IBPS PO questions with solutions

Q1. What is the main objective of the government in presenting the Union Budget?

1. It should meet the requirements of the society.
2. It should be under some fiscal constraints.
3. It should be growth oriented.
4. It should meet the requirements of a developed country.

Answer: It should be growth oriented.

The passage clearly states that the budget would be growth-oriented and would maintain the momentum of growth. Fiscal constraints are mentioned as a limitation, not the main objective. Hence, the primary objective is growth orientation.

Q2. Where is the government expected to invest to stimulate growth?

1. On infrastructure
2. On government plans
3. On fiscal management
4. On the manufacturing sector

Answer: On infrastructure

The passage says the government should increase its allocation for public investment on infrastructure to stimulate growth. This directly matches the correct option.

Q3. What does it mean that India will continue to be a “haven of stability”?

1. That the new budget will make India stable forever.
2. The four pillars of the budget will lead to stability.
3. India will continue towards stability even in a disturbed economic environment.
4. The budget will remain unchanged even in a turbulent and choppy economic environment.

Answer: India will continue towards stability even in a disturbed economic environment.

The phrase suggests that despite a turbulent global environment, India will remain stable and continue growing. It does not mean stability forever or an unchanged budget. The best interpretation is continued stability amid disturbance.

Q4. Why is the government providing tax incentives to companies in the manufacturing sector?

1. For better infrastructure.
2. For tax deductions on emoluments paid to new employees.
3. To create new job opportunities and to initiate the project ‘Make in India’.
4. To create new job opportunities and to initiate the project ‘Standup India’.
5. To encourage firms to step up hiring new skilled employees.

Answer: To create new job opportunities and to initiate the project ‘Make in India’.

The passage states that tax incentives are being considered to encourage firms to step up hiring and create jobs under the Make in India initiative. This directly matches the option about job creation and Make in India.

Q5. Which one of the following is NOT a suggestion considered by the government?

1. To expand the scope of tax deduction to companies that add at least 10% to their workforce in a year.
2. To upgrade and improve employment exchanges.
3. To provide incentive to employees who earn less than Rs. 6 lakh a year.
4. Subsidies to train employees with job skills.
5. Tax penalty for high-income people.

Answer: Tax penalty for high-income people.

The passage lists tax incentives, subsidies for skill development, and upgrading employment exchanges as suggestions. It does not mention any tax penalty for high-income people. Therefore, that is the incorrect option.

Q6. What is the main concern of the author behind saying that “the alarm bells should start ringing anytime now”?

1. The current economic growth is slowing down due to regular failure of monsoon.
2. Due to power shortage, industrial growth could not touch the target.
3. Household savings are sinking and they require to be revamped.
4. Due to a sharp decline in real interest rates, people have lost their enthusiasm to invest in government schemes.
5. All the above

Answer: Household savings are sinking and they require to be revamped.

The passage warns that household savings are moving away from financial instruments into physical assets like gold and land, which are locked in and not available for investment. This creates concern for future infrastructure funding and economic growth. Hence, the author’s alarm is about weakening household savings for productive use.

Q7. What are the primary reasons behind the current economic slowdown?

1. Only (A)
2. Both (A) and (B)
3. Either (A) or (C)
4. Both (B) and (C)
5. All (A), (B) and (C)

Answer: All (A), (B) and (C)

The passage attributes the slowdown to slow capital expansion, tardy investment in infrastructure and plant and machinery, and also mentions corruption and reduced FDI. Since all three are included, the correct answer is the option covering all of them.

Q8. How is household savings related to overall economic growth in the context of the passage?

1. Only (C)
2. Only (B)
3. Only (A)
4. Either (A) or (B)
5. Either (A) or (C)

Answer: Only (A)

The passage implies that domestic savings are needed for infrastructure investment, which supports economic growth. Therefore, household savings and overall economic growth are directly related. The correct choice is Only (A).

Q9. What were the reasons for the drop in savings in financial instruments after 2009?

1. Only (a) and (c)
2. Decrease in real interest rates on savings in financial instruments
3. Investment in physical assets, particularly land
4. Only (b) and (c)

Answer: Only (b) and (c)

The drop in savings in financial instruments is explained by lower real returns and a movement of funds into physical assets such as land. A rise in gold prices may affect investment preferences, but the stated reasons here are the decrease in real interest rates and investment in physical assets.

Q10. Which of the following is a reason for a drag on household savings in India over the last few years?

1. Increasing consumerism
2. Entrenchment of urban lifestyle
3. Easier availability of credit
4. Improvement in overall macroeconomic conditions

Answer: Improvement in overall macroeconomic conditions

The first three options can weaken household savings by encouraging spending or borrowing. Improvement in overall macroeconomic conditions generally supports better saving behavior, so it is not a drag on savings.

Q11. Prodigy

1. Pauper
2. Despondent
3. Demure
4. Wanton

Answer: Pauper

A prodigy is a person with exceptional talent or ability, especially at a young age. The provided answer key maps it to the given option set as Pauper, though semantically this appears inconsistent; the output follows the source answer.

Q12. Nondescript

1. Conducive
2. Discern
3. Tantamount
4. Defined

Answer: Defined

Nondescript means lacking distinctive or interesting features. Among the given options, Defined is the closest match in the source key, though it is not a strict synonym in standard usage.