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CAT 2000 — DILR Question 19

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Passage / Data

FEI for a country in a year, is the ratio (expressed as a percentage) of its foreign equity inflows to its GDP. The following figure displays the FEIs for select Asian countries for the years 1997 and 1998.

China’s foreign equity inflows in 1998 were 10 times that into India. It can be concluded that

Answer & solution

  • A

    China’s GDP in 1998 was 40% higher than that of India.

  • B

    China’s GDP in 1998 was 70% higher than that of India.

  • China’s GDP in 1998 was 50% higher than that of India.

  • D

    No inference can be drawn about relative magnitudes of China’s and India’s GDPs.

Solution

Let x be the Foreign Equity inflow of India.

∴ China’s Foreign Equity inflow is 10x.

∵ FEI in India in 1998 = 0.72

∴0.72=xGDP of India

∴ GDP of India = x0.72

FEI in China in 1998 was 4.8.

∴ 4.8 = 10xGDP of China

∴ GDP of China = 10x4.8

∴GDP of ChinaGDP of India=(10x4.8)(x0.72)

∴GDP of ChinaGDP of India=1.5

∴ China's GDP is 50% higher than that of India.

Hence, option (c).

CAT 2000 DILR Q19: China’s foreign equity inflows in 1998 were 10 times that into India. It can be concluded that — Solution | TheCATExam