1.

(a) Briefly explain two methods that increase land productivity.(b) What is meant by price elasticity of demand?(c) Distinguish between sunk capital and floating capital. (d) Give two reasons for consumer exploitation in India.(e) Distinguish between an entrepreneur and an organiser.

Answer»

(a) The two methods that increase land productivity are as follows: 

1. Permanent improvements done on land by generating artificial means of irrigation i.e., wells, tubewells, canals, tanks etc. help to keep the water supply regular, have a positive effect. 

2. New inventions, modem and scientific methods of production like using high yielding varieties of seeds, manure, etc. have increased the production. 

(b) Price elasticity refers to the degree of responsiveness of change in quantity demanded due to the change in its price. In certain cases, the change in demand may be at higher rates, in some cases, it may be lower and sometimes there may not be change. 

(c) 

BasicSunk capitalFloating capital
1. MeaningSunk capital is that category of capital, which can Be used to produce only one type of commodity or service.Floating capital includes all such items which can be put to alternate uses. The use of such commodities is not restricted for any specific purpose.
2. ExamplesAn ice factory, Oil Mill etc.Money, fuels, etc.

(d) 

The reasons for consumer exploitation are as follows: 

1. Limited Information: Producers provide incomplete and incorrect information about various products. 

2. Low Literacy: Illiteracy leads to exploitation. Lack of consumer awareness is the root cause for exploitation.

(e)

BasisEntrepreneurOrganiser
1. VentureAn entrepreneur sets up a new enterprise or undertakes a venture for his personal gratification.A manager does not take a new venture and renders service in an existing exterprise.
2. Risk BearingAn entrepreneur assumes risk of economic uncertainty involved in the enterprise.A manager does not assume or share any risk involved in the enterprise he is serving.


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