Read the passage carefully and answer the questions given below it. Certain
words/phrases have been given in bold to help you locate them while answering some of the questions.

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Why is falling inflation making so little difference to consumer spending? One explanation could be that
Indian consumers have been so thoroughly singed by the double- digit inflation rates of the previous six years that
they‘re not loosening up their purse strings yet. This could mean that the additional disposable income in the last
one year has been flowing into savings, rather than spending.
But that doesn‘t provide an explanation for why consumption has been actually weakening in recent
quarters. Nor does it explain why consumers were on a spending spree during the high inflation years until 2011-
12.This leads us to the other explanation- the state of the rural economy.
Most consumers – goods makers admit that the great Indian consumption boom between 2007-08 and
2011-12 was powered mainly by aspirational rural consumers. This period mainly by aspirational rural consumers.
This period not only mainly by aspirational rural consumers. This period not only saw rising rural consumers. This
period not only saw rising rural demand for FMCG goods such as branded hair oils, shampoos and creams, but
also brisk uptake of motorcycles, tractors,cars and consumer appliances. NSSO surveys of household consumption
for part of this period also support the view that rural consumers spent much more than their urban peers .
There were three drivers of the rural income boom from 2007 to 2012.One, sharp hikes in the minimum
support prices of key food crops by the pro-farmer.UPA lent considerable support to farm incomes in this period,
resulting in favorable terms of trade for agriculture for the first time in many years.
Two, the UPA regime also delivered another boost to rural prosperity by ushering in the MGNREGA. The
programme didn‘t just guarantee minimum employment to non-farm workers, it also set a floor on the wages they
could earn. These two factors sharply bolstered rural incomes and actually resulted in a transfer of wealth from
inflation-hit urban consumers to the growers of food products, who benefited from higher prices.
A third, less- acknowledged factor was soaring global prices of agricultural products .Led by recurring
shortages in global food and feed products and demand for bio-ethanol, global food crop prices valuated by 137
per cent (in absolute terms) between 2002 and 2012,after falling by 8 percent over the previous 10-year period.
This trickled down to Indian farmers as well, by expanding their realisations for cash crops such as cotton,
corn, oil meals, rubber, tea, coffee and so on. Contrary to popular perception, India‘s agricultural sector does have
significant global linkages both by way of imports (cerals, pulses, sugar, cooking oil) and exports; High
realizations and rising demand saw the country‘s agri-product exports vault four-fold from $10 billion to $40
billion between 2006 and 2012.

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What were the reasons of vault in export of agri-products between 2002-2012?

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(A) Realisation for cash crops such as cotton, corn, oil meals, tea, and coffee expanded.

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(B) Global linkage of India‘s agricultural sectors in both exports and imports

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(C) MGNREGA bolstered rural income and led to flow of urban money to the rural sector.

What, according to the passage, is the reason behind the reluctance of Indian consumers to spend despite
dwindling inflation?

How did the state of rural economy influence the rising expenditure overall 2011-2012?

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(A) It was found out that the cause of the boom in expenditure until 2011-12 was a rise in aspirational rural
consumers.

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(B) Consumption of FMCG goods in Indian rose high among rural consumers against their urban peer despite high
inflation.

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(C) Rural consumers spent much more than their urban peers.

What is the meaning of the phrase „trickle down‟ as used in the passage?

Choose the word/group of words which is MOST SIMILAR in meaning to the
word/group of words printed in bold as used in the passage.

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SPREE

Choose the word/group of words which is MOST SIMILAR in meaning to the
word/group of words printed in bold as used in the passage.

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PEERS

Choose the word/group of words which is MOST OPPOSITE in meaning of the word/ group of words
printed in bold as used in the passage.

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BOLSTERED

Choose the word/group of words which is MOST OPPOSITE in meaning of the word/ group of words
printed in bold as used in the passage.

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SOARING