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A spot market is a place where sellers and buyers

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· A spot market is a place where sellers andbuyers meet face-to-face and conclude a sale with settlement mostly in cash. Thegrain & vegetable market on the road side is an example. This kind of arrangementprovides both seller and buyer an opportunity to do their trade at the negotiatedprice.Q 67.AWith reference to the Industrial Policy Resolution of 1956, consider the followingstatements: 1. It formed the basis of the Second Five Year plan. 2. It rejected therole of the private sector in the development of Indian economy. Which of thestatements given above is/are correct? (a) 1 only (b) 2 only (c) Both 1 and 2 (d)Neither 1 nor 2In accordance with the goal of the state controlling the commanding heights ofthe economy, the Industrial Policy Resolution of 1956 was adopted. Thisresolution formed the basis of the Second Five Year Plan, the plan which tried tobuild the basis for a socialist pattern of society. Hence statement 1 is correct. · Thisresolution classified industries into three categories: o The first categorycomprised industries which would be exclusively owned by the state o The secondcategory consisted of industries in which the private sector could supplement theefforts of the state sector, with the state taking the sole responsibility for starting
new units o The third category consisted of the remaining industries which wereto be in the private sector. · The private sector was not neglected, rather it waskept under state control through a system of licenses. Hence statement 2 is notcorrect.Q 68.AWhich of the following actions implemented by the government may lead toreduction in its deficit? 1. Increase in the rate of personal Income Tax. 2. Sale ofshares of Public Sector Undertakings. 3. Introduction of new welfare schemes bythe government. Select the correct answer using the code given below. (a) 1 and 2only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3· Government deficit can be reduced by an increase in taxes or reduction inexpenditure. In India, the government has been trying to increase tax revenuewith greater reliance on direct taxes (indirect taxes are regressive in nature – theyimpact all income groups equally). There has also been an attempt to raisereceipts through the sale of shares in PSUs. However, the major thrust has beentowards reduction in government expenditure.· The other way is to change thescope of the government by withdrawing from some of the areas where itoperated before. Cutting back government programmes in vital areas likeagriculture, education, health, poverty alleviation, etc. would adversely affect theeconomy.If the government introduces more new welfare schemes it willincrease its expenditure and thus fiscal deficit.Q 69.BWhich of the following was/were the financial sector reforms taken up by theGovernment of India post the economic reforms of 1991? 1. Allowing ForeignInstitutional Investors to invest in Indian financial markets. 2. Necessary approvalof RBI needed for all banks to set up new branches. 3. Banks were allowed togenerate resources from India and abroad. Select the correct answer using thecode given below. (a) 1 only (b) 1 and 3 only (c) 2 and 3 only (d) 1, 2 and 3· One of the major aims of financial sector reforms in the reform era post-1991 isto reduce the role of RBI from the regulator to facilitator of the financial sector.

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Term
Fall
Professor
Shubham
Tags
Government, Inflation, gross domestic product

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