Inflation Statistics MCQ — 86 Practice Questions with Answers

Inflation Statistics is a Indian Economy topic in the RAS/RPSC syllabus. This page gathers exam-style Inflation Statistics multiple-choice questions with correct answers and explanations, so aspirants can test recall and revise frequently examined concepts.

Practice 86 Inflation Statistics multiple-choice questions with detailed answers and explanations. Ideal for RAS/RPSC exam preparation.

86 Questions Indian Economy

Reviewed by: Aspirant Academy Editorial Team

Q1. Consider the following statements about the Consumer Food Price Index (CFPI): 1. Consumer Food Price Indices are compiled for Rural, Urban and Combined sectors. 2. CFPI is compiled as a weighted average of the indices of specified food sub-groups. 3. All-India CPI press notes include inflation rates for CFPI. Which of the statements given above are correct?

A 1 and 2 only

B 1 and 3 only

C 2 and 3 only

D 1, 2 and 3 Correct

Explanation

All three statements are correct. The revised-series document says CFPI is compiled for Rural, Urban and Combined sectors, as a weighted average of specified sub-groups, and All-India CPI press notes carry CFPI inflation rates.

Q2. With reference to CPI price-data collection, consider the following statements: 1. CPI price data are collected from selected towns. 2. CPI price data are collected from selected villages. 3. CPI price data are collected by DPIIT's Office of the Economic Adviser. Which of the statements given above are correct?

A 1 and 3 only

B 1 and 2 only Correct

C 2 and 3 only

D 1, 2 and 3

Explanation

Statements 1 and 2 are correct: CPI price data are collected from selected towns and selected villages. Statement 3 is false because the cited CPI source names the Field Operations Division of NSO, MoSPI, not OEA/DPIIT.

Q3. With reference to monetary policy and inflation statistics in India, consider the following statements: 1. The amended RBI Act defined the primary objective of monetary policy as maintaining price stability while keeping in mind the objective of growth. 2. India's statutory inflation target is expressed in terms of WPI. 3. The Central Government determines the inflation target in consultation with the Reserve Bank. 4. In the first review conducted in March 2021, the target was replaced by a new WPI-based range. Which of the statements given above are correct?

A 1 and 2 only

B 1 and 3 only Correct

C 2 and 4 only

D 1, 3 and 4 only

Explanation

Statements 1 and 3 are correct. RBI material states the price-stability-with-growth objective and says the Central Government determines the CPI inflation target in consultation with the Bank. Statement 2 is incorrect because the target is in terms of CPI, not WPI. Statement 4 is incorrect because the March 2021 review retained the target for the subsequent five years.

Q4. With reference to CPI and CFPI in an official MoSPI release, consider the following statements: 1. CPI is released for rural, urban and combined sectors. 2. CFPI is released only for urban India. 3. The CPI release cited is on base 2012=100. Which of the statements given above are correct?

A 1 only

B 2 only

C 1 and 3 only Correct

D 1, 2 and 3

Explanation

Statements 1 and 3 are correct: the official release refers to CPI for rural, urban and combined sectors on base 2012=100. Statement 2 is false because CFPI is released for all-India rural, urban and combined sectors.

Q5. With reference to India's statutory inflation-targeting framework, consider the following statements: 1. Under Section 45ZA of the RBI Act, the Central Government, in consultation with the RBI, determines the inflation target in terms of CPI. 2. The inflation target is to be determined once every five years. 3. Section 45ZB provides for a six-member Monetary Policy Committee to determine the policy rate required to achieve the inflation target. 4. The target is specified in terms of WPI inflation because WPI excludes services. Which of the statements given above are correct?

A 1 and 4 only

B 2 and 3 only

C 1, 2 and 3 only Correct

D 1, 2, 3 and 4

Explanation

Statements 1, 2 and 3 are correct. RBI's discussion paper states that Section 45ZA uses CPI and requires review once in five years, while Section 45ZB creates a six-member MPC for the policy rate. Statement 4 is incorrect because the target is in terms of CPI, not WPI.

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Frequently Asked Questions

How many Inflation Statistics MCQ questions are available?

There are 86 Inflation Statistics practice MCQs available on Aspirant Academy, with detailed answers and explanations for each question.

Are answers and explanations provided for Inflation Statistics MCQs?

Yes, every Inflation Statistics question comes with the correct answer and a detailed explanation to help you understand the underlying concept.

How is Inflation Statistics relevant to the RAS/RPSC exam?

Inflation Statistics falls under the Indian Economy section of the RAS/RPSC syllabus. It is a frequently tested area and regular practice with these MCQs will strengthen your preparation.

Can I practice Inflation Statistics questions in Hindi?

Yes, Aspirant Academy offers bilingual support. You can practice Inflation Statistics MCQs in both English and Hindi, including questions, options, and explanations.

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Inflation Statistics MCQ — 86 Practice Questions with Answers

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