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2601.

Which event in 1945, according to Einstein, turned science and scientists into murderers? 

Answer»

According to Einstein Roosevelt kept him in the dark and made false promises. He had abused Einstein’s equation of E= mc2 that resulted in the destructive experiments. His actions had made science and scientists as murderers. 

2602.

What did Einstein do to show his displeasure over the atomic attack?

Answer»

To show his displeasure over the atomic attack, he decided to open educational institutions for children, adolescents and youth – institutions where along with science, spirituality will be compulsorily taught. 

2603.

Name the philosophers that Einstein invited to inaugurate the new institution. 

Answer»

Bertrand Russell and Albert Schweitzer were the philosophers that Einstein invited to inaugurate the new institution. 

2604.

Whose photo was garlanded at the inauguration of Einstein’s institute for children, adolescents and youth?

Answer»

Mahatma Gandhi’s photo was garlanded at the inauguration of Einstein’s institute for children, adolescents and youth.

2605.

Which of the following is (are) an endothermic process(es)? (i) Dilution of sulphuric acid (ii) Sublimation of dry ice (iii) Condensation of water vapours (iv) Evaporation of water (A) (i) and (iii) (B) (ii) only (C) (iii) only (D) (ii) and (iv)

Answer»

The correct option is (D) (ii) and (iv)

Explanation:

Sublimation of dry ice and evaporation of water both are endothermic processes. These processes pull heat (energy) from their surroundings to change from one state to another. Hence both these processes produce cooling rather than heating. Dry ice absorbs heat from the environment to convert into gas. This feature makes it a good refrigerant. Processes of dilution of sulphuric acid and condensation of water vapours produce a large amount of heat. That is why these are exothermic processes.

2606.

Two discs of radius 2 cm and 1 cm, made of the same material are placed as shown . The center of mass from O1 is:(a) 0.4 cm(b) 1.5 cm(c) 0.6 cm(d) 0.8 cm

Answer»

The correct option is (c) 0.6 cm.

Explanation:

x1 = M x 3/ 5M

= 3/5

= 0.6 cm

2607.

Find the position of the centre of mass of the T-shaped plate, from O [Fig.].

Answer»

Let m be mass per unit area of plate. 

Let O be the origin Centre of mass of top horizontal rectangular plate of mass 16 m will be at its centre i.e.(0,-1)

And centre of mass of vertical rectangular plate of mass 12m will be at (0,-5) 

So effective centre of mass of both the plates will be at (0,y) 

To determine y we have to use {16m x (-1) + 12m x (-5)}/ (16m +12m) 

Cancelling m, we get y = (-16-60) / 28 = -76/28 = -2.714 m 

Hence the centre of mass will be at (0,-2.71)

2608.

Find the general solution of the following differential equation:\(\frac{dx}{dy} = e^{x -y}+ x^2e^{-y}\)

Answer»

\(\frac{dx}{dy} = e^{x -y}+ x^2e^{-y}\)

⇒ \(dy = (e^{x-y} + x^2e^{-y})dx\)

⇒ \(dy = \frac{(e^x + x^2) }{e^y}dx\)

⇒ \(e^y \, dy = (e^x + x^2)dx\)

⇒ \(\int e^y dy = \int (e^x + x^2)dx\)

\(\therefore \,e^y = e^x + \frac{x^3}{3}+ C\), which is the required solution.

2609.

If a line makes an angles α, β, γ with the coordinate axes, then find the value of cos2α + cos2β + cos2γ.

Answer»

cos2α + cos2β + cos2γ

= 2(cos2α + cos2β + cos2γ) −3

= 2 − 3     (∵ cos2α + cos2β + cos2γ = 1)

= −1

2610.

(a) What type of drug is used in sleeping pills? (b) What type of detergents are used in toothpastes? (c) Why the use of alitame as artificial sweetener is not recommended?

Answer»

(a) Tranquilizers are used to treat mild mental diseases and form an essential component of sleeping pills. Their use creates a sense of tranquility and well-being. 

(b) Anionic detergents are used in toothpastes. 

(c) Alitame is not recommended as artificial sweetener because of its high potency sweetener.

2611.

Give an example of an angiosperm seed that has a  perisperm .Name the part the perisperm. develops from.

Answer»

The perisperm is developed from the residual, persistent nucleus in some seeds. It is found in black pepper and beetroot.

2612.

Describe the development of an endosperm in a viable seed. Why does endosperm development precede embryo development ?

Answer»

 The endosperm development is a result of triple fusion. During triple fusion, one of the male gametes fuses with the two polar nuclei of the central cell and give rise to primary endosperm cell (PEC). The primary endosperm cell divides repeatedly and forms a triploid endosperm tissue. The most common type of endosperm development is free-nuclear, in which the PEN undergoes successive nuclear divisions to give rise to a number of free nuclei. The endosperm thus formed is called free nuclear endosperm. Subsequently, cell formation occurs and the endosperm becomes cellular. 

The endosperm thus developed is required to provide essential nutrients to the growing embryo. 

Therefore endosperm development occurs before the embryo development.

2613.

'In-situ' conservation can help endangered/threatened species. Justify the statement.

Answer»

It is the process of conservation of living resources in their natural habitats. It is a type of on-site conservation. The endangered plants and animals are protected inside their natural surroundings. e.g. national park, lived life sanctuary, biosphere reserves.

 It also includes the introduction of plants and animal species back into agricultural, horticultural and animal husbandry practices so that they are cultivated/reproduced for their reuse by their farmers.

It also maintains genetic diversity of crop plantsAowers by saving seeds for next planting season. Biodiversity is permanently protected. Ecological integrity is maintained and managed. 

Facilitates scientific research of the site. 

It may be possible to improve the ecological integrity of the area and restore it if it has been damaged by poaching etc.

2614.

DNA being hydrophilic cannot pass through the cell membrane of a host cell. Explain how does recombinant DNA get introduced into the host cell to transform the latter.

Answer»

rDNA is introduced into the host cell by the following methods: 

(i) Heat shock method: In this method, DNA is treated with a specific concentration of a divalent cation, such as calcium, which increases the efficiency with which DNA enters the bacterium through pores in its cell wall. The rDNA is forced into the cell by incubating the cell with rDNA on ice, followed by placing them briefly at 42°C (heat shock) and then putting them back on ice. 

(ii) Micro-injection: In this method, the rDNA is directly injected into the nucleus of an animal cell. 

(iii) Gene gun/Biolistics: In this method, cells are bombarded with high velocity micro-particles of gold or tungsten coated with DNA.

2615.

Why is DNA molecule a more stable genetic material than RNA? Explain.

Answer»

In DNA, presence of thymine at the place of uracil confers more stability to DNA. In the nucleotide of RNA the 2¢-OH group is a reactive group and this makes RNA labile and degradable, while DNA is chemically less reactive and structurally more stable.

2616.

Mention the essential information that can be obtained by studying the population density of an organism.

Answer»

Status of habitat, whether competition for survival exists or not, whether population is increasing or declining, natality, mortality, emigration, immigration.

2617.

Study the flow chart given below. Name the hormones involved at each stage and explain their functions.

Answer»
  • Gonadotropin releasing hormone (GnRH) is a hypothalamic hormone and is secreted by the hypothalamus. 
  • It stimulates the anterior lobe of pituitary gland to secrete luteinising hormone (LH) and follicle stimulating hormone (FSH). 
  • They stimulate the growth of ovarian follicles and development of egg/oocyte within the follicle. 
  • After ovulation, remaining parts of the Graafian follicle transform as the corpus luteum. 
  • Corpus luteum secretes a large amount of progesterone which is essential for the maintenance of endometrium which is required for implantation of the embryo and other events of pregnancy. 
2618.

What does an Ecological Pyramid indicate ? Explain the three different types of upright Pyramids in nature with the help of an example each.

Answer»

It indicates food / energy relationship between organisms at different trophic levels
(i) Pyramid of Number = example grassland ecosystem 
                    ↓
Producers are more in number than herbivores carnivores
(ii) Pyramid of Biomass example = forest / tree ecosystem 
                    
Producers have more biomass than herbivores / carnivores
//
Pyramid of biomass shows a sharp decrease in biomass in higher trophic levels
(iii) Pyramid of energy = example. grassland ecosystem 
                    
Producers have more energy than herbivores / carnivores
(b) (i) Provides information of extinction of species
(ii) Regions with very high levels of species richness , high degree of endemism / species confined to that region and not found anywhere else are identified which need to be conserve all priority basis.

2619.

Distinguish between density and relative density of a substance.

Answer»
DensityRelative density
1. It is defined as mass per unit volume.1. It is defined as the ratio of density of the substance to density of water at 4°.
2. Its value is different in different systems of measurement.2. Its value is the same in all systems of measurement.
3. Its units are g cm-3 and kg m-33. It has no units.
2620.

A plant in which stem modifies for storage of food : (a) Ginger (b) Potato (c) Onion (d) All of these 

Answer»

(d) All of these

2621.

That part of a plant on which leaves, flowers and fruit are attached is called : (a) Primary root (b) Stem (c) Secondary root (d) None of these

Answer»

That part of a plant on which leaves, flowers and fruit are attached is called Stem.

2622.

Loss of water from different pores of a plant is called : (a) Transpiration (b) Photosynthesis (c) Condensation (d) Evaporation 

Answer»

Loss of water from different pores of a plant is called Transpiration.

2623.

 Name the causative agents of pneumonia and common cold. 

Answer»

Streptococcus pneumoniae and Haemophilus influenzae are responsible for the disease pneumonia. Common cold is caused by rhinoviruses.  

2624.

State the objective of lighting. Describe the three elements involved in lighting of the stage.

Answer»

Objectives of Lighting: When applied in a controlled manner light helps to establish visibility, highlight selected areas create the required environment and create three dimension aspect of actors and objects.

(A) Illumination: Theatre being an audio-visual art has, one of the primary objects of stage light i.e. to provide sufficient (adequate) illumination so that the audience may see the actors and be able to feel the environment easily visibility can be achieved through the installation of various kinds (types) of lighting equipment. Generally, the stage is divided into six or nine parts(down right, down left, down centre, centre left, center, centre right, up left, up centre, upright), according to its dimensions, to design the lighting be used on stage. The visibility of an object depends upon three factors. A distance between the stage and audience, for proper visibility. In different theatres, different levels of illumination are required keeping in mind the distance between the stage and the audience. 

(B) Integrity of lights falling upon the stage: The number of lights to be used depends on the size of the stage, while designing the lights. The number of lights needs to be enough to illuminate the whole stage sufficiently, according to size, the number may increase or decrease. 

(C) Its contrast with the background: This can be viewed in the context of the distance between the actor-object with the background which it is placed in contrast to them. If the background color matches or is similar to the color worn by the actors then lights of greater utterly are required, whereas, if the color contrast then the object actor is established comparatively easily. For example if there is blue background as ‘cyclorama’ and the actor is wearing a red costume, then the character can be established easily.

2625.

Differentiate between formal and informal organisations on the basis of (i) origin, (ii) authority(iii) flow of communication.

Answer»

Difference between formal and informal organisations :

BasisFormal OrganisationInformal Organisation
(i) OriginIt is deliberately created through a well defined policy of management.It arises as a result of social interaction among the employees.
(ii) AuthorityAuthority arises on the basis of position of management.Authority arises on the basis of personal qualities.
(iii) Flow of communicationCommunication takes place through the scalar chain.Communication does not take place through a planned route, it can take place in any direction.
2626.

State the importance of ‘The Meisner Technique’ as an approach to acting.

Answer»

The Meisner Technique is one of the most popular approaches to acting. Learn how to unleash truthful, emotional performances; let go of self-consciousness; expand acting range; build self-awareness; develop the ability to act moment to moment. 

Improvisation: Improvisation simulates a scene-like situation. It is a key stage in the Meisner Technique; teaching how to defeat self-consciousness when alone on stage, how to prepare before your entrance.

Relationships: This teaches how to add complexities and layers to the improvisation. The Actor will learn the nuances and subtleties available to him/her that moment with his/her partner, and how to set up an improvisation himself.

Text Analysis: An actor will also learn how to convert text, seemingly complex and full of options, into readings and performances that are strong, emotionally true and dynamic. 

Character: After text-analysis, the actor will apply improvisation skills to find hidden depth to the character’s monologue and his/her dialogues which will enable him/her to play them truthfully and deeply.

Scene Work: Scene work enables the combination of all the skills taught in different ways. The Actor will learn how to play a scene with his partner, rich in emotional colour and full of instinctive choices. 

Meisner: 

The Meisner Technique is one of the most popular approaches to acting. Learn how to unleash truthful, emotional performances; let go of self-consciousness; expand acting range; build self-awareness; develop the ability to act moment to moment. 

Improvisation: Improvisation simulates a scene-like situation. It is a key stage in the Meisner Technique; teaching how to defeat selfconsciousness when alone on stage, how to prepare before your entrance. 

Relationships: This teaches how to add complexities and layers to the improvisation. The Actor will learn the nuances and subtleties available to him/her that moment with his/her partner, and how to set up an improvisation himself. 

Text Analysis: An actor will also learn how to convert text, seemingly complex and full of options, into readings and performances that are strong, emotionally true and dynamic. 

Character: After text-analysis, the actor will apply improvisation skills to find hidden depth to the character’s monologue and his/her dialogues which will enable him/her to play them truthfully and deeply. 

Scene Work: Scene work enables the combination of all the skills taught in different ways. The Actor will learn how to play a scene with his partner, rich in emotional colour and full of instinctive choices.

2627.

This institution was set up by ‘Sangeet Natak Academi’ as one of its constituent units in 1959. Since then this institution is treated as the foremost theatre training institute in the world and one of its own kind in India.(a) Identify the institution.(b) State any two functions of this institution.

Answer»

(i) National School of Drama 

(ii) Training in the School is highly intensive and is based on a thorough, comprehensive, carefully planned syllabus which covers every aspect of theatre and in which theory is related to practice. As a part of their training, students are required to produce plays which are then performed for the public. The syllabus takes into account the methods of great theatre personalities who have shaped contemporary theatre in all its variety. The systematic study and practical performing experience of Sanskrit drama, modern Indian drama, traditional Indian theatre forms, Asian drama and western dramatic protocols give the students a solid grounding and a wide perspective in the art of theatre. 

Besides its 3-year training programme, the School also explores new vistas in the areas of children’s theatre and decentralization of theatre training through workshops under the Extension Programme. The School has two performing wings: the Repertory Company and Theatre-in-Education Company

2628.

State the steps in the selection procedure, after the employment interview and before the job offer.

Answer»

Following are the steps in the selection procedure, after the employment interview and before the job offer : 

1. Reference and background checks – Most of the employers seek from the candidates references, which may be previous employers, known persons, teachers etc. Employers request references to give detailed information about candidate’s capabilities. 

2. Selection decision – The final decision has to be made from among the candidates who pass the tests, interviews and reference checks. 

3. Medical examination – The next step in the selection process is medical examination to verify medical fitness of the candidate for the job to be assigned to him.

2629.

State the objective behind setting up the Sangeet Natak Akademi.

Answer»

Preservation and promotion of India’s diverse culture expressed through different genres. 

2630.

The convict goes to Paris, sells the silver candlesticks and starts a business. The business prospers and he starts a reformatory for ex-convicts. He writes a letter to the Bishop telling him of this reformatory and seeks his blessings. As the convict, Jean Valjean, write the letter to the Bishop.

Answer»

14, Champs Elysees
Paris
3rd July, 18XX
Respected Sir
I hope you are in the best of health, by the grace of God. Please convey my respects to your sister.
I want to express my gratitude to you for changing my life for the good by forgiving me for stealing your candlesticks. With the money I got by selling your silver candlesticks, I started a trading business which is now doing very well.
Inspired by your ideals, I have started a reformatory for ex-convicts. I am giving employment to these ex-convicts by telling them how trading can be carried out profitably. I seek your kind blessings for this new venture.
Thank you.
Yours sincerely
Jean Valjean

2631.

Read the extracts given below and answer the questions that follow:“I am going back to my grandmother. My lawyer will communicate with you later.”(a) Who is the speaker here? (b) Why is she going back to her grandmother? (c) What is the antonym of the word ‘ahead’ in the passage?

Answer»

(a) Lavinia, the narrator’s wife is the speaker here. 

(b) She is disgusted at the alleged flirtatious behaviour of her husband John at the Ouija board with Helen, the ghost. 

(c) back

2632.

List any 4 cyber safety guidelines which should be followed by all the Netizens. 

Answer»

All Netizens should follow the following guidelines to recognize online risks: 

• Set secure passwords and don’t share them with anyone. 

• Take advantage of privacy and security settings. Use site settings to limit the information you share with the general public online. 

• Be suspicious of unknown links or requests sent through email or text message. Do not click on unknown links or answer strange questions sent to your mobile device, regardless of who the sender appears to be. 

• Download only trusted applications from reputable sources or marketplaces.

2633.

Policy formulation is the function of  (a) top level managers  (b) middle level managers  (c) operational management  (d) all of the above

Answer»

The correct option is (a) top level managers.

Explanation: 

They are the ones, responsible for developing the policies and goals for the organization. On the other hand, middle level managers interpret these policies in terms of plans and objectives and works towards implementing them with the help of the operational management. The operational management as per the instructions of the middle management directly oversees the actual work process.

2634.

Describe the security challenges faced by the newly independent countries of Asia and Africa after the Second World War

Answer»

• After the Second World War, there were many newly countries emerged in Asia and Africa as a result of the collapse of colonialism and the most nations faced threats not only from outside their borders but also from within. 

• For the newly independent countries external and internal threats posed serious challenges to their security. 

• Some of these states are worried about threats from separatist movement within the country. • Terrorism is a problem faced by maximum newly free countries from outside borders i.e. 1ST 

• Newly independent countries are highly populated and low per capita income countries so that facing the problem of global poverty. 

• Newly independent countries are also facing the problem of social injustice discrimination based on caste, creed, religion which affects the human rights.

2635.

What was the impact of Print Revolution?

Answer»

The impact of Print Revolution:

(i) New reading public was emerged. 

(ii) The hearing people became reading people. 

(iii) Religious debates due to fear of prints led to distinctive interpretation of faith.

(iv) It influenced people’s conception and opened new ways of looking at things.

(v) It encouraged debates and discussions on written texts and encouraged freedom of opinion on important issues. Generated a new reading habit and book culture.

2636.

“India got independence under very difficult circumstances rather than any other country”. Justify the statement.

Answer»

India got independence in 1947 under very difficult circumstances: 

• Freedom came with the partition of the country. 

• The year 1947 became the year of unprecedented violence and trauma. 

• Indian leaders faced all these challenges in an appreciable manner by accommodating regional diversities also.

2637.

What are two thrust areas of globalisation?

Answer»

Globalisation has two thrust areas : 

• Liberalisation provides freedom of trade and investment, eliminate restrictions imposed on external trade and payments and expand technological progress to globalise faster. 

• Privatisation permits MNCs to produce goods and services inside the country to attract FDI.

2638.

Write short notes on the following: (a) India’s nuclear policy (b) Consensus in foreign policy matters

Answer»

(a) India’s Nuclear Policy : 

1. India advocates no first use and reiterates India’s commitment to global verifiable on non-discriminatory nuclear disarmament loading to a nuclear weapon free world. 

2. Pt. Nehru always promoted science and technology to build a modern India, i.e. initiated nuclear programme in the late 1940s under the guidance of Homi J. Bhoba. 

3. India was against nuclear weapons, hence pleaded many nuclear disarmament with superpowers. 

4. India always considered NPT as discriminatory and refused to sign on it. 

5. Even India’s first Nuclear Test in May 1974 was termed as a peaceful explosion and India argued to use nuclear power for peaceful purposes only. 

(b) Consensus in Foreign Policy matters : 

1. Pt. Nehru played a crucial role in the architecture of setting National Agenda for foreign policy. 

2. Both as a Prime Minister and Foreign Minister he played profound influence in the formulation and implementation of India’s foreign policy from 1946 to 1964. 

3. When different parties came to power from time to time, foreign policy of India played a limited role in party politics. 

2639.

What are the components of the ASEAN Vision 2020?

Answer»

The components of ASEAN Vision 2020 can be summed up as follows: 

• An outward looking role in international community. 

• To encourage negotiations over conflicts in the region. 

• To mediate to end the conflicts i.e. Cambodian conflict, East Timor Crisis, annual discussion on East Asian Cooperation through meetings.

2640.

Mention the steps taken to clean up London.

Answer»

Steps to clean up London :

(i) Large blocks of apartments were built.

(ii) Rent control was introduced in Britain during the First World War to ease the impact of a severe housing shortage.

(iii) Between the two World Wars (1919-39) the responsibility for housing the working classes was accepted by the British state, and a million houses, most of them single-family cottages, were built by local authorities.

(iv) Underground railways was built in 1863 which enabled large number of people to live outside central London.

2641.

What was the reason for the formation of SAARC?

Answer»

The states of South Asia recognised cooperation and friendly relations among themselves which gave birth to the formation of SAARC for mutual trust and understanding among its member states.

2642.

Highlight any three differences between intermediate goods and final goods.

Answer»

Final goods 
(i) The goods which are used either for final consumption or for capital formation. 
(ii) The value of final I goods is included in the national income. 
(iii) Example, television, bread or bakery products, etc. 

 Intermediate goods 
(i) The goods which are used up in producing the final goods and services. 
(ii) The value of intermediate goods is not included in the national income. 
(iii) Example, flour, cotton, etc. 

2643.

What is fixed exchange rate system? 

Answer»

Fixed exchange rate is the rate which is officially declared in any other currency by the government or central bank. It is fixed for a particular period. Like 1 $ = 55 Rs.

2644.

State two sources of demand for foreign exchange? 

Answer»

 1.To purchase goods and services from other countries i.e. import. 

 2. To send a gift abroad.

2645.

State components of current account of balance of payment account. 

Answer»

Components of current account 

1. Exports and imports of goods (merchandise transactions or visible trade): These includes exports and imports of goods only payments for imports of goods is recorded on the debit side and the receipt from exports is recorded as on credit side for example: exports of tea, jute etc and imports of computer, petroleum etc. 

2. Exports and imports on services: Invisible transaction these include transaction in services such as travel, banking, insurance etc. Payments of these services are recorded on the negative side (debit) and receipts on the positive side (credit). 

3. Unilateral or unrequired transfers to and from abroad: Unilateral transfers refers gift, donation personal remittances and other one way transactions receipts of unilateral transfers from rest of the world is shown on the credit side and unilateral transfers to rest of the world on the debit side.

2646.

State the various precautions of Product Method that should be kept in mind while estimating national income.

Answer»

Following are the precautions that must be taken while estimating national income by value added method or product method : 

1. Double counting – Value added equals value of output less intermediate cost. There is a possibility that instead of counting ‘value added’ one may count value of output. You can verify by taking some imaginary numerical example that counting only values of output will lead to counting the same output more than once. This will lead to overestimation of national income. 

There are two alternative ways of voiding double counting : 

(a) count only value-added and 

(b) count only the value of final products. 

2. Second-hand goods – Sale of second-hand goods should not be included in the national income because it does not represent current year’s production. However, any brokerage or commission paid to facilitate the sale of secondhand goods is a part of national income. 

3. Production for self-consumption – Production for self-consumption should be included in the national income because such production is a part of current year’s production. Hence, imputed rent of owner occupied building is a part of national income. 

4. Production from illegal activities – Production from illegal activities like smuggling, theft, gambling etc. should not be included in the national income because no accounts are maintained for such production.

2647.

Define a government budget. Elaborate “Economic Growth” as an objective of government budget.

Answer»

A government budget may be defined as the annual financial statement containing an estimate of all revenues and expenditures of the government for the coming year. The term “economic growth” refers to a sustained increase in the real GDP of the economy or an absolute increase in the production of goods and services. One of the primary objectives of the government budget is to mobilise resources for production by providing tax rebates, infrastructural stimulation, subsidies etc. For this purpose, the budget of the government may have a liberal expenditure policy in favour of public goods such as national defence, roads, government administration etc., to promote social welfare. The government can use its taxation policy to mobilise resources for investment. The government can also give subsidies to encourage production in some sectors and small scale industries. The government may discourage the production of undesirable goods through heavy taxation.

2648.

Using a numerical example, elaborate the credit creation process as handled by the commercial banks.

Answer»

When a bank grants loan to a person, it does not give it in cash to the borrower rather loan is credited in the borrower’s account. Every bank loan, thus, creates an equivalent deposits with the bank. The bank on the basis of legal reserve ratio is required to maintain a specified percentage of its deposits as cash reserve. Legal reserve ratio (a mix of Cash Reserve Ratio and Statutory Liquidity Ratio) is determined by the central bank of the country. If legal reserve ratio is increased, the capacity of bank to create credit is reduced. 

Thus, the capacity of commercial banks to create credit depends on following two factors : 

• Amount of deposit 

• Legal reserve ratio. 

Given the amount of fresh deposits and legal reserve ratio, the total money creation will be as under : 

Total money creation = Initial Deposit x   \(\frac{1}{legal\,Reserve\,Ratio}\)

Let us take an example. Suppose a bank gets a deposit of ₹40,000. Legal Reserve ratio is 20%. It means that bank can lend 80% of ₹ 40,000 i.e., ₹ 32,000. Borrowers are not given loan in cash and loan is credited to their account. Again 80% of ₹32,000 may be advanced as a loan to other borrowers. This process goes on and on. As a result, the bank creates credit a number of times (5 times) of primary deposits i.e., ₹2,00,000. 

Total money creation = 40,000 x  \(\frac{1}{0.20}\)

=₹ 2,00,000.

2649.

Complete the following tables :Income (Y) Rs.Consumption (C)APSMPS040----5070----100100----150120----

Answer»
Income (Y) Rs.Consumption (C)Saving (S)APSMPS
040–40----
5070-20-0.40.4
100100000.4
150120300.20.6
2650.

Discuss the mechanism of investment multiplier with the help of a numerical example.

Answer»

 Investment Multiplier refers to increase in national income as a multiple of a given increase in Investment. Its value is determined by MPC. It is denoted by 'K' where K = Δy/ΔI.where, ∆y = additional income generated

∆I = additional Investment

Multiplier = 1/1-MPC or 1/MP

Where MPC= Marginal Propensity to Consume MPS = Marginal Propensity to save

Suppose increase in investment is Rs. 1000 and MPC = 0.8. The increase in national income is in the following sequence:

(i) Increase in investment raises income of those who supply investment goods by Rs.1000. This is the first round increase.

(ii) Since MPC = 0.8, the income earners spend Rs. 800 on consumption. This raises the income of the suppliers of consumption goods by Rs.800. This is second round increase.

(iii) In the similar way, the third round increase is Rs.640 = 800 × 0.8. In this way, national income goes on increasing round after round.

(iv) The total increase in income is Rs. 5000 which equals:

∆Y = ∆I X 1/1-MPC

∆Y  = 1000 X1/1- 0.8 = Rs.5000