UPSC Previous Year Question | Prelims GS | 2022

Which of the following activities constitute real sector in the economy? 1. Farmers harvesting their crops 2. Textile mills converting raw cotton into fabrics 3. A commercial bank lending money to a trading company 4. A corporate body issuing Rupee Denominated Bonds overseas Select the correct answer using the code given below:

  1. 1 and 2 only
  2. 2, 3 and 4 only
  3. 1, 3 and 4 only
  4. 1, 2, 3 and 4

Answer

Correct Answer

1 and 2 only

Explanation

The real sector comprises enterprises and households producing goods and non-financial services (farming, manufacturing). Banking/lending (3) and bond issuance (4) belong to the financial sector, not the real sector.

Topics: agriculture and manufacturing, economy, production activities, real sector