Economics Questions asked in UPSC Prelims 2025

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1. With reference to investments, consider the following:

I. Bonds
II. Hedge Funds
III. Stocks
IV. Venture Capital

How many of the above are treated as Alternative Investment Funds?

(a) Only one
(b) Only two
(c) Only three
(d) All the four

2. Which of the following are the sources of income for the Reserve Bank of India?

I. Buying and selling Government bonds
II. Buying and selling foreign currency
III. Pension fund management
IV. Lending to private companies
V. Printing and distributing currency notes

Select the correct answer using the code given below:

(a) I and II only
(b) II, III and IV
(c) I, III, IV and V
(d) I, II and V

3. With reference to the Government of India, consider the following information:

Organization Some of its functions It works under

I. Directorate of Enforcement Enforcement of the Fugitive Economic Offenders Act, 2018 Internal Security Division-I, Ministry of Home Affairs
II. Directorate of Revenue Intelligence Enforces the Provisions of the Customs Act, 1962 Department of Revenue, Ministry of Finance
III. Directorate General of Systems and Data Management Carrying out big data analytics to assist tax officers for better policy and nabbing tax evaders Department of Revenue, Ministry of Finance

In how many of the above rows is the information correctly matched?

(a) Only one
(b) Only two
(c) All the three
(d) None

4. Consider the following statements:

I. The Reserve Bank of India mandates all the listed companies in India to submit a Business Responsibility and Sustainability Report (BRSR).
II. In India, a company submitting a BRSR makes disclosure in the report that are largely non-financial in nature.

Which of the statements given above is/are correct?

(a) I only
(b) II only
(c) Both I and II
(d) Neither I nor II

5. Consider the following statements:

Statement I:

In India, income from allied agricultural activities like poultry farming is exempted from income tax.

Statement II:

Income from rural agricultural land is exempt from tax under the provisions of the Income-tax Act, 1961.

Which one of the following is correct in respect of the above statements?

(a) Both Statement I and Statement II are correct and Statement II is the correct explanation of Statement I
(b) Both Statement I and Statement II are correct but Statement II is not the correct explanation of Statement I
(c) Statement I is correct but Statement II is incorrect
(d) Statement I is incorrect but Statement II is correct

6. Consider the following statements:

I. India has joined the Minerals Security Partnership as a member.
II. India is a resource-rich country in all the 30 critical minerals that (It) has identified.
III. The Parliament in 2023 has amended the Mines and Minerals (Development and Regulation) Act, 1957 empowering the Central Government to exclusively auction mining lease and composite license for certain critical minerals.

Which of the statements given above are correct?

(a) I and II only
(b) II and III only
(c) I and III only
(d) I, II and III

7. Consider the following statements:

Statement I:

As regards returns from an investment in a company, generally, bondholders are considered to be relatively at lower risk than stockholders.

Statement II:

Bondholders are lenders to a company whereas stockholders are its owners.

Statement III:

For repayment purpose, bondholders are prioritized over stockholders by a company.

Which one of the following is correct in respect of the above statements?

(a) Both Statement II and Statement III are correct and both of them explain Statement I
(b) Both Statement I and Statement II are correct and Statement I explains Statement II
(c) Only one of the Statements II and III is correct and that explains Statement I
(d) Neither Statement II nor Statement III is correct

8. Consider the following statements:

I. India accounts for a very large portion of all equity option contracts traded globally thus exhibiting a great boom.
II. India’s stock market has grown rapidly in the recent past even overtaking Hong Kong’s at some point of time.
III. There is no regulatory body either to warn the small investors about the risks of options trading or to act on unregistered financial advisors in this regard.

Which of the statements given above are correct?

(a) I and II only
(b) II and III only
(c) I and III only
(d) I, II and III

9. Consider the following statements:

Statement I:

Circular economy reduces the emissions of greenhouse gases.

Statement II:

Circular economy reduces the use of raw materials as inputs.

Statement III:

Circular economy reduces wastage in the production process.

Which one of the following is correct in respect of the above statements?

(a) Both Statement II and Statement III are correct and both of them explain Statement I
(b) Both Statement II and Statement III are correct but only one of them explains Statement I
(c) Only one of the Statements II and III is correct and that explains Statement I
(d) Neither Statement II nor Statement III is correct

10. Consider the following statements:

I. Capital receipts create a liability or cause a reduction in the assets of the Government.
II. Borrowings and disinvestment are capital receipts.
III. Interest received on loans creates a liability of the Government.

Which of the statements given above are correct?

(a) I and II only
(b) II and III only
(c) I and III only
(d) I, II and III

Economics Questions in UPSC Prelims – Trend (2013 to 2024)

Let’s take a look at how many Economics Questions in UPSC Prelims were asked each year. This helps identify the trend and prioritize your study plan accordingly.

As shown above, the number of Economics Questions in UPSC Prelims has mostly remained between 13 and 18 questions per year. This clearly signals the importance of Economics as a core area of focus.

Economics Questions from UPSC Prelims 2024

To understand the nature and complexity of Economics Questions in UPSC Prelims, here are actual questions from UPSC Prelims 2024.

UPSC Prelims 2024 – Economics Questions

1. Consider the following statements:

Statement-I: If the United States of America (USA) were to default on its debt, holders of US Treasury Bonds will not be able to exercise their claims to receive payment.

Statement-II: The USA Government debt is not backed by any hard assets, but only by the faith of the Government.

Which one of the following is correct in respect of the above statements?

(a) Both Statement-1 and Statement-II are correct and Statement-II explains Statement-I

(b) Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I

(c) Statement-I is correct, but Statement-II is incorrect

(d) Statement-I is incorrect, but Statement-II is correct

2. Consider the following statements:

Statement-I: Syndicated lending spreads the risk of borrower default across multiple lenders.

Statement-II: The syndicated loan can be fixed amount/lump sum of funds, but cannot be a credit line.

Which one of the following is correct in respect of the above statements?

(a) Both Statement-I and Statement-II are correct and Statement-I Statement-II explains

(b) Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I

(c) Statement-I is correct, but Statement-II is incorrect

(d) Statement-I is incorrect, but Statement-II is correct

Preparing for the UPSC Prelims requires smart strategy, and one crucial area that often decides the outcome is the Economics Questions in UPSC Prelims. Over the last decade, economics has consistently featured with substantial weightage in the General Studies (GS) Paper 1. This article offers a detailed analysis of the Economics Questions in UPSC Prelims, highlights the trend from 2013 to 2024, and includes real questions from recent years to help aspirants strengthen their preparation.

Economics in UPSC Prelims 2025

Economics emerged as the most dominant subject in the UPSC Prelims 2025, with a total of 21 questions, reflecting its increasing importance in the examination pattern. The difficulty level was moderate to difficult, with several questions testing conceptual clarity, current economic developments, and government policies. Many aspirants found this section slightly more challenging due to the inclusion of analytical and application-based questions. A good understanding of both static concepts and recent economic trends was essential to perform well in this part of the paper.

Economics Questions in UPSC Prelims 2025

Economics is a vital part of UPSC Prelims GS Paper 1, with around 15–25 questions each year. The syllabus covers both static concepts and current affairs. Key topics include microeconomics, macroeconomics, fiscal and monetary policy, Indian economy (pre- and post-1991 reforms), external sector, financial system, agriculture, industry, and services. Growth and development theories, HDI, and sustainability also feature prominently. Candidates must stay updated with the Economic Survey, Budget, and recent government schemes. Questions range from conceptual and application-based to current affairs and data interpretation, testing both theoretical knowledge and awareness of real-time economic issues. 

Conclusion

Mastering the Economics Questions in UPSC Prelims is not optional—it is essential. With a smart strategy, daily current affairs, conceptual clarity, and regular practice of previous year questions, aspirants can easily boost their chances of clearing the prelims stage. Track trends, focus on high-yield areas, and stay updated with economic policies and developments.

Economics Questions in UPSC Prelims FAQs

How many Economics Questions are usually asked in UPSC Prelims?

Over the past decade, 13 to 18 Economics Questions have been asked every year in the UPSC Prelims GS Paper 1. This makes Economics one of the most important and consistent subjects in the exam.

What topics are covered under Economics in UPSC Prelims?

 The Economics Questions in UPSC Prelims usually cover:

• Basic concepts like inflation, fiscal policy, and monetary policy

• Banking and finance

• Government schemes

• Budget and Economic Survey

• External sector and foreign trade

• Current economic affairs

Are current affairs important for Economics Questions in UPSC Prelims?

Yes, a significant portion of Economics Questions in UPSC Prelims are current-affairs-based. Reading newspapers like The Hindu and following updates from PIB and RBI is crucial.

Which books are best for preparing Economics Questions in UPSC Prelims?

 Recommended books include:

• NCERT Economics (Class 11 & 12)

• Indian Economy by Ramesh Singh

• Budget & Economic Survey Summary

• UPSC Previous Year Question Papers for practice

Can practicing previous years' Economics questions improve my score?

 Absolutely. Solving Economics Questions in UPSC Prelims from previous years helps you understand trends, question patterns, and recurring concepts. It also boosts speed and accuracy.