Liberalization, Privatization, and Globalization Class 12 MCQ Quiz – Test Your Understanding!

Are you ready to test your knowledge of Liberalization, Privatization, and Globalization (LPG) from the Class 12 Economics syllabus? This chapter explores the 1991 economic reforms that transformed India’s economy, paving the way for globalization and market-driven growth.

About the Quiz

Chapter Name: Liberalization, Privatization, and Globalization: An Appraisal
Subject: Economics
Book: NCERT Class 12 Economics
Question Type: Multiple Choice Questions (MCQs)
Leaderboard: Yes (Check Your Rank!)

Why Take This Quiz?

✔ Helps in CBSE board exam revision
✔ Strengthens understanding of economic reforms of 1991
✔ Enhances knowledge of LPG policies and their impact
✔ Track your progress with the leaderboard

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Chapter 3-Liberalization, Privatization, and Globalization: An Appraisal

1 / 15

What are the advantages of globalization for the Indian economy?

Improved access to technology and increased foreign investment

Increased market access and reduced trade barriers

All

Increased employment and job opportunities

2 / 15

What were the two major steps taken by the Government of India in the financial sector under the Economic Reforms of 1991?

Reduction in the role of the private sector in the financial sector

Change in the role of the Reserve Bank of India (RBI) from regulator to facilitator and origin of private banks

Increased government control over the financial sector

Nationalization of banks and imposition of strict controls on the financial sector

3 / 15

Which of the following policies was adopted to increase the competitive position of Indian goods in the international markets?

the rate of corporation tax was reduced

Foreign Institutional Investors (FII) were allowed to invest in India

export duties were removed

import licensing was abolished

4 / 15

Which of the following can help reduce the fiscal deficit?

decreasing the burden and incidence of tax

investing in improving public goods

increasing subsidies

increasing the PSU profits

5 / 15

What were the main reasons for introducing reforms in India?

Steep fall in foreign exchange reserves, unfavorable Balance of Payments, huge burden of external debt, high rate of price inflation, and huge burden of fiscal deficit

Increased foreign investment

Low rate of inflation

High rate of economic growth

6 / 15

Do you agree that profit-making public sector undertakings (PSUs) should be privatized? Why?

Yes, because it reduces government control over the economy

No, because it leads to job losses and reduced social welfare

No, because it increases inequality and reduces government revenue

Yes, because it increases efficiency and revenue generation

7 / 15

Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative from those given below.

Assertion (A): In 1991, as an immediate measure to resolve the Balance of Payments crisis, the rupee was devalued against foreign currencies.

Reason (R): Devaluation of currency was eminent, exchange reserves.

Both Assertion (A) and Reason (R) are true, but Reason (R) is the explanation of Assertion (A).

Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

Assertion (A) is false, but Reason (R) is true.

Assertion (A) is true, but Reason (R) is false.

8 / 15

Read the following statements - Assertion (A) and Reason (R). Choose one of the correct alternatives given below:

Assertion (A): Every year government fixes a target for disinvestment of Public Sector Enterprises (PSEs).

Reason (R): Disinvestment is an excellent tool for discarding the loss incurring Public Sector Enterprises (PSEs).

Assertion (A) is true but Reason (R) is false.

Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)a. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)

Assertion (A) is false but Reason (R) is true.

Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)

9 / 15

Which two taxes were subsumed in Goods and Services Tax (GST)?

Income tax and sales tax

Property tax and wealth tax

Excise duty and custom duty

Value-added tax and service tax

10 / 15

There are two statements given below, marked as Statement (1) and Statement (2). Read the statements and choose the correct option.

Statement (1): Air India, a fully owned Public Sector Undertaking (PSU) was disinvested and sold to a private entity.

Statement (2): Public Sector Undertakings (PSU) are sold to create more direct and/or indirect employment opportunities in the country.

Both statements 1 and 2 are true

Statement 1 is true and Statement 2 is false.

Statement 1 is false and Statement 2 is true.

Both statements 1 and 2 are false

11 / 15

How has the economic reform process affected the agricultural sector in India?

Increased public investment in agriculture

Reduced cost of production for farmers

Reduced prices of food grains

Increased international competitiveness and shift from food crops to cash crops

12 / 15

What is outsourcing?

Hiring of contract service from internal sources

Hiring of permanent service from external sources

Hiring of temporary service from internal sources

Hiring of regular service from external sources

13 / 15

Why is it necessary to become a member of the WTO?

Increased market access and reduced trade barriers

Improved access to technology and increased foreign investment

All

Strengthened rules-based trading system

14 / 15

Which of the following is a Maharatna?

Airport Authority of India

Bharat Sanchar Nigam Limited

Hindustan Aeronautics Limited

Indian Oil Corporation Limited

15 / 15

Which of the following falls under the role of the World Trade Organisation?

providing a platform for member countries to decide future tariff-related strategies

setting the limit for domestic and foreign investments in a country

aiding the development of poor countries by providing infrastructural investment

mandating the level of tax levied on foreign firms in developing countries

Your score is

The average score is 51%

Leaderboard – Top Scorers

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Pos.	Name	Score	Duration	Points
1	Karan Shukla	87 %	11 minutes 15 seconds	13
2	Rashmika	80 %	1 minutes 45 seconds	12
3	B	80 %	2 minutes 18 seconds	12
4	Hardik	80 %	3 minutes 45 seconds	12
5	Naman	80 %	4 minutes 9 seconds	12
6	Mg Liron	80 %	10 minutes 57 seconds	12
7	Yashika	73 %	1 minutes 27 seconds	11
8	Rashi	73 %	3 minutes 32 seconds	11
9	xyz	73 %	3 minutes 34 seconds	11
10	palak	73 %	4 minutes 58 seconds	11
11	Shreyashii	67 %	5 minutes 19 seconds	10
12	.	67 %	5 minutes 56 seconds	10
13	Shivam	67 %	6 minutes 40 seconds	10
14	Id	67 %	16 minutes 15 seconds	10
15	Yahana	60 %	1 minutes 19 seconds	9
16	tariq	60 %	4 minutes 38 seconds	9
17	Rashi	60 %	4 minutes 59 seconds	9
18	Shreyas	60 %	6 minutes 36 seconds	9
19	rashee	60 %	8 minutes 45 seconds	9
20	vansh	53 %	1 minutes 57 seconds	8
21	Sakshi	53 %	3 minutes 45 seconds	8
22	Naina	53 %	4 minutes 41 seconds	8
23	roar	53 %	5 minutes 18 seconds	8
24	hema	53 %	5 minutes 39 seconds	8
25	aish	53 %	13 minutes 11 seconds	8
26	Raj	47 %	4 minutes 48 seconds	7
27	abhay	47 %	5 minutes 7 seconds	7
28	Rashpreet	47 %	5 minutes 7 seconds	7
29	Rashida	40 %	4 minutes 12 seconds	6
30	....................................	40 %	5 minutes 13 seconds	6
31	Prince Gupta	33 %	1 minutes 53 seconds	5
32	Raj	33 %	1 minutes 55 seconds	5
33	Ishant shaw	33 %	6 minutes 49 seconds	5
34	Ref	27 %	1 minutes 6 seconds	4
35	Tahmeed Anwar Siddique	20 %	39 seconds	3
36	Me	20 %	39 seconds	3
37	Om	20 %	1 minutes 30 seconds	3
38	Saniya	20 %	2 minutes 46 seconds	3
39	dfmaxi	20 %	2 minutes 59 seconds	3
40	ANCD	13 %	34 seconds	2
41	Chcfg	7 %	32 seconds	1
42	Ram	7 %	2 minutes 22 seconds	1

Key Topics Covered in the Quiz

✔ Reasons for economic reforms in India
✔ Features of Liberalization, Privatization, and Globalization (LPG)
✔ Impact of LPG on various sectors of the economy
✔ Role of WTO and globalization in India
✔ Positive and negative consequences of economic reforms

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About the Quiz

Why Take This Quiz?

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Key Topics Covered in the Quiz

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