General Awareness / Business Knowledge
What TANCET tests here
General Awareness mixes static general knowledge with business and economic awareness: Indian polity and economy, banking and financial institutions, budgets and inflation, industry and brands, awards and books, science and current events. The section is broad rather than deep, so recognise concepts and pair them with their institutions or functions.
Core rules
- Monetary policy is the RBI's domain: repo rate (RBI lends to banks), reverse repo (RBI absorbs liquidity), CRR and SLR. Fiscal policy belongs to the government: taxation and spending.
- GDP measures output produced within a country's borders; GNP adds net factor income from abroad.
- Inflation is a sustained rise in the general price level; demand-pull inflation comes from excess demand, cost-push from input costs.
- SEBI regulates securities markets; IRDAI regulates insurance; RBI regulates banks and payments.
- For brands and companies, link the parent to the product and the sector, not just the slogan.
- For current affairs, anchor each event to an institution, a place and a date.
Worked example
If the RBI raises the repo rate, what is the most likely immediate effect? Higher repo makes bank borrowing from RBI costlier. Banks pass this on by raising lending rates, so credit becomes expensive, loan demand slows, and consumption and investment may cool, easing demand-pull inflation. Deposits may earn more, attracting savings. The rupee often strengthens as higher rates attract foreign capital. The correct answer is therefore 'borrowing becomes costlier and credit growth may slow', not 'government spending falls' - that would be fiscal policy.
Traps that cost marks
- Confusing repo with reverse repo, or CRR with SLR.
- Mixing fiscal and monetary tools.
- Answering from an outdated current-affairs year.
- Choosing a plausible-sounding institution without checking its actual mandate.
- Guessing when a static fact can be eliminated by two known options.