Economy and Business MCQs for UPSC and Banking Exams June 2026

1.

What is the typical stance of the RBI on liquidity management when inflation is a concern?

A To remain neutral and not interfere with market liquidity.

B To actively absorb liquidity from the system.

C To inject liquidity into the system to stimulate growth.

D To maintain a comfortable liquidity surplus.

2.

When the RBI aims to control excess liquidity in the banking system, which of the following tools is it most likely to use?

A Reducing the Cash Reserve Ratio (CRR)

B Increasing the repo rate

C Lowering the reverse repo rate

D Injecting funds through open market operations

3.

What is the Reserve Bank of India's (RBI) primary objective regarding inflation control?

A To maintain inflation below 2%

B To achieve and maintain price stability while keeping in mind the objective of growth

C To target a specific inflation rate of 5%

D To allow inflation to fluctuate freely based on market conditions

4.

What is the primary reason cited by most analysts for India's projected strong GDP growth in FY26 compared to many other major economies?

A Lower inflation rates globally

B Dependence on commodity exports

C Strong demographic dividend and domestic demand

D Significant reduction in interest rates worldwide

5.

Which of the following factors is NOT expected to significantly contribute to India's GDP growth in FY26?

A Strong domestic consumption

B Increased capital expenditure by the government

C A significant slowdown in global trade

D Resilient services sector performance

6.

According to recent projections by major financial institutions, what is the anticipated GDP growth rate for India in FY26?

A 6.5% - 7.0%

B 7.0% - 7.5%

C 7.5% - 8.0%

D 6.0% - 6.5%

Economy & Business MCQs - 2026-06-01