Explore topic-wise InterviewSolutions in Current Affairs.

NSSO collects data for the unorganized sector.

(4) Preparation of annual budget of the country and collection of taxes to raise capital for the implementation of the plans

The growth rate of agricultural production was negative in the Third Plan.

(a) Preparation of the plan

(d) All of the above

(d) Market mechanism guided by Government participation and planning

(a) M. Visvesvaraya

(a) Marginal cost equals the marginal revenue

 (b) Decrease

The correct answer is All of the Above.

• Primary activities are such economic activities that are directly dependent on the environment as they utilize the earth's resources directly.
• Thus hunting, gathering, agriculture, livestock rearing, Mining, Fisheries, Pastoral activities, forestry, quarrying are all primary activities.

• Secondary activities: This sector transforms raw materials from primary activities by value addition. Ex- Manufacturing, processing of materials
• Tertiary activities: This deals with the provision of services in various forms. Ex- banking, insurance, teaching, etc.
• Quaternary activities: this deals with the specialized and complex category of activities that are mainly concerned with knowledge such as education, information, and development. Ex- R&D

(a) Balance of trade

(c) A single tax that replaces State taxes like, surcharge, turnover tax, etc.

If a director is absent from India, for a period which is not less than three months, then it is called casual vacancy. It may be filled by the appointment of alternate director. The appointment must be authorised by the articles of association by passing a resolution in the meeting.

(a) Increased export and improvement in balance of payment

There are two basis of classifying the expenditure-

i) Creation of an asset 

ii) Reduction of any liability.

Any expenditure that neither creates an asset nor reduces any liability is called

revenue expenditure. Example- Payment of salaries, subsidies, interest payment etc.

Any expenditure that either creates an asset or reduces any liability is called

capital expenditure. Example- Construction of factory, repayment of loan, purchase of share etc

(b) Circulation of currency

(i) Discovery of Idea: The first and foremost function of entrepreneur is idea generation. A person may conceive his own ideas or develop the ideas contributed by others. Ideas can be generated through several ways like own experience and exposure of entrepreneur, keen observation of environment, education, training, market survey, environmental scanning and so on.

(ii) Determining the business objectives: Entrepreneur has to develop business objectives in the backdrop of nature of business and type of business activity i.e. nature of business, manufacturing or trading, type of business organisation chosen so that he/she can organise the venture in accordance with the objectives determined by him/her.

(iii) Detailed Investigation: Entrepreneur should investigate commercial feasibility of the product proposed to be produced and conduct market study to ascertain the potential demand for the product.

(iv) Choice of form of enterprise: Entrepreneur has to choose the appropriate form of organisation suited to implement the venture. There are various forms of organisation namely sole proprietor, partnership, company and co-operatives etc. which are in existence.

(v) Fulfilment of the formalities: Having chosen the appropriate type of organisation, entrepreneur has to take necessary steps to establish the form of organisation chosen. As regards sole trader, the formalities are barest minimum. In the case of partnership firm, entrepreneur has to arrange for partnership deed and he has to get the deed registered.

(vi) Preparation of Business Plan: Entrepreneur has to prepare a business plan or project report of the venture that he is proposing to take up.

(vii) Mobilisation of funds: Entrepreneur has to take steps to mobilise capital needed to implement the venture.Entrepreneur has to estimate the fixed capital and working capital required for running the project.

(viii) Procurement of Machines and Materials: Entrepreneur has to locate the various sources of supply of machineries, equipments and materials.

There are 3 types of deficits: -

Revenue Deficit- The excess of government revenue expenditure over revenue receipts is called revenue deficit.

Revenue Deficit = Revenue Expenditure - Revenue Receipts.

Implications:

• It implies dissavings of government. 
• It indicates the inability of the government to meet its regular and recurring expenditure. 
• A high revenue deficit gives a warning signal to the government to either curtail its expenditure or increase its revenue. 
• Revenue deficit is financed through capital receipts like borrowings and used to meet the consumption expenditure of the government. It leads to inflationary pressure in the economy. 

Fiscal Deficit = Total Expenditure - Total Receipts excluding borrowing

Implications-

• It indicates total borrowing requirements of the government. Borrowing create problem of not only payment of interest but also repayment of loans.If it continuously increases it means government takes more loans to repay the previous loans. As a result country is caught in debt trap. 
• If government borrows from central bank, central bank issue new currency notes. It increases money supply and generates inflationary pressure in the economy. 
• When government borrows from rest of the world, it raises the country’s dependence on other countries.

Primary Deficit- the excess of fiscal deficit over interest payments is called primary deficit.

Primary Deficit = Fiscal Deficit - Interest Payments

Implications:

• It indicates how much of the government borrowing are going to meet expenses other than interest payments. 
• If it is zero, it indicates that government is only borrowing to repay the interest of previous loans.

(d) Sustainable development

(b) Monetary Policy

Disinvestment in PSUs: The Govt, has started the process of disinvestment in those PSUs which had been running into loss. It means that Govt, has been selling out these industries to private sector. So disinvestment is a system of privatizing government enterprises.

Difference Balance of Trade and Balance of Payments:

(a) the revenue per unit of commodity sold

(c) An agency for safe-keeping of securities

(b) Application form test and or interview, reference check, and physical examination

Visible items refer to items relating to trade of material goods with other countries.

Examples - tea, clothes, machinery etc.

Invisible items refer to items relating to trade of services with other countries and unilateral transfers.

Examples- Transport services, Insurance and banking services etc.

(c) An agency for safe-keeping of securities

Selection tests are of two types:

• Ability Tests and Personality Tests. Ability tests can further be divided into: aptitude test, achievement test, intelligence test, and judgement test.
• Personality tests can further be divided into: interest test, personality inventory test, projective test or thematic appreciation test, and attitude test.

(d) Payment made for the use of land

Visible Items : Exports and Imports of all type of physical goods is called visible items. For e.g., Tea, Coffee etc. 

Invisible Items : Exports and Imports of services is called invisible items. For example, Shipping, Insurance, Banking etc.

National Stock Exchange was incorporated in November, 1992. It uses satellite link to spread trading throughout the country. Through computer network, members’ orders for buying and selling within prescribed price are matched by central computer.

Balance of payments of a country is always balanced because entries in BOP account are done on the basis of credit (or receipt) and debit (or payment) in dual entry system. After filling all the entries in the record, total credit and debit become equal to each other because both the sides are equal in transaction and recorded in opposite direction that is why, BOP is always in equilibrium.

National stock market system was advocated by the High Powered Group. It is headed by Shri. Pherwani (popularly known as Pherwani Committee). 

At present the National Stock Market comprises the following:

• National Stock Exchange of India Limited (NSE) 
• Stock Holding Corporation of India Limited (SHCIL) 
• Securities Trading Corporation of India (STCI)

Marketer seeks to distinguish his products/services by adding additional features or functionalities to the existing product, modifying the pricing structure, introducing new delivery pattern, creating new business models, introducing change in production process and so on.

(c) Both a and b 

(c) Scarcity problem gives birth to choice 

'Micros', which means 'small' belongs to Greek word.

Because resources are limited.

a) Foreign Exchange Market: The foreign exchange market is the market where the national currencies of various countries are converted, exchanged or traded for one another. 

b) Spot Market: The exchange rate that prevails in the spot market for foreign exchange is called Spot Rate. 

c) Forward Market: A market in which foreign exchange is bought and sold for future delivery is known as forward market. Exchange rate that prevails in a forward contract for purchase or sale. 

d) Managed Floating: This is the combination of fixed and flexible exchange rate. Under this, country manipulates the exchange rate to adjust the deficit in the balance of payment by following certain guidelines issued by I.M.F. 

e) Dirty floating: If the countries manipulate the exchange rate without following the guidelines issued is called dirty floating: 

f) Deficit in BOP- If in current account of balance of payment (BOP), autonomous receipts are less than autonomous payments, then balance of payment (BOP) is said to be in deficit. It reflects disequilibrium in BOP.

g) Devaluation of a currency means reduction in the external value of a country’s currency as a conscious policy measure adopted by the Government of a country. In other words, we make our currency cheaper in terms of foreign currency. This makes our goods cheaper to foreign buyers and foreign goods costlier to our buyers. Hence exports increase, imports fall and the gap in trade balance becomes smaller. When a country suffers from continued deficit in its balance of payments, it may resort to devaluation of its currency with a view to encouraging exports and restricting imports and thus narrowing down or covering its trade gap and balance of payments deficit. It takes place in Fixed Exchange Rate System. 

h) Depreciation of a currency means fall in value of domestic currency in terms of foreign currency. Example: if value of rupee in terms of US dollars falls, say from Rs. 45 to Rs. 50 per dollar, it will be a case of depreciation of Indian rupee because more rupees are required now to buy one US dollar. It occurs in Flexible Exchange Rate System

A rise in foreign exchange rate makes home country’s goods cheaper to foreigners so they will purchase more goods and services, as a result demand for country’s goods increases in foreign market which leads to increase in country’s exports. At the same time foreigners who want to invest in home country will invest more, more foreign tourists will come to visit home country. This brings a greater supply of foreign exchange. Hence supply of foreign currency rises.

In Macro Economics, ‘Full employment’ means a situation in which at a given level of real wage, demand for labour is equal to its available supply. Thus the term full employment is used to signify a situation I which ordinarily all those people wage rate get work. 

In other words, “Full employment is a situation in which all those persons who are able and willing to work get work i.e, employment at the prevailing wage rate.” 

In work of Spencer, “Full employment is a situation in which everyone who wants to work is working except for those who are frictionally and structurally unemployed.” 

Full employment is not a situation of zero employment. It does not mean lack of unemployment. It simply means that situation in which employment opportunities and qualified job-seekers get equilibrium but some sort of unemployment cannot be denied in the economy. This sort of unemployment may be referred as natural unemployment.

Flexible exchange rate : It refers to the system of exchange in which the value of currency is allowed to adjust freely or to float as determined by demand for and supply of exchange. Thus, flexible rate is free to and supply of foreign currency. 

 Hence, R = f (D, S) 

i.e, Exchange rate is a function of demand and supply. (where R = Exchange Rate, D= Demand for various currencies in the international market and S = Supply of various currencies in international market) 

The exchange rate at which demand for foreign exchange becomes equal to supply Exchange of Rate’. It is also termed as ‘Normal Rate of Exchange’ or ‘Equilibrium Rate of Exchange’

Merits of flexible Exchange System:- 

1) Simple System – It is a simple system in its operation where exchange rate is determined at a point where the demand supply forces of exchange rate become equal. 

Hence, it does not need any outside intervention. 

2) Continuous Adjustments – There is always a possibility of adjustment in flexible exchange rate and hence adverse effects of long-term disequilibrium can be avoided.

3) Improvement in BOP – Adjustments in balance of payments in flexible exchange rate are smoother as compared with the fixed exchange rate adjustments. 

4) Optimum use of Resources – Flexible exchange rate ensures optimum use of resources which consequently increase the level of efficiency in the economy.

Demerits of Flexible Exchange Rate : 

1) Bad effect of less Elasticity – Less elasticity in exchange rate makes foreign exchange market unstable and consequently BOP situation becomes worse as a result of depreciation in scarce money. 

2) Uncertainty – Flexible exchange rate generates uncertainty and frequent changes in exchange rate discourage international trade and capital movements. 

3) Instability in International Trade – Instability in international money market generates instability in international trade. Consequently, formulation of long run policies related to import and export becomes difficult.

b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A). 

a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

c) Assertion (A) is true but Reason (R) is false.

(a) Low level of income and Low level of investment

a) Both the statements are true

(b)  A-iii; B-iv; C-i; D-ii

a) Restrictive policies of commodity production, trade and tariff pursued by the colonial government adversely affected the structure, composition and volume of India’s foreign trade