Explore topic-wise InterviewSolutions in Current Affairs.

The New foreign trade policy was announced in the year 2000.

An incremental change independent variable with respect to change independent variable is known as Slope.

1. Micro, small and medium Enterprises are MSMEs produce a wide variety of products in almost all sectors. 

2. The prominent among them are the engineering, electrical, chemicals, plastics, steel, paper, matches, textiles, hosiery and garments sector.

1. Privatisation is transfer of ownership and management of enterprises from public sector to private sector. 

2. Denationalization, disinvestment and opening exclusive public sector enterprises to private sector are the gateways to privatization.

In sex ratio, Tamil Nadu ranks Third.

1. Large number of Buyers and sellers. 

2. Homogeneous Product and Uniform price. 

3. Free Entry and exit. 

4. Absence of Transport cost. 

5. Perfect mobility of factors of production. 

6. Perfect knowledge of the market. 

7. No Government Intervention.

Productivity position of Tamil Nadu and India:

1. The Government of Tamil Nadu lays emphasis on agricultural production and productivity. 

2. Tamil Nadu tops in productivity, in food crops as well as non – food crops among the states in India.

Productivity position of Tamil Nadu in India

1. Tamil Nadu ranks first in maize, cumbu, groundnut, oil seeds and cotton. 

2. Tamil Nadu ranks second in rice and coconut. 

3. Tamil Nadu ranks third in sugarcane, sunflower and Jowar.

The important features of utility are:

1. Utility is psychological. It depends on the consumer’s mental attitude. 

For example, a vegetarian derives no utility from mutton. 

2. Utility is not equivalent to usefulness. 

For example, a smoker derives utility from a cigarette; but, his health gets affected. 

3. Utility is not the same a pleasure. A sick person derives utility from taking a medicine, but definitely it is not providing pleasure. 

4. Utility is personal and relative. An individual obtains varied utility from one and the same good in different situations and places. 

5. Utility is the function of the intensity of human want. An individual consumer faces a tendency of diminishing utility.

6. Utility cannot be measured objectively. It is a subjective concept and it cannot be measured numerically. 

7. Utility has no ethical or moral significance. 

For example, a cook derives utility from a knife using which he cuts some vegetables, and a killer wants to stab his enemy by that knife. In economics, a commodity has utility if it satisfies a human want.

In literacy rate, TN ranks Eighth.

A cost incurred in the past and cannot be recovered in future is called as Sunk Cost. This is historical but irrelevant for future business decisions. It is called as sunk because; they are unalterable, unrecoverable and if once invested it should be treated as drowned or disappeared.

(I) Land Tenure refers to the system of land ownership and management. 

(II) The features that distinguish a land tenure system from the others relate to the following:

• Who owns the land;
• Who cultivate the land;
• Who is responsible for paying the land revenue to the government.

(III) Based on these questions, three different types of land tenure existed in India before Independence.

(c) Both PC and Calculator

Personal Distribution: Personal Distribution is the distribution of national income among the individuals.

Functional Distribution: Functional Distribution means the distribution of income among the four factors of production namely land, labour, capital and organization for their services in production process.

Identify the formula of estimating average variable cost TVC/Q.

In India’s total cement production, Tamil Nadu ranks Third.

(a) Rao’s National Income Methodology:

1. Rao’s name is remembered for his pioneering work on the enumeration of national income of India. 

2. He attempted 

• To develop the national income concepts suited to India and developing countries.
• To analyze the concepts of investment, saving and the multipliers is an underdeveloped economy.
• To study the compatibility of the national incomes of Industrialized and underdeveloped countries.

3. Rao’s paper on “Full Employment and Economic Development” was one of the earliest contributions in the field of development towards employment.

(b) Rao’s views on Industrialization: Rao gave the following reasons for low per capita income and low levels of per capita nutrition in India.

1. Uneconomic holdings with sub-divisions and fragmentation. 

2. Low levels of water availability for crops. 

3. Excess population pressure on agriculture due to the absence of a large industrial sector. 

4. Absence of capital. 

5. Absence of autonomy in currency policy, and in general in monetary matters encouraging holding of gold.

Goods are also called: 

1. Products 

2. Commodities 

3. Things 

4. In Economics, the term ‘goods’ implies the term ‘services’.

(I) Large Population:

1. India stands second in terms of size of population next to China and our country is likely to overtake China in near future. 

2. Population growth rate of India is very high and this is always a hurdle to growth rate.

(II) Inequality and poverty:

1. There exists a huge economic disparity in the Indian economy. 

2. The proportion of income and assets owned by top 10% of Indians goes on increasing. 

3. Increase in the poverty level in the society and still Below Poverty Line [BPL] a higher percentage of individuals are living. 

4. As a result of unequal distribution of the rich becomes richer and poor becomes poorer.

(III) Increasing Prices of Essential Goods:

1. Even though there has been a constant growth in the GDP and growth opportunities in the Indian economy, there have been steady increase in the prices of essential goods. 

2. The continuous rise in prices erodes the purchasing power and adversely affects the poor people, whose income is not protected.

(IV) Weak Infrastructure: 

1. A gradual improvement in the infrastructural development. 

2. There is still a scarcity of the basic infrastructure like power, transport, storage etc.

(V) Inadequate Employment generation

:1. Growing youth population, there is a huge need of the employment opportunities.

2. The growth in production is not accompanied by creation of job. 

3. The Indian economy is characterized by “ Jobless growth”

(VI) Outdated technology: The level of technology in agriculture and small scale Industries is still outdated and obsolete.

Features of Rural Economy: 

(I) Village is an Institution: The village is a Primary Institution and it satisfies almost all the needs of the rural community. The rural people have a feeling of belongingness and a sense of unity towards each other.

Dependence on Agriculture: The rural economy depends much on nature and agricultural activities. Agriculture and allied activities are the main occupation in rural areas.

Life of Rural people: Lifestyles in villages are very simple. Public services like education, housing, health and sanitation, transport and communication, banking, roads and markets are limited and unavailable.

The standards of living of majority of rural people are poor and pitiable. In terms of methods of production, social organization and political mobilization, rural sector is extremely backward and weak.

Population Density: Population density, measured by number of persons living per sq.km is very low and houses are scattered in the entire villages.

Employment: There exists unemployment, seasonal unemployment and under employment in rural areas.

Poverty: Poverty is a condition where the basic needs of the people like food, clothing and shelter are not being met..

Indebtedness: People in rural areas are highly indebted owing to poverty and underemployment, lack of farm and non – farm employment opportunities, low wage employment, seasonality in production, poor marketing network etc.

Rural Income: The Income of the rural people is constrained as the rural economy is not sufficiently vibrant to provide them.

Dependency: Rural households are largely dependent on social grants and remittances from family members working in urban areas and cities.

Dualism: Dualism means the co-existence of two extremely different features like developed and under developed. These characteristics are very common in rural areas. Inequality: The distributions of income, wealth and assets are highly skewed among rural people. Land, livestock and other assets are owned by a few people.

Migration: Rural people are forced to migrate from villages to urban areas in order to seek gainful employment for their livelihood.

Correct Answer is: (a) Poverty

(c) Both (a) & (b)

Features of Rural Economy: 

(I) Village is an Institution: The village is a Primary Institution and it satisfies almost all the needs of the rural community. The rural people have a feeling of belongingness and a sense of unity towards each other.

(II) Dependence on Agriculture: The rural economy depends much on nature and agricultural activities. Agriculture and allied activities are the main occupation in rural areas.

(III) Life of Rural people: Lifestyles in villages are very simple. Public services like education, housing, health and sanitation, transport and communication, banking, roads and markets are limited and unavailable. The standards of living of majority of rural people are poor and pitiable. In terms of methods of production, social organization and political mobilization, rural sector is extremely backward and weak.

(IV) Population Density: Population density, measured by number of persons living per sq.km is very low and houses are scattered in the entire villages.

(V) Employment: There exists unemployment, seasonal unemployment and under employment in rural areas. 

(VI) Poverty: Poverty is a condition where the basic needs of the people like food, clothing and shelter are not being met. 

(VII) Indebtedness: People in rural areas are highly indebted owing to poverty and underemployment, lack of farm and non – farm employment opportunities, low wage employment, seasonality in production, poor marketing network etc. 

(VIII) Rural Income: The Income of the rural people is constrained as the rural economy is not sufficiently vibrant to provide them. 

(IX) Dependency: Rural households are largely dependent on social grants and remittances from family members working in urban areas and cities. 

(X) Dualism: Dualism means the co – existence of two extremely different features like developed and under developed. These characteristics are very common in rural areas. 

(XI) Inequality: The distributions of income, wealth and assets are highly skewed among rural people. Land, livestock and other assets are owned by a few people.

(XII) Migration: Rural people are forced to migrate from villages to urban areas in order to seek gainful employment for their livelihood.

1. Rural Economics deals with the application of economic principles in understanding and developing rural areas. 

2. Rural areas are geographical areas located outside towns and cities. 

3. Rural Economy refers to villages and rural community refers to people living in villages.

Rural areas are facing number of problems relating to, 

1. People

2. Agriculture 

3. Infrastructure 

4. Economy 

5. Society and Culture 

6. Leadership and 

7. Administration.

(I) People Related Problems: The problems related to individuals and their standard of living consist of illiteracy, lack of technical know how, low level of confidence, dependence on sentiments and beliefs etc.

(II) Agriculture Related Problems: The problems related to agriculture include as follows, 

1. Lack of expected awareness, knowledge, skill and attitude. 

2. Unavailability of inputs.

3. Poor marketing facility.

(III) Infrastructural Related problems: Poor infrastructure facilities like, water, electricity, transport, educational institutions, communication, health, employment, storage facility, banking and insurance are found in rural areas. 

(IV) Economics related problems: The economic problems related to rural areas are,

1. Inability to adopt high cost technology. 

2. High cost of inputs. 

3. Under privileged rural industries. 

4. Low income 5. Indebtedness 

6. Existence of inequality in land holdings and assets. 

(V) Leadership Related Problems: The Specific leadership related problems found in rural areas are,

1. Leadership among the hands of inactive and incompetent people 

2. Self – interest of leaders 

3. Biased political will 

4. Less bargaining power

5. Negation skills and dominance of political leaders

(VI) Administrative Problems: The rural administrative problems are,

1. Political interference 

2. Lack of motivation and interest 

3. Low wages in villages 

4. Improper utilization of budget 

5. Absence of monitoring 

6. Implementation of rural development programme.

Rural areas are facing number of problems relating to,

1. People

2. Agriculture 

3. Infrastructure 

4. Economy 

5. Society and Culture 

6. Leadership and 

7. Administration.

(I) People Related Problems: The problems related to individuals and their standard of living consist of illiteracy, lack of technical know how, low level of confidence, dependence on sentiments and beliefs etc.

(II) Agriculture Related Problems: The problems related to agriculture include as follows,

• Lack of expected awareness, knowledge, skill and attitude.
• Unavailability of inputs.
• Poor marketing facility.

(III) Infrastructural Related problems: Poor infrastructure facilities like, water, electricity, transport, educational institutions, communication, health, employment, storage facility, banking and insurance are found in rural areas.

(IV) Economics related problems: The economic problems related to rural areas are,

• Inability to adopt high cost technology
• High cost of inputs
• Under privileged rural industries.
• Low income
• Indebtedness
• Existence of inequality in land holdings and assets

(V) Leadership Related Problems: The Specific leadership related problems found in rural areas are:

• Leadership among the hands of inactive and incompetent people
• Self – interest of leaders
• Biased political will
• Less bargaining power
• Negation skills and dominance of political leaders

Administrative Problems: The rural administrative problems are,

• Political interference
• Lack of motivation and interes
• Low wages in villages
• Improper utilization of budget
• Absence of monitoring
• Implementation of rural development programme.

Monetary reforms aimed at doing away with interest rate distortions and rationalizing the structure of lending rates. The new policy tried in many ways to make the banking system more efficient. 

Some of the measures undertaken were:

(I) Reserve Requirements:

• Reduction in Statutory liquidity ratio [SLR] and the cash reserve ratio [CRR] were the recommendations by the Narasimham Committee Report, 1991.
• It was proposed to cut down the SLR from 38.5 percent to 25 percent within a time span of three years.

(II) Interest Rate Liberalisation: RBI controlled:

• The interest rates payable on deposits. The interest rate which could be charged for bank loans.
• Greater competition among public sector, private sector and foreign banks and elimination of administrative constraints.
• Liberalisation of bank branch licensing policy in order to rationalize the existing branch network.
• Banks were given freedom to relocate branches and open specialized branches
• Guidelines for opening new private sector bankNew accounting norms regarding classification of. assets and provisions of bad debt were introduced in tune with the Narasimham Committee Report.

Correct answer is 103.

Correct option: D) Label

Correct option: A) Product Modification

Correct option: B) Augumented product

(c) The quantity of inputs and the quantity of output

(d) (b) and (c)

(c) Getting new slide

(b) Theory of factor pricing

Internal Economics of Scale:

1. Internal Economies of scale refers to the advantages enjoyed by the production unit which causes a reduction in the cost of production of the commodity. 

2. For example, a firm enjoying the advantage of an application of most modem machinery, generation of internal capital, an improvement in managerial skill etc. are sure to reduce the cost of production. 

They are of various types:

(a) Technical Economies:

1. When the size of the firm is large, large amount of capital can be used. 

2. There is a possibility to introduce up – to – date technologies; this improves productivity of the firm. 

3. Research and development strategies can be applied easily.

(b) Financial Economies: Big firms can float shares in the market for capital expansion, while small firms cannot easily float shares in the market.

(c) Managerial Economies: Large scale production facilitates specialization and delegation.

(d) Labour Economies:

1. Large scale production implies greater and minute division of labour. 

2. This leads to specialization which enhances the quality. 

3. This increases the productivity of the firm.

(e) Marketing Economies:

1. In the context of large scale production, the producers can both buy raw – materials in bulk at cheaper cost and can take the products to distant markets. 

2. They enjoy a huge bargaining power.

(f) Economies of survival:

1. Product diversification is possible when there is large scale production. 

2. This reduces the risk in production. 

3. Even if the market for one product collapses, market for other commodities offsets it.

External Economies of Scale:

1. External Economies of Scale refer to changes in any factor outside the firm causing an improvement in the production process. 

2. This can take place in the case of industry also. 

3. These are the advantages enjoyed by all the firms in industry due to the structural growth.

4. Important external economies of scale are listed below :

• Increased transport facilities
• Banking facilities
• Development of townships
• Development of information and communication.

1. Tamil Nadu has a well – developed rail network as part of Southern Railway, Headquartered at Chennai. 

2. The present Southern Railway network extends over a large area of India’s Southern Peninsula, covering the States of Tamil Nadu, Kerala, Puducherry, minor portions of Karnataka and Andhra Pradesh.

3. Tamil Nadu has a total railway track length of 6,693 km and there are 690 railway stations in the State. The system connects it with most major cities in India. 

4. Main rail junctions in the State include Chennai, Coimbatore, Erode, Madurai, Salem, Tiruchirapalli and Tirunelveli. 

5. Chennai has a well – established Suburban Railway network, a Mass Rapid Transport System and is currently developing a Metro system, with its first underground stretch operational since May 2017.

(c) Univariate Function

(b) Total revenue

(b) Monopoly

The Causes for Rural Indebtedness:

(I) Poverty of Farmers:

• The vicious circle of poverty forces the farmers to borrow for consumption and cultivation.
• Thus poverty, debt and high rates of interest hold the farmer in the grip of money lenders.

(II) Failure of Monsoon:

• Frequent failure of monsoon is a curse to the farmers and they have to suffer due to the failure of nature.
• Farmers find it difficult to identify good years to repay their debts.

(III) Litigation:

• Due to land disputes litigation in the court compels them to borrow heavily.
• Being uneducated and ignorant they are caught in the litigation process and dry away their savings and resources.

(IV) Money Lenders and High Rate of Interest: The rate of interest charged by the local money lenders is very high and the compounding of interest leads to perpetuate indebtedness of the farmer

Major features of SHGs [Self Help Groups] 

1. SHG is generally an economically homogeneous group formed through a process of self – selection based upon the affinity of its members.

2. Most SHGs are women’s groups with membership ranging between 10 and 20. 

3. SHGs have well – defined rules and by – laws, hold regular meetings and maintain records and savings and credit discipline. 

4. SHGs are self managed institutions characterized by participatory and collective decision making.

(a) Micro and macroeconomics

Wages are divided into four types.

1. Nominal Wages or Money Wages: Nominal wages are referred to the wages paid in terms of money.

2. Real Wages: Real wages are the wages paid in terms of goods and services. Hence, real wages are the purchasing power of money wages. 

3. Piece Wages: Wages that are paid on the basis of quantum of work done.

4. Time Wages: Wages that are paid on the basis of the amount of time that the worker works.

(a) Equilibrium

(c) Foreign Direct Investment

Correct option is d) profit

1. Risk bearing theory of profit was propounded by the American economist F.B. Hawley in 1907. 

2. According to him, profit is the reward of risk taking in business. 

3. Risk taking is an essential function of the entrepreneur and is the basis of profits.

4. It is a well know fact that every business involves some risks. 

5. Since the entrepreneur undertakes the risks, he receives profit. 

6. If the entrepreneur does not receive the reward, he will not be prepared to undertake the risks. 

7. Every entrepreneur products goods in anticipation of demand. 

8. It is the profit that induces the entrepreneurs to undertake such risks.

Correct answer is  (c) (i), (iii)