Theory of Drain of Wealth during Colonialism of India MCQs and Answers

1) What was the main motive behind the British policy of Drain of Wealth in India?

a) To make India a rich colony

b) To make India economically dependent on Britain

c) To finance the British war effort in Europe

d) To enrich a few British companies

Answer: d

Explanation: The main motive behind the British policy of Drain of Wealth in India was to enrich themselves and the home country at the expense of the Indian people. This was done by forcing India to buy British goods, while preventing Indians from selling their own products. This resulted in a massive trade deficit for India, which the British then used to finance their own projects.


2) How did the British policy of Drain of Wealth affect India’s economy?

a) It led to a decline in India’s GDP

b) It caused an increase in the country’s trade deficit

c) It resulted in a decrease in the standard of living of the people of India

d) All of the above

Answer: d

Explanation: The British policy of Drain of Wealth was a perfect example of how a colonial power can affect the economy of its colony. The policy drained India of its wealth by forcing it to export more than it imported, and by imposing high tariffs on Indian goods. This made India’s economy very dependent on the British, and led to a decline in its standard of living. The policy also caused a great deal of social and economic disruption, as it led to a decline in the production of indigenous goods and an increase in the price of imported goods.


3) What were some of the methods used by the British to Drain the Wealth of India?

a) Exporting more goods from India than importing into the country

b) Imposing high taxes on Indian goods

c) Giving preferential treatment to British goods in the Indian market

d) All of the above

Answer: d

Explanation: The British colonialists drained the wealth of India in a variety of ways. They imposed high taxes on the indigenous population, forcing them to sell their land and possessions to pay the taxes. They also extracted raw materials from India to manufacture goods in British factories, and then sold the finished products back to the Indian people at high prices. In addition, the British monopolized the Indian trade, which meant that Indians had to pay inflated prices for British goods.


4) What was the impact of the Drain of Wealth on India’s social structure?

a) It led to the rise of the Indian middle class

b) It resulted in the decline of the traditional Indian caste system

c) It caused a decrease in the standard of living for many people in India

d) All of the above

Answer: c

Explanation: The impact of the Drain of Wealth on India’s social structure was significant. The drain of wealth led to a decrease in the standard of living for many people in India. It also resulted in a loss of social status for those who were affected by it. The drain of wealth also had a negative impact on the Indian economy.


5) What was the ultimate goal of the British policy of Drain of Wealth in India?

a) To make India economically dependent on Britain

b) To reduce the economic power of India

c) To benefit British businesses operating in India

d) All of the above

Answer: c

Explanation: The ultimate goal of the British policy of Drain of Wealth in India was to plunder the wealth of India and transfer it to Britain. This was done by imposing high taxes on the people of India, and by creating a monopoly on Indian trade. The British also drained India’s resources by sending large numbers of Indian soldiers to fight in wars, and by building huge infrastructure projects like the railways.


6) What were the main components of the Drain of Wealth?

a) Taxation

b) Export of raw materials

c) Importation of British manufactured goods

d) all of the above

Answer: d

Explanation: The Drain of Wealth was a process by which the British Empire extracted resources and wealth from India. The main components of this process were taxes, trade restrictions, and the exploitation of India’s natural resources.

The British government imposed high taxes on the Indian people, which forced them to sell their resources at below-market prices. The British also imposed restrictions on Indian trade, which limited the ability to sell products in free markets. Lastly, the British exploited India’s natural resources, such as minerals and forests, for their own benefit.

The Drain of Wealth led to the impoverishment of India and the enrichment of the British Empire. It is estimated that over the course of the British rule in India, the Empire extracted around $45 trillion from the country. This process was one of the main factors that contributed to the decline of the Indian economy.


7) Which of the following was not a direct result of the Drain of Wealth?

a) Deindustrialization of India

b) Famines

c) Mass emigration

d) increased poverty

Answer: c

Explanation: The Drain of Wealth was a direct result of the exploitative economic policies of the British Raj in India. These policies led to the concentration of wealth in the hands of a few, while the majority of the population remained in poverty. As a result of this, India’s economy was not able to grow and develop as it should have, and this had a number of negative consequences. One of these was the outbreak of the Indian Rebellion of 1857, which was a direct result of the economic exploitation of the people by the British.


8) Why was India’s share of the world economy reduced from 23% to 4% during the colonial period?

a) Because of the increase in the world population

b) Because of the Industrial Revolution in Europe

c) Because of the British policy of Drain of Wealth

d) Because of the Napoleonic Wars

Answer: c

Explanation: The British policy of Drain of Wealth was one of the main reasons for the decline of India’s economy during the colonial period. This policy involved the transfer of wealth from India to Britain, which resulted in a massive decline in India’s share of the world economy. From 23% in the 18th century, India’s share of the world economy had fallen to just 4% by the end of the 19th century. This decline was a direct result of the British policy of economic exploitation of India.


9) The British Parliament passed the Regulating Act of 1773 in order to:

a) tax the colonists in America

b) establish the East India Company as the ruling power in India

c) raise revenues in India

d) control the affairs of the East India Company

Answer:

Explanation: The Regulating Act of 1773 was passed by the British Parliament in order to better control the affairs of the East India Company. This act placed the company under the control of the British government and established a new Board of Control. The company was also required to appoint a Governor-General to oversee its operations. The Regulating Act was an important step in the British government’s effort to control the East India Company and bring it under the rule of law.


10) The _____ was created in 1858 in order to stop the further drain of wealth from India.

a) British Raj

b) East India Company

c) Government of India Act

d) Queen’s Proclamation

Answer: c

Explanation: The Government of India Act was created in 1858 in order to stop the further drain of wealth from India. However, this Act did not put an end to the exploitation of India. The British continued to plunder India’s resources and exploit its people. This led to the Indian Rebellion of 1857, which was crushed by the British.


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