20 January 2024

Q1. Consider the following statements:

1. The GDP calculates India’s national income by adding up all the expenditures in the economy.
2. Gross Value Added (GVA) is not considered while measuring national income.
3. If the government earned more from taxes than what it spent on subsidies, GVA will be higher than GDP.

How many of the above statements are correct?

(a) Only one

(b) Only two

(c) All three

(d) None

Ans: (a)

Explanation:

• For any financial year, the two main variables of national income are GDP and GVA (or Gross Value Added). The GDP calculates India’s national income by adding up all the expenditures in the economy while the GVA calculates the national income from the supply side by looking at the value-added in each sector of the economy.
• While both the variables measure national income, they are linked as follows:
• GDP = (GVA) + (Taxes earned by the government) — (Subsidies provided by the government).
• As such, if the government earned more from taxes than what it spent on subsidies, GDP will be higher than GVA. If, on the other hand, the government provided subsidies in excess of its tax revenues, the absolute level of GVA would be higher than the absolute level of GDP.

Q2. Consider the following statements regarding GDP deflator:

1. GDP deflator is a measure of the level of prices of all new, domestically produced, final goods and services in an economy in a year.
2. Like CPI, the GDP deflator is based on a fixed basket of goods and services.
3. When GDP deflator is negative, it necessarily means that there is inflation in the economy.

How many of the above statements are correct?

(a) Only one

(b) Only two

(c) All three

(d) None

Ans: (a)

Explanation:

• Only statement 1 is correct.
• In economics, the GDP deflator is a measure of the level of prices of all new, domestically produced, final goods and services in an economy in a year.
• Like the consumer price index (CPI), the GDP deflator is a measure of price inflation/deflation with respect to a specific base year.
• The GDP deflator is a more comprehensive inflation measure than the CPI index because it isn’t based on a fixed basket of goods.
• When GDP deflator is negative, nominal GDP is less than real DP. It means that there is deflation in the economy.

Q3. Consider the following saints:

1. Appar
2. Sundarar
3. Periyalvar
4. Andal

How many of the above saints was/were Nayanars?

(a) Only one

(b) Only two

(c) Only three

(d) All four

Ans: (b)

Explanation:

Nayanars and Alvars:

• There were 63 Nayanars, who belonged to different caste backgrounds such as potters, “untouchable” workers, peasants, hunters, soldiers, Brahmanas and chiefs. The best known among them were Appar, Sambandar, Sundarar and Manikkavasagar. There are two sets of compilations of their songs – Tevaram and Tiruvacakam.
• There were 12 Alvars, who came from equally divergent backgrounds, the best known being Periyalvar, his daughter Andal, Tondaradippodi Alvar and Nammalvar. Their songs were compiled in the Divya Prabandham.

Q4. What is regenerative agriculture?

(a) Regenerative agriculture is a farming technique that relies on the heavy use of chemical fertilizers and pesticides to maximize crop yields.

(b) Regenerative agriculture is a sustainable farming approach that focuses on enhancing soil health and biodiversity while reducing environmental impacts.

(c) Regenerative agriculture is a term used to describe traditional farming practices that have been in use for centuries.

(d) Regenerative agriculture is a form of urban gardening that promotes the growth of ornamental plants in city landscapes.

Ans: (b)

Explanation:

• Context: The 5th World Coffee Conference (WCC) was held in Bengaluru, and organized by the International Coffee Organization (ICO), a UN body focused on highlighting the economic importance of coffee.
• Regenerative agriculture is a sustainable farming approach that focuses on enhancing soil health and biodiversity while reducing environmental impacts.
• Regenerative agriculture is a set of holistic farming practices that aim to improve the resilience and productivity of agricultural ecosystems. It is based on the principles of soil health, biodiversity, and the water cycle. Regenerative agriculture practices can include:
• Minimizing soil disturbance: This helps to preserve soil structure and prevent erosion.
• Keeping the soil covered: This can be done by planting cover crops or using mulch. Cover crops help to protect the soil from erosion, improve soil health, and suppress weeds.
• Crop rotation: This helps to break pest cycles, improve soil fertility, and reduce the need for chemical pesticides.
• Composting: This helps to add organic matter to the soil, which improves soil health and fertility.
• Integrated pest management: This involves using a variety of methods to control pests, including biological control, cultural practices, and selective use of pesticides.

Q5. Consider the following statements with reference to the ‘5th World Coffee Conference’ (WCC):

1. It was held in Bengaluru, Karnataka.
2. It is organized by the Coffee Board of India.

Which of the statements given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

Ans: (a)

Explanation:

• Context: The 5th World Coffee Conference (WCC) was held in Bengaluru, and organized by the International Coffee Organization (ICO), a UN body focused on highlighting the economic importance of coffee.
• It is being held for the first time in an Asian coffee-producing country.
• One of the key topics discussed at the conference was “regenerative agriculture,” a holistic farming approach that emphasizes soil health, food quality, biodiversity, water quality, and air quality.