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Economic Reforms and the Informal Sector: Unlocking Potential

Description: This quiz aims to assess your understanding of the economic reforms implemented in India, particularly those related to the informal sector. The questions cover various aspects of these reforms, their impact on the informal sector, and the potential benefits of unlocking the potential of this sector.
Number of Questions: 15
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Tags: economic reforms informal sector liberalization globalization economic development
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What was the primary objective of the economic reforms implemented in India in the 1990s?

  1. To promote economic growth and development

  2. To reduce government control over the economy

  3. To increase foreign investment and trade

  4. To address poverty and inequality


Correct Option: A
Explanation:

The primary objective of the economic reforms implemented in India in the 1990s was to promote economic growth and development by liberalizing the economy, reducing government control, and encouraging private sector participation.

Which sector of the Indian economy is characterized by a lack of formal regulation, low productivity, and limited access to credit and other resources?

  1. Formal Sector

  2. Informal Sector

  3. Public Sector

  4. Private Sector


Correct Option: B
Explanation:

The informal sector of the Indian economy is characterized by a lack of formal regulation, low productivity, and limited access to credit and other resources.

What is the estimated contribution of the informal sector to India's GDP?

  1. 15-20%

  2. 25-30%

  3. 35-40%

  4. 45-50%


Correct Option: C
Explanation:

The informal sector is estimated to contribute around 35-40% to India's GDP.

Which economic reform measure was introduced to reduce the role of the government in the economy?

  1. Privatization

  2. Liberalization

  3. Globalization

  4. Deregulation


Correct Option: A
Explanation:

Privatization is an economic reform measure that involves the transfer of ownership of state-owned enterprises to the private sector.

What is the potential benefit of unlocking the potential of the informal sector?

  1. Increased economic growth

  2. Reduced poverty and inequality

  3. Enhanced job creation

  4. All of the above


Correct Option: D
Explanation:

Unlocking the potential of the informal sector can lead to increased economic growth, reduced poverty and inequality, and enhanced job creation.

Which government initiative aims to provide financial assistance and skill development opportunities to workers in the informal sector?

  1. Pradhan Mantri Mudra Yojana

  2. National Skill Development Mission

  3. Make in India

  4. Digital India


Correct Option: A
Explanation:

Pradhan Mantri Mudra Yojana is a government initiative that provides financial assistance and skill development opportunities to workers in the informal sector.

What is the main challenge faced by the informal sector in accessing formal credit?

  1. Lack of collateral

  2. High interest rates

  3. Complex application process

  4. All of the above


Correct Option: D
Explanation:

The informal sector faces challenges in accessing formal credit due to lack of collateral, high interest rates, and complex application process.

Which economic reform measure was introduced to reduce trade barriers and promote international trade?

  1. Privatization

  2. Liberalization

  3. Globalization

  4. Deregulation


Correct Option: B
Explanation:

Liberalization is an economic reform measure that involves reducing trade barriers and promoting international trade.

What is the impact of globalization on the informal sector?

  1. Increased competition

  2. Access to new markets

  3. Transfer of technology

  4. All of the above


Correct Option: D
Explanation:

Globalization has led to increased competition, access to new markets, and transfer of technology for the informal sector.

Which government initiative aims to provide social security benefits to workers in the informal sector?

  1. Pradhan Mantri Jeevan Jyoti Bima Yojana

  2. Pradhan Mantri Suraksha Bima Yojana

  3. Atal Pension Yojana

  4. All of the above


Correct Option: D
Explanation:

All of the mentioned government initiatives aim to provide social security benefits to workers in the informal sector.

What is the role of technology in unlocking the potential of the informal sector?

  1. Improved access to information and markets

  2. Enhanced productivity and efficiency

  3. Financial inclusion

  4. All of the above


Correct Option: D
Explanation:

Technology can play a significant role in unlocking the potential of the informal sector by improving access to information and markets, enhancing productivity and efficiency, and promoting financial inclusion.

Which economic reform measure was introduced to reduce government regulations and simplify business processes?

  1. Privatization

  2. Liberalization

  3. Globalization

  4. Deregulation


Correct Option: D
Explanation:

Deregulation is an economic reform measure that involves reducing government regulations and simplifying business processes.

What are the challenges faced by the informal sector in terms of skill development?

  1. Lack of access to formal education

  2. Limited training opportunities

  3. Mismatch between skills and market demand

  4. All of the above


Correct Option: D
Explanation:

The informal sector faces challenges in terms of skill development due to lack of access to formal education, limited training opportunities, and mismatch between skills and market demand.

Which government initiative aims to promote entrepreneurship and job creation in the informal sector?

  1. Start-up India

  2. Stand-up India

  3. Make in India

  4. Digital India


Correct Option: A
Explanation:

Start-up India is a government initiative that aims to promote entrepreneurship and job creation in the informal sector.

What is the significance of the informal sector in providing employment opportunities?

  1. Absorbs a large portion of the workforce

  2. Provides flexibility and adaptability to the labor market

  3. Contributes to economic growth and development

  4. All of the above


Correct Option: D
Explanation:

The informal sector plays a significant role in providing employment opportunities by absorbing a large portion of the workforce, providing flexibility and adaptability to the labor market, and contributing to economic growth and development.

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