'SENSEX' is the popular Index of Bombay Stock Exchange (BSE). It is measured on the basis of how many blue chip companies listed in BSE?

The correct answer is B) 30. SENSEX is the benchmark index of the BSE, and it is computed from 30 large, well-established blue chip companies listed on the exchange. These constituents are chosen on the basis of market capitalisation, liquidity and sector representation, and the index is calculated on a free-float market capitalisation weighted method.

Why the others are wrong: 20, 25 and 10 do not match the constituent count of SENSEX. The number 50 belongs to the NIFTY 50 of the NSE, which is the most common mix-up in this area.

• Core concept: Stock market indices are sample-based barometers. The number of constituents, the selection method and the weighting method are what define each index.
• Syllabus link: This sits under Indian economy and financial markets. For Mains, the same idea helps in discussing FPI flows, passive investing and index funds, where benchmark composition matters.

Trap: Aspirants often swap SENSEX (BSE, 30 stocks) with NIFTY 50 (NSE, 50 stocks). Fix the pair in memory: BSE to SENSEX to 30, NSE to NIFTY to 50.