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Question 1

Q11. Gilt-edged market means

bullion market

market of government securities

market of guns

market of pure metals

Answer

Answer : market of government securities

Gilt-edged market means market of government securities.

The gilt-edged market is the market in government securities or the securities guaranteed (as to both principal and interest) by the government. The former include securities of the Government of India and of the slate governments; the latter are securities issued by Local authorities (like city corporations, municipalities, and port trusts) and autonomous government undertakings like development hanks, state electricity boards, etc.

The term gilt-edged means ‘of the best quality”. It has come to be reserved for government securities as they do not suffer from the risk of default. Besides, government securities are highly liquid, as they can be easily sold in the market at their going market price. The open market operations of the RBI are also conducted in government securities.
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Question 2

Q12. In the second nationalization of commercial banks, ___ banks were nationalized.

4

5

6

8

Answer

Answer : 6

In the second nationalization of commercial banks, 6 banks were nationalized.

A second round of nationalisations of six more commercial banks followed in 1980. The stated reason for the nationalisation was to give the government more control of credit delivery. With the second round of nationalisations, the Government of India controlled around 91% of the banking business of India.

The following banks were nationalised in 1980:
1. Punjab and Sind Bank
2. Vijaya Bank
3. Oriental Bank of India
4. Corporate Bank
5. Andhra Bank
6. New Bank of India
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Question 3

Q13. Depreciation means

closure of a plant due to lock out.

closure of a plant due to labour trouble.

loss of equipment over time due to wear and tear.

destruction of a plant in a fire accident.

Answer

Answer : loss of equipment over time due to wear and tear.

Question 4

Q14. India changed over to the decimal system of coinage in

April 1995

April 1957

April 1958

April 1959

Answer

Answer : April 1957

India changed over to the decimal system of coinage in April 1957.

In 1957, India shifted to the decimal system, but for a short period both decimal and non-decimal coins were in circulation. To distinguish between the two pice, the coins minted between 1957 and 1964 have the legend "Naya Paisa".

The denominations in circulation were 1, 2, 3, 5, 10, 20, 25, 50 (naya) paise and one rupee which remained as the same pre-decimal value. Therefore pre-decimal coins of one, half and quarter rupees could remain in circulation after decimalisation.
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Question 5

Q15. On which one of the followings is the benefits received principle of taxation to achieve optimality bases?

Marginal benefit received

Total benefit received

Average benefit received

Ability to pay for the benefit

Answer

Answer : Ability to pay for the benefit

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