Consider the following actions which the Government can take: 1. Devaluing the domestic currency. 2. Reduction in the export subsidy. 3. Adopting suitable policies which attract greater FDI and more funds from FIIs.

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Q: 10 (IAS/2011)
Consider the following actions which the Government can take:
1. Devaluing the domestic currency.
2. Reduction in the export subsidy.
3. Adopting suitable policies which attract greater FDI and more funds from FIIs.

question_subject: 

Economics

question_exam: 

IAS

stats: 

0,110,152,28,80,44,110

keywords: 

{'domestic currency': [0, 0, 0, 1], 'export subsidy': [0, 0, 0, 1], 'greater fdi': [0, 0, 0, 1], 'suitable policies': [0, 0, 0, 1], 'more funds': [0, 0, 0, 1], 'government': [5, 0, 0, 1], 'fiis': [0, 0, 0, 1], 'reduction': [2, 4, 2, 13]}

The correct option is 4.

The actions mentioned in the question are:

Devaluing the domestic currency.

Reduction in the export subsidy.

Adopting suitable policies which attract greater FDI and more funds from FIIs.

Devaluing the domestic currency (Option 1) can help boost exports, as it makes exports cheaper for foreign buyers. This can help increase demand for domestic goods and services in foreign markets.

Reduction in the export subsidy (Option 2) can help the government reduce its expenditure on subsidies and can also help create a level playing field for all exporters, irrespective of their size or scale of operation.

Adopting suitable policies which attract greater FDI and more funds from FIIs (Option 3) can help increase foreign investment in the country, which can lead to greater job creation, technology transfer, and overall economic growth.

Therefore, the correct option is 4, i.e., 1 and 3. Devaluing the domestic currency and adopting suitable policies to attract greater FDI and more funds from FIIs can help boost exports and increase foreign investment in the country, respectively.

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