Class 10 SST Understanding Economic Development Chapter 4 Globalisation and the Indian Economy Most Important Questions By PW

With PW’s Most Important Questions for Class 10 SST Chapter 4 – Globalisation and the Indian Economy, you can prepare in an exam-focused way. The questions are organised section-wise and based on the marks distribution, helping you prioritise topics effectively. You will cover key areas like globalisation, liberalisation, foreign trade, MNCs, WTO, and their impact on India. This approach not only strengthens conceptual clarity but also improves your answer-writing skills. If you want efficient revision with a clear exam strategy, this PW resource helps you stay confident and well-prepared.

CBSE Important Questions for Class 10 Social Science Economics Chapter 4

Section –A (1 Mark)

 1. Tax on imports is an example of ________.

(A) Investment (B) Disinvestment

(C) Trade barrier (D) Privatisation

Ans. (C)

2. Liberalisation does not include ________.

(A) Removing trade barriers

(B) Introducing quota system

(C) Liberal policies

(D) Disinvestment

Ans. (B)

3. Which one of the following statements is false?

(A) MNCS offer subsidy to the small scale industries.

(B) MNCs acquire small companies to expand production.

(C) MNCs enter into joint venture to enter into foreign markets.

(D) MNCs set up own production centre in foreign countries.

Ans. (A)

4. Globalisation is not supported by _________.

(A) Privatization

(B) Liberalization

(C) Information and communication technology

(D) None of the options

Ans. (D)

5. The most important factor that has stimulated globalisation is __________.

(A) Population explosion

(B) Spread of education

(C) Urbanisation

(D) Rapid improvement in technology

Ans. (D)

6. The most common route for investments by MNCs in countries around the world is to_______.

(A) Set up new factories

(B) Buy existing local companies

(C) Form partnerships with local companies

(D) None of the above

Ans. (B)

7. ___________ provides the advantage of being a cheap manufacturing location.

(A) China

(B) Japan

(C) South Korea

(D) India

Ans. (A)

8. Identify why do MNCs set up offices and factories in more than one nation?

(A) Because the cost of production is high and the MNCs can earn profit.

(B) Because the cost of production is low and the MNCs undergoes a loss.

(C) Because the cost of production is low and the MNCs can earn greater profit.

(D) Because the MNCs want to make their presence felt globally.

 Ans. (C)

9. Which Indian company has been bought by Cargill Foods, an MNC?

(A) Amul

(B) Parakh Foods

(C) Britannia

(D) Dabur

Ans. (B)

Section –B (2 Marks)

10. What are Multi-National Corporations (MNCs)?

Sol. A Multi-National Corporation (MNC) is a company that owns or controls production in more than one nation. The goods and services are produced globally. The production process is

divided into small parts and spread out across the globe.

11. Explain 'what is investment'? Give a few examples of investment.

Sol. Investment is buying of an asset in the form of a factory, a machine, land and building, etc.

(Physical assets) or shares (monetary assets) for the purpose of making or sharing profits of the enterprises concerned. Common investments are: buying land, factories, machines for faster

production, buying small local companies to expand production, cheap labour, skilled engineers, IT personnel, etc.

12. Why is 'tax' on imports known as a trade barrier?

Sol. Tax on imports is known as a trade barrier because it increases the price of imported commodities. It is called a barrier because some restriction has been set up.

13. Why had the Indian Government put barriers to foreign trade and foreign investment after independence?

Sol. The Indian government after independence had put barriers to foreign trade and investment.

• This was done to protect the producers within the country from foreign competition.

• To protect the Indian economy from foreign infiltration in industries affecting the economic growth of the country as planned.

14. "Globalisation and greater competition among producers has been of advantageous to consumers." Justify the statement with examples.

Sol. Globalisation and greater competition among producers has been of advantageous to consumers in the following ways:

• Consumers in today's world have a wide variety of goods and services to choose from. The latest models of digital cameras, mobile phones and televisions made by the leading

manufacturers are available to them.

• Consumers now enjoy better and improved quality at lower prices.

• It has resulted in higher standards of living.

• There has been a varying impact on producers and workers.

• Many top Indian companies have been able to establish themselves as multinational corporations.

• Latest technology and production methods have raised production standards.

15. "Technology has stimulated the globalisation process." Support the statement with examples.

Sol. Technology has stimulated the process of globalisation in the following ways:

• Transportation technology has witnessed several improvements in past fifty years. This has made much faster delivery of goods across long distances possible at lower costs, such as

use of containers have led to huge reduction in port handling costs and increased the speed  which exports can reach markets. Also, the cost of air transport has fallen. Ultimately, it has stimulated the globalisation process.

• Telecommunication has also shown remarkable development. Computers, internet, e-mail, voice-mail, etc. are used intensively to contact one another around the

world.

• There has been a remarkable development in information and communication technology. It has enabled to access information instantly and communicate even in the remotest areas.

Call centres use this to satisfy their customers abroad or provide outsourcing services from anywhere.

16. What is the meaning of SEZ? Mention any two features of SEZ.

Sol. Special Economic Zones. These are designated  areas in a region set up by the government to attract foreign companies to invest in their countries.

The features of Special Economic Zones are:

• The companies who set up production units in these areas are exempted from paying taxes for an initial period of five years.

• These areas are provided with best infrastructural facilities like roads, water, transportation, communication, markets etc.

Section –E (4 Marks)

17. Case Study:

Despite the growth of the economy following the implementation of liberalization policies, it can be argued that this was merely a coincidence and that the growth was actually a delayed effect of previous industrial policies.

Furthermore, it could be contended that economic growth would have occurred even without any policy changes. In order to determine whether the improvements in the Indian economy were indeed a result of liberalization reforms, we have employed the synthetic-control method. This is a statistical technique in which researchers compare a unit that received a treatment with a combination of units

that did not receive the treatment. In this case, the unit is a country and the treatment is liberalization policies. We compare the treated unit to countries that did not implement liberalization policies.

The synthetic control creates an imaginary country that never received the treatment, allowing us to consider how certain variables would have developed in the absence of the treatment. We have utilized GDP per capita as the indicator of economic growth. If the GDP per capita of the synthetic India behaves in the same manner as that of the real India, we cannot conclusively attribute

the exceptional growth of the 1990s to liberalization policies.

(i) What do you understand by the term "liberalization of economic policy".

Sol. "Liberalization of economic policy" refers to the relaxation or removal of government regulations, trade barriers, and restrictions in order to promote

economic freedom and encourage free-market principles. It often involves reducing tariffs,

deregulating industries, privatizing state-owned enterprises, and fostering competition to enhance economic growth and international trade.

(ii) What are the pros and cons of liberalization of economy?

Sol. Pros Cons of liberalization of economy:

• Economic Growth: It can stimulate economic growth by attracting investments and fostering entrepreneurship.

• Inequality: It may exacerbate income inequality.

• Efficiency: Competition and market-driven policies can enhance efficiency in industries.

• Vulnerability: Overreliance on global markets can make the economy vulnerable to external shocks.

(iii) What is the synthetic-control method used for?

Sol. It compares a country that implemented a policy with a synthetic version of the country that did not, to assess the policy's impact.

CBSE Important Questions for Class 10 Social Science Economics Chapter 4 PDF

PW provides a downloadable PDF with important questions based on CBSE exam patterns. You can practise key topics like globalisation, MNCs, WTO, and trade for quick and effective revision.

CBSE Important Questions for Class 10 Social Science Economics Chapter 4 PDF