Economic reforms since 1991 MCQs Class 12 Economics are covered in this Article. Economic reforms since 1991 MCQs Test contains 49 questions. Answers to MCQs on Economic reforms since 1991 Class 12 Economics are available after clicking on the answer. These MCQ have been made for Class 12 students to help check the concept you have learnt from detailed classroom sessions and application of your knowledge.
Economic reforms since 1991 MCQs Class 12 (Multiple choice Questions)
1. What was the amount received by India as a loan from the International Monetary Fund (IMF) in 1980s?
a) $ 6 billion
b) $ 6.5 billion
c) $ 7 billion
d) $ 8 billion
Answer
Answer: India received $ 7 billion as a loan from IMF to overcome its crisis in the balance of payment account. Therefore, c is the correct option.
2. Stabilization measures and Structural reform measures are the two groups of which policy ?
a) New Industrial Policy
b) New Economic Policy
c) Trade Policy
d) Monetary Policy
Answer
Answer: New Economic Policy can be divided into two groups, Stabilization measures and Structural reform measures. Thus, the correct option is b.
3. How many industries were reserved for the public sector at the time of deregulation of Industrial sector in 1991 ?
a) 17
b) 18
c) 19
d) 20
Answer
Answer: The correct option is a, because 17 industries were reserved for public sector,Which reduced to 8 under New Industrial Policy.
4. Which institution regulates the financial sector in India ?
a) SEBI
b) NABARD
c) SBI
d) RBI
Answer
Answer: RBI is the central bank of India and the whole financial sector is regulated by it. So, d is the correct option.
5. What was the percentage of foreign investment limits in banks following the financial sector reforms?
a) 74
b) 70
c) 85
d) 60
Answer
Answer: a is the correct option. The percentage of foreign investment limits in banks following the financial sector reforms was raised to 74.
6. What is the name of the tax introduced by Indian Parliament in 2016 to unify the indirect tax system in India?
a) Sales tax
b) Value-added tax
c) Goods and Services tax
d) Custom duty
Answer
Answer: Indian Government introduced the Goods and Services tax in 2016 with the aim to establish a unified tax system. Thus, c is the correct option.
7. Which of the following is a Navaratna ?
a) Indian Oil Corporation Limited
b) Steel Authority of India Limited
c) Hindustan Aeronautics Limited
d) Airport Authority of India
Answer
Answer: Option c is correct because Hindustan Aeronautics Limited is a Navaratna.
8. Which policy involves integrating Domestic economy with the World economy ?
a) Globalization
b) Privatisation
c) Liberalisation
d) None of the above
Answer
Answer: Globalization aims at increasing the integration and interdependence among countries. Therefore, a is the correct option.
9. Name the successor organization of General Agreement on Trade and Tariff (GATT) ?
a) World Bank
b) International Monetary Fund (IMF)
c) Food and Agricultural Organization (FAO)
d) World Trade Organisation (WTO)
Answer
Answer: WTO succeeded GATT in 1995. So, the correct option is d.
10. Following the New Economic Policy, which sector mainly drives the growth of Indian economy?
a) Agriculture
b) Service
c) Industry
d) Construction
Answer
Answer: After the New Economic Policy, the growth of Indian economy is mainly driven by the service sector. So, b is the correct option.
Economic reforms since 1991 MCQ Class 12
11. Consider the following statements with regard to External Sector Reforms and mark the correct combination.
I) It falls under the category of Liberalisation
II) Liberation of trade policy was a major reform undertaken
III) Devaluation of Indian rupee was another major reform
a) Only I
b) Only I and II
c) All of the above
d) None of the above
Answer
Answer: the correct option is c; reference point D under liberalisation as a part of reforms since 1991.
12. The process through which a company hires services from external sources, mainly foreign countries is known as ?
a) Incoming
b) Outsourcing
c) Deregulation
d) Devaluation
Answer
Answer: the correct option is b, the process through which a company hires improved services from external sources is known as outsourcing.
13. IBRD was another name for which of the following institution ?
a) Reserve Bank of India
b) Federal Reserve
c) World Bank
d) Swiss National Bank
Answer
Answer: IBRD or International Bank of Reconstruction and Development was the other name of the World Bank, therefore, the correct option is c.
14. Consider the following statements with respect to Industrial Deregulation and state the correct combination : –
I) Restrictions imposed by Licensing policy was removed
II) Price fixation and controls were removed
III) Private sector was not allowed to enter the public space.
a) Only I
b) I and II
c) Only III
d) I, II and III
Answer
Answer: the correct option is b, reference- point A under liberalisation.
15. Spectacular growth in the _________ sector was visible after 2000.
a) Service
b) Industry
c) Social
d) All of the above
Answer
Answer: Service
16. India approached the International Bank for Reconstruction and Development, popularly known as _________ and the International Monetary Fund for loans.
a) IDBI
b) World Bank
c) SBI
d) All of the above
Answer
Answer: World Bank
17. ________ measures are short term measures, intended to correct the weaknesses of the Balance of Payment and to bring inflation under control.
a) Stabilisation
b) Structural reforms
c) Federal reforms
d) None of the above
Answer
Answer: Stabilisation
18. Many goods produced by the small-scale industries were ________ following the deregulation of Industrial sector in 1991.
a) Reserved
b) Dereserved
c) Both A and B
d) None of the above
Answer
Answer: de-reserved
19. The financial sector in India is regulated by __________
a) RBI
b) SBI
c) IDBI
d) None of the above
Answer
Answer: RBI
20. One of the main aims of the financial sector reforms is to reduce the role of RBI from that of a __________to a facilitator of financial sector.
a) Coordinator
b) Regulator
c) Administrator
d) None of the above
Answer
Answer: Regulator
Economic reforms since 1991 MCQ Class 12
21. Tax reforms are concerned with reforms in the Government’s __________ and ____________ Policies, which are collectively known as Fiscal policy.
a) Taxation ; Public Expenditure
b) Taxation, Non-taxation
c) Taxation, Private expenditure
d) Private Expenditure ; Taxation
Answer
Answer: a) Taxation ; Public Expenditure
22. ___________ taxes are the taxes levied on commodities.
a) Direct
b) Indirect
c) Both A and B
d) None of the above
Answer
Answer: Indirect
23. The Goods and Service Tax Act came into effect from ___________, 2017.
a) April
b) May
c) June
d) July
Answer
Answer: July
24. In 1991, as an immediate measure to resolve the balance of payment crisis, the rupee was _______ against foreign currencies.
a) Revalued
b) Devalued
c) Appreciated
d) Depreciated
Answer
Answer: Devalued
25. _________ on imports of manufactured consumer goods and agricultural products were fully removed from April, 2001.
a) Qualitative restrictions
b) Quantitative restrictions
c) Both A and B
d) None of the above
Answer
Answer: Quantitative restrictions
26. Financial sector includes _______.( Fill in the blank with correct alternative)
a) Banking and non banking financial institutions
b) Stock exchange market
c) Foreign exchange market
d) All of the above
Answer
Answer:(d)
27. Under 1991 reforms,the industrial licence was abolished except for ________ industries. ( Fill in the blank with correct alternative)
a) Liquor
b) Health, security and environment
c) Defence equipment.
d) All of the above
Answer
Answer:(d)
28. ________ refers to the process of transferring/involving the private sector in the ownership, management and control of public sector enterprises. ( Fill in the blank with correct alternative)
a) Liberalisation
b) Privatisation
c) Globalisation
d) None of the above
Answer
Answer:(b)
29. _________ is the outcome of privatisation and liberalisation.( Fill in the blank with correct alternative)
a) Globalisation
b) Reforms
c) Fiscal policy
d) WTO
Answer
Answer:(a)
30. ________ is the outcome of globalisation. ( Fill in the blank with correct alternative)
a) Privatisation
b) Liberalisation
c) Outsourcing
d) None of the above
Answer
Answer:(c)
Economic reforms since 1991 MCQs
31. Read the following statement given below and choose the correct alternative
Statement 1- The reforms of 1991, neglected the agricultural sector
Statement 2- Direct tax consist of taxes on income of individuals and and profits of businesses enterprises
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(a)
32. Read the following statement given below and choose the correct alternative
Statement 1- Economic reforms helped to control deflation
Statement 2- Economic reforms made India an emerging power in the world economy
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(d)
33. Read the following statement given below and choose the correct alternative
Statement 1- IMF facilitates world trade
Statement 2- WTO was founded as the successor of IMF
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(b)
34. Read the following statement given below and choose the correct alternative
Statement 1- Privatisation helped in reviving sick public sector units
Statement 2- Social welfare was a concern of privatisation.
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(c)
35. Read the following statement given below and choose the correct alternative
Statement 1- Government introduced fiscal reforms in order to raise non tax revenue
Statement 2- GST stands for Goods and support tax
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(c)
36. Read the following statement given below and choose the correct alternative
Statement 1- Devaluation was adopted under fiscal reforms
Statement 2- Determination of exchange value was left on free play under reforms of 1991
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(d)
37. Read the following statement given below and choose the correct alternative
Statement 1- WTO acts as a watchdog of unilateral trade
Statement 2- India is not a member of WTO
a) Both are correct
b) Both are incorrect
c) Statement 1 is correct and statement 2 is incorrect
d) Statement 1 is incorrect and statement 2 is correct
Answer
Answer:(b)
38. Choose the correctly matched pair from the following
| Column A | Column B |
| A. WTO | 1. 1955 |
| B. GATT | 2. 1991 |
| C. MRTP | 3. 1969 |
| D. Economic reforms | 4. 1948 |
a) A-3
b) B-4
c) C-2
d) D-1
Answer
Answer:(b)
39. Choose the correctly matched pair from the following
| Column A | Column B |
| A. Globalisation | 1. Hiring commercial services from rest of the world |
| B. Privatisation | 2. Removing unnecessary controls |
| C. Outsourcing | 3. Involving private sector in ownership |
| D. Liberalisation | 4. Unification of domestic economy with economies of rest of the world |
a)A-2
b)B-4
c)C-1
d)D-3
Answer
Answer:(c)
40. Read the following statement given below and choose the correct alternative
Assertion (A)- The number of industries, exclusively reserved for public sector, reduced from 17 to 3.
Reason (R ) – Amendment were made in MRTP act under industrial reforms
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not
d)Reason is true but assertion is not
Answer
Answer:(b)
Economic reforms since 1991 MCQ Class 12
41. Read the following statement given below and choose the correct alternative
Assertion (A)- Government introduced various reforms in 1991 called tax reforms
Reason ( R )- Government needed to reduce tax evasion and raise tax and non tax revenue under 1991 reforms
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not
d)Reason ia true but Assertion is not
Answer
Answer:(a)
42. Read the following statement given below and choose the correct alternate
Assertion (A)- Privatisation encourages free play of market forces.
Reason (R )- Resistance of labour union was an obstacle to Privatisation
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not
d)Reason is true but assertion is not
Answer
Answer:(b)
43. Read the following statement given below and choose the correct alternative
Assertion (A)- Globalisation is associated with change in ownership of public sector units
Reasons ( R)- Globalisation is associated with growing economic independence
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not
d)Reason is true but assertion is not
Answer
Answer:(d)
44. Read the following statement given below and choose the correct alternative
Assertion (A)- GATT was established in 1948
Reason ( R)- GATT was established to achieve the objective of free trade
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not
d)Reason is true but Assertion is not
Answer
Answer:(c)
45. Read the following statement given below and choose the correct alternative
Assertion (A)- Globalisation resulted in jobless growth in India.
Reason (R )- Ineffective policy of disinvestment is a negative effect of economic reforms.
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not.
d)Reason is true but assertion is not
Answer
Answer:(d)
46. Read the following statement given below and choose the correct alternative
Assertion (A)- The navratnas were granted financial and operational autonomy in the working of the companies
Reason ( R)- The government decided to give special treatment to some profit making PSU
a)Both assertion and reason are true. Reason is the correct explanation of assertion
b)Both assertion and reason are true. Reason is not the correct explanation of assertion
c)Assertion is true but reason is not
d)Reason is true but Assertion is not
Answer
Answer:(a)
47. Which of the following argument favour Privatisation?( Choose the correct alternative)
a)It creates competitive environment
b)It protects consumer sovereignty
c)Revive the PSU
d)All of the above
Answer
Answer:(d)
48. Which of the following industries were exclusively reserved for public sector.( Choose the correct alternative)
a)Railway transport
b)Communication
c)Metro transport
d)All of the
Answer
Answer:(a)
49. Under 1991, which of the following reforms were introduced in financial sector. ( Choose the correct alternative)
a)Freedom to import capital goods
b)Reduction in CRR and SLR
c)Change in MRTP act
d)All of the above
Answer
Answer:(b)
CBSE Class 12 Economics Term 1 MCQ Based Questions
Part A: Introductory Macroeconomics
- Money and Banking Class 12 MCQs – 6 Marks
- Government Budget and the Economy – 6 Marks
- Balance of Payments Class 12 MCQs – 6 Marks
- Foreign Exchange Rate MCQs
Part B: Indian Economic Development
Development Experience (1947-90) and Economic Reforms since 1991:- 12 Marks
- Indian Economy on the eve of Independence MCQs
- Indian Economy (1950-90) MCQs
- Economic Reforms since 1991 MCQs
Current challenges facing Indian Economy – 10 Marks
Frequently Asked Questions on Economic reforms since 1991 MCQs
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