SSC CGL Economy – External Sector – BoP, Forex, Trade & International Institutions – Tier II Level · Marathon

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SSC CGL Economy – External Sector – BoP, Forex, Trade & International Institutions – Tier II Level · Marathon – 10 questions, subject: Indian Economy. Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.

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1.  
Imaginary (US$ bn): CAB −45, capital account +60, errors and omissions −3. The change in reserves is:

Correct Answer: D [+12]

Explanation:

−45 + 60 − 3 = +12 → reserves rise by $ 12 bn.

2.  
Reverse questionReserves fell by $ 8 bn while the CAD was $ 40 bn and errors and omissions were zero. Net capital inflow was:

Correct Answer: B [$ 32 bn]

Explanation:

Answer: $ 32 bn. −40 + K = −8 → K = 32.

3.  
GDP $ 3,750 bn; trade deficit $ 240 bn; net invisibles $ 165 bn. CAD as % of GDP is:

Correct Answer: C [2%]

Explanation:

Answer: 2%. CAD = 75; 75/3,750 = 2%.

4.  
Reserves of $ 585 bn and annual imports of $ 780 bn give an import cover of:

Correct Answer: D [9 months]

Explanation:

Monthly imports = 780/12 = 65 → 585 ÷ 65 = 9 months (0.75 is 585/780 in years).

5.  
If ₹/$ rises from 64 to 80, the rupee depreciates by:

Correct Answer: A [20%]

Explanation:

Answer: 20%. 16/80 = 20% (dollar up 25%).

6.  
Reverse questionThe rupee depreciated by 10% against the dollar from ₹ 81 per $. The new rate is:

Correct Answer: A [₹ 90 per $]

Explanation:

Rupee depreciation is measured on the value of ₹ 1 in dollars: it falls to 0.9 × (1/81), so ₹/$ = 81/0.9 = 90.

7.  
Export prices rise 10% and import prices rise 21% in a year (base 100). The terms of trade become about:

Correct Answer: D [90.9]

Explanation:

Answer: 90.9. 110/121 × 100 ≈ 90.9.

8.  
Assertion–Reason
A: A rupee depreciation can worsen the trade balance in the short run.
R: Import bills in rupees rise at once while export volumes respond with a lag.

Correct Answer: B [Both A and R are true and R explains A]

Explanation:

Answer: Both A and R are true and R explains A. This is the J-curve effect.

9.  
Statement-basedWhich is/are correct?
I. In the IMF, voting power depends on quotas.
II. In the WTO, decisions are generally taken by consensus.
III. The World Bank President is chosen by the WTO.

Correct Answer: C [I and II only]

Explanation:

The World Bank's Board of Executive Directors selects its President.

10.  
Data-basedFrom the list – remittances, FDI, dividends, NRI deposits, travel, FPI – how many items belong to the current account?

Correct Answer: D [3]

Explanation:

Remittances, dividends, travel = current; FDI, NRI deposits, FPI = capital.

➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Indian Economy book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-indian-economy

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