UPSC Prelims 2024— Question 43

The correct answer is option (D). The digital rupee is India's central bank digital currency and a sovereign liability of the RBI, like physical currency in the monetary system. It is not designed as an inflation-indexed or inflation-insured asset, but it can be converted into commercial bank money and cash. Hence statements 1, 2 and 4 are correct. The key to this question is to distinguish the exact constitutional provision, factual association, scientific principle, or current-affairs detail being tested from statements that are partly true but incomplete or incorrectly framed. UPSC often makes the distractors plausible by changing one institutional role, date, classification, geographic association, or causal relationship. Option A — “1 and 2 only” is incorrect. It does not match the established fact or contains the incorrect combination, institution, relationship, classification, or proposition identified in the explanation above. Choosing it would therefore introduce a factual error or omit a necessary element. Option B — “1 and 3 only” is incorrect. It does not match the established fact or contains the incorrect combination, institution, relationship, classification, or proposition identified in the explanation above. Choosing it would therefore introduce a factual error or omit a necessary element. Option C — “2 and 4 only” is incorrect. It does not match the established fact or contains the incorrect combination, institution, relationship, classification, or proposition identified in the explanation above. Choosing it would therefore introduce a factual error or omit a necessary element. Option D — “1, 2 and 4” is correct. It matches the established fact described above and gives the complete combination or identification required by the question. For examination purposes, the safest approach is to verify each statement independently before looking at the answer-code combination. This is particularly important in statement-based questions, because one false clause makes an entire combination wrong. In factual questions, compare the defining characteristic asked in the stem with each alternative rather than relying on superficial familiarity. The answer recorded here follows the verified Set C key used for this database.