CBSE Class 10 Social Science Globalization and The Indian Economy MCQs Set 05

Multiple Choice Questions (MCQs) for Class 10 Social Science: Chapter 04 Globalization and the Indian Economy

Explore reliable objective questions for Chapter 04 Globalization and the Indian Economy tailored for Class 10 learners. Utilizing these Social Science multiple-choice formats ensures thorough preparation and strengthens problem-solving speed for upcoming school assessments.

Practice Chapter 04 Globalization and the Indian Economy MCQs for Class 10 Social Science

Navigate directly to the 50 objective questions for Chapter 04 Globalization and the Indian Economy using the digital viewer below. Each practice set includes verified answer keys, allowing students to instantly cross-check their work and identify areas requiring further revision.

Question 1: Which Indian company was bought by Cargill Foods, an MNC?
(a) Amul
(b) Parakh Foods
(c) Britannia
(d) Dabur
Show Answer & Explanation

Answer: (b) Parakh Foods

Explanation:
1. Cargill Foods, a large MNC, acquired the Indian company Parakh Foods.

Teacher's Note:
a) This is the NCERT textbook's own named example of an MNC acquisition in India.

Question 2: With which Indian manufacturer did Ford Motors enter the Indian automobile business?
(a) Mahindra and Mahindra
(b) Suzuki
(c) Maruti
(d) Hindustan Motors
Show Answer & Explanation

Answer: (a) Mahindra and Mahindra

Explanation:
1. Ford Motors entered India in collaboration with Mahindra and Mahindra, a major Indian manufacturer of jeeps and trucks.

Teacher's Note:
a) This collaboration is the NCERT textbook's own detailed case study of an MNC setting up in India.

Question 3: Which of the following best describes an MNC?
(a) A company that controls production of goods and services in multiple nations
(b) A government body that controls the distribution of resources in a country
(c) An organisation that ensures new technology is used in farming
(d) A conglomerate of domestic companies controlling production in the domestic region only
Show Answer & Explanation

Answer: (a) A company that controls production of goods and services in multiple nations

Explanation:
1. A Multinational Company (MNC) is defined precisely as one that owns or controls production of goods or services in more than one country.

Question 4: Rajiv runs a textile firm and spends money on thread, machinery, equipment and a warehouse to produce cloth. What is this expenditure called?
(a) Investment
(b) Profits
(c) Equity
(d) Interest
Show Answer & Explanation

Answer: (a) Investment

Explanation:
1. Money spent on acquiring assets for production, like machinery and buildings, is called investment.

Question 5: The investment made by MNCs (from abroad) is called:
(a) Foreign investment
(b) Foreign trade
(c) Foreign demand
(d) Foreign supply
Show Answer & Explanation

Answer: (a) Foreign investment

Explanation:
1. Investment made by a company or individual from one country into another country is called foreign investment.

Question 6: What is a major benefit of joint production between a local company and an MNC?
(a) MNCs can bring the latest technology into production
(b) MNCs can control price increases
(c) MNCs can buy the local company
(d) MNCs can sell the products under their own brand name
Show Answer & Explanation

Answer: (a) MNCs can bring the latest technology into production

Explanation:
1. A key benefit of collaboration with MNCs is access to their advanced technology and production methods.

Question 7: Identify the INCORRECT feature of a Multinational Company.
(a) It owns/controls production in more than one nation
(b) It sets up factories close to markets
(c) It organises production in complex ways
(d) It employs labour only from its own country
Show Answer & Explanation

Answer: (d) It employs labour only from its own country

Explanation:
1. MNCs typically employ local labour in the countries where they operate, not only workers from their home country — making this statement incorrect.

Teacher's Note:
a) Hiring local labour (often cheaper) is actually one of the main reasons MNCs set up factories abroad.

Question 8: Why do MNCs set up offices and factories in more than one nation?
(a) Because production costs are high, letting MNCs earn profit
(b) Because production costs are low, and MNCs undergo a loss
(c) Because production costs are low, letting MNCs earn greater profit
(d) Because MNCs want a global presence
Show Answer & Explanation

Answer: (c) Because production costs are low, letting MNCs earn greater profit

Explanation:
1. MNCs typically locate production where costs are lower, which increases their profit margins.

Question 9: The past two decades of globalisation have seen rapid movement in:
(a) Goods, services, technology and investments between countries
(b) Goods, services and people between countries
(c) Goods, investments and people between countries
(d) None of the above
Show Answer & Explanation

Answer: (a) Goods, services, technology and investments between countries

Explanation:
1. Globalisation specifically involves the increased flow of goods, services, technology and investment across national borders.

Question 10: Globalisation, by connecting countries, leads to:
(a) No competition between producers
(b) Lesser competition between producers
(c) Greater competition between producers
(d) None of the above
Show Answer & Explanation

Answer: (c) Greater competition between producers

Explanation:
1. Connecting markets globally exposes local producers to more competitors, increasing overall competition.

Question 11: Trade between countries:
(a) Decreases competition between countries
(b) Determines prices of products in different countries
(c) Makes a country dependent on another
(d) None of the above
Show Answer & Explanation

Answer: (b) Determines prices of products in different countries

Explanation:
1. International trade links markets together, so prices in one country can be influenced by supply, demand and prices elsewhere.

Question 12: What was the far-reaching policy change made in India in 1991?
(a) Increase in trade barriers
(b) Removal of trade barriers
(c) Removal of taxation
(d) None of the above
Show Answer & Explanation

Answer: (b) Removal of trade barriers

Explanation:
1. The 1991 reforms removed many of India's earlier trade barriers, opening the economy to liberalisation.

Question 13: Removing barriers or restrictions set by the government is called:
(a) Investment
(b) Liberalisation
(c) Favourable trade
(d) Free trade
Show Answer & Explanation

Answer: (b) Liberalisation

Explanation:
1. This is the definition of liberalisation — lessening government restrictions on the economy.

Question 14: Which of the following is an example of globalisation?
(a) Indians consuming goods produced abroad
(b) Indians becoming self-sufficient in production
(c) Indians moving between different states domestically
(d) Indians producing large amounts of agricultural produce
Show Answer & Explanation

Answer: (a) Indians consuming goods produced abroad

Explanation:
1. Indians buying foreign-made goods is a direct, everyday example of globalisation connecting markets.

Question 15: Which of the following is a benefit of globalisation?
(a) Consumers pay more, so producers are better off
(b) Asymmetric information cannot exist in a globalised market
(c) Consumers get a wide variety of goods to choose from
(d) Homogeneous goods are sold in a globalised market
Show Answer & Explanation

Answer: (c) Consumers get a wide variety of goods to choose from

Explanation:
1. A wider range of product choices for consumers is one of globalisation's clearest, most direct benefits.

Question 16: Which of the following is an advantage of globalisation specifically for MNCs?
(a) MNCs don't need raw materials from other countries, due to self-sufficiency
(b) Spreading production across international borders can lower production costs
(c) MNCs don't pay taxes if they generate employment
(d) MNCs can easily pass increased costs onto global consumers
Show Answer & Explanation

Answer: (b) Spreading production across international borders can lower production costs

Explanation:
1. Spreading production across countries, to areas with lower costs, is a genuine advantage globalisation gives MNCs.

Question 17: What can be a benefit to local businesses from working with MNCs?
(a) Local businesses don't need to invest, since MNCs do all the investing
(b) MNCs provide cheap labour to local businesses
(c) MNCs can bring advanced techniques of production
(d) Local businesses earn higher profits as their production cost becomes nil
Show Answer & Explanation

Answer: (c) MNCs can bring advanced techniques of production

Explanation:
1. Access to advanced production techniques and technology is a real benefit local businesses gain from MNC partnerships.

Question 18: Which of the following is an example of a trade barrier?
(a) Remittances to foreigners
(b) Cost of transportation
(c) Tax on imports
(d) Interest on bonds
Show Answer & Explanation

Answer: (c) Tax on imports

Explanation:
1. A tax on imports is a classic example of a trade barrier, used to restrict or regulate the flow of goods into a country.

Question 19: Which of the following is a reason for the government to impose trade barriers?
(a) To regulate the type and amount of goods entering the country
(b) To increase competition in the domestic market
(c) To remove monopoly markets from the country
(d) To improve domestic producers' performance
Show Answer & Explanation

Answer: (a) To regulate the type and amount of goods entering the country

Explanation:
1. Trade barriers are primarily used to control and regulate what, and how much, comes into the country from abroad.

Question 20: Which Indian industry was hit hard by globalisation?
(a) Information Technology (IT)
(b) Toy-making
(c) Jute
(d) Cement
Show Answer & Explanation

Answer: (b) Toy-making

Explanation:
1. India's traditional toy-making industry struggled significantly to compete once cheaper machine-made imports entered the market under globalisation.

Teacher's Note:
a) This contrasts with IT, which has been one of globalisation's biggest beneficiaries in India.

Question 21: In which year did the Indian government decide to remove barriers on foreign trade and investment?
(a) 1993
(b) 1992
(c) 1991
(d) 1990
Show Answer & Explanation

Answer: (c) 1991

Explanation:
1. India's landmark economic liberalisation took place in 1991.

Teacher's Note:
a) 1991 is one of the single most important dates in this entire chapter.

Question 22: WTO aims at:
(a) Restricting trade practices
(b) Establishing rules for domestic trade
(c) Liberalising international trade
(d) None of the above
Show Answer & Explanation

Answer: (c) Liberalising international trade

Explanation:
1. The World Trade Organisation's core aim is to liberalise and facilitate international trade among its member countries.

Question 23: Which organisation places emphasis on the liberalisation of foreign trade and foreign investment?
(a) International Monetary Fund
(b) International Labour Organisation
(c) World Health Organisation
(d) World Trade Organisation
Show Answer & Explanation

Answer: (d) World Trade Organisation

Explanation:
1. The WTO is specifically focused on liberalising trade and investment rules between countries.

Question 24: Identify the INCORRECT statement about Special Economic Zones (SEZs).
(a) They do not have to pay taxes for a long period
(b) The government has allowed flexibility in labour laws within SEZs
(c) They have world-class facilities
(d) They do not have to pay taxes for an initial period of five years
Show Answer & Explanation

Answer: (a) They do not have to pay taxes for a long period

Explanation:
1. The tax exemption for SEZs applies only for an initial period (typically five years), not indefinitely for 'a long period' as this statement vaguely and incorrectly suggests.

Teacher's Note:
a) Compare carefully: (a) says 'long period' (vague, incorrect), (d) says 'initial period of five years' (precise, correct) — read such near-duplicate options closely.

Question 25: How did competitive pressure affect workers in the garment industry?
(a) Reduced cost of raw materials
(b) Reduced labour cost (wages)
(c) Decreased working hours
(d) Increased protection for workers
Show Answer & Explanation

Answer: (b) Reduced labour cost (wages)

Explanation:
1. Competitive pressure led many garment manufacturers to cut labour costs, often at the expense of workers' wages and job security.

Teacher's Note:
a) This connects to the chapter's broader point about globalisation sometimes pushing firms toward more 'flexible' (less secure) employment.

Question 26: Ford Motor Company wants to develop Ford India as a component-supplying base for its other plants across the world because:
(a) A number of local manufacturers are supplying components to its Chennai plant, and MNCs feel they can supply components to other plants globally
(b) Cost of labour and material is very low in India
(c) The components can easily be supplied to other MNC car manufacturers in India and China
(d) All of the above
Show Answer & Explanation

Answer: (d) All of the above

Explanation:
1. Low-cost local component manufacturing, cheap labour and material, and easy supply to other MNCs in the region together make India an attractive component-supply base.

Teacher's Note:
a) All three factors — local supplier base, low costs, regional MNC presence — drive this decision.
b) This illustrates how MNCs structure global production networks.

Question 27: What is the condition that should be met for multinational companies (MNCs) to set up their production units?
(a) Close to the market
(b) Favourable government policies
(c) Skilled and unskilled labour available at low cost
(d) All of these
Show Answer & Explanation

Answer: (d) All of these

Explanation:
1. MNCs choose production locations based on a combination of market proximity, supportive government policy, and the availability of low-cost labour.

Teacher's Note:
a) MNC location decisions depend on market access, policy and low-cost labour together.
b) No single factor alone usually decides where an MNC sets up production.

Question 28: Assertion (A): MNCs have been attracted towards the Indian market. Reason (R): The Government of India has allowed flexibility in labour laws.
(a) Both A and R are true and R is the correct explanation of A.
(b) Both A and R are true but R is not the correct explanation of A.
(c) A is true but R is false.
(d) A is false but R is true.
Show Answer & Explanation

Answer: (a) Both A and R are true and R is the correct explanation of A.

Explanation:
1. MNCs are indeed drawn to India, and flexible labour laws are a genuine part of why — they reduce production costs and make setting up operations easier for MNCs.

Teacher's Note:
a) Flexible labour laws are a real reason MNCs find India attractive.
b) Both statements are true, and R correctly explains A.

Question 29: Which among the following statements is correct regarding foreign trade?
(a) Foreign trade implies exchange of goods and services across countries
(b) It helps expand the size of the market for producers
(c) Producers and consumers can get commodities produced in any part of the world
(d) All of the above
Show Answer & Explanation

Answer: (d) All of the above

Explanation:
1. Foreign trade covers all three effects together: cross-border exchange, larger markets for producers, and wider commodity access for consumers.

Teacher's Note:
a) Foreign trade expands both producers' markets and consumers' choices.
b) All three statements describe genuine effects of foreign trade.

Question 30: How does foreign trade become a main channel connecting countries?
(a) It creates an opportunity for producers to reach beyond domestic markets
(b) Producers can sell not just within their own country but also compete in markets abroad
(c) The impact of goods produced in another country also expands the choice of goods available
(d) All of the above
Show Answer & Explanation

Answer: (d) All of the above

Explanation:
1. Foreign trade connects countries through all three channels together: wider market reach, cross-border competition, and expanded consumer choice.

Teacher's Note:
a) Foreign trade links countries by widening both producer reach and consumer choice.
b) These combined effects are why trade is called a main channel of globalisation.

Question 31: Read the given statements in the context of 'globalisation' and choose the correct option.
(a) It is the only way for economic development of the country
(b) It interlinks only production-based activities in dispersed locations in the world
(c) It has always given only positive results in all countries
(d) It leads to the spread of technology, cultures and diseases from one region to another
Show Answer & Explanation

Answer: (d) It leads to the spread of technology, cultures and diseases from one region to another

Explanation:
1. Globalisation is accurately described as spreading technology, cultures and even diseases across regions; the other options overstate globalisation as the only path to development, limit it to production alone, or wrongly claim it is always positive.

Teacher's Note:
a) Globalisation spreads technology, culture and even disease across borders.
b) It isn't the only route to development, nor is it always purely positive.

Question 32: Chinese manufacturers began exporting cheaper, better-designed plastic toys to India; within a year, 70-80% of toy shops replaced Indian toys with Chinese ones, and prices fell. Removing barriers or restrictions set by the government on foreign trade and foreign investment, which enabled this, is known as:
(a) Nationalisation
(b) Globalisation
(c) Liberalisation
(d) Taxation
Show Answer & Explanation

Answer: (c) Liberalisation

Explanation:
1. Removing government-imposed barriers and restrictions on foreign trade and investment is specifically called liberalisation — which then enables the broader process of globalisation.

Teacher's Note:
a) Liberalisation is the removal of trade/investment barriers.
b) It is the policy step that enables globalisation and cases like the Chinese-toys example.

Question 33: Seema's teacher asked her a question, to which she answered 'Internet'. What could have been the teacher's question?
(a) Name an important factor that has enabled globalisation
(b) Name a factor that has discouraged setting up of MNCs
(c) Name a factor that has enabled import of goods
(d) Name a factor that has enabled export of goods
Show Answer & Explanation

Answer: (a) Name an important factor that has enabled globalisation

Explanation:
1. The internet is a key enabling factor behind globalisation, allowing instant communication and coordination across countries.

Teacher's Note:
a) The internet is a major enabler of globalisation.
b) It allows instant communication and coordination across countries.

Question 34: A student discusses liberalisation, making these points: (I) It is a process of removing government-imposed obstacles or constraints. (II) As a consequence of trade liberalisation, business organisations are NOT free to decide what to import/export. (III) In liberal countries, intercountry trade is easier and efficient. (IV) Under liberalisation, governments select the types/quantities of commodities allowed through trade barriers. Which statements are correct?
(a) Statement (I) is correct and (II) is incorrect
(b) Statement (III) is incorrect and (IV) is correct
(c) Both (I) and (III) are correct
(d) Both (II) and (IV) are correct
Show Answer & Explanation

Answer: (c) Both (I) and (III) are correct

Explanation:
1. Liberalisation removes government obstacles (I) and makes intercountry trade easier (III); statements II and IV describe the opposite of liberalisation — continued government control — making them incorrect.

Teacher's Note:
a) Liberalisation removes obstacles and eases trade, matching I and III.
b) II and IV describe continued government control, which is the opposite of liberalisation.

Question 35: Removing barriers or restrictions set by the government is known as:
(a) Globalisation
(b) Privatisation
(c) Nationalisation
(d) Liberalisation
Show Answer & Explanation

Answer: (d) Liberalisation

Explanation:
1. Liberalisation specifically refers to removing government-imposed trade and investment barriers.

Teacher's Note:
a) Liberalisation = removing government-imposed barriers.
b) This is distinct from globalisation, privatisation and nationalisation.

Question 36: Fill in the blank: ___ has helped most in the spread of production of services.
(a) Manufacturing industry
(b) Automobile sector
(c) Call centres
(d) IT sector
Show Answer & Explanation

Answer: (d) IT sector

Explanation:
1. The IT sector has been the primary driver behind the global spread of service production, through outsourcing and digital connectivity.

Teacher's Note:
a) The IT sector drove the global spread of service production.
b) It enabled outsourcing and digital service delivery across borders.

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Multiple Choice Questions (MCQs) for Class 10 Social Science Chapter 04 Globalization and the Indian Economy

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