Economy & Business MCQs - 2026-08-12

In the Index of Industrial Production (IIP), the manufacturing sector holds the highest weightage, followed by mining and electricity. This reflects its significant contribution to the overall industrial output of the country.

Robust growth in industrial production signifies increased activity across manufacturing, mining, and electricity sectors. This typically translates to higher demand for goods, increased investment in production capacities, and consequently, more job opportunities within the industrial sector, contributing positively to overall economic growth.

The Index of Industrial Production (IIP) is compiled and released monthly by the National Statistical Office (NSO), under the Ministry of Statistics and Programme Implementation (MoSPI).

Maintaining the repo rate, especially when inflation is a concern, means the RBI is not easing its monetary stance. This typically leads to stable, rather than decreasing, borrowing costs for banks and, consequently, for consumers and businesses. This stability, particularly if rates are already elevated, tends to discourage new borrowing and investment, helping to curb aggregate demand and inflationary pressures.

The repo rate is the interest rate at which the Reserve Bank of India lends money to commercial banks in exchange for government securities. It is a crucial tool for controlling the money supply and influencing interest rates in the economy.

Maintaining the repo rate amidst inflation concerns signals that the RBI is prioritizing inflation control. It aims to keep borrowing costs stable, thereby moderating demand and inflationary pressures, rather than stimulating further growth which could exacerbate inflation.