Agricultural Pricing MCQ

Question 1

1. CACP considers cost of production while recommending MSPs.
2. CACP considers demand-supply conditions while recommending MSPs.
3. CACP considers only monsoon rainfall while recommending MSPs.
Which of the statements given above are correct?

Accepted Answer

Statements 1 and 2 are correct because cost of production and demand-supply conditions are expressly listed. Statement 3 is incorrect because the source lists several factors; it does not say that only monsoon rainfall is considered.

Question 2

Consider the following statements about PM-AASHA and its price-support architecture:
1. PM-AASHA includes the Price Support Scheme, Price Deficiency Payment Scheme and Pilot Private Procurement and Stockist Scheme.
2. Under Price Deficiency Payment Scheme, no physical procurement is done.
3. States/UTs have an option to implement either PSS or PDPS for a particular notified oilseed in a given procurement season for the entire State.
4. The Pilot Private Procurement and Stockist Scheme is meant for wheat and paddy procurement through FCI.
Which of the statements given above are correct?

Accepted Answer

Statements 1, 2 and 3 are correct. PIB describes PM-AASHA as including PSS, PDPS and PPSS; PDPS involves no physical procurement; and States/UTs may choose PSS or PDPS for notified oilseeds in a season. Statement 4 is incorrect because PPSS is described as a pilot option in selected APMCs for oilseeds, while wheat and paddy are handled under existing Department of Food and Public Distribution schemes.

Question 3

Consider the following statements about crop categories under the MSP framework:
1. Paddy, jowar, bajra, maize, ragi, tur, moong, urad, groundnut, soyabean, sunflower seed, sesamum, nigerseed and cotton are kharif crops in the mandated MSP basket.
2. Wheat is listed as a kharif crop in the mandated MSP basket.
3. Jute and copra are the two other commercial crops in the mandated MSP basket.
4. Cotton is one of the two other commercial crops rather than a kharif crop in the mandated MSP basket.
Which of the statements given above are correct?

Accepted Answer

Statements 1 and 3 are true as the PIB release lists those kharif crops and identifies jute and copra as the two other commercial crops. Statement 2 is false because wheat is a rabi crop. Statement 4 is false because cotton is listed among kharif crops, not among the two other commercial crops.

Question 4

Consider the following statements about the Price Deficit Payment Scheme under PM-AASHA:
1. It involves compulsory physical procurement by the Government.
2. It provides direct payment of the difference between MSP and the selling or modal price to pre-registered farmers.
3. It covers all foodgrains including wheat and paddy.
Which of the statements given above are correct?

Accepted Answer

Statement 1 is incorrect because PDPS has no physical procurement. Statement 2 is correct: the farmer receives the difference between MSP and the selling or modal price. Statement 3 is incorrect because the cited component is for notified oilseeds, not all foodgrains.

Question 5

Consider the following statements regarding Minimum Support Price (MSP) in India:
1. The Commission for Agricultural Costs and Prices recommends MSPs to the Government of India.
2. In 2018-19, the Government announced that MSP would be kept at least 1.5 times the all-India weighted average cost of production.
3. MSP recommendations are made only for kharif crops.
Which of the statements given above are correct?

Accepted Answer

Statement 1 is correct because CACP recommends MSPs. Statement 2 is correct because the announced principle was at least 1.5 times the all-India weighted average cost of production. Statement 3 is incorrect: CACP recommends MSPs for kharif and rabi crops, not only kharif crops.

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