A hypothetical manufacturer’s annual sales rise from ₹100 lakh to ₹120 lakh, while total costs rise from ₹90 lakh to ₹115 lakh. Which conclusion follows?

Turnover rises by 20%, while profit falls by 50%

Turnover and profit both rise by 20%

Turnover rises by 20%, while profit falls by 25%

Turnover and profit both fall by 50%

Consider the following statements: Statement-I: A jointly accessible testing laboratory can reduce duplicated investment by small manufacturers. Statement-II: Specialised equipment required periodically by individual firms can be shared across several enterprises. Which one of the following is correct?

Both are correct, and II explains I

Both are correct, but II does not explain I

I is correct, but II is incorrect

I is incorrect, but II is correct

In a simplified example, gross exports rise from ₹100 to ₹120 and embodied foreign value added rises from ₹40 to ₹60. Which description of domestic value added is correct?

Its amount remains ₹60 and its share falls to 50%

Its amount rises and its share remains 60%

Its amount remains unchanged and its share rises

Its amount falls to ₹40 and its share falls to 50%

An anchor manufacturer opens in a zone but purchases almost all inputs from distant suppliers and offers no supplier-development support. Which assessment is most justified?

Local spillovers require evidence of procurement and capability linkages

Local supplier linkages are established by its physical presence alone

All imported or distant inputs necessarily reduce product performance

Land allotment is sufficient evidence of broad cluster benefits

A supported firm expands production after receiving assistance. Which additional evidence is most relevant to judging the additionality of the support?

A credible estimate of expansion that would occur without support

The total expansion recorded after the assistance

The percentage of approved funds disbursed

The firm’s entire turnover after expansion

A protective-gear prototype performs well in one demonstration, but subsequent batches show inconsistent performance. Which intervention most directly addresses the immediate constraint?

Process control and repeated validation of production

A branding campaign before checking repeatability

Higher sales targets without changing the process

A larger production run based on the single demonstration

Practice MCQs Current Affairs

Khelo India Sports Goods Scheme: Manufacturing and MSMEs — MCQs with Answers

Test what you know about Khelo India Sports Goods Scheme: Manufacturing and MSMEs with 10 UPSC Prelims-style questions. Try each one first, then tap “Show answer” for the correct option and its explanation.

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10 practice questions
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Answers & explanations

Answers revealed

Try each question yourself first, then check the answer.

Q1. Consider the following statements about the approved scheme: 1. It combines support for new manufacturing investment with upgrading existing clusters. 2. Its manufacturing focus makes assistance for certification and skills unnecessary. 3. The ₹1,130 crore combined component and ₹105 crore certification component are included within the total outlay. Which of the statements given above are correct?
1. A. 1 and 2 only
2. B. 2 and 3 only
3. C. 1, 2 and 3
4. D. 1 and 3 only
Show answer

Correct answer: (D) 1 and 3 only

Explanation

Correct Answer: (D). Statements 1 and 3 reflect the scheme’s complementary design and the relationship between component allocations and total outlay. Statement 2 is incorrect: physical production capacity does not replace skilled work or conformity assessment. The component amounts must not be counted again as additions above the announced total.
Q2. A hypothetical manufacturer’s annual sales rise from ₹100 lakh to ₹120 lakh, while total costs rise from ₹90 lakh to ₹115 lakh. Which conclusion follows?
1. A. Turnover and profit both rise by 20%
2. B. Turnover rises by 20%, while profit falls by 50%
3. C. Turnover rises by 20%, while profit falls by 25%
4. D. Turnover and profit both fall by 50%
Show answer

Correct answer: (B) Turnover rises by 20%, while profit falls by 50%

Explanation

Correct Answer: (B). Sales increase by 20 on a base of 100, giving 20% turnover growth. Profit changes from 100 minus 90, or 10, to 120 minus 115, or 5. That is a 50% profit decline. Revenue growth therefore cannot be used as a substitute for profitability analysis.
Q3. Consider the following statements: Statement-I: A jointly accessible testing laboratory can reduce duplicated investment by small manufacturers. Statement-II: Specialised equipment required periodically by individual firms can be shared across several enterprises. Which one of the following is correct?
1. A. Both are correct, and II explains I
2. B. Both are correct, but II does not explain I
3. C. I is correct, but II is incorrect
4. D. I is incorrect, but II is correct
Show answer

Correct answer: (A) Both are correct, and II explains I

Explanation

Correct Answer: (A). Sharing periodically used equipment can avoid each firm purchasing and maintaining a separate set, explaining the potential reduction in duplicated investment. Both statements are correct and causally connected. The word can matters: access, operators and maintenance are still necessary, so the argument does not guarantee savings from any laboratory building.
Q4. In a simplified example, gross exports rise from ₹100 to ₹120 and embodied foreign value added rises from ₹40 to ₹60. Which description of domestic value added is correct?
1. A. Its amount rises and its share remains 60%
2. B. Its amount remains unchanged and its share rises
3. C. Its amount remains ₹60 and its share falls to 50%
4. D. Its amount falls to ₹40 and its share falls to 50%
Show answer

Correct answer: (C) Its amount remains ₹60 and its share falls to 50%

Explanation

Correct Answer: (C). Domestic value added is 100 minus 40, or 60, initially and 120 minus 60, again 60, subsequently. Its share changes from 60/100 to 60/120. Gross exports rise but domestic value remains unchanged and its share falls, illustrating why export invoices cannot directly measure domestic contribution.
Q5. Consider the following statements about certification: 1. Financial assistance for certification does not remove the need to meet technical requirements. 2. Certification for one application establishes approval for every competition. 3. Certification renewal is relevant to continuing quality assurance. Which of the statements given above are correct?
1. A. 1 and 2 only
2. B. 1 and 3 only
3. C. 2 and 3 only
4. D. 1, 2 and 3
Show answer

Correct answer: (B) 1 and 3 only

Explanation

Correct Answer: (B). Assistance addresses the cost of obtaining or renewing certification, not exemption from conformity requirements. Statements 1 and 3 are correct. Certification has a defined scope, and competition organisers may impose relevant conditions, so approval for one application cannot be extended automatically to every competition as statement 2 proposes.
Q6. Consider the following indicator–category pairs: 1. Public expenditure on a laboratory — Input 2. An operational common testing centre — Output 3. A sustained decline in product rejection rates — Outcome How many of the pairs given above are correctly matched?
1. A. All three
2. B. Only one
3. C. Only two
4. D. None
Show answer

Correct answer: (A) All three

Explanation

Correct Answer: (A). All three pairs follow the results chain. Expenditure supplies resources, an operational centre is a delivered facility, and lower rejection rates reflect a change in production performance. These categories should not be collapsed: spending or establishing a centre alone does not prove that product quality has actually improved.
Q7. An anchor manufacturer opens in a zone but purchases almost all inputs from distant suppliers and offers no supplier-development support. Which assessment is most justified?
1. A. Local supplier linkages are established by its physical presence alone
2. B. All imported or distant inputs necessarily reduce product performance
3. C. Land allotment is sufficient evidence of broad cluster benefits
4. D. Local spillovers require evidence of procurement and capability linkages
Show answer

Correct answer: (D) Local spillovers require evidence of procurement and capability linkages

Explanation

Correct Answer: (D). An anchor can generate opportunities, but physical presence does not prove local procurement, technical learning or participation by smaller firms. Those linkages require evidence. Distant or imported inputs are not automatically harmful to performance, and land allotment measures an administrative step rather than the breadth of realised cluster benefits.
Q8. A supported firm expands production after receiving assistance. Which additional evidence is most relevant to judging the additionality of the support?
1. A. The total expansion recorded after the assistance
2. B. The percentage of approved funds disbursed
3. C. A credible estimate of expansion that would occur without support
4. D. The firm’s entire turnover after expansion
Show answer

Correct answer: (C) A credible estimate of expansion that would occur without support

Explanation

Correct Answer: (C). Additionality asks what the intervention changed relative to what would have happened without it. A credible baseline or counterfactual is therefore central. Approval timing and visible expansion alone do not establish causation, because the firm could have planned investment already or benefited from other changes in market conditions.
Q9. A protective-gear prototype performs well in one demonstration, but subsequent batches show inconsistent performance. Which intervention most directly addresses the immediate constraint?
1. A. Process control and repeated validation of production
2. B. A branding campaign before checking repeatability
3. C. Higher sales targets without changing the process
4. D. A larger production run based on the single demonstration
Show answer

Correct answer: (A) Process control and repeated validation of production

Explanation

Correct Answer: (A). The observed constraint is repeatability, so process control and validation directly address it. A successful prototype is not proof of reliable mass production. Branding, targets or a larger run may increase commercial exposure while leaving inconsistent quality unresolved; they do not substitute for fixing the manufacturing process.
Q10. Consider the following statements about exports: 1. Certification can help address a quality-related market-access barrier. 2. Meeting technical requirements guarantees an export order irrespective of price or delivery. 3. Market outreach and reliable supply can complement product-quality improvement. Which of the statements given above are correct?
1. A. 1 and 2 only
2. B. 1 and 3 only
3. C. 2 and 3 only
4. D. 1, 2 and 3
Show answer

Correct answer: (B) 1 and 3 only

Explanation

Correct Answer: (B). Certification can demonstrate relevant conformity, while outreach and dependable delivery help firms reach and retain buyers. Statements 1 and 3 are correct. Technical compliance is not the same as commercial demand: prices, logistics and delivery obligations still matter, so statement 2 incorrectly converts a facilitating condition into a guarantee.

More practice MCQ sets

All MCQ sets

Q2. A hypothetical manufacturer’s annual sales rise from ₹100 lakh to ₹120 lakh, while total costs rise from ₹90 lakh to ₹115 lakh. Which conclusion follows?

Q4. In a simplified example, gross exports rise from ₹100 to ₹120 and embodied foreign value added rises from ₹40 to ₹60. Which description of domestic value added is correct?

Q6. Consider the following indicator–category pairs: 1. Public expenditure on a laboratory — Input 2. An operational common testing centre — Output 3. A sustained decline in product rejection rates — Outcome How many of the pairs given above are correctly matched?

Q7. An anchor manufacturer opens in a zone but purchases almost all inputs from distant suppliers and offers no supplier-development support. Which assessment is most justified?

Q8. A supported firm expands production after receiving assistance. Which additional evidence is most relevant to judging the additionality of the support?

Q9. A protective-gear prototype performs well in one demonstration, but subsequent batches show inconsistent performance. Which intervention most directly addresses the immediate constraint?

More practice MCQ sets