Read the unseen passage and answer the questions that follow.
Demonetization refers to an economic policy where a certain currency unit leases to be used as a legal
tender. It occurs whenever there is a change in the national currency: The existing form or forms of
money is pulled from circulation and retired, to be replaced with new notes or coins. Sometimes, a
country completely replaces the old currency with new currency.
On 8 November, 2016, the Indian government decided to demonetize the 500 and 1000 rupee notes, the
two biggest denominations in its currency system. These notes accounted for 86% of the country’s
circulating cash. With little warning, India’s Prime Minister Narendra Modi announced to the citizenry
that these notes would be rendered immediately ineffective with immediate effect. People were given
time till the end of the year to deposit or exchange them for newly introduced 2000 rupee and 500 rupee
notes.
The government’s goal was to combat India’s thriving underground economy on several fronts:
eradicate counterfeit currency, fight tax evasion (only 1% of the population pays taxes), eliminate black
money accumulated from money laundering and terrorist¬financing activities, and to promote a
cashless economy. Individuals and entities with huge sums of black money Acquired from parallel cash
systems were forced to take their large- denomination notes to a bank, and account for them
satisfactorily and submit proof if tax paid. If the owner could not provide proof of making any tax
payments on the cash, he possessed a penalty of 200% on the tax due was imposed.
Demonetisation had a severe impact on the gold market. The extraordinary demand for the yellow
metal, made a stiff hike in the cost. However, the Government made it mandatory that every buyer had
to submit his/her PAN card details for purchases made. Erring jewelers were brought to book.
Many Indians switched to alternative payment methods. The biggest gainers were mobile wallet
companies that offered easy transactions through a large network of partners. Alibaba-backed Paytm
saw a sevenfold increase in overall traffic. Prepaid cash cards were another option that the customers
found useful. Other alternatives were mobile payment systems linked to e-commerce businesses like
Ola Money, FreeCharge, Flipkart Wallet.
Answer the following questions briefly:
(i) Explain the idiom, ‘brought to book’.
(ii) Find a word in the passage which means ‘to provide or supply’.
(iii) Which were the alternate payment methods available for Indians post demonetization?
(iv) How Demonetisation had a severe impact on the gold market.
(v) Who were the biggest gainers? Also Give examples.
(vi) How black money accumulated before demonetization.
Answers
Answer:
(i) to be punished officially under the law.
(ii) Furnish.
(iii) The Indians started using the services of mobile wallet companies (Alibaba-backed Paytm) and prepaid cash cards. The other alternatives include mobile payment systems linked to e-commerce businesses like Ola Money, FreeCharge, Flipkart Wallet.
iv) Demonetisation had a severe impact on the gold market. The extraordinary demand for the yellow metal, made a stiff hike in the cost. However, the Government made it mandatory that every buyer had to submit his/her PAN card details for purchases made. Erring jewelers were brought to book.
v) Many Indians switched to alternative payment methods. The biggest gainers were mobile wallet companies that offered easy transactions through a large network of partners. Alibaba-backed Paytm
vi) eliminate black money accumulated from money laundering and terrorist¬financing activities, and to promote a cashless economy
Explanation:
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