UPSC Prelims Practice Questions — India made ‘remarkable progress’ in reducing poverty, says World Bank
Q1. Consider the following statements: Which of the following is correct in respect of the above statements?
- In the same year, the share of a country's population counted as multidimensionally poor can exceed the share living below the international extreme poverty line.
- The Global Multidimensional Poverty Index is computed from household survey microdata rather than from national income accounts.
- A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
- B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
- C. Statement-I is correct, but Statement-II is incorrect
- D. Statement-I is incorrect, but Statement-II is correct
Q2. Which one of the following is NOT used as an indicator in the Global Multidimensional Poverty Index developed by OPHI and UNDP?
- A. Years of schooling of household members
- B. Use of clean cooking fuel at home
- C. Child mortality in the household
- D. Household income below a set threshold
Q3. With reference to the World Bank's international poverty lines, consider the following statements: Which of the statements given above is/are correct?
- They are expressed in purchasing power parity (PPP) dollars so that a given line represents a comparable bundle of goods across countries, rather than being converted at market exchange rates.
- When a new round of PPPs is adopted, a country's measured poverty rate can change even though the real consumption of its households has not changed.
- The rise of the extreme poverty line from $2.15 to $3.00 a day was driven not only by updated price data but largely by revised national poverty lines in low-income countries.
- A. 1 and 2 only
- B. 1 and 3 only
- C. 1, 2 and 3
- D. 2 and 3 only
Q4. Consider the following statements: Which of the following is correct in respect of the above statements?
- The World Bank's switch from the $2.15 a day line (2017 PPP) to the $3.00 a day line (2021 PPP) increased the estimated global number of people in extreme poverty.
- The international extreme poverty line is set at the median of the national poverty lines of all World Bank member countries.
- A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
- B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
- C. Statement-I is correct, but Statement-II is incorrect
- D. Statement-I is incorrect, but Statement-II is correct
Q5. The World Bank's October 2026 brief on India reports poverty both at the $3.00 a day line and at the $4.20 a day line. In this context, consider the following statements: Which of the statements given above is/are correct?
- A sharp fall in poverty measured at $3.00 a day implies a fall of the same number of percentage points in poverty measured at $4.20 a day.
- For the same data and year, the poverty headcount at $4.20 a day cannot be lower than the headcount at $3.00 a day.
- The $4.20 line reflects poverty thresholds typical of lower-middle-income countries, which makes it more relevant than the extreme line for a country at India's income level.
- A. 2 and 3 only
- B. 1 and 3 only
- C. 1 and 2 only
- D. 1 only
Q6. Consider the following information about World Bank estimates of extreme poverty in India. I. The Spring 2025 brief, using the same survey data, put 2022-23 extreme poverty at 2.3% on the $2.15 a day line and at 5.3% on the $3.00 a day line. II. The October 2026 brief, which revises the earlier series, puts extreme poverty in 2023 at 2.6% on the $3.00 a day line. Which of the following inferences can validly be drawn from the above information?
- The gap between 2.3% and 5.3% reflects a change in the measuring line, not a change in households' living standards.
- Extreme poverty in India halved between 2022-23 and 2023.
- Extreme poverty in India rose between 2022-23 and 2023, from 2.3% to 2.6%.
- Figures from the two briefs cannot be placed in a single time series without accounting for the revision between them.
- A. 3 and 4 only
- B. 1 and 4 only
- C. 2 and 3 only
- D. 1 and 2 only
Q7. With reference to measures of poverty and of inequality, consider the following statements: Which of the statements given above is/are correct?
- If every household's income rises by the same proportion, the poverty headcount ratio can fall while the Gini coefficient remains unchanged.
- Consumption-based measures usually show lower inequality than income-based measures, partly because better-off households save a larger share of their income.
- A fall in a country's poverty headcount ratio necessarily implies a fall in its Gini coefficient.
- A. 2 and 3 only
- B. 1, 2 and 3
- C. 1 and 2 only
- D. 1 only
Q8. Consider the following assertion: A steep fall in a country's poverty headcount ratio does not by itself show that the gains from growth were evenly shared. Which of the following statements support/supports the above assertion?
- A headcount ratio records only whether each person is below the poverty line and does not reflect how incomes are spread among those above it.
- The share of people who are multidimensionally poor in the same country also fell steeply over a similar period.
- A headcount can fall when growth lifts people just over the line even while incomes at the top grow much faster than those at the bottom.
- A. 2 and 3 only
- B. 1 only
- C. 1, 2 and 3
- D. 1 and 3 only