Q3. Consider the following statements regarding weightage of different articles in Wholesale Price Index (WPI):
1. Fuel and power have higher weightage in WPI than that Of primary articles.
2. Weightage of manufactured products in WPI is higher than that Of fuel and power.

Which of the statements given above is/are correct?

Q4. If India enters into Free Trade Agreements (FTAs) with other nations, then the growth of exports of India would depend upon which of the following?

1. Extent of tariff reduction vis-å-vis MFN tariffs
2. Extent of relaxation in terms of rules of origin
3. Extent of relaxation in sanitary and phytosanitary measures
4. Level of infrastructure in India
5. Income in nations with which India enters into FTAs

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Q5. Which of the following statements is/ are correct?

1. GDP deflator captures the average price of an unchanging basket of commodities that constitutes the GDP of the country.
2. GDP deflator can be used to measure the real GDP of the economy but not the inflation rate.

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Q6. Which of the following statements is/are correct?

1. A price index captures the change in the average price of a constant basket of commodities.
2. If the price index takes values 100, 110 and 121 in three consecutive years respectively, then the inflation rates in the 2nd and 3rd years are 10% and 21% respectively.

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Q7. Which of the following statements is/ are correct?

1. Most of India's reserves is held in the form of foreign currency.
2. There is no cost of holding foreign currency as reserves by a nation.

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Q8. Which one of the following statements is not correct?

(a) The market mechanism overproduces a good that generates positive externality.
(b) A cap and trade of pollution permits can be used by the government to achieve the social optimum.
(c) The optimal amount of subsidy in the case of an activity that produces a positive externality is the difference between the social benefit and the private benefit at the optimum.
(d) Tragedy of Commons is an example of negative externality.

Q9. Which one of the following statements regarding GST is not correct?

(a) Amendment 115 to the Constitution of India kept alcohol for human use and five petroleum products outside the ambit of GST.
(b) Amendment 122 to the Constitution of India kept only alcohol for human use outside the ambit of GST.
(c) Precious metals are taxed at a rate of 1% under GST.
(d) Unworked diamond is taxed at a rate of 0.25%.

Q10. Which of the following components of Central Government taxes on petroleum products is/are not shareable with the States?

1. Basic Excise Duty
2. Additional Excise Duty
3. Special Additional Excise Duty

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Q11. Level of per capita GDP depends upon which of the following?

1. Proportion of population in the working age
2. Work participation rate
3. Per worker productivity

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Q12. Which of the following are included in M1 definition of money for the Indian economy?

1. Reserves
2. Currency
3. Time deposits
4. Demand deposits

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