
(3) Beginning of National Rural Employment Guarantee Scheme (c) 1997
(4) Beginning of Swarna Jayanti Shahari Rozgar Yojana (SJSRY) (d) 1999

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(B) 2 – (b)

Explanation:
Sampooma Grameen Rozgar Yojana was launched on 25 September, 2001. The program is geared towards itself in nature and aims to provide employment and food to people in rural areas living below the poverty line.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 42.

Unemployment which is caused by the introduction of new machinery, improvement of production techniques, labour saving devices, etc. is called:

(A) frictional unemployment
(B) casual unemployment
(C) structural unemployment
(D) technological unemployment
Answer:
(D) technological unemployment

Question 43.

Which type of unemployment is more in India?

(A) Open unemployment
(B) Disguised unemployment
(C) Seasonal unemployment
(D)Educated unemployment
Answer:
(B) Disguised unemployment

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
Because India is an Agrarian country.

Question 44.

Find the odd one out:

(A) Owner of a salon
(B) A cobbler
(C) A cashier in Mother Dairy
(D) A tuition master
Answer:
(C) A cashier in Mother Dairy

Explanation:
Except cashier in Mother dairy, all are self-employed’

Question 45.

Find odd one out:

(A) Rickshaw puller who works under a rickshaw owner
(B) Mason
(C) Mechanic shop worker
(D) Shoe shine boy
Answer:
(D) Shoe shine boy

Explanation:
Only shoe shine boy comes under the category of self-employed.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 46.

Which of the following statements is true?

(A) Employment means a situation in which a person willing to work and able to work does not get employment at the prevailing wage rate.
(B) Employment is an indicator of that situation in which worker is engaged in some productive activity for earning his living.
(C) Labour supply refers to the amount of labour that are unwilling to offer services corresponding to a particular wage rate.
(D) An arrangement in which a worker uses his own resources to make a living is known as casual workers.
Answer:
(B) Employment is an indicator of that situation in which worker is engaged in some productive activity for earning his living.

Question 47.

Which of the following is not true about the causes of unemployment in India?

(A) Rapid increase in population
(B) High rate of economic development
(C) Inadequate economic planning.
(D) The nature of agriculture is seasonal
Answer:
(B) High rate of economic development

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 48.

Identify the correctly matched pair of Column A to that of Column B:

Column A Column B
(1) Structural Unemployment (a) Arises due to change in demand pattern and supply structure
(2) Disguised Unemployment (b) Not working by choice
(3) Seasonal Unemployment (c) Invisible in nature
(4) Casual Unemployment (d) Arises due to movement of labour

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D)4 – (d)
Answer:
(A) 1 – (a)

Explanation:
With the passage of time, when demand pattern of goods changes there will be change in demand pattern for labour Some labour in one sector becomes idle while there may be demand in the other sector. Since labour cannot immediately switch over to new pattern, therefore, it causes
structural unemployment

Question 49.

Identify the correctly matched pair of column A to that of Column B:

Column A Column B
(1) Self-Employed Labour (a) Works in his own company
(2) Hired Worker (b) Works using his own resources
(3) Casual Worker (c) Works whenever they want
(4) Regular Worker (d) Works all the time

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D)4 – (d)
Answer:
(A) 1 – (a)

Question 50.

To which type of infrastructure, transport is related?

(A) Economic
(B) Social
(C) Both (A) and (B)
(D) None of the above
Answer:
(A) Economic

Explanation:
Economic infrastructure is the key institutions that directly benefit the production and distribution process in the economy. Roads, railways, telecommunications systems, waterways, airports, financial institutions, electricity, water supply, etc. are examples of economic infrastructure.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 51.

Social infrastructure helps in production and distribution:

(A) In direct form
(B) In indirect form
(C) In no way
(D) In both (A) and (B)
Answer:
(B) In indirect form

Explanation:
Unlike economic infrastructure, social infrastructure indirectly increases productivity and production of goods and services. For example, the availability of better health care and medical facilities makes for an endless supply of healthy workers which is also reflected in the- state of increased productivity levels.

Question 52.

Agriculture waste is the source of energy:

(A) Commercial
(B) Non-Commercial
(C) Both (A) and (B)
(D) None of the above
Answer:
(B) Non-Commercial

Explanation:
The sources of energy that are usually availably free of cost to the users are referred to as non-commercial energy. Examples are: Firewood, agricultural waste, dried dung.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 53.

Identify the correctly matched pair of column A to that of Column B:

Column A Column B
(1) Pradhan Mantri Jan Dhan Yojana (a) May 2016
(2) Pradhan Mantri Ujjwala Yojana (b) May 2015
(3) Pradhan Mantri Jeevan Jyoti Bima Yojana (c) Aug. 2014
(4) Mahatma Gandhi National Rural Employment Guarantee Scheme (d) Feb. 2006

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(D) 4 – (d)

Explanation:
MGNREGA was launched by Govt, of India in 2006, to provide for the enhancement of livelihood security of the households in rural areas

Question 54.

Which of the following statements is not true regarding infrastructure in India?

(A) Infrastructure increases the productivity of productive resources.
(B) Infrastructure raises the standard of living and economic development of the country.
(C) All those factors like-energy, transport, communication, schools, colleges and hospitals do not form part of infrastructure.
(D) Infrastructure refers to the basic supporting structure which is built to provide different kinds of services in an economy. 52
Answer:
(C) All those factors like-energy, transport, communication, schools, colleges and hospitals do not form part of infrastructure.

Question 55.

Which of the following statements is not true about the power sector in India?

(A) Government needs to invest on the infrastructure to meet growing demand for electricity, India’s commercial energy supply needs to grow at about 7%.
(B) There has been an increase in profits of State Electricity Boards.
(C) Private sector power generators are yet to play their role in a major way.
(D) There is general public unrest due to high power tariffs and prolonged power cuts in different parts of the country.
Answer:
(B) There has been an increase in profits of State Electricity Boards.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 56.

Identify the correctly matched pair of the items in Column A (Government Schemes) to that of Column B.

Column A Column B
1. Ayushman Bharat (a) Sep., 2018
2. Swachh Bharat Abhiyan (b) Oct. 2018
3. Make in India (c) Oct. 2015
4. Digital India (d) May 2014

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(A) 1 – (a)

Explanation:
Ayushman Bharat Pradhan Mantri Jan Arogya Yojana of the Government of India, launched by Prime Minister on September 23, 2018, is a national health insurance scheme that aims to provide free access to health care for low-income people in the country.

Question 57.

Identify the correctly matched pair of the items in Column A (Government Schemes) to that of Column B (Period they were active):

Column A Column B
1. National Health Protection Scheme (a) 2005-2018
2. National Rural Health Mission (b) 2005-2012
3. National Health Insurance Scheme (c) 2015-2017
4. Deendayal Disabled Rehabilitation Scheme (d) 2012-2018

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(B) 2 – (b)

Explanation:
National Rural Health Mission (2005-2012) was launched to provide quality health care to rural people, especially the vulnerable group.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 58.

Which of the following is not used as a strategy for Sustainable Development?

(A) Use of bio-gas
(B) Use of solar power
(C) Use of thermal power
(D) Use of hydel power
Answer:
(A) Use of bio-gas

Explanation:
Burning oil, liquid natural gas (LNG), coal, and other substances are used to create thermal power, and these substances are non-renewable resources. Thus, thermal power is not a strategy of sustainable development.

Question 59.

The essential condition for sustainable growth is:

(A) Protection of natural resources
(B) Pollution free growth
(C) Quality of life
(D) All of the above
Answer:
(D) All of the above

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 60.

Physical environment includes:

(A) Land
(B) Water
(C) Air
(D) AH of the above
Answer:
(D) AH of the above

Explanation:
The physical environment includes air, land, water, animals and plants, buildings and other infrastructure, as well as all natural resources that provide our basic needs and opportunities for social and economic development.

Question 61.

To check water pollution following method can be adopted:

(A) Commerce
(B) Better engine for cars
(C) Re-use of industrial waste
(D) Use of non-polluting sources for energy.
Answer:
(C) Re-use of industrial waste

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 62.

Out of following one is non-renewable source:

(A) Forest
(B) Water
(C) Sun rays
(D) Coal
Answer:
(D) Coal

Explanation:
Coal is classified as a nonrenewable energy source because it takes millions of years to form.

Question 63.

Following are included in strategies for sustained development:

(A) Wind Energy
(B) Solar Energy
(C) Bio-compost
(D) All of the above
Answer:
(D) All of the above

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 64.

Identify the correctly matched pair from the items in Column A by matching them to the items in column B:

Column A Column B
1. Environment Degradation (a) Soil Erosion
2. Land Pollution (b) Future Use
3. Sustainable Development (c) Leads to Poverty
4. Air Pollution (d) Green house Gases

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D)4 – (d)
Answer:
Option (D) is correct.

Explanation:
Air pollution includes greenhouse gases such as carbon dioxide. Greenhouse gases cause the climate to warm by trapping heat from the Sun in the Earth’s atmosphere.

Question 65.

Identify the correctly matched pair from the items in Column A by matching them to the items in column B:

Column A Column B
1. Sustainable Development (a) The process whereby the real per capita income of a country increases over a long period of time.
2. Economic De-velopment (b) Development that means the need of the present generation without compromising the ability of future generation to meet their own needs.
3. Economic Growth (c) Comprehensive concept including increasing real per capita income of a country over a long period of time along with reduction in poverty, inequality and unemployment.
4. Environment (d) The total planetary inheritance and the totality of all resources.

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(D) 4 – (d)

Explanation:
The physical environment includes air, land, water, animals and plants, buildings and other infrastructure, as well as all natural resources that provide our basic needs and opportunities for social and economic development.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 66.

Identify the correctly matched pair from the items in Column A by matching them to the items in Column B:

Column A Column B
1. Use of Coal (a) Less pollution
2. Use of LPG (b) Global warming
3. Use of CNG (c) Increases pollution
4. Use of Air Conditioners (d) Ozone layer depletion

(A) 1 – (a)
(B) 2 – (b)
(C) 3 – (c)
(D) 4 – (d)
Answer:
(D) 4 – (d)

Explanation:
Air conditioners consume large amounts of electricity, and the fluorocarbons they use as refrigerants deplete the ozone layer and contribute to global warming.

Question 67.

Which industry employs the largest number of women in India?

(A) Tea
(B) Textile
(C) Jute
(D) Coal
Answer:
(A) Tea

Explanation:
The tea industries employ thousands of women for tea plantation, harvesting and cutting works.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Assertion and Reason Based MCQs

Directions: In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).
(B) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
(C) Assertion (A) is true, but Reason (R) is false.
(D) Assertion (A) is false, but Reason (R) is true.

Question 1.

Assertion (A): Casual labourers are most vulnerable in the society.
Reason (R): Casual labourers don’t have a permanent earning facility and their earning varies a lot. They can even lose their jobs with a slight dip in the economic growth.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Question 2.

Assertion (A): Calorie-based norm is not an adequate measure to identify the poor.
Reason (R): This method does not differentiate between the very poor and the other poor.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Explanation:
This mechanism takes into account expenditure on food and a few other items as proxy for income. It ignores many other vital factors associated with poverty; for instance, the accessibility to basic education, health care, drinking water and sanitation.

Question 3.

Assertion (A): Poverty and unemployment are related to each other.
Reason (R): Unemployment leads to poverty.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
When unemployment prevails, people don’t get income. As a result, they are not able to get necessities of life and they become poor. Unemployment gives birth to poverty. Therefore, there is a direct relationship between poverty and unemployment.

Question 4.

Assertion (A): It is essential to develop proper storage facilities in rural areas.
Reason (R): Farmers can wait for better price for their products in the market.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Explanation:
They are forced to sell their crops at very low prices to traders because of the fear of getting damage from fire, rodents or pests due to lack of proper storage facilities.

Question 5.

Assertion (A): In rural India, horticulture plays a vital role in providing food and nutrition to the rural population.
Reason (R): Various horticultural activities in Indian villages have improved the economic conditions of many farmers. Such activities have become a lucrative source of livelihood for many women in the rural India.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Question 6.

Assertion (A): The Prime Minister urged to increase the rural income by increasing non-farm activities.
Reason (R): Non-farm activities (agro-processing industries, poultry, craft, handloom) provide alternative avenues for sustainable livelihood and may raise the level of income as the risks due to fluctuations in production and market prices is generally less.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Explanation:
Agriculture in India is mainly a seasonal occupation, however, during off seasons, it becomes difficult to find employment and stabilize farmer’s income. Thus, the Prime Minister has urged appropriately in the best interest of the farmers of the rural India.

Question 7.

Assertion (A): Physical capital helps in formation of human capital.
Reason (R): Physical capital is passive in nature.

Answer:
(D) Assertion (A) is false, but Reason (R) is true.

Explanation:
Human capital helps in formation of physical capital.

Question 8.

Assertion (A): Human Capital Formation gives birth to innovation, invention and technological improvements.
Reason (R): Investment in education creates ability to adopt newer technologies, facilitates invention and innovation since educated workforce generally adapts to modern technologies and innovation,

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Explanation:
Human Capital Formation not only increases the productivity of available human resources but also stimulates innovation and creates ability to adopt new technologies.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 9.

Assertion (A): Indian economy is marching ahead towards progress.
Reason (R): The contribution of agriculture in national income is declining but the contribution of industries and service sector is increasing continuously. It is an indicator of economic development of Indian Economy.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Question 10.

Assertion (A): Less women are found in regular salaried employment.
Reason (R): Women workers accord highest- priority to self-employment because of mobility of female labour work force both in urban as well as in rural areas.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Question 11.

Assertion (A): Meena is a housewife. Besides taking care of household chores, she works in the cloth shop which is owned and operated by her husband. She is considered as self-employed worker.
Reason (R): Self-employed workers are those who uses their own resources to earn and make a living.

Answer:
(B) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).

Explanation:
A person who participates in the production process and contributes to GDP formation is referred to as a worker. As here, Meena works in a cloth store to support her husband and contribute to GDP by donating her services, therefore, she can be considered an worker.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 12.

Assertion (A): Bengaluru in Karnataka is referred to as Silicon Valley of India, as it is the hub of IT based industries.
Reason (R): Presence of world class communication facilities help it to attract many multinational companies that makes it hub of IT based industries.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Explanation:
Bangaluru is also known as the “Silicon Valley of India” because of its role in promoting the IT industry in India. Infosys, ISRO, Infosys, HA1, Wipro and other Indian technology organizations have their headquarters in the city.

Question 13.

Assertion (A): Investors are reluctant to invest in tidal energy projects.
Reason (R): Tidal energy has high cost and low running cost. As a result, a tidal power scheme may not give returns for years.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Explanation:
Tidal energy has a high capital cost i.e., installation cost.

Question 14.

Assertion (A): Medical Tourism is great opportunity for India.
Reason (R): Indian health services combine the latest medical technologies with qualified professionals and are cheaper for foreigners. By upgrading health services, it can be a great opportunity for India.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 15.

Assertion (A): Sustainable development is the only way that will allow economy to have a proper development.
Reason (R): Sustainable development is the development in which the economy is developed considering the needs of the future generation.

Answer:
(B) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).

Explanation:
Dimensions of Sustainable Development:
(i) social development
(ii) economic development
(iii) environmental development
As all three aspects are included in sustainable development, thus sustainable development is the only way that will allow economy to have a proper development.

Question 16.

Assertion (A): Indian government is investing a lot in Solar Energy.
Reason (R): Solar Energy is a clean form of energy and thus does very minimum harm to the environment.

Answer:
(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Question 17.

Assertion (A): Soil Erosion is the major environmental problem faced by India.
Reason (R): India is an agricultural economy

Answer:
(C) Assertion (A) is true, but Reason (R) is false.

Explanation:
Soil Erosion is the major environmental problem faced by India because faulty practices of farming.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Case-Based MCQs

I. Read the following hypothetical case study carefully and answer the questions follow on the basis of the same.
Since ages, farmers in India have taken recourse to debt. In the earlier times the same was from informal sources. Since independence with the efforts of the government, formal sector has actively come into picture. Farmers borrow not only to meet their investment needs but also to satisfy their personal needs.

Uncertainty of income caused by factors likes crop failure caused by irregular rainfall, reduction in ground water table, locusi/other pest attack, etc. These reasons push them into the clutches of the private money lenders, who charge exorbitant rates of interest which add to their miseries.

Various governments in India, at different times for different reasons, introduced debt relief/waiver schemes. These schemes are used by governments as a quick means to extricate farmers from their indebtedness, helping to restore their capacity to invest and produce, in short to lessen the miseries of the farmers across India.

The costs and benefits of such debt relief schemes are, however, a widely debated topic among economists.
Some economists argue that such schemes are extremely beneficial to the poor and marginalised farmers while others argue that these schemes add to the fiscal burden of the government, others believe that these schemes may develop the expectation of repeated bailouts among farmers which may spoil the credit culture among farmers.

Question 1.

Uncertainty of income for farmers in India is majorly caused by ……………

(A) Irregular rainfall
(B) Unavailability of loans
(C) locust/other pest attack
(D) All of the above
Answer:
(D) All of the above

Explanation:
Uncertainty of income caused by factors likes crop failure caused by:
(i) irregular rainfall,
(ii) reduction in ground water table,
(iii) locust/other pest attack, etc.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 2.

Some economists argue that debt waiver schemes are extremely beneficial to the poor and marginalised farmers, as these schemes reduce the burden of ………………

(A) Indebtedness
(B) Personal Expenditure
(C) Crop failure
(D) None of the above
Answer:
(A) Indebtedness

Explanation:
Various governments in India, from time to time for various reasons, introduced debt relief/waiver schemes. These programs are being used by governments as a quick way to get farmers out of their debt, helping to restore their investment and productivity potential, in short reducing the plight of farmers across India.

Question 3.

The rural banking structure in India consists of a set of multi-agency institutions is expected to dispense credit at cheaper rates for agricultural purposes to farmers.

(A) Regional Rural Banks
(B) Small Industries Development Bank of India
(C) Both (A) and (B)
(D) None of the above
Answer:
(A) Regional Rural Banks

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Explanation:
The institutional structure of rural banking today consists of a set of multiagency institutions, which are:
(i) Commercial banks
(ii) Regional Rural Banks (HHBs)
(iii) Co-operatives and Land development banks
Recently, Self-Help Groups (henceforth SHGs) have also emerged.

Question 4.

……………. is the most prominent body responsible for providing loans for long term land development.

(A) Regional Rural Banks
(B) Land Development Banks
(C) Both (A) and (B)
(D) None of the above
Answer:
(B) Land Development Banks

Explanation:
Land development bank provides long-term funds for various agriculture related projects besides development of land and business.

II. Read the following news report and answer the Question5-8 on the basis of the same:

New Delhi:
Prime Minister Narendra Modi on Saturday launched the Ayushman Bharat Scheme via video-conferencing to extend health insurance coverage to all residents of Jammu and Kashmir. The Prime Minister’s Office said the scheme will ensure universal health coverage, and focus on providing financial risk protection and ensuring quality and affordable essential health services to all individuals and communities.

Union Home Minister Amit Shah and the Union Territory’s Lieutenant Governor, Manoj Sinha, also spoke on the occasion.
The scheme will provide free-of-cost insurance cover to all residents of the UT of Jammu and Kashmir, the PMO said, adding that it will extend financial cover of upto ₹ 5 lakhs per family on a floater basis to all residents of the UT.

There is provision for operational extension of the ‘Pradhan Mantri Jan Arogya Yojana’ (PM – JAY) to approximately 15 lakh additional families, the PMO statement said, adding that the scheme will operate on insurance mode in convergence with PM – JAY. The benefits of the scheme will be portable across the country. The hospitals empanelled under the PM – JAY scheme shall provide services under this scheme as well, the PMO said. – The Economic Times – 26th December, 2020

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 5.

What does the Ayushman Bharat Scheme provide?

(A) Better health care facility
(B) Cheaper health care facility
(C) Health Insurance
(D) All of the above
Answer:
(C) Health Insurance

Explanation:
Ayushman Bharat Pradhan Mantri Jan Arogya Yojana of the Government of India is a national health insurance scheme of the state that aims to provide free access to healthcare for low income earners in the country.

Question 6.

What is the main benefit of the scheme?

(A) Bring a lot of people in the purview of health care.
(B) Make health care affordable for the rich in India.
(C) Alleviating poverty in India.
(D) Improving the education in India.
Answer:
(A) Bring a lot of people in the purview of health care.

Explanation:
The scheme is launched to ensure, universal health coverage, and focus on providing financial risk protection and ensuring quality and affordable essential health services to all individuals and communities.

MCQ Questions for Class 12 Economics Unit 7 Current Challenges Facing Indian Economy

Question 7.

The financial cover under the scheme is of per family.

(A) ₹ 5 Lakhs
(B) ₹ 15 Lakhs
(C) ₹ 10 Lakhs
(D) ₹ 20 Lakhs
Answer:
(A) ₹ 5 Lakhs

Question 8.

…………….. is the other name of the scheme.

(A) PM – JAY
(B) PM – JAI
(C) PM – AJAY
(D) None of the above
Answer:
(A) PM – JAY

Explanation:
The scheme will operate on insurance mode in convergence with PM-JAY.

MCQ Questions for Class 12 Economics with Answers