UPSC CSE (Preliminary) Exam 2024 Paper I (GS) – 16 June 2024 (Answer Key)

Explanation – The average number of children a hypothetical cohort of women would have at the end of their reproductive period if they were subject during their whole lives to the fertility rates of a given period and if they were not subject to mortality. It is expressed as children per woman. Total fertility rate is directly calculated as the sum of age-specific fertility rates (usually referring to women aged 15 to 49 years), or five times the sum if data are given in five-year age groups.

Explanation –

• Statement 1 is incorrect. LAF is a facility extended by RBI to the scheduled commercial banks (excluding RRBs) and PDs to avail of liquidity in case of requirement or park excess funds with RBI in case of excess liquidity on an overnight basis against the collateral of G-Secs including SDLs.
• Statement 2 is correct. FIIs are those institutional investors which invest in the assets belonging to a different country other than that where these organizations are based. Recently, the Reserve Bank of India (RBI) has allowed investments in India’s Sovereign Green Bonds (SGrBs) by Foreign Institutional Investors (FIIs).
• Statement 3 is correct. In India, Stock exchanges can offer separate trading platforms for debts. Example – NSE’s Electronic Debt Bidding platform (NSE-EBP).

Explanation –

• Option 1 is correct. Insurance companies have the flexibility to invest in both corporate bonds and government securities, depending on their risk appetite and investment strategy.
• Option 2 is correct. Insurance companies and pension funds invest in both corporate bonds and government securities. Corporate bonds offer diversification and steady income, while government securities are safer due to government backing. Returns depend on market conditions and credit risk. NPS in India allows asset allocation across these classes.
• Option 3 is correct. Retail investors can trade in both corporate bonds and government securities.

Explanation – Option 1 and 3 are correct. A financial instrument is a real or virtual document representing a legal agreement involving any kind of monetary value. Examples of financial instruments include stocks, exchange-traded funds (ETFs), bonds, certificates of deposit (CDs), mutual funds, loans, and derivatives contracts, among others.

Explanation – Option 2, 3 and 4 are correct.

Explanation –  Option 1, 2, 3 and 4 are correct. SAF is a biofuel used to power aircraft that has similar properties to conventional jet fuel but with a smaller carbon footprint. Depending on the feedstock and technologies used to produce it, SAF can reduce life cycle GHG emissions dramatically compared to conventional jet fuel. Some emerging SAF pathways even have a net-negative GHG footprint. These resources are –

• Corn grain
• Oil seeds
• Algae
• Other fats, oils, and greases
• Agricultural residues
• Forestry residues
• Wood mill waste
• Municipal solid waste streams
• Wet wastes (manures, wastewater treatment sludge)
• Dedicated energy crops.

Explanation –  Option 2 and 4 are correct.
Fixed Capital:

• Invested in long-term assets (e.g., land, machinery, buildings).
• Not for immediate resale.
• Example: A textile factory’s weaving machines and factory building.
  

Working Capital:

• Used for day-to-day operations (e.g., cash, inventory, receivables).
• Easily converted into cash.
• Example: Cash reserves for paying wages and purchasing raw materials

Explanation – The metaverse refers to virtual worlds where users, represented by avatars, interact—usually in 3D and focus on social and economic connections1. It’s like an immersive online universe experienced through virtual reality or augmented reality. Think of it as the next iteration of the internet, where physical and digital realities converge.

Explanation – 

• Statement 1 is incorrect. The initial minimum paid-up voting equity capital for a WOS shall be 5 billion for new entrants. Existing branches of foreign banks desiring to convert into WOS shall have a minimum net worth of 5 billion.
• Statement 2 is correct. Not less than fifty per cent of the directors should be Indian nationals /NRIs/ PIOs subject to the condition that not less than 1/3rd of the directors are Indian nationals resident in India.

Explanation – 

• Statement 1 is correct. Section 198 provides that while computing the net profits of a company a credit should be given for the subsidies and bounties received from any government, or public authority constituted or authorised on this behalf.
• For computing net profits, credit cannot be given for the following sums:
  • Profits, by way of premium on shares, unless the company is an investment company.
  • Profits on sales of forfeited shares.
  • Profits of a capital nature, including profits from the sale of the undertaking or any part thereof.
  • Profits from the sale of any fixed assets or immovable property of a capital nature comprised in the undertaking, unless the company business consists of buying and selling any assets or property.
  • Any change in the carrying amount of an asset or of a liability recognised in equity reserves, including surplus in profit and loss accounts for the measurement of the asset or the liability at fair value.
  • Any amount representing notional gains, unrealised gains or revaluation of assets.
• Statement 2 is incorrect. The provisions of CSR applies to every company fulfiing any of the following
  conditions in the preceding financial year:

• Net worth of more than Rs.500 crore
• Turnover of more than Rs.1000 crore
• Net profit of more than Rs.5 crore

• The Board of Directors of every company for which the CSR provisions apply must ensure that the company spends in every financial year at least 2% of its average net profits made during the immediately preceding three financial years as per its CSR policy. If the company has not completed three financial years since its incorporation, it must spend 2% of its average net profits made during the immediately preceding financial years as per its CSR policy.