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Q.1 What is crowdfunding ?

A) Money collected for public welfare projects by levying an entry fee to exhibitions, shows etc.

B) Money collected by charitable organisations by placing a donation box at a prominent locations

C) Money raised by innovators & inventors by launching their products & services through the internet

D) Money raised by individuals by passing the hat around to onlookers at a street performance

Ans. C

Crowdfunding is the practice of funding a project or venture by raising many small amounts of money from a large number of people, typically via the Internet.[1] Crowdfunding is a form of crowdsourcing and of alternative finance. In 2015, it was estimated that worldwide over US$34 billion was raised this way

the term crowdfunding refers to Internet-mediated registries. This modern crowdfunding model is generally based on three types of actors: the project initiator who proposes the idea and/or project to be funded, individuals or groups who support the idea, and a moderating organization (the “platform”) that brings the parties together to launch the idea.

Crowdfunding has been used to fund a wide range of for-profit entrepreneurial ventures such as artistic and creative projects, medical expenses, travel, or community-oriented social entrepreneurship projects

War bonds are theoretically a form of crowdfunding military conflicts.

The Crowdfunding Centre’s May 2014 report identified two primary types of crowdfunding:

1.    Rewards crowdfunding: entrepreneurs presell a product or service to launch a business concept without incurring debt or sacrificing equity/shares.

2.    Equity crowdfunding: the backer receives shares of a company, usually in its early stages, in exchange for the money pledged


Q.2 The meaning of carbon footprint is described by the amount of :

A) Carbon dioxide released into the atmosphere as a result of the activities of a particular individual, organization or community

B) Greenhouse gases emitted by industries contributing to global warming

C) Carbon emissions released by the burning of jet fuel

D) Increase in the carbon content of the atmosphere due to the felling of trees

Ans. A

A carbon footprint is historically defined as the total set of greenhouse gas emissions caused by an individual, event, organisation, or product, expressed as carbon dioxide equivalent

A measure of the total amount of carbon dioxide (CO2) and methane (CH4) emissions of a defined population, system or activity, considering all relevant sources, sinks and storage within the spatial and temporal boundary of the population, system or activity of interest. Calculated as carbon dioxide equivalent using the relevant 100-year global warming potential(GWP100).

Carbon footprint is one of a family of footprint indicators, which also includes water footprint and land footprint.

•     4Indirect carbon emissions: the carbon footprints of products

o     4.1Food

o     4.2Textiles

o     4.3Materials

o     4.4Cement

•     5Schemes to reduce carbon emissions: Kyoto Protocol, carbon offsetting, and certificates

Carbon dioxide emissions into the atmosphere, and the emissions of other GHGs, are often associated with the burning of fossil fuels, like natural gas, crude oil and coal.

The Kyoto Protocol defines legally binding targets and timetables for cutting the GHG emissions of industrialized countries that ratified the Kyoto Protocol. Accordingly, from an economic or market perspective, one has to distinguish between a mandatory market and a voluntary market. Typical for both markets is the trade with emission certificates:

•     Certified Emission Reduction (CER)

•     Emission Reduction Unit (ERU)

•     Verified Emission Reduction (VER)

local emissions reduction schemes have no status under the Kyoto Protocol itself, they play a prominent role in creating the demand for CERs and ERUs, stimulating Emissions Trading and setting a market price for emissions.


Q.3 Consider the following statements :

Consider the following statements :

1. IPDS strengthens the distribution network in urban areas while DDUGJY does the same in rural areas

2. DELP focuses to substitute LED bulbs for incandescent bulbs

Which of the following statements is/are correct ?

A) Only 1

B) Only 2

C) Both are correct

D) Both are incorrect

Ans. C

“Integrated Power Development Scheme” (IPDS) with the objectives of: 1. Strengthening of sub-transmission and distribution network in the urban areas; 2. Metering of distribution transformers /feeders / consumers in the urban areas. 3. IT enablement of distribution sector and strengthening of distribution network as per CCEA approval dated 21.06.2013 for completion of targets laid down under Restructured Accelerated Power Development and Reforms Programme (RAPDRP) for 12th and 13th Plans by carrying forward the approved outlay for RAPDRP to IPDS. The scheme will help in reduction in AT&C losses, establishment of IT enabled energy accounting / auditing system, improvement in billed energy based on metered consumption and improvement in collection efficiency.

Deen Dayal Upadhyaya Gram Jyoti Yojana: is a Government of India scheme designed to provide continuous power supply to rural India.[1] The initiative is named in honor of Indian political philosopher Deen Dayal Upadhyaya. It is one of the key initiatives of the NDA government 2014-2019. The government plans to invest ₹756 billion (US$12 billion) for rural electrification under this scheme. The scheme will replace the existing Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY).[2]

The DDUGJY scheme : It will enable to initiate much awaited reforms in the rural areas. It focuses on feeder separation (rural households & agricultural) and strengthening of sub-transmission & distribution infrastructure including metering at all levels in rural areas. The deadline for the Centre’s rural electrification programme is May 2018. Keeping in view the above problems, Ministry of Power, Government of India has launched Deen Dayal Upadhyaya Gram Jyoti Yojana for rural areas having following objectives: To provide electrification to all villages Feeder separation to ensure sufficient power to farmers and regular supply to other consumers Improvement of Sub-transmission and distribution network to improve the quality and reliability of the supply Metering to reduce the losses

Domestic Efficient Lighting Programme (DELP): The scheme was announced as “Domestic Efficient Lighting Programme (DELP)” on 5 January 2015, urging the people to use LED bulbs in place of incandescent bulbs, tube lights and CFL bulbs as they are more efficient, long lasting and economical in their life cycle duration. The government’s target is to replace 77 crore incandescent bulbs in India with LEDs by 2019 leading to an expected reduction in installed load of 20,000 MW with an annual estimated savings of over 100 million kwh and an annual reduction of ₹400 billion (US$6.3 billion) in electricity bills “Bachat Lamp Yojana” was a launched by the government of India on 25 February 2009 to reduce the cost of compact fluorescent lamps (CFLs, i.e., energy saving lights) sold to consumers.


Q.4 Government of India had introduced Consumer protection Bill 2015. The bill gives the right to consumers to:

1. seek redressal against unfair or restrictive trade practices

2.File a complaint for overcharging or deceptive charging

Which of the above is/are included in the bill ?

A) Only 1

B) Only 2

C) Both are correct

D) Both are incorrect

Ans. C

The Consumer Protection Act of 1986 was enacted to provide protection of the interests of consumers and for the purpose of establishment of consumer councils and other authorities for the settlement of consumer disputes, and for matter connected therewith The said Act was amended three times to make the act more effective but even then there were a few lacunas and nuances that were not incorporated. Several shortcomings have been noticed while administering the various provisions of the said Act. The new Consumer Protection Bill 2015 that has been introduced in the monsoon session of parliament seeks to replace the old act. The primary motivation to replace the older law with a new one is to modernise the law with respect to the development of new markets and to further widen the ambit and a scope of the law to incorporate nuances so that the big companies cannot use them as loop holes to exploit the consumers and to further increase the accountability of the said companies. The new bill seeks to make manufacturers liable for any injury attributed to the consumer or death of a consumer or property damage and get them sentenced for life.


Q.5 Which among the following is/are true with respect to the FDI ?

1. Overseas corporate bodies (OCB) are disallowed to invest in India

2. Direct investment excludes investment through purchase of shares

3. After 2010, Permission of upto 49% FDI under the government automatic approval route in multi brand retailing, subject to specified conditions has been allowed under FDI policy changes.

Select the correct answer using the codes given below :

A) 1 & 3

B) Only 2

C) 2 & 3

D) 1 & 2

Ans. D

– Broadly, foreign direct investment includes “mergers and acquisitions, building new facilities, reinvesting profits earned from overseas operations and intra company loans”. In a narrow sense, foreign direct investment refers just to building new facility, a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor

FDI is the sum of equity capital, other long-term capital, and short-term capital as shown the balance of payments.

FDI usually involves participation in management, joint-venture, transfer of technology and expertise.

Direct investment excludes investment through purchase of shares

Types of FDI

1.      Horizontal FDI arises when a firm duplicates its home country-based activities at the same value chain stage in a host country through FDI.

2.      Platform FDI Foreign direct investment from a source country into a destination country for the purpose of exporting to a third country.

3.      Vertical FDI takes place when a firm through FDI moves upstream or downstream in different value chains i.e., when firms perform value-adding activities stage by stage in a vertical fashion in a host country

Foreign direct investment incentives may take the following forms:

•       low corporate tax and individual income tax rates

•       tax holidays

•       other types of tax concessions

•       preferential tariffs

•       special economic zones

•       EPZ – Export Processing Zones

•       Bonded warehouses

•       Maquiladoras

•       investment financial subsidies[8]

•       free land or land subsidies

•       relocation & expatriation

•       infrastructure subsidies

•       R&D support

•       Energy

•       derogation from regulations (usually for very large projects)

Foreign investment was introduced in 1991 under Foreign Exchange Management Act (FEMA), driven by then finance minister Manmohan Singh.

India disallowed overseas corporate bodies (OCB) to invest in India. India imposes cap on equity holding by foreign investors in various sectors,

current FDI in aviation and insurance sectors is limited to a maximum of 49%


Q.6 Which among the following statements is/are true with respect to the Bureau of Indian Standards ?

1.It  is the national Standards Body of India working under the Ministry of Commerce

2. As a corporate body, it has 21 members drawn from Central or State Governments only

3. BIS is a founder member of International Organisation for Standardization (ISO)

Select the correct answer using the codes given below :

A) Only 2

B) 1 & 2

C) Only 3

D) 1,2,3

Ans. C

The Bureau of Indian Standards (BIS) is the national Standards Body of India working under the aegis of Ministry of Consumer Affairs, Food & Public Distribution, Government of India. It is established by the Bureau of Indian Standards Act, 1986 which came into effect on 23 December 1986.[2] The Minister in charge of the Ministry or Department having administrative control of the BIS is the ex-officio President of the BIS.

As a corporate body, it has 25 members drawn from Central or State Governments, industry, scientific and research institutions, and consumer organisations. Its headquarters are in New Delhi, with regional offices in Kolkata, Chennai, Mumbai, Chandigarh and Delhiand 20 branch offices. It also works as WTO-TBT enquiry point for India.

BIS is a founder member of International Organisation for Standardization (ISO)

It represents India in the International Organization for Standardization (ISO), the International Electrotechnical Commission (IEC) and the World Standards Service Network (WSSN).

Product Certifications are to be obtained voluntarily. For, some of the products like Milk powder, Drinking Water, LPG Cylinders, Thermometers etc., certification is mandatory. Because these products are concerned with health and safety

National Institute of Training for Standardization (NITS)

It is a training institute of BIS which is set up in 1995. It is functioning from Noida, Uttar Pradesh, India.[7]

The primary activities of NITS are:-

•       In-House and Open Training Programme for Industry

•       International Training Programme for Developing Countries (Commonwealth countries)

•       Training Programme to its employees.

Indian Standards Bill, 2015

The main objectives of the proposed legislation are:-

•       To establish the Bureau of Indian standards(BIS) as the National Standards Body of India.

•       The Bureau to perform its functions through a governing council, which will consist of President and other members.

•       To include goods, services and systems, besides articles and processes under the standardization regime.

•       To enable the government to bring under the mandatory certification regime for such articles, processes or service which it considers necessary from the point of view of health, safety, environment, prevention of deceptive practices, consumer security etc. This will help consumers receive ISI certified products and will also help in prevention of import of sub-standard products.

•       To allow multiple types of simplified conformity assessment schemes including self-declaration of conformity (SDOC) against any standard which will give multiple simplified options to manufacturers to adhere to standards and get a certificate of conformity, thus improving the ‘ease of doing business’.

•       To enable the Central Government to appoint any authority in addition to the Bureau of Indian Standards, to verify the conformity of products and services to a standard and issue certificate of conformity.

•       To enable the Government to implement mandatory hallmarking of precious metals articles.

•       To strengthen penal provisions for better effective compliance and enable compounding of offences for violations.

•       To provide recall, including product liability of products bearing the Standard Mark, but not conforming to relevant Indian Standards.

•       Repeal of the BIS Act of 1986.

•       The Bureau of Indian Standards Act 2016 received the assent of the President on 21 March 2016


Q.7 MIBOR rate is used as a bench mark rate for which of the following ?

1. Demand deposits

2. Forward rate agreements

3. Term deposits

Select the correct answer using the codes given below :

A) 1 & 3

B) 2 & 3

C) 1 & 2

D) 1,2,3

Ans. B

The MIBID/MIBOR rate is used as a bench mark rate for majority of deals struck for Interest Rate Swaps, Forward Rate Agreements, Floating Rate Debentures and Term Deposits.

MIBOR – Mumbai Inter-Bank Offer Rate

The Committee for the Development of the Debt Market that had studied and recommended the modalities for the development for a benchmark rate for the call money market. Accordingly, NSE had developed and launched the NSE Mumbai Inter-bank Bid Rate (MIBID) and NSE Mumbai Inter-bank Offer Rate (MIBOR) for the overnight money market on June 15, 1998.


Q.8 Which among the following reports are released by the United Nations Conference on Trade and Development (UNCTAD) ?

1. Trade and Development Report

2. World development report

3. World investment report

Select the correct answer using the codes given below :

A) 2 & 3

B) 1 & 2

C) Only 2

D) 1 & 3

Ans. D

The United Nations Conference on Trade and Development (UNCTAD) was established in 1964 as a permanent intergovernmental body.

UNCTAD is the principal organ of the United Nations General Assembly dealing with trade, investment, and development issues. The organization’s goals are to: “maximize the trade, investment and development opportunities of developing countries and assist them in their efforts to integrate into the world economy on an equitable basis.

The conference ordinarily meets once in four years; the permanent secretariat is in Geneva.

The United Nations Conference on Trade and Development was established to provide a forum where the developing countries could discuss the problems relating to their economic development.

Currently, UNCTAD has 194 member states and is headquartered in Geneva, Switzerland. UNCTAD has 400 staff members and a bi-annual (2010–2011) regular budget of $138 million in core expenditures and $72 million in extra-budgetary technical assistance funds. It is a member of the United Nations Development Group.[2] There are non-governmental organizations participating in the activities of UNCTAD

UNCTAD produces a number of topical reports, including:

•       The Trade and Development Report

•       The Trade and Environment Review

•       The World Investment Report

•       The Economic Development in Africa Report

•       The Least Developed Countries Report

•       UNCTAD Statistics

•       The Information Economy Report

•       The Review of Maritime Transport

•       The International Accounting and Reporting Issues Annual Review

•       The Technology and Innovation Repor

UNCTAD conducts technical cooperation programmes such as ASYCUDA, DMFAS, EMPRETEC and WAIPA.

In addition, UNCTAD conducts certain technical cooperation in collaboration with the World Trade Organization through the joint International Trade Centre (ITC), a technical cooperation agency targeting operational and enterprise-oriented aspects of trade development.

UNCTAD hosts the Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting (ISAR).


Q.9 With reference to the news, what are AD Category-I banks ?

A) It is the form of Smart Banking initiative that enables banks to optimise customer engagement models

B) These are the business correspondents that extend small credit on behalf of the banks

C) These are the banks that are equipped with technology for automated transaction of cash

D) These are the banks that deal with the conversion of currency notes, coins or travellers’ cheques designated in foreign currency into Indian Rupees & Vice versa

Ans. D

Authorised Dealer(AD) category 1 bank is one of the three types of authorised money changer approved by the RBI under Foreign Exchange Management Act(FEMA) with the other two being Authorised Dealer category 2 and Full Fledged Money Changer(FFMC). They deal with the conversion of currency notes, coins or travellers’ cheques designated in foreign currency into Indian Rupees and vice versa. Their objective is to provide easier foreign exchange facilties for travellers and tourists, including NRIs.


Q.10 Which among the following is/are true with respect to the Loro account ?

1. Commercial banks maintains their own loro accounts with the authorization from RBI

2. A balance on loro account represents central bank money in the regarded currency

Select the correct answer using the codes given below “

A) Only 1

B) Only 2

C) Both are correct

D) Both are incorrect

Ans. B

The central bank maintains loro accounts for a group of commercial banks, the so-called direct payment banks. A balance on such a loro account (it is a nostro account in the view of the commercial bank) represents central bank money in the regarded currency. Since central bank money currently exists mainly in the form of electronic records (electronic money) rather than in the form of paper or coins (physical money), open market operations can be conducted by simply increasing or decreasing (crediting or debiting) the amount of electronic money that a bank has in its reserve account at the central bank.

Open market operations

An open market operation (OMO) is an activity by a central bank to give (or take) liquidity in its currency to (or from) a bank or a group of banks.

The central bank can either buy or sell government bonds in the open market (this is where the name was historically derived from) or, in what is now mostly the preferred solution, enter into a repo or secured lending transaction with a commercial bank: the central bank gives the money as a deposit for a defined period and synchronously takes an eligible asset as collateral.

A central bank uses OMO as the primary means of implementing monetary policy.

The usual aim of open market operations is – aside from supplying commercial banks with liquidity and sometimes taking surplus liquidity from commercial banks – to manipulate the short-term interest rate and the supply of base money in an economy, and thus indirectly control the total money supply, in effect expanding money or contracting the money supply.

This involves meeting the demand of base money at the target interest rate by buying and selling government securities, or other financial instruments. Monetary targets, such as inflation, interest rates, or exchange rates, are used to guide this implementation

Classical economic theory postulates a distinctive relationship between the supply of central bank money and short-term interest rates: like for a commodity, a higher demand for central bank money would increase its price, the interest rate. When there is an increased demand for base money, the central bank must act if it wishes to maintain the short-term interest rate. It does this by increasing the supply of base money: it goes to the open market to buy a financial asset, such as government bonds.

•       Under a currency board open market operations would be used to achieve and maintain a fixed exchange rate with relation to some foreign currency.

•       Under a gold standard, notes would be convertible to gold, and so open market operations could be used to keep the value of a fiat currency constant relative to gold.

The two traditional type of OMO’s used by RBI:

1.      Outright purchase (PEMO): Is outright buying or selling of government securities. (Permanent).

2.      Repurchase agreement (REPO): Is short term, and are subject to repurchase

The RBI brought together a Liquidity Adjustment Facility (LAF). It commenced in June, 2000, and it was set up to oversee liquidity on a daily basis and to monitor market interest rates. For the LAF, two rates are set by the RBI: repo rate and reverse repo rate. The repo rate is applicable while selling securities to RBI (daily injection of liquidity), while the reverse repo rate is applicable when banks buy back those securities (daily absorption of liquidity). Also, these interest rates fixed by the RBI also help in determining other market interest rates

 on the recommendations of the Working Group of RBI on instruments of Sterilization (December, 2003), a new scheme known as the Market stabilization scheme (MSS) was set up. The LAF and the OMO’s were dealing with day-to-day liquidity management, whereas the MSS was set up to sterilize the liquidity absorption and make it more enduring

According to this scheme, the RBI issues additional T-bills and securities to absorb the liquidity. And the money goes into the Market Stabilization scheme Account (MSSA). The RBI cannot use this account for paying any interest or discounts and cannot credit any premiums to this account. The Government, in collaboration with the RBI, fixes a ceiling amount on the issue of these instruments.