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Identify, which of… (Class 12 Economics SQP 2024-25, Q23)

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EconomicsCBSE Class 12 · Sample paper, session 2024-25 · 1 mark · MCQ

CBSE Class 12 Economics sample paper 2024-25: question 23

From the official CBSE sample question paper for 2024-25, section B, question 23, for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q23 · 1 mark · MCQLiberalisation, Privatisation and Globalisation: An Appraisal

Identify, which of the following statement is incorrect about the financial sector reform introduced in 1991? (Choose the correct option)

  1. (A)Enabled the establishment of private sector banks, Indian as well as foreign
  2. (B)Foreign investment limit in banks was raised to around 74%
  3. (C)Foreign Institutional Investors were allowed to invest in Indian financial markets
  4. (D)Change in the role of the Reserve Bank of India from facilitator to regulator

Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2024-25.

Hints

Open one hint at a time and try again before the next.

Hint 1

The question asks for the incorrect statement.

Hint 2

Did reforms give the RBI more control or less?

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. Options A, B and C are correct features of the 1991 financial sector reforms: private (Indian and foreign) banks were allowed, the foreign investment limit in banks was raised to about 74%, and FIIs could invest in Indian markets.

  2. D is incorrect: the RBI's role changed from regulator to facilitator of the financial sector, not the other way round. Option (D).

    1 mark

Answer: (D) Change in the role of the Reserve Bank of India from facilitator to regulator

Where the marks are

  • RBI moved from regulator to facilitator (1 mark)

Revise the chapter

Practise this chapterBoard-style questions from Liberalisation, Privatisation and Globalisation: An Appraisal, one at a time, marked against the answer key and marking points.Back to the full paperSample paper 2024-25: every question, by section.

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