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Reading Passage
India has suffered from persistent high inflation. Increase in administered prices, demand and supply imbalances, imported inflation aggravated by rupee depreciation, and speculation — have combined to keep high inflation going. If there is an element common to all of them, it is that many of them are the outcomes of economic reforms, India's vulnerability to the effects of changes in international prices has increased with trade liberalisation. The effort to reduce subsidies has resulted in a continuous increase in the prices of commodities that are administered.

What is the most logical, rational and crucial message that is implied in the above passage?

20152Mprelimsupscyear-2015p2csatreading-comprehension
A.Under the present circumstances, India should completely avoid all trade liberalisation policies and all subsidies.
B.Due to its peculiar socio-economic situation, India is not yet ready for trade liberalisation process.
C.There is no solution in sight for the problems of continuing poverty and inflation in India in the near future.
D.Economic reforms can often create a high inflation economyCorrect
Explanation & Solution

Correct Option: (D) Economic reforms can often create a high inflation economy

The passage discusses the challenges of high inflation in India and how it is linked to economic reforms such as trade liberalization and reduction of subsidies. This implies that economic reforms can often lead to high inflation, as they can increase vulnerability to international price changes and reduce subsidies on essential commodities.

हिंदी में प्रश्न एवं आदर्श उत्तर

पठित परिच्छेद
India has suffered from persistent high inflation. Increase in administered prices, demand and supply imbalances, imported inflation aggravated by rupee depreciation, and speculation — have combined to keep high inflation going. If there is an element common to all of them, it is that many of them are the outcomes of economic reforms, India's vulnerability to the effects of changes in international prices has increased with trade liberalisation. The effort to reduce subsidies has resulted in a continuous increase in the prices of commodities that are administered.

What is the most logical, rational and crucial message that is implied in the above passage?

A.Under the present circumstances, India should completely avoid all trade liberalisation policies and all subsidies.
B.Due to its peculiar socio-economic situation, India is not yet ready for trade liberalisation process.
C.There is no solution in sight for the problems of continuing poverty and inflation in India in the near future.
D.Economic reforms can often create a high inflation economyसही

सही उत्तर: (D) Economic reforms can often create a high inflation economy

The passage discusses the challenges of high inflation in India and how it is linked to economic reforms such as trade liberalization and reduction of subsidies. This implies that economic reforms can often lead to high inflation, as they can increase vulnerability to international price changes and reduce subsidies on essential commodities.

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