Edzy
Single Answer MCQ
Q-00015868

Which scenario describes a debt trap?

1

A farmer repaying the loan on time

2

A farmer having regular income from crops

3

A farmer selling land due to inability to repay debt

4

A farmer investing in better farming equipment

Reviewed & Verified by Edzy Expert

Sandeep Chaturvedi

Sandeep Chaturvedi

CBSE Social Science & Humanities Reviewer

Social science and humanities educator with 14+ years of experience reviewing CBSE SST, economics, commerce, arts, and vocational content.

M.A. HistoryM.A. Political ScienceB.Ed.

Answer and Solution

Answer

C. A farmer selling land due to inability to repay debt

Solution:

A debt trap occurs when a borrower sells assets, like land, due to failing to repay loans, worsening their financial situation.

Watch Video Solution

Keep Practising

Students who asked this also explored

Continue with nearby questions to strengthen the same chapter concept while you still have the context fresh in mind.

Q1

What factor often makes it difficult for small farmers to obtain loans from banks?

Single Answer MCQ
View explanation
Q2

Which of the following is NOT a documented requirement for getting a loan?

Single Answer MCQ
View explanation
Q3

What term describes the agreement that outlines loan conditions?

Single Answer MCQ
View explanation
Q4

Which of the following is a characteristic of cooperative credit?

Single Answer MCQ
View explanation