Question

19.Swapna , a small farmer ,grows groundnut on her three acres of land. She takes a loan
from money lender to meet the expenses of cultivation. Hoping that her harvest would
help repay the loan. Midway through the season the crop is hit by the pest and the crop
l fails. Though swapna sprays her crops with expensive pesticides, it makes little difference. She is unable to repay the moneylender and the debt grows over the year into
a large amount. Next year, swapna takes a fresh loan for cultivation. It is a normal crop

this year. But the earnings are not enough to cover the old loan. She is caught in debt. She
has to sell a part of the land to pay off the debt.


Answer the following MCQs by choosing the most appropriate option:


19.1 The passage given above relates to which of the following options?


a) Collateral credit
b) credit recovery is very painful.

C) failure of crops
d) credit is somewhere beneficial.


19.2 According to the passage, swapna faced which of the following options:


a) Failure of the crop made loan repayment impossible.

b) She had to sell part of the land to repay the loan.

c) Credit left her worse off
(d) All of the above.


19.3 It refers to an agreement in which the lender supplies the borrower with money. Goods

or Services in return for the promise of future payment. It is called-


(a) Term of credit
(b) credit
C) Depositor
(d) borrower


19.4 The above passage is an example of ;


(a)Collateral loan
(b) Borrower’s loan

C) Debt- trap
(d) informal loan trap​

Answer 1

Answer:

19.1) b. Credit recovery is painful

19.2) d. All of the above

19.3) b. Credit

19.4) c. Debt-trap