Economy & Business MCQs

Strong FDI inflows suggest that foreign investors are optimistic about the country's economic prospects, leading to capital investment, technology transfer, and job creation.

FDI inflows demonstrated strong momentum in early 2026, indicating increased investor confidence and capital infusion into the Indian economy.

Maintaining the repo rate can help control inflationary pressures while allowing economic growth to continue at a sustainable pace.

The repo rate is a key monetary policy instrument used by the RBI to influence interest rates and manage inflation.

The RBI decided to maintain the repo rate at 6.5% in early 2026, balancing growth and inflation concerns.

A PMI of 58.8 indicates a significant increase in manufacturing output, new orders, and employment, reflecting strong economic growth.

A PMI reading above 50 indicates expansion, while a reading below 50 suggests contraction. The April 2026 reading of 58.8 clearly shows expansion.

India's Manufacturing PMI reached 58.8 in April 2026, signifying robust growth in the manufacturing sector.

Monetary policy transmission is the process through which the RBI's policy actions (like changes in repo rate) influence broader financial conditions, including interest rates, credit, and ultimately inflation and economic activity.

Open Market Operations (OMOs), such as buying and selling government securities, are a key tool used by the RBI to inject or absorb liquidity from the banking system.