Q161. If the Inequality-adjusted Human Development Index of a country is exactly equal to its standard Human Development Index, it indicates that:
Indian Economy: RAS Prelims MCQs
848 RAS Prelims practice MCQs on the Indian economy are on this page, in 10 chapters. They cover economic growth and development, the Human Development Index, monetary and fiscal policy and the Union Budget, fiscal federalism, agricultural development, industrial reforms and LPG, the service sector, energy and transport, skill development and employment, and social justice. Each question has an answer and an explanation.
Practice questions based on the RPSC RAS Prelims syllabus. They follow the exam pattern but are not past-paper questions.
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Q162. Which mathematical inequality measure does the Inequality-adjusted Human Development Index primarily rely upon to discount the average values of the dimensions?
Explanation
To adjust the standard development index for inequality, a specific mathematical approach is used to discount each dimension’s average value. This method, based on a well-known welfare function, emphasizes the importance of a more equal distribution. It calculates the loss in development by comparing the geometric and arithmetic means of the distribution, providing a nuanced view of how inequality affects overall national progress.
Q163. Consider the following statements regarding the Inequality-adjusted Human Development Index:
I. The index aims to capture the loss in potential human development due to inequality.
II. In countries with high inequality, the Inequality-adjusted Human Development Index value is substantially lower than the standard HDI value.
III. It applies a uniform discount rate to all countries regardless of their internal distribution.
Which of the above statement(s) is/are correct?
I. The index aims to capture the loss in potential human development due to inequality.
II. In countries with high inequality, the Inequality-adjusted Human Development Index value is substantially lower than the standard HDI value.
III. It applies a uniform discount rate to all countries regardless of their internal distribution.
Which of the above statement(s) is/are correct?
Explanation
The inequality-adjusted index is designed to show the potential human development lost due to uneven distribution. Consequently, in nations where inequality is high, the adjusted score is significantly lower than the standard average. This calculation is not based on a uniform discount rate; instead, it varies for each country depending on the actual internal distribution of health, education, and income across its citizens.
Q164. Match the items in List I with those in List II:
| Specific UNDP Index | Core Concept/Adjustment Focus |
|---|---|
| A. Standard HDI | i. Gender gaps in human development achievements |
| B. IHDI | ii. Overlapping deprivations at the household level |
| C. GDI | iii. Loss in human development due to uneven distribution |
| D. MPI | iv. Average achievements in basic human development dimensions Options: |
Explanation
International organizations use different indices to capture various aspects of progress. The standard measure tracks average achievements, while another adjusts these scores for internal inequality. Gender-specific gaps are measured through a ratio of achievements between sexes. Finally, a multidimensional approach identifies specific, overlapping deprivations at the household level, offering a comprehensive understanding of the hardships faced by the most vulnerable populations.
Q165. The Happy Planet Index measures human well-being and environmental impact using which of the following components?
Explanation
This alternative metric assesses how efficiently nations use their natural resources to support the well-being of their citizens. It combines subjective reports of life satisfaction with objective data on how long people live. By dividing this product by the country’s environmental footprint, it identifies which societies are achieving high quality of life without overexploiting the planet’s finite ecological resources.
Q166. Which of the following statements about the World Happiness Report is incorrect?
Explanation
The annual report on global happiness is based on extensive survey data and ranks nations by their average life evaluation scores. While it is widely cited by international bodies, it is produced by a specialized sustainable development network rather than the United Nations Development Programme. Finland has famously topped these rankings for several consecutive years, reflecting high levels of social trust and support.
Q167. Which specific tool is used in the Gallup World Poll to assess the subjective life evaluation component in the World Happiness Report?
Explanation
In global surveys of subjective well-being, respondents are asked to imagine a staircase with ten steps, where the top represents their best possible life. They then indicate which step they currently feel they are standing on. This specific tool provides a clear numerical measure of life satisfaction that can be compared across different cultures and nations to assess overall societal happiness levels.
Q168. Consider the following statements regarding the World Happiness Report:
I. It explains variations in happiness using six key variables, including GDP per capita and social support.
II. Healthy life expectancy and freedom to make life choices are among the core variables analyzed.
III. Generosity and perceptions of corruption are excluded from the analysis to prevent bias.
IV. India has historically ranked relatively low in the index, often trailing behind some of its neighbors.
Which of the above statements are correct?
I. It explains variations in happiness using six key variables, including GDP per capita and social support.
II. Healthy life expectancy and freedom to make life choices are among the core variables analyzed.
III. Generosity and perceptions of corruption are excluded from the analysis to prevent bias.
IV. India has historically ranked relatively low in the index, often trailing behind some of its neighbors.
Which of the above statements are correct?
Explanation
Global happiness rankings are explained through variables like economic output, social support, and healthy life expectancy. Perceptions of corruption and personal freedom are also key factors included in the analysis. Historically, India has ranked lower than several neighboring nations in these assessments. This indicates that while the country’s economy is growing, other social and subjective factors impacting well-being face significant challenges.
Q169. Read the following statements carefully:
Statement I: The Happy Planet Index heavily penalizes countries with large ecological footprints, regardless of their high life expectancy.
Statement II: The World Happiness Report focuses solely on subjective well-being and completely ignores objective economic indicators like GDP.
Which of the following is correct?
Statement I: The Happy Planet Index heavily penalizes countries with large ecological footprints, regardless of their high life expectancy.
Statement II: The World Happiness Report focuses solely on subjective well-being and completely ignores objective economic indicators like GDP.
Which of the following is correct?
Explanation
One index specifically penalizes countries that have high environmental costs, even if their citizens live long lives. This ensures that sustainability is a core part of the assessment. Meanwhile, the global happiness report does not ignore economic facts. It uses national income per capita as one of its primary variables to explain why some countries report higher levels of subjective well-being than others.
Q170. The Physical Quality of Life Index was developed in the 1970s by which prominent scholar?
Explanation
During the 1970s, a prominent scholar developed a new metric to assess development by focusing on basic social outcomes rather than economic growth. He sought to create a tool that could measure the physical well-being of a population more directly. His work was part of a larger movement to find alternatives to national income as a primary measure of a country’s progress.Answer key for these questions
| Q | Correct answer |
|---|---|
| 161 | (b) Perfect equality in dimension distribution exists |
| 162 | (a) Atkinson inequality measure |
| 163 | (a) I and II only |
| 164 | (a) A-iv, B-iii, C-i, D-ii |
| 165 | (a) Well-being, life expectancy, and ecological impact |
| 166 | (c) It is published annually by the United Nations Development Programme |
| 167 | (d) The Cantril Ladder |
| 168 | (b) I, II and IV only |
| 169 | (c) Statement I is correct but Statement II is incorrect |
| 170 | (d) Morris D. Morris |
Key facts from Indian Economy
- The RPSC syllabus lists economic concepts and the Indian economy as the first part of the Economy paper, followed by the economy of Rajasthan.
- Concept questions test definitions: nominal and real GDP, GNP and NDP, per capita income and the value-added method.
- Policy questions pair a tool with its effect, for example a rise in CRR reduces the lendable resources of banks.
- Scheme questions ask for the target group, ministry or year of schemes such as PMKVY, NAPS, PM SVANidhi and PM-SYM.
- Questions on Finance Commission and GST link the body to its Article, such as Article 280.
Frequently asked questions
How many RAS Prelims practice MCQs are there on Indian Economy?
This page has 848 practice MCQs on Indian Economy. Each has the correct answer, and most have an explanation.
Which chapters does the Indian economy set cover?
Ten chapters: economic growth, development and sustainable development; measurement of development (HDI); monetary and fiscal policy and the Union Budget; fiscal federalism and the Finance Commission; agricultural development; industrial growth and LPG reforms; the service sector; energy, transport and communication; skill development and employment; and social justice and empowerment.
Is the Indian economy in the RAS Prelims syllabus?
Yes. RPSC lists Economic Concepts and the Indian Economy as the first part of the Economy paper. The second part covers the economy of Rajasthan, which is on its own page.
How should I revise economy for RAS Prelims?
Learn the definitions and the cause-and-effect chains first, then the schemes with their year, ministry and target group. Attempt each chapter, read every explanation and keep a one-line note for each scheme and body.