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MCQs - 2026-04

2611.
The record high in foreign exchange reserves is a positive indicator of India's:
A Economic weakness
B Ability to meet international financial obligations
C Increased reliance on foreign aid
D Growing trade deficit
2612.
A strong foreign exchange reserve position enhances the central bank's flexibility in:
A Increasing inflation
B Managing the exchange rate and maintaining macroeconomic stability
C Reducing foreign investment
D Increasing import duties
2613.
Besides foreign currency assets, what other components contribute to India's foreign exchange reserves?
A Government bonds and corporate debt
B Gold reserves and special drawing rights (SDRs)
C Domestic currency and real estate
D Commodity futures and derivatives
2614.
The RBI's active management of the foreign exchange market contributes to:
A Increased currency volatility
B Depletion of reserves
C Build-up of reserves
D Reduced investor confidence
2615.
What is a primary benefit of substantial foreign exchange reserves?
A Increased currency depreciation
B Reduced capacity to manage import bills
C A strong buffer against external shocks
D Decreased investor confidence
2616.
Which of the following is NOT mentioned as a factor contributing to the surge in foreign exchange reserves?
A Growth in remittances
B Sustained FDI and FPI inflows
C Unfavorable balance of payments
D RBI's management of the forex market
2617.
The accumulation of foreign exchange reserves is a testament to:
A Weak external sector performance
B Declining capital inflows
C Strong external sector performance and robust capital inflows
D Increased import bills
2618.
What is the approximate all-time high level reached by India's foreign exchange reserves in early April 2026?
A $600 billion
B $625 billion
C $650 billion
D $675 billion
2619.
Which of the following is NOT mentioned as a reason for the strong performance of the services sector?
A Robust domestic demand
B Strong international client demand
C Government subsidies for all services
D Increased business activity
2620.
The services sector is described as a major engine of:
A Inflationary pressure
B Economic growth and employment
C Government debt
D Import dependency