Economy and Business Current Affairs MCQs

1.

Which of the following is a tool used by the RBI to implement its monetary policy?

A Fiscal Deficit Management

B Repo Rate

C Government Bond Issuance

D Trade Balance Adjustment

2.

When the RBI adopts a 'hawkish' monetary policy stance, what is it typically aiming to do?

A To lower interest rates and stimulate borrowing.

B To increase the money supply and encourage spending.

C To combat inflation by potentially raising interest rates or reducing liquidity.

D To maintain a neutral stance without significant policy changes.

3.

What does the RBI's 'Monetary Policy Stance' primarily indicate?

A The current level of foreign exchange reserves.

B The central bank's approach and direction towards managing inflation and economic growth.

C The number of new bank licenses issued in a year.

D The total amount of government debt.

4.

Which component of the CPI basket typically has the largest weightage and significantly influences retail inflation trends in India?

A Housing

B Food and Beverages

C Clothing and Footwear

D Education

5.

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

A To maintain a high rate of inflation to stimulate economic growth.

B To keep inflation within a specified target range to ensure price stability.

C To encourage deflation to increase the purchasing power of money.

D To allow inflation to fluctuate freely based on market forces.

6.

Which index is primarily used to measure retail inflation in India?

A Wholesale Price Index (WPI)

B Consumer Price Index (CPI)

C Index of Industrial Production (IIP)

D Gross Domestic Product (GDP) Deflator

Economy & Business MCQs - 2026-06-16