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CBSE Class 10 Social Science Chapter 21 Globalisation and the Indian Economy — 20 MCQs with Answers

Globalisation and the Indian Economy is a pivotal chapter in CBSE Class 10 Social Science, linking economic history, policy shifts, and contemporary trade dynamics. The 1991 liberalisation wave, the rise of MNCs, and debates around fair globalisation form the backbone of questions in board exams. This page presents 20 NCERT-grounded MCQs — spanning easy recall, application, and higher-order thinking — to help you test and consolidate your understanding before the 2025 boards.

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Key takeaways

  • ✓Chapter 21 Globalisation and the Indian Economy typically carries 3–5 marks in CBSE Class 10 Social Science board papers, often as case-based or assertion-reason MCQs.
  • ✓MNCs (Multinational Corporations) spread production across countries to cut costs, access markets, and tap into skilled labour — a core NCERT concept tested repeatedly.
  • ✓Liberalisation (1991 reforms) removed trade barriers, allowing free flow of goods, services, and investment, fundamentally reshaping the Indian economy.
  • ✓WTO (World Trade Organization) enforces rules for international trade; developing nations argue these rules favour richer countries — a frequent HOTS question topic.
  • ✓Fair globalisation requires government policies that protect small producers, workers, and ensure equitable distribution of benefits — often tested in assertion-reason format.
  • ✓Practising 15–20 MCQs from this chapter sharpens your ability to distinguish between MNC production strategies, trade liberalisation, and barriers to trade.
  • ✓CBSETUTOR.ai offers unlimited AI-powered MCQ generation, photo-upload doubt solving, and personalised practice for all CBSE subjects at ₹999/month for Classes 6–12, with a 3-day free trial.

Understanding Globalisation — Core Concepts and Definitions

Globalisation refers to the process of rapid integration or interconnection between countries through greater foreign investment and foreign trade. NCERT Chapter 21 emphasises that globalisation has been facilitated by rapid improvements in technology, especially in transport (faster shipping and air freight) and communication (internet, mobile phones). For CBSE Class 10 Social Science, understanding the definition and drivers of globalisation is foundational; questions often ask you to identify which factor enabled globalisation or to distinguish globalisation from liberalisation. The 2025 board exam pattern favours assertion-reason and case-based MCQs, so clarity on these concepts is non-negotiable.
  • MCQ 1: Globalisation means — (A) Integration of domestic economy with world economy (B) Opening up of economy to foreign trade and investment (C) Rapid interconnection among countries (D) All of the above | Answer: (D) All of the above. Reason: NCERT defines globalisation as integration through trade, investment, and technology, encompassing all three aspects.
  • MCQ 2: Which of the following is NOT a factor that has enabled globalisation? (A) Improvement in transportation technology (B) Rapid spread of internet and telecommunications (C) Increase in government control over imports (D) Liberalisation of foreign trade | Answer: (C) Increase in government control over imports. Reason: Globalisation requires fewer barriers, not more; liberalisation removes government controls.
  • MCQ 3: The term 'liberalisation' in the context of Indian economy refers to — (A) Removal of trade barriers (B) Greater government regulation (C) Protection of domestic industries (D) Banning foreign investment | Answer: (A) Removal of trade barriers. Reason: Liberalisation in 1991 dismantled licensing, quotas, and tariffs, allowing freer trade and investment.
  • MCQ 4: Assertion (A): Technology has played a key role in spreading globalisation. Reason (R): Advances in transport and communication have made movement of goods and ideas faster and cheaper. (A) Both A and R are true; R is the correct explanation of A (B) Both A and R are true; R is not the correct explanation (C) A is true, R is false (D) A is false, R is true | Answer: (A) Both A and R are true; R is the correct explanation of A. Reason: NCERT explicitly links technology improvements to the acceleration of globalisation.

Multinational Corporations (MNCs) and Global Production Networks

MNCs are companies that own or control production in more than one nation. Chapter 21 explains that MNCs set up offices and factories for production in regions where markets are close, skilled and unskilled labour is available at low costs, and where government policies are favourable. They spread production across countries to maximise profits by accessing cheaper inputs, avoiding tariffs, and tapping into new consumer markets. NCERT uses examples like Ford Motors, Coca-Cola, and Nokia. Understanding MNC strategies — such as setting up production jointly with local companies, buying up local competitors, or placing large orders with small producers — is critical for CBSE Class 10 Social Science MCQs. The 2025 exam has seen a surge in case-based questions where you read a short para about an MNC and answer three MCQs.
  • MCQ 5: MNCs set up production where — (A) Markets are large and labour is cheap (B) Only skilled labour is available (C) Government policies are restrictive (D) There is no competition | Answer: (A) Markets are large and labour is cheap. Reason: NCERT states MNCs seek cost advantages and proximity to consumers.
  • MCQ 6: Which of the following is a way MNCs spread their production? (A) Setting up partnerships with local firms (B) Buying up local companies (C) Placing orders with small producers (D) All of the above | Answer: (D) All of the above. Reason: Chapter 21 lists all three as common MNC strategies in India.
  • MCQ 7: Foreign investment by MNCs is called — (A) Foreign Direct Investment (FDI) (B) Foreign Indirect Investment (C) Foreign Trade (D) Export promotion | Answer: (A) Foreign Direct Investment (FDI). Reason: FDI refers to investment in factories, offices, or land by foreign entities, a key NCERT term.
  • MCQ 8: A garment export factory in Bengaluru receives designs and orders from a European brand, which the brand then sells globally. This is an example of — (A) Joint production (B) Globalised production network (C) Domestic production (D) Import substitution | Answer: (B) Globalised production network. Reason: Production is spread across countries — design in Europe, manufacturing in India, sale worldwide.

Foreign Trade and Integration of Markets

Foreign trade creates an opportunity for producers to reach beyond domestic markets. NCERT Chapter 21 explains that trade leads to integration of markets — when goods produced in one country are sold in another, producers and buyers in different countries are connected. A classic example is Chinese toys or Korean electronics flooding Indian markets. The removal of trade barriers (tariffs, quotas) under liberalisation has made foreign goods cheaper and more accessible, benefiting consumers but challenging local producers who cannot compete on price. Understanding the positive (access to variety, lower prices) and negative (threat to small producers, unemployment in traditional sectors) impacts of foreign trade is essential for Class 10 Social Science Globalisation and the Indian Economy MCQs. The 2025 board paper is likely to include assertion-reason or statement-based questions on trade integration.
  • MCQ 9: Foreign trade leads to integration of markets by — (A) Connecting producers and consumers across countries (B) Making goods available beyond domestic boundaries (C) Equalising prices of similar goods globally (D) All of the above | Answer: (D) All of the above. Reason: NCERT defines integration of markets as the process where choice of goods, prices, and production get interconnected globally.
  • MCQ 10: Which of the following is a benefit of foreign trade for consumers? (A) Greater variety of goods (B) Lower prices due to competition (C) Access to advanced technology (D) All of the above | Answer: (D) All of the above. Reason: Foreign trade expands consumer choice, reduces prices, and brings in new technologies.
  • MCQ 11: A negative impact of foreign trade on Indian small-scale industries has been — (A) Increased exports (B) Stiff competition from cheap imports (C) Higher wages (D) Expansion of markets | Answer: (B) Stiff competition from cheap imports. Reason: NCERT notes that Chinese toys and electronics undercut Indian small producers, leading to closures.
  • MCQ 12: Assertion (A): Removal of trade barriers has led to greater integration of Indian economy with the world. Reason (R): Trade barriers like tariffs and quotas restrict the flow of goods between countries. (A) Both A and R are true; R is the correct explanation of A (B) Both A and R are true; R is not the correct explanation (C) A is true, R is false (D) A is false, R is true | Answer: (A) Both A and R are true; R is the correct explanation of A. Reason: Lower barriers enable more imports and exports, hence greater integration.

WTO and Trade Liberalisation — Rules and Debates

The World Trade Organization (WTO) was established in 1995 to liberalise international trade and ensure that trade flows as smoothly, predictably, and freely as possible. NCERT Chapter 21 explains that WTO aims to remove trade barriers set by different countries, but developing nations argue that WTO rules favour developed countries. For instance, developed nations continue to subsidise agriculture heavily while demanding that developing countries open up their markets. This imbalance is a frequent HOTS question in CBSE Class 10 Social Science. Understanding WTO's role, the concept of 'fair globalisation,' and criticisms of WTO policies is vital for scoring in analytical MCQs and assertion-reason formats in the 2025 board exam.
  • MCQ 13: WTO was started in the year — (A) 1991 (B) 1995 (C) 2000 (D) 1947 | Answer: (B) 1995. Reason: NCERT states WTO replaced GATT in 1995 to enforce global trade rules.
  • MCQ 14: The main aim of WTO is to — (A) Promote free and fair trade among nations (B) Increase government control over trade (C) Protect domestic industries at all costs (D) Ban foreign investment | Answer: (A) Promote free and fair trade among nations. Reason: WTO seeks to liberalise and regulate international trade for smoother flow.
  • MCQ 15: Developing countries criticise WTO rules because — (A) WTO favours developed nations by allowing them to subsidise agriculture (B) WTO forces developing nations to remove trade barriers while rich nations keep theirs (C) WTO rules do not ensure fair globalisation (D) All of the above | Answer: (D) All of the above. Reason: NCERT highlights that developed countries retain subsidies and barriers, creating unequal playing fields.
  • MCQ 16: Which of the following is an example of unfair globalisation? (A) MNCs investing in India and creating jobs (B) Developed nations forcing poor countries to open markets while protecting their own (C) Indian IT exports growing (D) Availability of foreign goods in India | Answer: (B) Developed nations forcing poor countries to open markets while protecting their own. Reason: Fair globalisation requires equal treatment; the current system often does not, as NCERT notes.

Impact of Globalisation on Indian Workers and Small Producers

Globalisation has had mixed effects on India. NCERT Chapter 21 discusses winners and losers. Winners include employees in export industries (IT, garments), urban consumers with access to global brands, and large Indian companies that can now compete globally. Losers include small manufacturers unable to compete with cheap imports, traditional artisans displaced by machine-made goods, and workers in sectors downsized due to competition. For instance, the entry of Chinese toys led to closure of small toy units in India. Understanding these contrasts is essential for case-based and assertion-reason MCQs in CBSE Class 10 Social Science. The 2025 board exam often includes a question asking you to identify who has benefited and who has suffered from globalisation.
  • MCQ 17: Which group has benefited the most from globalisation in India? (A) Small-scale toy manufacturers (B) IT and BPO sector employees (C) Traditional handloom weavers (D) Farmers growing food grains | Answer: (B) IT and BPO sector employees. Reason: Globalisation opened global markets for Indian IT services, creating high-paying jobs.
  • MCQ 18: A negative impact of globalisation on Indian small producers is — (A) Access to global technology (B) Competition from cheap Chinese imports (C) Increase in export opportunities (D) Higher wages | Answer: (B) Competition from cheap Chinese imports. Reason: NCERT cites battery, toy, and electronics industries facing closures due to low-cost imports.
  • MCQ 19: Assertion (A): Globalisation has not benefited all sections of Indian society equally. Reason (R): Small producers and workers in certain sectors face job losses and factory closures due to foreign competition. (A) Both A and R are true; R is the correct explanation of A (B) Both A and R are true; R is not the correct explanation (C) A is true, R is false (D) A is false, R is true | Answer: (A) Both A and R are true; R is the correct explanation of A. Reason: NCERT emphasises unequal distribution of globalisation benefits.
  • MCQ 20: Which sector in India has seen significant job creation due to globalisation? (A) Handloom weaving (B) Small-scale battery manufacturing (C) Information Technology and services (D) Traditional pottery | Answer: (C) Information Technology and services. Reason: India became a global IT hub post-liberalisation, employing millions in software and BPO sectors.

How to Attempt MCQs in the CBSE Social Science Paper — Strategy and Tips

CBSE Class 10 Social Science MCQs now carry 20 marks (20 questions of 1 mark each) in the 2024–25 board exam pattern. Chapter 21 Globalisation and the Indian Economy typically contributes 2–3 MCQs, often in assertion-reason or case-based format. To maximise your score, first read the question stem carefully — underline keywords like 'NOT', 'main aim', 'negative impact'. In assertion-reason MCQs, verify both statements independently before choosing whether R explains A. For case-based questions, skim the passage for proper nouns (MNC names, countries, years) and match them to options. Eliminate obviously wrong options first; if two options seem correct, re-read the NCERT definition to choose the most precise answer. Time management is crucial: allocate 15–18 minutes for 20 MCQs, leaving time to revisit flagged questions. Practise at least 50 MCQs from Chapter 21 before the exam to build speed and confidence. CBSETUTOR.ai offers unlimited AI-generated MCQs for every NCERT chapter, adaptive difficulty, and instant explanations — all for ₹999/month across Classes 6–12, with a 3-day free trial to test the platform risk-free.
  • Read the question twice if it contains 'NOT' or 'EXCEPT' to avoid negative-marking traps in practice tests.
  • In assertion-reason MCQs, treat Assertion and Reason as independent statements first, then check if R logically explains A.
  • For case-based sets, underline key data points (year, country, MNC name) in the passage before reading options.
  • Eliminate one or two obviously incorrect options immediately to improve your odds if you must guess.
  • Use NCERT definitions verbatim when two options seem similar; CBSE answer keys prefer exact textbook language.
  • Practise past-year MCQs and NCERT Exemplar problems to familiarise yourself with question styles and common distractors.
  • CBSETUTOR.ai provides chapter-wise MCQ drills, performance analytics, and 24×7 doubt solving via photo upload — sign up for a 3-day free trial at ₹999/month.

Frequently asked questions

How many MCQs from Chapter 21 Globalisation and the Indian Economy appear in CBSE Class 10 Social Science board exam?+
Typically 2–3 MCQs from Chapter 21 appear in the 20-mark MCQ section. These may be standalone, assertion-reason, or part of a case-based set covering MNCs, liberalisation, WTO, or impacts on workers and producers.
What are assertion-reason MCQs, and how do I solve them for Globalisation chapter?+
Assertion-reason MCQs present two statements: Assertion (A) and Reason (R). You must decide if both are true and whether R correctly explains A. First verify each statement against NCERT, then check logical connection. For example, if A says 'Globalisation benefits all equally' (false per NCERT) and R says 'Some sectors face job losses' (true), the answer is (D) A is false, R is true.
Which NCERT topics from Globalisation and the Indian Economy are most frequently tested as MCQs?+
MNC production strategies, liberalisation of 1991, WTO role and criticisms, impact on small producers vs IT sector, and meaning of fair globalisation are high-frequency topics. Practise definitions, examples (Chinese imports, Ford Motors), and NCERT diagrams for quick recall.
How can I remember the difference between globalisation and liberalisation for MCQs?+
Globalisation is the broader process of integration of countries through trade, investment, and technology. Liberalisation is a policy step — removal of trade barriers and government controls — that enables globalisation. Think: liberalisation is the tool, globalisation is the outcome. NCERT uses 1991 reforms as the liberalisation example that accelerated India's globalisation.
Are there negative-marking rules for Class 10 Social Science MCQs in 2025 boards?+
No, CBSE does not apply negative marking in Class 10 board exams. However, accuracy still matters because each wrong answer is a lost mark. Practise enough MCQs so you can confidently eliminate wrong options and choose the NCERT-aligned answer without second-guessing.
What is a case-based MCQ set, and how do I tackle it for Globalisation chapter?+
A case-based set presents a 60–80 word paragraph (e.g. describing an MNC's strategy or a trade scenario) followed by 3–4 MCQs. Read the passage carefully, underline key facts (company name, country, year, product), then answer each MCQ by matching passage details to NCERT concepts. Time limit: 2–3 minutes for the entire set.
Which are common wrong-answer traps in Globalisation MCQs?+
Options that sound plausible but contradict NCERT definitions, e.g. 'Globalisation benefits all equally' (false), 'WTO bans all trade barriers' (false; it regulates and reduces, not bans), or 'Liberalisation increases government control' (opposite). Always cross-check with NCERT wording before selecting.
How does CBSETUTOR.ai help with Chapter 21 MCQ practice?+
CBSETUTOR.ai offers unlimited auto-generated MCQs for every NCERT chapter, adaptive difficulty based on your performance, instant explanations with NCERT page references, and 24×7 AI tutor support. Upload a photo of any doubt and get step-by-step solutions. All features cost ₹999/month for Classes 6–12, with a 3-day free trial to explore the platform.
Should I memorise MNC names and examples for MCQs?+
Yes, but focus on NCERT-mentioned examples: Ford Motors, Coca-Cola, Nokia, and generic references like Chinese toy imports. MCQs may ask you to identify which company illustrates a global production network or which sector benefited from FDI. Knowing 3–4 examples ensures you can tackle application-based MCQs confidently.
What is the best revision strategy for Globalisation MCQs one week before boards?+
Revise NCERT definitions and examples daily. Solve 10 MCQs each day, noting mistakes. Focus on assertion-reason and case-based formats. Use CBSETUTOR.ai's chapter-wise quizzes to identify weak topics, then re-read those NCERT sections. On the final day, attempt a full 20-MCQ mock to simulate exam pressure and fine-tune time management.

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