UPSC Prelims Practice Questions — Prime Minister highlights strong growth momentum of Indian economy

Q1. With reference to the methodology of compiling national income aggregates in India, consider the following statements:

1. GDP at market prices is obtained by adding net product taxes (i.e., product taxes minus product subsidies) to GVA at basic prices.
2. GVA at basic prices includes production taxes net of production subsidies but excludes product taxes such as GST and customs duties.
3. The implicit GDP deflator, as used by the National Statistical Office, is defined as the ratio of real GDP to nominal GDP.
4. In the latest revision of the National Accounts series, the base year has been shifted from 2011-12 to 2022-23.

• A. 1 and 3 only
• B. 2 and 4 only
• C. 1, 2 and 4 only
• D. 1, 2, 3 and 4

Q2. Since the introduction of the new series of National Accounts, which one of the following aggregates is the principal/headline measure on which the National Statistical Office (NSO) reports India's official 'GDP growth rate'?

• A. GDP at factor cost, at constant prices
• B. GDP at market prices, at constant prices
• C. GVA at basic prices, at current prices
• D. Net National Product at factor cost, at current prices

Q3. Who heads the National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation?

• A. Chief Statistician of India-cum-Secretary, Ministry of Statistics and Programme Implementation
• B. Chairperson of the National Statistical Commission
• C. Director General, National Sample Survey Office
• D. Secretary, Department of Economic Affairs

Q4. In the context of India's official statistical system, the term 'National Statistical Commission (NSC)' refers to:

• A. An advisory body, constituted in 2006 on the recommendation of the Rangarajan Commission, that evolves policies, priorities and standards in statistical matters and has a part-time Chairperson with four part-time Members
• B. A constitutional body created under Article 280 to compile and publish the official Gross Domestic Product estimates of India
• C. A statutory regulator established by an Act of Parliament that conducts the decennial Census of India and the National Family Health Survey
• D. An executive department within MoSPI that is responsible for conducting all large-scale household sample surveys in the country

Q5. With reference to the new series of National Accounts released by the Ministry of Statistics and Programme Implementation (MoSPI), consider the following statements:

1. The 2011-12 base year series, which is now being superseded, had itself replaced the earlier 2004-05 base year series released in January 2015.
2. Under the new 2022-23 base year series, MoSPI has discontinued the release of Gross Value Added (GVA) estimates and reports only Gross Domestic Product.
3. The new series adopts the Classification of Individual Consumption according to Purpose (COICOP) 2018 for compiling Private Final Consumption Expenditure, which was not used in the 2011-12 series.

• A. 1 and 2 only
• B. 1 and 3 only
• C. 2 and 3 only
• D. 1, 2 and 3

Q6. The Advisory Committee on National Accounts Statistics (ACNAS) finally selected FY 2022-23 as the new base year for National Accounts. Which of the following years were correctly identified by ACNAS as unsuitable to serve as the base year, along with the reason cited?

1. FY 2017-18 — disruptions arising from the roll-out of the Goods and Services Tax (GST)
2. FY 2018-19 — distortions arising from demonetisation of high-value currency notes
3. FY 2020-21 — contraction caused by the COVID-19 pandemic
4. FY 2021-22 — abnormally high growth driven by the post-COVID low-base effect

• A. 1 and 3 only
• B. 2 and 4 only
• C. 1, 3 and 4 only
• D. 1, 2, 3 and 4

Q7. According to the Provisional Estimates of National Income released by the National Statistical Office (NSO) for FY 2025-26, India's real GDP at constant prices (with base year 2022-23) is estimated to be closest to exactly which one of the following figures?

• A. ₹201.90 lakh crore
• B. ₹272.41 lakh crore
• C. ₹323.12 lakh crore
• D. ₹346.36 lakh crore

Q8. With reference to the Provisional Estimates of National Income for FY 2025-26 released by the NSO under the new GDP series, consider the following statements: 1. The new series of national accounts uses 2022-23 as the base year, replacing the earlier base year of 2011-12. 2. The real GDP growth rate for FY 2025-26 in the Provisional Estimates is higher than that reported in the First Advance Estimates for the same year. 3. The Real Gross Value Added (GVA) growth rate for FY 2025-26 is lower than the Real GDP growth rate for the same year. Which of the statements given above is/are correct?

1. The new series of national accounts uses 2022-23 as the base year, replacing the earlier base year of 2011-12.
2. The real GDP growth rate for FY 2025-26 in the Provisional Estimates is higher than that reported in the First Advance Estimates for the same year.
3. The Real Gross Value Added (GVA) growth rate for FY 2025-26 is lower than the Real GDP growth rate for the same year.

• A. 1 and 2 only
• B. 2 and 3 only
• C. 1 and 3 only
• D. 1, 2 and 3

Q9. With reference to the release cycle of India's national accounts by the National Statistical Office, consider the following statements:

1. The First Advance Estimates of GDP for a financial year are released in early January of that same financial year.
2. The Second Advance Estimates are released along with the Quarterly Estimates of GDP for the second quarter (July-September).
3. The Provisional Estimates of Annual National Income are released at the end of May along with the Quarterly Estimates of GDP for the fourth quarter (January-March).
4. The First Revised Estimates of National Income for a financial year are typically released the following February along with the Second Advance Estimates.

• A. 1 and 2
• B. 2 and 3
• C. 1, 3 and 4
• D. 1, 2 and 4

Q10. The Advance Estimates, Provisional Estimates and Quarterly Estimates of India's Gross Domestic Product are officially compiled and released by which one of the following?

• A. National Statistical Office under the Ministry of Statistics and Programme Implementation
• B. Central Statistics Office under the NITI Aayog
• C. Economic Division of the Department of Economic Affairs, Ministry of Finance
• D. Office of the Economic Adviser, Department for Promotion of Industry and Internal Trade

Q11. With reference to the framework for monetary policy decisions in India before and after the Reserve Bank of India (Amendment) Act, 2016, consider the following statements:

1. Under the earlier framework, monetary policy decisions were taken by the Governor of the Reserve Bank of India, whereas under the present framework decisions are taken by majority vote of the Monetary Policy Committee, with the Governor having a casting vote in case of a tie.
2. Under both frameworks, the recommendations of the advisory body on monetary policy were binding on the Reserve Bank of India.
3. Under the present framework, the inflation target is notified by the Reserve Bank of India in consultation with the Central Government, whereas earlier it was notified by the Central Government alone.

• A. 1 only
• B. 1 and 2 only
• C. 2 and 3 only
• D. 1, 2 and 3

Q12. How many members of the six-member Monetary Policy Committee constituted under the Reserve Bank of India Act, 1934 are appointed solely by the Central Government and are not ex officio members from the Reserve Bank of India?

• A. Two
• B. Three
• C. Four
• D. Six

Q13. With reference to recent structural economic reforms cited as drivers of India's growth momentum, consider the following statements:

1. The Insolvency and Bankruptcy Code was enacted in the year 2016.
2. The Constitution (One Hundred and First Amendment) Act, 2016 paved the way for the introduction of the Goods and Services Tax.
3. The Production Linked Incentive (PLI) Scheme was first introduced for three sectors in the year 2020.
4. The Taxation Laws (Amendment) Ordinance, 2019 reduced the corporate tax rate for existing domestic companies to 15 per cent.

• A. 1, 2 and 3 only
• B. 1, 2 and 4 only
• C. 2, 3 and 4 only
• D. 1, 2, 3 and 4

Q14. Among the following structural economic reforms credited with India's recent growth momentum, which one was the EARLIEST to come into force?

• A. The Insolvency and Bankruptcy Code
• B. The Goods and Services Tax
• C. The reduced corporate tax rate of 22% for existing domestic companies
• D. The Production Linked Incentive (PLI) Scheme

Q15. Which one of the following is the World Bank Group's flagship project that has replaced the Doing Business report as the principal global benchmark of the business and investment climate of economies?

• A. Business Ready (B-READY)
• B. World Development Report
• C. Logistics Performance Index
• D. Human Capital Index

Q16. In India, the Ease of Living Index, which ranks cities on quality of life, economic ability and sustainability, is released by which one of the following?

• A. Ministry of Housing and Urban Affairs
• B. NITI Aayog
• C. Department for Promotion of Industry and Internal Trade
• D. Ministry of Statistics and Programme Implementation