Statement 1 is correct: Total foreign trade (exports + imports) as a proportion of GDP is a common measure
of the degree of openness of an economy. An open economy trades with other nations in goods, services and at times in financial assets.

Statement 2 is incorrect: Even a closed economy can be a fast-growing economy.

Statement 3 is incorrect: Number or depth of financial institutions does not show how open an economy is.

However, with more openness, one can expect that FIs grow large in number and have deeper penetration of the economic system.

Efforts at poverty alleviation have borne fruit in that for the first time since independence, the percentage of absolute poor in some states is now well below the national average. Despite a variety of approaches, programmes and schemes to alleviate poverty; hunger, malnourishment, illiteracy and lack of basic amenities continue to be a common feature in many parts of India. The Fifth Five-Year Plan laid stress on employment, poverty alleviation (Garibi Hatao), and justice. The plan also focused on self-reliance in agricultural production and defence.

This was the first time that poverty alleviation was declared in the objectives of any plan. Thus statement 1 is correct. Scholars, while assessing these programmes, state three major areas of concern which prevent their successful implementation. Due to unequal distribution of land and other assets, the benefits from direct poverty alleviation programmes have been appropriated by the non-poor. Thus statement 2 is correct. Secondly, compared to the magnitude of poverty, the amount of resources allocated for these programmes is not sufficient. There is also non-participation of local level institutions in programme implementation

In a recent speech delivered by RBI Deputy Governor Viral Acharya, he points out the dangers of elevated government borrowing. According to him, not only does government borrowing crowd out the private sector, but it can also induce the private sector to borrow more short-term, which can increase financial fragility. As more government debt floods markets, the relative safety and liquidity premium attached by investors to high-rated corporate bonds diminishes, raising the cost of borrowing especially for AAA-rated borrowers and making it relatively less sensitive to policy rate cuts. Thus statement 1 and 2 are correct. Statement 3 is incorrect as there is no relation between corporate governance and the amount of capital borrowed by government from the market.

The Education Quality Upgradation and Inclusion Programme, has been released by Ministry of Human Resource Development. It is crafted by ten committees led by experts within the government such as NITI Aayog CEO, Principal Scientific Advisor and former Revenue Secretary, as well as some Corporate Chiefs. Hence, statement 1 is correct.

- The ten Expert Groups drawn from senior academicians, administrators and industrialists, have suggested more than 50 initiatives that would transform the higher education sector completely.

- EQUIP is proposed to put together an action plan to give a multi-pronged boost to the higher education system in India. It is to be implemented between 2019-2024. Hence, statement 2 is NOT correct. 

Objectives of the programme are:

- To double the Gross Enrolment Ratio in higher education.
- Improve teaching and learning processes;

- Resolve the geographically skewed access to higher educational institutions.
- Achieve globally acceptable quality standards across the country

Changes in the price of foreign exchange under flexible exchange rates are referred to as currency depreciation or appreciation. For instance, if the equilibrium Rupee-Dollar exchange rate was Rs.65 and now it has become Rs.70 per dollar, then the Rupee has depreciated against the dollar. By contrast a currency appreciates when it becomes more expensive in terms of foreign currency. Thus statement 1 is correct.

The objectives of setting up of small finance banks will be to further financial inclusion by (a) provision of savings vehicles, and (ii) supply of credit to small business units; small and marginal farmers; micro and small industries; and other unorganised sector entities, through high technology-low cost operations Prudential norms:

The small finance bank will be subject to all prudential norms and regulations of RBI as applicable to existing commercial banks including requirement of maintenance of Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR). No forbearance would be provided for complying with the statutory provisions. Thus statement 1 is correct.

The small finance banks will be required to extend 75 per cent of its Adjusted Net Bank Credit (ANBC) to the sectors eligible for classification as priority sector lending (PSL) by the Reserve Bank. Thus statement 2 is correct. At least 50 per cent of its loan portfolio should constitute loans and advances of upto Rs. 25 lakh.

Eligible promoters: Resident individuals/professionals with 10 years of experience in banking and finance; and companies and societies owned and controlled by residents will be eligible to set up small finance banks. Existing Non-Banking Finance Companies (NBFCs), Micro Finance Institutions (MFIs), and Local Area Banks (LABs) that are owned and controlled by residents can also opt for conversion into small finance banks.

Ecomark or Eco mark is a certification mark issued by the Bureau of Indian Standards to products conforming to a set of standards aimed at the least impact on the ecosystem. The marking scheme was started in 1991.

Minimum Support Price (MSP) is a form of market intervention by the Government of India to insure agricultural producers against any sharp fall in farm prices. The minimum support prices are announced by the Government of India at the beginning of the sowing season for certain crops on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP). MSP is price fixed by Government of India to protect the producer -farmers - against excessive fall in price during bumper production years. Thus statement 1 is incorrect.

Government announces minimum support prices (MSPs) for 22 mandated crops and fair and remunerative price (FRP) for sugarcane.The list of crops are as follows.

- Cereals (7) - paddy, wheat, barley, jowar, bajra, maize and ragi
- Pulses (5) - gram, arhar/tur, moong, urad and lentil
- Oilseeds (8) - groundnut, rapeseed/mustard, toria, soyabean, sunflower seed, sesamum, safflower seed and nigerseed
- Raw cotton

- Raw jute
- Copra
- De-husked coconut

- Sugarcane (Fair and remunerative price)
- Virginia flu cured (VFC) tobacco

Thus statement 2 is incorrect.

GDP of a country measures the aggregate production of final goods and services taking place within the domestic economy during a year. Gross National Product (GNP) is defined as GDP plus Net Factor Income from abroad. Net factor income from abroad is factor income earned by domestic factors of production employed in the rest of the world minus factor income earned by the factors of production of the rest of the world employed in the domestic economy. Thus, all the above options are included in GNP and not GDP. Thus, option d is the correct answer.

Recently, the RBI in consultation with the Government of India has decided that the limits for WMA for the first half of the financial year 2019-20 will be Rs. 75000 crore. The Reserve Bank of India acts as the banker to both the Central and State Governments. The government used to borrow money from the RBI through treasury bills, but Ways and Means Advances replaced it in 1997. It acts as a loan facility to both Central and State governments to meet their cash requirements. The loans taken by the government through Ways and Means Advances need to be returned in 90 days. The interest rate of WMA is currently the repo rate, and its limits are decided mutually by the RBI and the Government of India. Hence, the correct option is (b).