Nine Economy questions from the actual UPSC 2024 Prelims paper, verbatim, with answers and one-line reasoning. Tap a question to reveal. For pattern-based practice in the same style, start with Polity.
Actual past questions — UPSC CSE Prelims 2024, GS Paper I (Set A)
Nine Economy questions transcribed verbatim from the official UPSC paper. Source: UPSC’s published PDF →. Answers verified against the underlying facts and published keys.
Q40. With reference to the Indian economy, “Collateral Borrowing and Lending Obligations” are the instruments of:
- (a) Bond market
- (b) Forex market
- (c) Money market
- (d) Stock market
Answer: (c). CBLO is a short-term, collateralised money-market instrument operated by CCIL — used by banks, mutual funds and liquidity-constrained entities to park or borrow overnight funds.
Q43. In India, which of the following can trade in Corporate Bonds and Government Securities?
1. Insurance Companies
2. Pension Funds
3. Retail Investors
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: (d). Insurers and pension funds are the institutional backbone of the bond market, and retail investors can buy G-secs directly (RBI Retail Direct) and corporate bonds on exchanges — all three can trade.
Q44. Consider the following:
1. Exchange-Traded Funds (ETF)
2. Motor vehicles
3. Currency swap
Which of the above is/are considered financial instruments?
- (a) 1 only
- (b) 2 and 3 only
- (c) 1, 2 and 3
- (d) 1 and 3 only
Answer: (d). An ETF is a traded security and a currency swap is a derivative contract — both financial instruments. A motor vehicle is a real (physical) asset, however you finance it.
Q47. With reference to physical capital in Indian economy, consider the following pairs:
1. Farmer’s plough — Working capital
2. Computer — Fixed capital
3. Yarn used by the weaver — Fixed capital
4. Petrol — Working capital
How many of the above pairs are correctly matched?
- (a) Only one
- (b) Only two
- (c) Only three
- (d) All four
Answer: (b). Fixed capital is used repeatedly (plough, computer); working capital is used up in one cycle (yarn, petrol). Correctly matched: computer and petrol — the plough and yarn labels are flipped.
Q48. Which one of the following words/phrases is most appropriately used to denote “an interoperable network of 3D virtual worlds that can be accessed simultaneously by millions of users, who can exert property rights over virtual items”?
- (a) Big data analytics
- (b) Cryptography
- (c) Metaverse
- (d) Virtual matrix
Answer: (c). The definition is essentially the textbook description of the metaverse — persistent, interoperable virtual worlds with user property rights.
Q51. Consider the following statements:
Statement-I: If the United States of America (USA) were to default on its debt, holders of US Treasury Bonds will not be able to exercise their claims to receive payment.
Statement-II: The USA Government debt is not backed by any hard assets, but only by the faith of the Government.
Which one of the following is correct in respect of the above statements?
- (a) Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
- (b) Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
- (c) Statement-I is correct, but Statement-II is incorrect
- (d) Statement-I is incorrect, but Statement-II is correct
Answer: (d). Bondholders retain their legal claims even in default — they simply may not be paid on time — so Statement-I is wrong. Statement-II is right: US debt rests on the government’s creditworthiness, not collateral.
Q52. Consider the following statements:
Statement-I: Syndicated lending spreads the risk of borrower default across multiple lenders.
Statement-II: The syndicated loan can be a fixed amount/lump sum of funds, but cannot be a credit line.
Which one of the following is correct in respect of the above statements?
- (a) Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
- (b) Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
- (c) Statement-I is correct, but Statement-II is incorrect
- (d) Statement-I is incorrect, but Statement-II is correct
Answer: (c). Risk-spreading across the syndicate is the whole point of syndication (Statement-I ✓). Statement-II is wrong: syndicated facilities can be revolving credit lines, not only term loans.
Q59. Consider the following statements:
1. India is a member of the International Grains Council.
2. A country needs to be a member of the International Grains Council for exporting or importing rice and wheat.
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). India is an IGC member. But IGC membership is a cooperation forum — no trade in grains requires membership, so statement 2 fails.
Q98. With reference to the Digital India Land Records Modernisation Programme, consider the following statements:
1. To implement the scheme, the Central Government provides 100% funding.
2. Under the Scheme, Cadastral Maps are digitised.
3. An initiative has been undertaken to transliterate the Records of Rights from local language to any of the languages recognized by the Constitution of India.
Which of the statements given above are correct?
- (a) 1 and 2 only
- (b) 2 and 3 only
- (c) 1 and 3 only
- (d) 1, 2 and 3
Answer: (d). DILRMP is a Central Sector Scheme (100% central funding), cadastral-map digitisation is a core component, and the transliteration initiative covers the Constitution-recognised languages. All three stand.
Transcribed from the official UPSC CSE (Preliminary) Examination 2024 General Studies Paper I (Set A). Also see: Polity — including 10 actual 2024 PYQs · Economy explainers.