On this page · 8 sections 01 The core idea 02 Three economic systems 03 Planning in India 04 The four goals of planning 05 Exam shortcuts 06 Common mistakes 07 Quick revision 08 Check your understanding Every economy must decide what to produce, how to produce it and for whom . After 1947, India answered through a mixed economy guided by Five Year Plans , with four goals: growth, modernisation, self-reliance and equity.
System What to produce For whom Capitalist What the market demands and is profitable Those with purchasing power Socialist What the state judges society needs By need; the state owns the means of production Mixed The market, with the state filling the gaps Market, plus state provision of essentials
A purely capitalist economy can leave the poor without essentials, since goods go to those who can pay. A socialist economy can be slow to give people what they want, since the state, not demand, decides output. India's leaders, Jawaharlal Nehru above all, admired Soviet planning but wanted a democratic India with private enterprise. So the state would provide what the market failed to, and lead in key industries. The Industrial Policy Resolution of 1948 and the Directive Principles reflect this outlook.
A plan says how a nation's resources will be used to reach set goals over a period. India planned for five years at a time, within a perspective plan of about 20 years.
The Planning Commission was established in March 1950 by a Government of India resolution, with the Prime Minister as Chairperson .
The First Five Year Plan ran from 1951 to 1956 ; India had twelve five year plans, formulated between 1950 and 2014 , the Twelfth running 2012–17.
NITI Aayog was constituted on 1 January 2015, with the Prime Minister as Chairperson , replacing the Planning Commission. It works as a policy think tank and does not draw up Five Year Plans.
1950 is the Planning Commission; 1951 is the start of the First Plan. The Commission was set up by a government resolution, not an Act of Parliament.
P.C. Mahalanobis , a statistician, is called the architect of Indian planning . Planning in the real sense began with the Second Plan (1956–61) , built on his ideas: a stress on heavy industry (capital goods) and the public sector , because machines raise the capacity to produce in future. He founded the Indian Statistical Institute in Calcutta in 1931 and started its journal, Sankhya .
The First Plan had put agriculture first.
Goal Meaning Example Growth A rise in the capacity to produce goods and services, measured by GDP GDP rises by 6% in a year Modernisation New technology, and a change in social outlook New seed varieties; equal rights for women Self-reliance Avoid importing what India can produce, above all food Growing enough grain at home Equity Growth's gains reach the poor; everyone meets basic needs Land for the landless; cheap food
A country that must import food can be pressured by those who supply it, so depending on others for food could expose India to interference in its policies. The first seven plans stressed self-reliance.
Yes. Resources spent on one goal are not available for another, and a labour-saving machine may modernise production while throwing workers out of work, which works against equity. Each plan therefore chose its priorities.
Modernisation is not only machines: the change in social outlook (such as accepting that women should have the same rights as men) is part of it. And self-reliance never meant stopping all trade.
Planning Commission March 1950, PM as chair; First Plan 1951–56; Twelfth 2012–17; NITI Aayog 1 January 2015.
Mahalanobis: Second Plan, heavy industry, ISI 1931, Sankhya.
Four goals: growth, modernisation, self-reliance, equity.
Capitalism distributes by purchasing power; socialism by need.
Saying NITI Aayog makes Five Year Plans.
Giving the First Plan a heavy-industry focus (that was the Second).
Treating a rise in GDP as modernisation.
Calling India's economy purely socialist.
Systems
Capitalist: market, purchasing power
Socialist: state, need
Mixed: India's choice
Planning
Planning Commission 1950, NITI Aayog 2015
First Plan 1951–56; twelve plans in all
Mahalanobis and the Second Plan
Goals
Growth, modernisation, self-reliance, equity
Goals can conflict
How planning changed farming is in land reforms and the green revolution .
Next · 07 Quick revision → Check your understanding 54 questions, grouped by type, easy to hard. Pick an answer and check it. The worked solution opens when you ask for it.
Economic systems Q1 of 54 Q1
Economic systems 14 questions Every economy has to answer three questions. Which of these is NOT one of them?
Options for question 1 A Option A What goods should be produced, and how much? B Option B Who should govern the country? C Option C How should the goods be produced? D Option D How should the goods be distributed?
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Show the explanation Hide the explanation Answer B · Who should govern the country?
What to produce, how to produce and for whom to produce are the three central questions; who governs is a political question.
In a capitalist economy, what is produced is decided mainly by
Options for question 2 A Option A a central planning authority B Option B the needs of society as judged by the state C Option C village councils D Option D market forces of demand and supply
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Show the explanation Hide the explanation Answer D · market forces of demand and supply
Firms produce what buyers want and will pay for, since that earns a profit.
After independence, India chose
Options for question 3 A Option A a purely capitalist economy B Option B a mixed economy C Option C a purely socialist economy D Option D a barter economy
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Show the explanation Hide the explanation Answer B · a mixed economy
India combined a large public sector with a private sector: the state and the market would both play a role.
In a capitalist economy, goods are distributed among people according to
Options for question 4 A Option A their purchasing power B Option B what they need C Option C an equal share for each person D Option D decisions of the government
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Show the explanation Hide the explanation Answer A · their purchasing power
Goods go to those who can buy them; someone who cannot pay goes without, whatever the need.
In a socialist economy, goods are distributed according to
Options for question 5 A Option A what people can afford to pay B Option B the profits firms expect C Option C what people need D Option D the prices set in the market
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Show the explanation Hide the explanation Answer C · what people need
The government decides what to produce in line with society's needs, and distributes by need, not by purchasing power.
Read the two statements and choose the correct option.
I. In a socialist economy, the government decides what goods are to be produced.
II. In a socialist economy, private property is widespread.
Options for question 6 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer A · Only I
I is true: production follows the state's view of society's needs.
In a socialist society the state owns the means of production, so II is false.
In a mixed economy, the government steps in mainly to
Options for question 7 A Option A set the price of every single good and service sold in the country B Option B own every factory and every farm C Option C provide essential goods and services the market fails to provide D Option D stop private firms from earning profits
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Show the explanation Hide the explanation Answer C · provide essential goods and services the market fails to provide
The market supplies what it can produce well; the state supplies essentials the market leaves out.
Assertion (A): A purely capitalist economy may leave the poor without essential goods.
Reason (R): In a capitalist economy, goods go to those who can pay for them.
Options for question 8 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
Distribution by purchasing power means the poor can be priced out of essentials.
R explains A.
Which pair of documents reflected India's choice of a mixed economy with a strong public sector?
Options for question 9 A Option A The Industrial Policy Resolution of 1948 and the Directive Principles B Option B The Government of India Act of 1935 and the Rowlatt Act of 1919 C Option C The Permanent Settlement of 1793 and the Ryotwari land revenue system D Option D The Bretton Woods agreement of 1944 and the GATT of 1947
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Show the explanation Hide the explanation Answer A · The Industrial Policy Resolution of 1948 and the Directive Principles
The Industrial Policy Resolution of 1948 and the Directive Principles of State Policy in the Constitution both set out this outlook.
Match each economic system with how it answers 'for whom to produce'.
List I List II A. Capitalist I. By the market, with the state filling gaps B. Socialist II. By purchasing power C. Mixed III. By custom and tradition D. Traditional village economy IV. By need, as the state judges it
Options for question 10 A Option A A-II, B-I, C-III, D-IV B Option B A-I, B-II, C-IV, D-III C Option C A-III, B-II, C-I, D-IV D Option D A-II, B-IV, C-I, D-III
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Show the explanation Hide the explanation Answer D · A-II, B-IV, C-I, D-III
Capitalism distributes by the ability to pay; socialism by need; a mixed economy uses both.
A traditional economy follows custom.
Assertion (A): Planning in India set targets for both the public and the private sector.
Reason (R): India's economy had no private sector at all after independence.
Options for question 11 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer C · A is true, but R is false.
In a mixed economy the plans guided both sectors, so A is true.
A large private sector existed, so R is false.
Read the two statements and choose the correct option.
I. Jawaharlal Nehru favoured a socialist pattern of society but did not want to abolish private property altogether.
II. India's planners wanted the public sector to play a leading role in the economy.
Options for question 12 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer C · Both I and II
Nehru admired Soviet planning but wanted a democratic India with private enterprise too: I is true.
The public sector was given the commanding heights of the economy: II is true.
Assertion (A): The early plans gave the public sector a leading role.
Reason (R): Private investors in 1950 had neither the capital nor the market to build heavy industry.
Options for question 13 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
Heavy industry needed huge investment with a long wait for returns, which private firms could not supply.
So the state took the lead. R explains A.
Assertion (A): A socialist economy may be slow to give consumers what they want.
Reason (R): In a socialist economy, the state, not consumer demand, decides what is produced.
Options for question 14 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
When production follows a plan rather than demand, it can lag behind what people actually want.
R explains A.
Planning and the Planning Commission 13 questions A plan, in economics, spells out
Options for question 15 A Option A the prices of all goods for the coming year B Option B which political party will govern next C Option C how resources will be used to reach set goals D Option D the wages every firm must pay its workers
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Show the explanation Hide the explanation Answer C · how resources will be used to reach set goals
A plan sets general and specific goals for a period and says how resources will be used to reach them.
The Planning Commission of India was set up in
Options for question 16 A Option A 1947 B Option B 1950 C Option C 1951 D Option D 1956
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Show the explanation Hide the explanation Answer B · 1950
It was set up in March 1950 by a government resolution, with the Prime Minister as its chairperson.
Worth noting
1951 is when the First Five Year Plan began, not when the Commission was set up.
Who was the chairperson of the Planning Commission?
Options for question 17 A Option A The Prime Minister B Option B The President C Option C The Finance Minister D Option D The RBI Governor
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Show the explanation Hide the explanation Answer A · The Prime Minister
The Prime Minister chaired the Planning Commission, as the Prime Minister now chairs NITI Aayog.
The First Five Year Plan covered the period
Options for question 18 A Option A 1947–52 B Option B 1951–56 C Option C 1950–55 D Option D 1956–61
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Show the explanation Hide the explanation Answer B · 1951–56
The First Plan ran from 1951 to 1956; the Second, built on Mahalanobis's ideas, from 1956 to 1961.
Which body replaced the Planning Commission, and when?
Options for question 19 A Option A The Finance Commission, in 1991 B Option B NITI Aayog, on 1 April 2017 C Option C The National Development Council, in 2014 D Option D NITI Aayog, on 1 January 2015
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Show the explanation Hide the explanation Answer D · NITI Aayog, on 1 January 2015
NITI Aayog (National Institution for Transforming India) was constituted on 1 January 2015, with the Prime Minister as chairperson.
How many Five Year Plans did India have before planning by Five Year Plans ended?
Options for question 20 A Option A 10 B Option B 11 C Option C 12 D Option D 13
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Show the explanation Hide the explanation Answer C · 12
Twelve Five Year Plans were drawn up; the Twelfth ran from 2012 to 2017.
Besides five-year goals, India's planners also set long-term goals over about 20 years. Such a plan is called a
Options for question 21 A Option A perspective plan B Option B rolling plan C Option C annual plan D Option D budget plan
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Show the explanation Hide the explanation Answer A · perspective plan
A perspective plan sets long-run goals; each Five Year Plan is meant to be a step towards them.
Read the two statements and choose the correct option.
I. Every Five Year Plan gave equal weight to all four goals of planning.
II. The goals of a plan should be stated clearly and be realistic.
Options for question 22 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer B · Only II
Limited resources mean each plan stresses some goals more than others, so I is false.
II is true: vague or impossible goals cannot guide the use of resources.
Arrange these in chronological order.
A. The Second Five Year Plan begins
B. The Planning Commission is set up
C. NITI Aayog is constituted
D. The First Five Year Plan begins
Options for question 23 A Option A D, B, A, C B Option B B, A, D, C C Option C B, D, C, A D Option D B, D, A, C
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Show the explanation Hide the explanation Answer D · B, D, A, C
Planning Commission 1950, First Plan 1951, Second Plan 1956, NITI Aayog 2015.
Assertion (A): India adopted five-year planning soon after independence.
Reason (R): The Planning Commission was chaired by the Prime Minister.
Options for question 24 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer B · Both A and R are true, but R is not the correct explanation of A.
Both statements are true: the First Plan began in 1951, and the Prime Minister chaired the Commission.
Who chaired the Commission does not explain why India chose to plan, so R is not the explanation.
Assertion (A): The Planning Commission was set up by an Act of Parliament.
Reason (R): The Prime Minister was the chairperson of the Planning Commission.
Options for question 25 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer D · A is false, but R is true.
It was set up by a government resolution, not an Act, so A is false.
R is true.
Assertion (A): NITI Aayog is chaired by the Prime Minister.
Reason (R): NITI Aayog was set up before the Planning Commission.
Options for question 26 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer C · A is true, but R is false.
A is true.
NITI Aayog replaced the Planning Commission in 2015, so R is false.
Read the two statements and choose the correct option.
I. NITI Aayog draws up Five Year Plans just as the Planning Commission did.
II. The last Five Year Plan was the Twelfth, which ran from 2012 to 2017.
Options for question 27 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer B · Only II
Five Year Plans ended with the Twelfth Plan; NITI Aayog works as a policy think tank instead. I is false.
II is true.
Mahalanobis and the Second Plan 8 questions Who is called the architect of Indian planning?
Options for question 28 A Option A V.K.R.V. Rao B Option B P.C. Mahalanobis C Option C Dadabhai Naoroji D Option D C. Rangarajan
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Show the explanation Hide the explanation Answer B · P.C. Mahalanobis
Planning in the real sense began with the Second Plan, whose ideas came from P.C. Mahalanobis.
Which Five Year Plan was based on the ideas of P.C. Mahalanobis?
Options for question 29 A Option A The First Plan B Option B The Fifth Plan C Option C The Second Plan D Option D The Eighth Plan
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Show the explanation Hide the explanation Answer C · The Second Plan
The Second Plan (1956–61) followed Mahalanobis's model, with its stress on heavy industry.
The Second Five Year Plan laid special stress on
Options for question 30 A Option A agriculture and irrigation alone B Option B exports of services C Option C heavy industry and the public sector D Option D selling public sector firms
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Show the explanation Hide the explanation Answer C · heavy industry and the public sector
Mahalanobis argued that capital goods industries would lay the base for long-run growth, and the public sector was to build them.
Worth noting
The First Plan, not the Second, put agriculture first.
P.C. Mahalanobis founded the
Options for question 31 A Option A Reserve Bank of India B Option B Indian Statistical Institute C Option C National Sample Survey Office D Option D Indian Institute of Science
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Show the explanation Hide the explanation Answer B · Indian Statistical Institute
He set up the Indian Statistical Institute in Calcutta in 1931, and started its journal, Sankhya.
Sankhya, a journal still used by statisticians, was started by
Options for question 32 A Option A Jawaharlal Nehru B Option B M. Visvesvaraya C Option C Amartya Sen D Option D P.C. Mahalanobis
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Show the explanation Hide the explanation Answer D · P.C. Mahalanobis
Mahalanobis started Sankhya alongside the Indian Statistical Institute.
Read the two statements and choose the correct option.
I. Mahalanobis was a statistician.
II. Mahalanobis's plan model favoured consumer goods over capital goods.
Options for question 33 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer A · Only I
He was a statistician of world standing: I is true.
His model favoured capital goods (heavy industry), so II is false.
Assertion (A): The Second Plan stressed industries making capital goods.
Reason (R): Capital goods raise a country's capacity to produce in the future.
Options for question 34 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
Machines make more goods later; building them first was meant to raise long-run growth.
R explains A.
Assertion (A): The Second Five Year Plan was the first to be based on P.C. Mahalanobis's model.
Reason (R): P.C. Mahalanobis was an economist trained only in agriculture.
Options for question 35 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer C · A is true, but R is false.
A is true.
He was a statistician, which is why he founded the Indian Statistical Institute. R is false.
The goals of planning 19 questions The four common goals of India's Five Year Plans were
Options for question 36 A Option A growth, modernisation, self-reliance and equity B Option B growth, inflation, exports and equity C Option C privatisation, growth, imports and modernisation D Option D self-reliance, disinvestment, growth and trade
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Show the explanation Hide the explanation Answer A · growth, modernisation, self-reliance and equity
Growth, modernisation, self-reliance and equity ran through all the plans, with different weights.
Growth, as a goal of planning, means
Options for question 37 A Option A a steady fall in the prices of essential goods B Option B a fair sharing of income among people C Option C cutting down on imports of food D Option D more capacity to produce goods and services
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Show the explanation Hide the explanation Answer D · more capacity to produce goods and services
Growth means more output: a larger stock of capital, more efficient services, or both. It is measured by the rise in GDP.
Equity, as a goal of planning, means
Options for question 38 A Option A that the gains from growth reach the poor too B Option B that every worker is paid exactly the same wage C Option C that India imports as much as it exports D Option D that all firms are owned by the government
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Show the explanation Hide the explanation Answer A · that the gains from growth reach the poor too
Growth alone may leave the poor behind; equity asks that each Indian can meet basic needs: food, a decent house, education and health care.
Read the two statements and choose the correct option.
I. Equity means that every Indian should be able to meet basic needs such as food, a decent house, education and health care.
II. Equity also means that inequality in the distribution of wealth should be reduced.
Options for question 39 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer C · Both I and II
Both are part of the goal of equity, so both are true.
Modernisation, as a goal of planning, includes
Options for question 40 A Option A both new technology and changes in social outlook B Option B only the use of newer machines in the country's factories C Option C only building new roads and dams D Option D only higher exports of farm products
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Show the explanation Hide the explanation Answer A · both new technology and changes in social outlook
Modernisation means adopting new technology, and also a change in social outlook, such as accepting that women should have the same rights as men.
A farmer switches to a new seed variety, and a factory buys a newer machine. These are examples of
Options for question 41 A Option A self-reliance B Option B equity C Option C modernisation D Option D disinvestment
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Show the explanation Hide the explanation Answer C · modernisation
Adopting new technology to raise output is modernisation.
Self-reliance, as a goal of the early plans, meant
Options for question 42 A Option A stopping all foreign trade with every other country B Option B avoiding imports of goods that India could make itself C Option C every family growing all of its own food and cloth D Option D borrowing freely from abroad to grow as fast as possible
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Show the explanation Hide the explanation Answer B · avoiding imports of goods that India could make itself
The first seven plans stressed self-reliance: produce at home what could be produced at home.
Dependence on other countries for food could open India to their interference in its policies.
Why did planners fear depending on other countries for food?
Options for question 43 A Option A Imported food was always of poorer quality than Indian food B Option B It could open India to foreign pressure on its policies C Option C Food could not be carried across the oceans by ship D Option D The Constitution banned all imports of food grains
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Show the explanation Hide the explanation Answer B · It could open India to foreign pressure on its policies
A country that must import food can be pressured by those who supply it.
Match each goal of planning with an example of it.
List I List II A. Growth I. Farmers adopt new seed varieties B. Modernisation II. Land is given to the landless C. Self-reliance III. GDP rises by 6% in a year D. Equity IV. India stops importing food grains
Options for question 44 A Option A A-III, B-IV, C-II, D-I B Option B A-IV, B-III, C-I, D-II C Option C A-IV, B-II, C-III, D-I D Option D A-III, B-I, C-IV, D-II
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Show the explanation Hide the explanation Answer D · A-III, B-I, C-IV, D-II
More output is growth; new technology is modernisation; producing food at home is self-reliance; spreading assets to the poor is equity.
Read the two statements and choose the correct option.
I. The goals of planning can sometimes conflict with one another.
II. Modern labour-saving technology can work against the goal of providing jobs.
Options for question 45 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer C · Both I and II
I is true: resources spent on one goal are not available for another.
II is true and is an example of I: a new machine may replace workers, which can hurt equity.
Assertion (A): Accepting that women should have the same rights as men is part of modernisation.
Reason (R): Modernisation means only the adoption of new machines.
Options for question 46 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer C · A is true, but R is false.
Modernisation includes a change in social outlook, so A is true.
It is not only machines, so R is false.
The goal of self-reliance was given the most importance in
Options for question 47 A Option A only the Twelfth Five Year Plan B Option B the Five Year Plans after 1991 C Option C the first seven Five Year Plans D Option D none of the plans
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Show the explanation Hide the explanation Answer C · the first seven Five Year Plans
Self-reliance ran through the first seven plans, until the reforms of 1991 opened the economy.
Which of these does NOT help the goal of equity?
Options for question 48 A Option A Land reforms that give land to those who till it B Option B Tax cuts that benefit only the richest households C Option C Free primary education for all children D Option D Cheap food grains for the poorest households
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Show the explanation Hide the explanation Answer B · Tax cuts that benefit only the richest households
Equity means spreading the benefits to the poor; a cut that helps only the rich widens the gap.
A goal of planning that matters especially when a country's farmers adopt new seeds and machines is
Options for question 49 A Option A equity B Option B self-reliance C Option C modernisation D Option D disinvestment
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Show the explanation Hide the explanation Answer C · modernisation
New seeds and machines are new technology, which is modernisation.
Assertion (A): Growth in GDP is a goal of planning.
Reason (R): A larger GDP means the country produces more goods and services.
Options for question 50 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
More output means more goods and services for people, which is why growth is a goal.
R explains A.
Read the two statements and choose the correct option.
I. Self-reliance in the early plans meant that India would not trade with any other country.
II. Modernisation is measured by the rise in a country's GDP.
Options for question 51 A Option A Only I B Option B Only II C Option C Both I and II D Option D Neither I nor II
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Show the explanation Hide the explanation Answer D · Neither I nor II
Self-reliance meant avoiding imports of what India could make, not ending trade. I is false.
A rise in GDP measures growth, not modernisation. II is false.
Assertion (A): Modernisation and equity can pull in different directions.
Reason (R): Labour-saving machines can raise output while cutting jobs.
Options for question 52 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
A new machine modernises production but may throw workers out, which hurts equity.
R explains A.
Assertion (A): High growth by itself may not improve the lives of most people.
Reason (R): The benefits of growth may go mainly to the rich.
Options for question 53 A Option A Both A and R are true, and R is the correct explanation of A. B Option B Both A and R are true, but R is not the correct explanation of A. C Option C A is true, but R is false. D Option D A is false, but R is true.
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Show the explanation Hide the explanation Answer A · Both A and R are true, and R is the correct explanation of A.
If the gains go to a few, most people see little change; that is why equity is a separate goal.
R explains A.
A country's GDP grows fast, but most of the extra income goes to the richest tenth of households. Which goal of planning is it failing?
Options for question 54 A Option A Growth B Option B Modernisation C Option C Self-reliance D Option D Equity
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Show the explanation Hide the explanation Answer D · Equity
Output is rising, so growth is met. The gains are not shared, so equity is not.
Question types · easy to hard
NTA's Economics syllabus is three courses: Introductory Microeconomics, Introductory Macroeconomics and Indian Economic Development, each split into units with a list of topics. It prints no chapters and no split of the 50 questions across the courses. So the areas here are NTA's three courses, and the chapters inside them are ours: a unit that covers several ideas, such as consumer behaviour and demand, is split into a chapter for each, so that a chapter can be practised in one sitting. All three courses are here.