Daily Quiz: UPSC Prelims Marathon – August 14, 2018

Gross Domestic Product (GDP) is the total monetary value of all final goods and services produced

in the economic territories of a country in a given year, irrespective of who the producer of the goods

and services are. In calculating India’s Gross Domestic Product, the monetary value of all final goods and services produced/rendered by Individuals, private sector, public sector and foreign companies will be

considered. Hence, Statements 1, 3 and 4 are correct.

The services rendered by an Indian working in Dubai will not be considered in calculating India’s Gross

Domestic Product. The services rendered by an Indian working and residing abroad will be counted for the calculation of the respective country’s GDP. Statement 2 is incorrect.

The income of all Indian nationals working abroad and Indian companies having business outside India

will be considered in calculating India’s Gross National Product.

Green Gross Domestic Product is the index of the Economic growth of a particular country which enshrines the environment consequences of the economic growth. Green GDP accounts the monetized loss of biodiversity, costs caused by climate change. Green GDP is conventional gross domestic product figures adjusted for the environmental costs of economic activities. It’s a measure of how a country is prepared for sustainable economic development.

Statement 1 is correct.

The Financial Stability and Development Council (FSDC) has been constituted vide GOI notification dated 30th December, 2010. The Council deals, inter-alia, with issues relating to financial stability, financial sector development, inter-regulatory coordination, financial literacy, financial inclusion and macro prudential supervision of the economy including the functioning of large financial conglomerates.

Statement 2 is incorrect. Financial Stability and Development Council is not a statutory body.

Statement 3 is Incorrect. The Council is chaired by the Union Finance Minister. FSDC’s members are Governor, Reserve Bank of India; Finance Secretary and/or Secretary, Department of Economic Affairs; Secretary, Department of Financial Services; Chief Economic Adviser, Ministry of Finance; Chairman, Securities and Exchange Board of India; Chairman, Insurance Regulatory and Development Authority and Chairman, Pension Fund Regulatory and Development Authority.

All of the above schemes are associated with development of urban infrastructure.

Smart Cities Mission is an urban renewal and retrofitting program by the Government of India with a mission to develop 100 cities all over the country making them citizen friendly and sustainable. The Union Ministry of Urban Development is responsible for implementing the mission in collaboration with the state governments of the respective cities.

The Swachh Bharat Mission (Urban) aims to create urban infrastructure like scientific processing/disposal reuse/recycle of Municipal Solid Waste, Capacity Building and Administrative & Office Expenses, Community and Public Toilets, Construction of Household Toilets etc. The Pradhan Mantri Awas Yojana (Urban) is a programme of the Ministry of Housing and Urban Poverty Alleviation (MoHUPA) which envisions provision of Housing for All by 2022. It includes slum rehabilitation, Promotion of Affordable Housing for weaker section through credit linked subsidy, Affordable Housing in Partnership with Public & Private sectors and subsidy for beneficiary-led individual house construction /enhancement.

The National Heritage City Development and Augmentation Yojana (HRIDAY) scheme focuses on holistic development of heritage cities. The Scheme supports development of core heritage

infrastructure projects which shall include revitalization of urban infrastructure for areas around

heritage assets identified / approved by the Ministry of Culture, Government of India and State

Governments. These initiatives shall include development of water supply, sanitation, drainage, waste management, approach roads, footpaths, street lights, tourist conveniences, electricity wiring, landscaping and such citizen services.

Statement 1 is correct.

The Pradhan Mantri Suraksha Bima Yojana is a one year cover Personal Accident Insurance Scheme, renewable from year to year, offering protection against death or disability due to accident.

Statement 2 is incorrect. An individual who is willing to get enrolled in Pradhan Mantri Suraksha Bima Yojana must have a bank account. In case of multiple bank accounts held by an individual in one or different banks, the person would be eligible to join the scheme through one bank account only.

Statement 3 is incorrect.

All individual (single or joint) bank account holders in the age 18 to 70 years in participating banks will be entitled to join in Pradhan Mantri Suraksha Bima Yojana.

Option (c) is correct.

Angel investors former entrepreneurs or professional who provides starting or growth capital in

promising ventures, and helps also with advice and contacts. Unlike venture capitalists, angel investors usually operate alone (or in very small groups) and play only an indirect role as advisors in the operations of the investee firm. They are deemed to be ‘angels’ in comparison with grasping investors who are termed ‘vulture capitalists.’ Also called business angel.

All the statements are correct.

FDI is an investment by non-resident entities like MNCs to carry out business operations in India with the management of investment, production of goods or services, employing people and marketing their products. In FDI, both the ownership and control of the firm remains with the investor. Thus, FDI helps in technology transfer from developed countries to developing countries. FPI is investment aimed at getting profits from shares, interests from deposits etc. Thus, it is known as hot money. The portfolio investors stay his money in the capital market only for a short period of time. Its destination period is so small and is empirically considered as fluctuating (often short-term) capital. It is highly volatile, a fair weather friend, speculative, involves exchange risks and may lead to capital flight and currency crisis affecting real economic variables. It is destabilizing in the foreign exchange market. Fluctuations in the mobility of FPI affects the foreign exchange rate, domestic money supply, value of rupee, call money rates, security market etc. FII (Foreign Institutional Inflows) inflows depend on two factors: first, return potential of the destination market (host country) and second availability of risk capital at source geographies (home market; countries like the US). A change in the environment in any of these will result in quick reversal of the flows.