Skip to content
Early access — you're among the first to try PYQLabs. Share feedback

UPSC 2017 Economics PYQ Solved

30 Economics questions from UPSC 2017 Prelims GS Paper 1 — solved with answers

30
Questions
77%
Trap Rate
Similar Sounding
Top Trap
Q3hardSimilar Sounding
'Recognition of Prior Learning Scheme' is sometimes mentioned in the news with reference to
(a) Certifying the skills acquired by construction workers through traditional channels.
(b) Enrolling the persons in Universities for distance learning programmes.
(c) Reserving some skilled jobs to rural and urban poor in some public sector undertakings.
(d) Certifying the skills acquired by trainees under the National Skill Development Programme.
Answer: (a)
Trap: Similar Sounding
Option (d) sounds very plausible because RPL is indeed under the broader skill development ecosystem. However, RPL specifically certifies skills acquired through INFORMAL/traditional channels, not formal training under NSDP. The word 'construction workers' in (a) is oddly specific but reflects the scheme's focus on informal sector workers.
Q9easy
Which of the following gives 'Global Gender Gap Index' ranking to the countries of the world ?
(a) World Economic Forum
(b) UN Human Rights Council
(c) UN Women
(d) World Health Organization
Answer: (a)
Q11moderatePartial Truth
Which of the following statements is/are correct regarding the Monetary Policy Committee (MPC) ? 1. It decides the RBI's benchmark interest rates. 2. It is a 12-member body including the Governor of RBI and is reconstituted every year. 3. It functions under the chairmanship of the Union Finance Minister. Select the correct answer using the code given below :
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 2 and 3 only
Answer: (a)
Trap: Partial Truth
MPC is a 6-member body (not 12) and is reconstituted every 4 years (not every year). It functions under the chairmanship of the RBI Governor (not Finance Minister). Statement 2 has two wrong facts embedded in one sentence, making partial evaluation tricky.
Q18easy
The term 'Digital Single Market Strategy' seen in the news refers to
(a) ASEAN
(b) BRICS
(c) EU
(d) G20
Answer: (c)
Q20easyPartial Truth
With reference to the 'Prohibition of Benami Property Transactions Act, 1988 (PBPT Act)', consider the following statements : 1. A property transaction is not treated as a benami transaction if the owner of the property is not aware of the transaction. 2. Properties held benami are liable for confiscation by the Government. 3. The Act provides for three authorities for investigations but does not provide for any appellate mechanism. Which of the statements given above is/are correct ?
(a) 1 only
(b) 2 only
(c) 1 and 3 only
(d) 2 and 3 only
Answer: (b)
Trap: Partial Truth
Statement 3 is partially true — the Act does provide for authorities for investigation, but it ALSO provides an appellate mechanism (Appellate Tribunal). The 'does not provide for any appellate mechanism' part makes it false. Statement 1 is also a trap — awareness of the owner is not the criterion.
Q23easySimilar Sounding
Which of the following are the objectives of 'National Nutrition Mission' ? 1. To create awareness relating to malnutrition among pregnant women and lactating mothers. 2. To reduce the incidence of anaemia among young children, adolescent girls and women. 3. To promote the consumption of millets, coarse cereals and unpolished rice. 4. To promote the consumption of poultry eggs. Select the correct answer using the code given below :
(a) 1 and 2 only
(b) 1, 2 and 3 only
(c) 1, 2 and 4 only
(d) 3 and 4 only
Answer: (a)
Trap: Similar Sounding
Statements 3 and 4 sound like plausible nutrition objectives but are NOT specific objectives of the National Nutrition Mission. The mission focuses on awareness, technology use (ICT), and convergence of schemes — not promoting specific food items. Students may include these because they seem nutritionally logical.
Q27easy
The term 'Domestic Content Requirement' is sometimes seen in the news with reference to
(a) Developing solar power production in our country
(b) Granting licences to foreign T.V. channels in our country
(c) Exporting our food products to other countries
(d) Permitting foreign educational institutions to set up their campuses in our country
Answer: (a)
Q29easyPartial Truth
Who among the following can join the National Pension System (NPS) ?
(a) Resident Indian citizens only
(b) Persons of age from 21 to 55 only
(c) All State Government employees joining the services after the date of notification by the respective State Governments
(d) All Central Government employees including those of Armed Forces joining the services on or after 1st April, 2004
Answer: (c)
Trap: Partial Truth
Option (d) is the main trap — NPS applies to Central Government employees joining after 1 April 2004 BUT Armed Forces are EXCLUDED (they have their own pension scheme). The inclusion of 'Armed Forces' makes (d) wrong. NRIs can also join, making (a) wrong.
Q32moderateCommon Misconception
Consider the following statements : 1. The Standard Mark of Bureau of Indian Standards (BIS) is mandatory for automotive tyres and tubes. 2. AGMARK is a quality Certification Mark issued by the Food and Agriculture Organisation (FAO). 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
Answer: (a)
Trap: Common Misconception
AGMARK is issued by the Directorate of Marketing and Inspection under the Ministry of Agriculture, Government of India — NOT by FAO. The mention of FAO sounds plausible because it's a food-related international body, but AGMARK is purely an Indian certification.
Q33easy
What is/are the advantage/advantages of implementing the 'National Agriculture Market' scheme ? 1. It is a pan-India electronic trading portal for agricultural commodities. 2. It provides the farmers access to nationwide market, with prices commensurate with the quality of their produce. Select the correct answer using the code given below :
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (c)
Q34moderateAbsolute Qualifier
With reference to the 'National Intellectual Property Rights Policy', consider the following statements : 1. It reiterates India's commitment to the Doha Development Agenda and the TRIPS Agreement. 2. Department of Industrial Policy and Promotion is the nodal agency for regulating intellectual property rights in India. Which of the above statements is/are correct ?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (c)
Trap: Absolute Qualifier
Students might doubt Statement 2 because they expect a law ministry or commerce ministry to handle IPR. But DIPP (now DPIIT) was designated as the nodal agency. Also, students might think India's IPR policy doesn't explicitly reference Doha/TRIPS, but it does.
Q39easyAbsolute Qualifier
With reference to 'Quality Council of India (QCI)', consider the following statements : 1. QCI was set up jointly by the Government of India and the Indian Industry. 2. Chairman of QCI is appointed by the Prime Minister on the recommendations of the industry to the Government. Which of the above statements is/are correct ?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (c)
Trap: Absolute Qualifier
Students might doubt Statement 2 — it seems unusual that the PM appoints the Chairman based on industry recommendations. But QCI is a PPP body, and this appointment mechanism is accurate. The industry-government joint nature makes this governance structure logical.
Q40moderateSimilar Sounding
What is the purpose of setting up of Small Finance Banks (SFBs) in India ? 1. To supply credit to small business units 2. To supply credit to small and marginal farmers 3. To encourage young entrepreneurs to set up business particularly in rural areas. Select the correct answer using the code given below :
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Answer: (a)
Trap: Similar Sounding
Statement 3 about encouraging young entrepreneurs in rural areas sounds like it could be an SFB objective but is NOT a specific stated purpose. SFBs are meant for financial inclusion — serving unserved/underserved sections, small businesses, and marginal farmers. 'Young entrepreneurs' is too specific and not part of the mandate.
Q41easyPartial Truth
With reference to 'Asia Pacific Ministerial Conference on Housing and Urban Development (APMCHUD)', consider the following statements : 1. The first APMCHUD was held in India in 2006 on the theme 'Emerging Urban Forms — Policy Responses and Governance Structure'. 2. India hosts all the Annual Ministerial Conferences in partnership with ADB, APEC and ASEAN. 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
Answer: (a)
Trap: Partial Truth
Statement 2 is wrong on multiple counts: APMCHUD is NOT annual (held every 2-3 years), India does NOT host all conferences (different countries host), and it is NOT in partnership with ADB/APEC/ASEAN. The statement bundles multiple falsehoods together.
Q43moderateScope Confusion
Which of the following is a most likely consequence of implementing the 'Unified Payments Interface (UPI)' ?
(a) Mobile wallets will not be necessary for online payments.
(b) Digital currency will totally replace the physical currency in about two decades.
(c) FDI inflows will drastically increase.
(d) Direct transfer of subsidies to poor people will become very effective.
Answer: (a)
Trap: Scope Confusion
Option (d) sounds plausible (DBT + digital payments), but UPI specifically eliminates the need for third-party wallets by enabling direct bank-to-bank transfers via phones. Options (b) and (c) are exaggerated claims. The key insight is UPI's role in making wallets redundant.
Q55easyCommon Misconception
With reference to 'National Investment and Infrastructure Fund', which of the following statements is/are correct ? 1. It is an organ of NITI Aayog. 2. It has a corpus of Rs 4,00,000 crore at present. Select the correct answer using the code given below :
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (d)
Trap: Common Misconception
NIIF is NOT an organ of NITI Aayog — it is an independent investment fund (Category II AIF) under the Department of Economic Affairs. Its initial corpus was Rs 40,000 crore (not Rs 4,00,000 crore — a 10x exaggeration). Both statements contain factual errors.
Q56hard
The Global Infrastructure Facility is a/an
(a) ASEAN initiative to upgrade infrastructure in Asia and financed by credit from the Asian Development Bank.
(b) World Bank collaboration that facilitates the preparation and structuring of complex infrastructure Public-Private Partnerships (PPPs) to enable mobilization of private sector and institutional investor capital.
(c) Collaboration among the major banks of the world working with the OECD and focused on expanding the set of infrastructure projects that have the potential to mobilize private investment.
(d) UNCTAD funded initiative that seeks to finance and facilitate infrastructure development in the world.
Answer: (b)
Q60moderateAbsolute Qualifier
With reference to the role of UN-Habitat in the United Nations programme working towards a better urban future, which of the statements is/are correct ? 1. UN-Habitat has been mandated by the United Nations General Assembly to promote socially and environmentally sustainable towns and cities to provide adequate shelter for all. 2. Its partners are either governments or local urban authorities only. 3. UN-Habitat contributes to the overall objective of the United Nations system to reduce poverty and to promote access to safe drinking water and basic sanitation. Select the correct answer using the code given below :
(a) 1, 2 and 3
(b) 1 and 3 only
(c) 2 and 3 only
(d) 1 only
Answer: (b)
Trap: Absolute Qualifier
Statement 2 uses 'only' — UN-Habitat partners with a wide range of stakeholders including NGOs, civil society, academia, and private sector, NOT just governments and local authorities. The restrictive 'only' makes the statement false.
Q61moderateAbsolute Qualifier
With reference to 'National Skills Qualification Framework (NSQF)', which of the statements given below is/are correct ? 1. Under NSQF, a learner can acquire the certification for competency only through formal learning. 2. An outcome expected from the implementation of NSQF is the mobility between vocational and general education. Select the correct answer using the code given below :
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (b)
Trap: Absolute Qualifier
Statement 1 uses 'only through formal learning' — NSQF explicitly recognizes competency acquired through formal, non-formal, and informal learning (including Recognition of Prior Learning). The word 'only' makes it wrong.
Q63easySimilar Sounding
Consider the following in respect of 'National Career Service' : 1. National Career Service is an initiative of the Department of Personnel and Training, Government of India. 2. National Career Service has been launched in a Mission Mode to improve the employment opportunities to uneducated youth of the country. Which of the above statements is/are correct ?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (d)
Trap: Similar Sounding
NCS is under the Ministry of Labour and Employment (not DoPT). It serves ALL job seekers (not just uneducated youth). Both statements have plausible-sounding but incorrect details. DoPT sounds right because it deals with personnel/staffing.
Q64moderateSimilar Sounding
Which of the following statements best describes the term 'Scheme for Sustainable Structuring of Stressed Assets (S4A)', recently seen in the news ?
(a) It is a procedure for considering ecological costs of developmental schemes formulated by the Government.
(b) It is a scheme of RBI for reworking the financial structure of big corporate entities facing genuine difficulties.
(c) It is a disinvestment plan of the Government regarding Central Public Sector Undertakings.
(d) It is an important provision in 'The Insolvency and Bankruptcy Code' recently implemented by the Government.
Answer: (b)
Trap: Similar Sounding
Option (a) is a trap — 'Sustainable Structuring of Stressed Assets' sounds environmental ('sustainable', 'stressed'). Option (d) relates to IBC which also deals with stressed assets. But S4A is specifically an RBI framework for resolving stressed corporate loans by bifurcating debt into sustainable and unsustainable portions.
Q72moderateSimilar Sounding
Consider the following statements : The nation-wide 'Soil Health Card Scheme' aims at 1. expanding the cultivable area under irrigation. 2. enabling the banks to assess the quantum of loans to be granted to farmers on the basis of soil quality. 3. checking the overuse of fertilizers in farmlands. Which of the above statements is/are correct ?
(a) 1 and 2 only
(b) 3 only
(c) 2 and 3 only
(d) 1, 2 and 3
Answer: (b)
Trap: Similar Sounding
Statement 2 is the cleverly designed trap — linking soil quality to loan assessment sounds logical but is NOT the scheme's purpose. Statement 1 about irrigation is unrelated. The Soil Health Card tells farmers about nutrient status and recommends appropriate fertilizer dosage — its primary aim is preventing overuse of fertilizers.
Q77moderateCommon Misconception
Which of the following has/have occurred in India after its liberalization of economic policies in 1991 ? 1. Share of agriculture in GDP increased enormously. 2. Share of India's exports in world trade increased. 3. FDI inflows increased. 4. India's foreign exchange reserves increased enormously. Select the correct answer using the codes given below :
(a) 1 and 4 only
(b) 2, 3 and 4 only
(c) 2 and 3 only
(d) 1, 2, 3 and 4
Answer: (b)
Trap: Common Misconception
Statement 1 is the trap — agriculture's share in GDP has DECLINED after liberalization (from ~30% to ~15%), not increased. Services and industry grew faster. Students may confuse agricultural OUTPUT growth with its SHARE of GDP.
Q79easy
Consider the following statements : 1. National Payments Corporation of India (NPCI) helps in promoting the financial inclusion in the country. 2. NPCI has launched RuPay, a card payment scheme. 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
Answer: (c)
Q81easyAbsolute Qualifier
What is/are the most likely advantages of implementing 'Goods and Services Tax (GST)' ? 1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India. 2. It will drastically reduce the 'Current Account Deficit' of India and will enable it to increase its foreign exchange reserves. 3. It will enormously increase the growth and size of economy of India and will enable it to overtake China in the near future. Select the correct answer using the code given below :
(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
Answer: (a)
Trap: Absolute Qualifier
Statements 2 and 3 use extreme/exaggerated language: 'drastically reduce', 'enormously increase', 'overtake China in near future'. GST is an indirect tax reform — it doesn't directly impact CAD or forex reserves. The exaggerated claims should be red flags.
Q82easy
'Broad-based Trade and Investment Agreement (BTIA)' is sometimes seen in the news in the context of negotiations held between India and
(a) European Union
(b) Gulf Cooperation Council
(c) Organization for Economic Cooperation and Development
(d) Shanghai Cooperation Organization
Answer: (a)
Q83easyOutdated Info
Consider the following statements : 1. India has ratified the Trade Facilitation Agreement (TFA) of WTO. 2. TFA is a part of WTO's Bali Ministerial Package of 2013. 3. TFA came into force in January 2016. Which of the statements given above is/are correct ?
(a) 1 and 2 only
(b) 1 and 3 only
(c) 2 and 3 only
(d) 1, 2 and 3
Answer: (a)
Trap: Outdated Info
TFA came into force in February 2017, NOT January 2016. The wrong date is close enough to seem plausible. India ratified it (Statement 1 correct) and it was part of the Bali Package 2013 (Statement 2 correct). Only the enforcement date is wrong.
Q88moderateSimilar Sounding
What is the purpose of 'Vidyanjali Yojana' ? 1. To enable the famous foreign educational institutions to open their campuses in India. 2. To increase the quality of education provided in government schools by taking help from the private sector and the community. 3. To encourage voluntary monetary contributions from private individuals and organizations so as to improve the infrastructure facilities for primary and secondary schools. Select the correct answer using the code given below :
(a) 2 only
(b) 3 only
(c) 1 and 2 only
(d) 2 and 3 only
Answer: (d)
Trap: Similar Sounding
Statement 1 about foreign institutions is a fabricated connection — Vidyanjali is about community volunteering for government schools. The trap distinguishes between the correct Statements 2 (private sector/community help) and 3 (voluntary monetary contributions) from the wrong Statement 1.
Q89moderateSimilar Sounding
What is the aim of the programme 'Unnat Bharat Abhiyan' ?
(a) Achieving 100% literacy by promoting collaboration between voluntary organizations and government's education system and local communities.
(b) Connecting institutions of higher education with local communities to address development challenges through appropriate technologies.
(c) Strengthening India's scientific research institutions in order to make India a scientific and technological power.
(d) Developing human capital by allocating special funds for health care and education of rural and urban poor, and organizing skill development programmes and vocational training for them.
Answer: (b)
Trap: Similar Sounding
Option (a) sounds plausible for anything with 'Bharat' in the name. Option (d) about skill development sounds like many government schemes. But Unnat Bharat Abhiyan specifically links IITs and other higher education institutions with rural communities for development. 'Unnat' (upliftment) + 'Bharat' = uplifting India through academia-community partnership.
Q94moderateAbsolute Qualifier
Consider the following statements : 1. Tax revenue as a percent of GDP of India has steadily increased in the last decade. 2. Fiscal deficit as a percent of GDP of India has steadily increased in the last decade. 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
Answer: (d)
Trap: Absolute Qualifier
The word 'steadily' is the trap in both statements. Neither tax revenue as % of GDP nor fiscal deficit as % of GDP has 'steadily' increased — both have fluctuated. Tax-GDP ratio has been relatively stagnant/fluctuating, and fiscal deficit has been on a declining trend (not increasing) with some fluctuations.