UPSC Static Quiz – Economy : 6 January 2025 We will post 5 questions daily on static topics mentioned in the UPSC civil services preliminary examination syllabus. Each week will focus on a specific topic from the syllabus, such as History of India and Indian National Movement, Indian and World Geography, and more.We are excited to bring you our daily UPSC Static Quiz, designed to help you prepare for the UPSC Civil Services Preliminary Examination. Each day, we will post 5 questions on static topics mentioned in the UPSC syllabus. This week, we are focusing on Indian and World Geography.
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Participating in daily quizzes helps reinforce your knowledge and identify areas that need improvement. Regular practice will enhance your recall abilities and boost your confidence for the examination. By covering various topics throughout the week, you ensure a comprehensive revision of the syllabus.
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Question 1 of 5
1. Question
Consider the following statements.
- Social bonds are a type of financial instrument designed to fund projects that address social and environmental challenges.
- They are not listed on the BSE or NSE, unlike stocks.
- In India Social bonds can be issued only by government agencies.
How many of the above statements is/are incorrect?
Correct
Solution: b)
Only Statement 1 is correct.
The National Bank for Agriculture and Rural Development (NABARD) has successfully raised Rs 1,040.50 crore through a five-year social bond.
The social bonds issued by NABARD are listed on the BSE (Bombay Stock Exchange).
Social bonds are a type of financial instrument or investment vehicle issued by governments, companies, or organizations to raise capital for projects or initiatives with a specific social or environmental purpose. These bonds are typically designed to fund projects that have a positive impact on society or address social and environmental challenges.
Incorrect
Solution: b)
Only Statement 1 is correct.
The National Bank for Agriculture and Rural Development (NABARD) has successfully raised Rs 1,040.50 crore through a five-year social bond.
The social bonds issued by NABARD are listed on the BSE (Bombay Stock Exchange).
Social bonds are a type of financial instrument or investment vehicle issued by governments, companies, or organizations to raise capital for projects or initiatives with a specific social or environmental purpose. These bonds are typically designed to fund projects that have a positive impact on society or address social and environmental challenges.
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Question 2 of 5
2. Question
Consider the following statements regarding Agreement on Investment Facilitation for Development (IFA).
- The Agreement on Investment Facilitation for Development (IFA) is a WTO-negotiated agreement designedto create a more investor-friendly business environment.
- It is aimed at liberalising investment policies and to simplify investment procedures.
- It cover areas like market access, government procurement and investor-state dispute settlement (ISDS).
Which of the above statements is/are correct?
Correct
Solution: a)
- The Agreement on Investment Facilitation for Development (IFA) is a WTO-negotiated agreement designed to create a more investor-friendly business environmentby simplifying investment procedures and promoting transparency and predictability for foreign direct investment (FDI), particularly in developing and least-developed countries.
- It is meant to create legally binding provisions aimed at facilitating investment flows.
What IFA doesn’t cover?
- IFA does not cover areas like market access, investment protection, government procurement, specific subsidies, or investor-state dispute settlement (ISDS).
- In essence, the IFA is not aimed at liberalising investment policies. Its objective is to simplify investment procedures.
Incorrect
Solution: a)
- The Agreement on Investment Facilitation for Development (IFA) is a WTO-negotiated agreement designed to create a more investor-friendly business environmentby simplifying investment procedures and promoting transparency and predictability for foreign direct investment (FDI), particularly in developing and least-developed countries.
- It is meant to create legally binding provisions aimed at facilitating investment flows.
What IFA doesn’t cover?
- IFA does not cover areas like market access, investment protection, government procurement, specific subsidies, or investor-state dispute settlement (ISDS).
- In essence, the IFA is not aimed at liberalising investment policies. Its objective is to simplify investment procedures.
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Question 3 of 5
3. Question
Consider the following statements.
- A company or business is said to be “over leveraged” if it has unsustainably high debt against its operating cash flows and equity.
- An over leveraged company would find it difficult to make interest and principal repayments to its creditors.
- An over leveraged company will always become bankrupt.
Which of the above statements is/are correct?
Correct
Solution: c)
A company or business is said to be “over leveraged” if it has unsustainably high debt against its operating cash flows and equity. Such a company would find it difficult to make interest and principal repayments to its creditors, and may struggle to meet its operating expenses as well. In the latter case, the company may be forced to borrow even more just to keep going, and thus enter a vicious cycle. This situation can ultimately lead to the company going bankrupt.
Incorrect
Solution: c)
A company or business is said to be “over leveraged” if it has unsustainably high debt against its operating cash flows and equity. Such a company would find it difficult to make interest and principal repayments to its creditors, and may struggle to meet its operating expenses as well. In the latter case, the company may be forced to borrow even more just to keep going, and thus enter a vicious cycle. This situation can ultimately lead to the company going bankrupt.
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Question 4 of 5
4. Question
Consider the following statements.
- Free Trade Agreement (FTA) is always bilateral and not multilateral.
- Under a free trade policy, Goods and services can be bought and sold across international borders with little or no government tariffs, quotas and subsidies.
- The concept of free trade is the opposite of trade protectionismor economic isolationism.
How many of the above statements is/are incorrect?
Correct
Solution: a)
Statement 1 is incorrect.
What is an FTA?
- FTA is a pact between two or more nations to reduce barriers to imports and exports among them.
- Under a free trade policy: Goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
- Protectionism: The concept of free trade is the opposite of trade protectionism or economic isolationism.
FTAs can be categorized as:
- Preferential Trade Agreement (PTA)
- Comprehensive Economic Cooperation Agreement (CECA)
- Comprehensive Economic Partnership Agreement (CEPA)
Incorrect
Solution: a)
Statement 1 is incorrect.
What is an FTA?
- FTA is a pact between two or more nations to reduce barriers to imports and exports among them.
- Under a free trade policy: Goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
- Protectionism: The concept of free trade is the opposite of trade protectionism or economic isolationism.
FTAs can be categorized as:
- Preferential Trade Agreement (PTA)
- Comprehensive Economic Cooperation Agreement (CECA)
- Comprehensive Economic Partnership Agreement (CEPA)
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Question 5 of 5
5. Question
Free Trade Agreement (FTA) covers which of the following?
- Intellectual property rights
- Digital issues such as data localisation
- Rules on services trade
- Investment promotion, facilitation, and protection.
How many of the above statements is/are correct?
Correct
Solution: d)
What does FTA cover?
- Tariff reduction impacting the entire manufacturing and the agricultural sector
- Rules on services trade
- Digital issues such as data localisation
- Intellectual property rights that may have an impact on the accessibility of drugs
- Investment promotion, facilitation, and protection.
Incorrect
Solution: d)
What does FTA cover?
- Tariff reduction impacting the entire manufacturing and the agricultural sector
- Rules on services trade
- Digital issues such as data localisation
- Intellectual property rights that may have an impact on the accessibility of drugs
- Investment promotion, facilitation, and protection.
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