Advanced Quiz – 6 October 2026 | General Studies

Answer: (a)

Explanation: Current Account and Savings Account (CASA) deposits are relatively low-cost sources of funds for banks. If their share declines and banks increasingly depend on costlier term deposits, the average cost of funds can rise.

Banks earn a Net Interest Margin (NIM) from the difference between interest earned on assets such as loans and the interest paid on funding sources. When funding becomes more expensive, banks may try to protect margins by increasing lending to higher-yield segments.

However, higher-yield lending can also involve greater credit risk. Thus, a shift away from CASA deposits can create a chain of higher funding costs → pressure on NIM → search for higher yields → potentially greater credit risk.

Answer: (d) All four

Explanation: Pair 1 is correct. A carry trade generally involves borrowing where financing costs are relatively low and investing where expected returns are higher. A rapid unwinding can generate capital outflows from emerging markets.

Pair 2 is correct. The Liquidity Coverage Ratio is intended to improve the ability of financial institutions to withstand short-term liquidity stress.

Pair 3 is correct. Macroprudential measures target risks to the financial system as a whole. Higher risk weights on rapidly expanding risky credit categories are an example.

Pair 4 is correct. Payment-In-Kind arrangements permit obligations such as interest to be satisfied without an immediate cash payment, for example by adding to the debt obligation. Growing dependence on such arrangements can indicate stress in private credit markets.

Answer: (c) Only three

Explanation: The first three are correctly matched.

The proposed framework separates major regulatory functions among three autonomous councils. The Regulatory Council deals with governance, compliance and graded autonomy. The Accreditation Council deals with accreditation, while the Standards Council defines areas such as national learning outcomes, curricular standards and credit-transfer frameworks.

The fourth is incorrect. A significant feature of the proposed structure is the separation of regulation from funding. According to the source, the VBSA would not possess grant-disbursal powers. Funding would remain with the Ministry of Education.

Answer: (d) All four

Explanation: All four are correctly matched.

ULLAS, also known as the New India Literacy Programme, targets persons aged 15 years and above who missed formal schooling. It includes foundational literacy and numeracy, critical life skills and lifelong learning.

NIPUN Bharat, launched under Samagra Shiksha, focuses on foundational literacy and numeracy among children, particularly in the foundational stage.

PM SHRI seeks to strengthen more than 14,500 schools as exemplar institutions demonstrating the implementation of NEP 2020.

PM POSHAN provides hot cooked meals to children in Bal Vatika and Classes I to VIII in government and government-aided schools, linking nutrition with enrolment and retention.

Answer: (b) 1, 2 and 3 only

Explanation: Statements 1, 2 and 3 are correct.

NCM 2.0 is a Central Sector Scheme designed as a consolidated framework for climate-resilient coastal management, ecosystem restoration and sustainable coastal livelihoods.

It covers the nine coastal States: Gujarat, Maharashtra, Goa, Karnataka, Kerala, Tamil Nadu, Andhra Pradesh, Odisha and West Bengal.

It also covers four coastal Union Territories: Dadra and Nagar Haveli and Daman & Diu, Puducherry, Andaman & Nicobar Islands and Lakshadweep.

Statement 4 is therefore incorrect. Delhi, Chandigarh and Ladakh do not fall within the geographical coverage given for the Mission. ICZMPs and Coastal Marine Spatial Plans are specifically included within its planning framework.