12th Economics Mod Question Paper

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A.VENNILA
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MYDEEN MATRIC. HR.SEC. SCHOOL
Time Allowed : 3 Hourst
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2 C Karl Marx 12 D Customs Union
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4 D C+S + T+Rf 14 A Sales Tax
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6 D Increase bowings and spending 16 A Living
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et et 24. Gold et eStandard:

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28. Meaning of Seed Ball:

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from the citizens or from different institutions within international organisation.
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An internal public debt only involves transfer of Loan from other countries and the
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31. Demerits if Socialism:

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i.Nie.Ne
lsaai.lN
ai.N lsaai.lN
ai.N of filessafrom ai.N one table
laai.lN to
i.Niother to i.Ne lsaai.lN
sa sa
a a a as salaala
a as salaala a as salaala sa a a
a as salaala a as a as adsa
a
P Pa
a
2. Absence of Incentive:
et et e•t et The major t et
elimitation of et et
socialism is that etthis
et system idoes et et not provide t et incentiveNefor
eany t et
sa lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N alsaai.lN
ai.N alsaai.lN
ai.N a lsaa.lN
ai.N a lsaai.lN
ai.N a lsaai.lai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
PaPdad PaPdad
efficiency. PaPdad productivity
Therefore, PaPdadalso suffers. PaPdad PaPdad PaPdad a d
P Pa
et et 3. Limited
et et Freedom et eof
t Choice: .NeNt et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai lai. a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a d s
ada • a d s
ada
Consumers do not
a d s
ada
enjoy freedoma d s
aof
d a choice over
a d s
athe
d a consumption a d s
ada of goods and a d s
adservices.
a a d adsa
a
32. Difference between Classism and Keynesianism:

salsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a a s s
a a s
a a s
a a s
a a adsa
PaPdad PaPdad
S.No ada
PaPdKeynesianism PaPdad PaPdad PaPdad PaPdad
Classicism a d
P Pa
a
1. Short-run equilibrium Long-run equilibrium

et et et et et et et et et et
et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N 2. lsaai.lN
Saving
a ai.N is a vice a lsaai.lN
ai.N Saving a a lsaai.lN
lsaai.lN
aisai.N
i.Na social lsaai.lN
virtue.
a ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
aPdaada
s
a a s
a a s
a a adsa
a
PaPdad PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
3. Macro approach to national problem PMicro foundation to macro problems
et et et et4.
Stateet intervention
et
is advocated et et Champions
et et et et
of Laissez-fair et et
policy et et
sa lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da a d adsa
a a d adsa
a a d adsa
a a d adsa
a a dadsa
a a d adsa
a ad adsa
a a d adsa
a
33. Difference between Autonomous and induced investment:
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
34. Cambridge equations of value of money:
sa lsaai.lN
ai.N a aai.lN
lsi) ai.N
Marshall’s lsaai.lN
Equation
a ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
The Marshall equation is expressed as: M = KPY
et et
Where et t et et et et et et et et et et et et
lsaai.lN
ai.N l aai.lN
ai.Ne lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
sa s
adaa s M is thes
adaa quantity of s
ada a
money s
adaa s
adaa s
adaa s
adaa adsa
da a d
P Pa a d
P Pa a
P Pad a d
P Pa a d
P Pa a d
P Pa a d
P Pa a
P Pad a
 Y is the aggregate real income of the community
et et et etP is Purchasing et et Power of money
et et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a d s
ada  K a d s
ada
represents the a d s
ada
fraction of the real
a d s
adaincome which a d s
adathe public s
ada
desires
a d to hold in
a d s
athe
d a form of a d adsa
a
money.
et et Thus, t
e e the price level
t et eP
t = M/KY or etthe
et value of i.money et et (The reciprocal et et of price et et is 1/P =i.NKY/M
level) et et
salsaai.lN
ai.N lai.Ni.N
la lai.Ni.N
la lai.Ni.N
la la Ni.N
la lai.Ni.N
la lai.Ni.N
la la i.N
la lai.N
la
da asaasa asaasa asaasa asaasa asaasa asaasa asaasa asaasa
PaPdad PaPdad PaPdad PaPdad PaPdad PaPdad PaPdad PaPdad
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et ii) Keynes’
et et Equation et et et et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a is expressed s
a a s
da a s
da a s
a a s
a a adsa
a
PaPdad Keynes equation PaPdad PaPdad as: n = pkPa(or)
Pad p = n / k PaPad PaPdad PaPdad a d
P Pa
Where
ai.•N n is the
et et et et total et et et et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN a lsa ai.N supply sof
i.lN a lsamoney
i.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da d s
ada d s
ada a d ada a d s
ada d s
ada d s
ada d s
ada d adsa
a
a
P Pa • p is the general price level of consumption goods
P aP a P aP a P aP a P aP a P aP a P aP a P aP a
•t k is the totalt quantity of consumption units the people decide to keep in the form of cash.
et et e et e et t e et t e et t e et t e et t e et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
Keynes indicates that K is a real balance, because it is measured in terms of consumer goods.
sa lsaai.lN
ai.N ai.lN
ai.N
35.alSubject .lN
alaiof
Matter ai.N .N .N
alai laiEconomics:
International .N N
alai lai. a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da dasasa dasasa dasasa dasasa s
a a s
a a s
a a adsa
a
PaPad PaPad PaPad PaPad PaPdad PaPdad PaPdad a d
P Pa
1. Pure Theory of Trade
et et et et et et eNt et eNt et e.Nt et et et et et
sa lsaai.lN
ai.N a ai.•N This component
lsaai.lN a lsaai.lN
ai.N explainsa lsaai.lN
ai.the causes a lsaai.lN
for ai.foreign trade,
a lsaai.lN
aicomposition, a lsaai.lN
ai.N
direction and a
.lN
ai.N
lsaaivolume lsaai.lN
a
da a d s
ada a d s
ada a d s
ada a d s
ada a d s
ada a d s
ada a d s
ada a d adsa
a
of trade, determination of the terms of trade and exchange rate, issues related to balance
et et et t
of trade and balance of payments.
et t et t et t et t et t et t
e e e e e e e
salsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da a d adsa
a ad adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a
P Pa 2. Policy P Pa
Issues P Pa P Pa P Pa P Pa P Pa P Pa
• policy issues such as free trade vs. protection, methods of regulating trade, capital and
et et et et et et et t et et et et et t et et
lsaai.lN
ai.N lsaai.lN
ai.N technology lsaai.lN
ai.N
flows, use lsaai.lN
of i.Ne
ataxation, lsaai.lN
subsidies ai.N and dumping,lsaai.lN
ai.N exchange lsaai.lN i.Ne
acontrol and lsaai.lN
ai.N lsaai.lN
a
sa sa
a a s
a aa s
a aa s
a aa s
a aa s
a aa s
a aa adsa
P Pa
a
convertibility, foreign aid, external borrowings and foreign direct investment.
et et e.Nt et et et et et Regulatory et et et et et et et et
sa lsaai.lN
ai.N a lsa3. aiInternational
i.lN a lsaai.lFinancial
N
ai.N anda lsaai.lTrade
N
ai.N a ai.NInstitutions
lsaai.lN a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a a a s s
a a s
a a s
a a s
aPdaada IBRD,
s
ada adsa
PaPdad • The ada
PaPdfinancial PaPdad
institutions PaPdad
like International PaPdad
Monetary Fund PIMF, P ad a
WTO etc which
P P aP
da a
influence international economic transactions and relations shall also be the part of
sa lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
international
a alsaai.lN
ai.N economics. ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
36. Trade Blocks:
et et et et et et e.Nt et et et et et et et et et
sa lsaai.lN
ai.N a ai.•N Tradesablocks
lsaai.lN lsaai.lN
ai.N are a set a i.lN
lsaof aicountries lsaai.lN
which
a ai.N engage sin
a i.lN
ai.N
international
lsaa a aai.lN
ltradeai.N together a i.lN
lsaand ai.Nare lsaai.lN
a
da
s
a a a a s
a a a s
a a a a s
a a s s
a a a adsa
a
P Pa
usually related through a free trade agreement or other associations.
ai.•N
et et et et Trade ablocks et et et et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN ai.N cover different
lsaai.lN a ai.N kindssof
lsaai.lN a lsaaiarrangements
.lN
ai.N a lsaaibetween
.lN
ai.N or among
a ai.N countries
lsaai.lN a lsaafor
i.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a a a s
a a s
a a s
a a adsa
a
PaPdad PaPdad benefit. PaPdad
mutual PaPdad PaPdad PaPdad PaPdad a d
P Pa
et et
•
e.Nt et
Some countries e.Nt et
create business e.Nt et
opportunities e.Nt et
for themselves e.Nt et
by integrating e.Nt et
their et et
sa lsaai.lN
ai.N l a i .lN
a i la i .lN
a i l a i .lN
a i l a i .lN
a i la i.lN
a i l ai .lN
ai i.Ni.N
salaala lsaai.lN
a
da asaasa sa a in orderdato
economies
adaadas
sa a
a adasavoid unnecessary
sa a
adaadas
sa a
competition
adaadas among them.
sa a
adaadas adaadas adsa
a
PaPdad PP PP PP PP PP PP a d
P Pa
37. Three methods of redemption of public debt:
sa lsaai.lN
ai.N a aai.lN
ls(1) ai.Sinking Funda lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a d s
ada a d s
ada a d s
ada ad s
ada a d s
ada a d s
ada ad s
ada a d adsa
a
• Under this method, the Government establishes a separate fund known as “Sinking Fund”.
et et • eNtTheet Government et et credits everyt t year a fixed
i.NeNe
tamount
i.NeNe
t of money
t t to this fund.
i.NeNe
t t
i.NeNe et et
sa lsaai.lN
ai.N a lsaai.lN
ai. a lsaai.lN
ai.N la lai. la lai. la lai. la lai. lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a asa
asa asa
asa asaasa asaasa s
a aa adsa
a
P Pa
(2) Conversion
et et
•
et et
Conversionet of
et
loans is another
et et
method of redemption of
et et
public debt. et et
et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N i.Ni.N
salaala sa lai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da
s
a a • aPdaadas that
ItPmeans anPold asa is
aPdaadloan adsa
converted a in to a new a
adsloan.
a adsa
a s
a aa adsa
a
PaPdad a d
P Pa a d
P Pa a d
P Pa PaPdad a d
P Pa
et et (3) eBudgetary
t et Surplus et et et et et et et et et et et et
lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
sa
da a d
P Pa
s
adaa • When
a d
P Pa
s a
adathe Government a d
P Pa
sa
ada presentsasurplus d
P Pa
s
adaa budget,
a d
P Pa
s
ait
d
a
acan be utilized
a
P Pad s a
ada for repaying a d
P Pa
sa
adthe
a debt. a d
P Pa
adsa
a
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et 38. Causes t t of water N

i.Nie.Ne
pollution:
t t
i. ie.Ne et et et et et et et et et et
sa lsaai.lN
ai.N la la la la lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da asaasa asaasa s
a aa s
a aa s
a aa sa
a a sa
a a adsa
a
P Pa
1. Discharge of sewage and waste water:
et et e•t et Sewage, garbage et et and liquid et etwaste of households,et et agricultural et et runoff eand
t et effluents Nfrom et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lai.N lsaai.lN
a
s s
factories
a a are discharged s into lakes s s s s adsa
PaPdadand rivers.PaPdad
da a a a a a a a a a a a a a
PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
et et et t et et et et et et et et et et et et
lsaai.lN
ai.N ls2.
aai.lNi.Ne
aDumping ofalsolidai.N wastes: salsaai.lN
aai.lN ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
sa sa
a a s
a a s s a s a s a s a adsa
da PaPdad PaPdad aPdaada a a
PaPdad
a a
PaPdad
a a
PaPdad
a a
PaPdad a d
P Pa
a
• The dumping of Psolid wastes and litters in water bodies cause huge problems.
sa lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N alsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a 3. Discharge s a industrialadw
a of s
aastes:
a s
a a s
a a s
a a s
a a adsa
a
PaPdad PaPdad P Pad PaPdad PaPdad PaPdad PaPdad a d
P Pa
• Industrial waste contains pollutants like asbestos, lead, mercury, grease oil and
et et et et petrochemicals,
t t which are
i.Nie.Ne
t extremely
i.Nie.Ne
t harmful
t t
i.Nie.Ne
to bothi.Npeople
et t
i.Ne
and environment.
t t
i.Nie.Ne et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N la la la la la la la la la la lsaai.lN
ai.N lsaai.lN
a
da
s
a a asaasa asaasa asaasa asaasa asaasa s
a aa adsa
a
P Pa
39. Calculation of Standard Deviation: 14, 22, 9, 15, 20, 17, 12, 11
salsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a s a s s
a a s
a a s
a a s
a a s
a a adsa
ada
PaPd40. ada
PaPdbetween PaPdad growth and PaPdadeconomic development:
PaPdad PaPdad PaPdad a d
P Pa
a
Difference economic
et et et et .NeNet
t et t et et et et et et et et
sa lsaai.lN
ai.N a lsaaiBasis
.lN
ai.N of Difference
alai lai. a aEconomic
lsaai.lNi.Ne Growth
a lsaai.lN
ai.N a lsaai.lN
ai.N Economic
a ai.N Development
lsaai.lN a lsaai.lN
ai.N lsaai.lN
a
da
s
a a asasa s
a a s
a a s
ada s
ada s
ada adsa
a
PaPdad Deals PaPdad PaPdad with the problems
Deals PaPdad of ad
P Pa a d
Deals Pwith
Pa the problems a d
P Pa of UDCs P Pa a d
Developed countries
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
s
a a s
a a s
a a s
ada steady adada s Change a s s
a a adsa
da PaPdad Changes Change
PaPdad is gradual PaPdaand PaPdis
adadiscontinuous PaPdadand
a
PaPdad P Pa a d
P Pa
spontaneous
et et et et et et t
.NeNet et et e.Nt et et et et et
sa lsaai.lN
ai.N a i.lN
ai.N
lsaaScope a lsaai.lN
ai.N i i.
salaala
Narrow a lsaai.lN
ai.N a lsaai.lN
aiWider concept
a lsaai.lN
ai.N
Development a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a adadas
s
a a s
a a s
a a s
a a adsa
a
PaPdad PaPdad P Pa PaPdad PaPdad PaPdad PaPdad a d
P Pa
= Growth + Change
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
salsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et et et et et et et PART et e-t IV et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
aPdaada
s
a a s
a a s
ada adsa
a
PaPdad
IV. Answer any seven PaPdad PaPdad Question PNo.30
questions. is compulsory.PaPdad PaPdad ad
P Pa 7 x 5 = 35 P Pa a d
et et 41.a. NScope et et of Micro eEconomics:

t et et et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lai.N a lsaai.lN
ai.N a lsaai.lN
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ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a i. NationaladIncome:s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
PaPdad P Pad PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
• Measurement of national income and its composition by sectors are the basic aspects of
et et et et macro economic et et analysis. et et et et et et et et et et
sa lsaai.lN
ai.N lai.N
l ai.N lai.N lai.N lai.N ai.N
l lai.N ai.N
l lai.N ai.N l lai.N ai.N l lai.N ai.N l lsaai.lN
a
da asaasa asaasa asaasa asa
asa asaasa asaasa asaasa adsa
a
P Pa
ii. Business Cycle:
et et et et eNt et et et et t et et et t et et
lsaai.lN
ai.N ai.•N Almost
lsaai.lN i.lN
lsaall ai.economies lsaai.lN
face ai.Nthe problemlsaai.lNi.Nebusinessafluctuations
aof lsaai.lN
ai.N and lsaai.lN i.Ne
abusiness cycle.lsaai.lN
ai.N lsaai.lN
a
sa s
a aa s
a aa a s
a aa s
a aa s
a a s
a aa s
a aa adsa
P Pa
a
• The cyclical movements in the economy need to be carefully studied based on aggregate
et et et et economic.Nvariables.
eNt et t
.NeNet
t
.NeNet
t
.NeNet
t
.NeNet
t
.NeNet
sa lsaai.lN
ai.N a lsaai.lN
ai.N lai lai. lai lai. lai lai. lai lai. lai lai. lai lai. lsaai.lN
a
da
s
a a asaasa asaasa asaasa asaasa asaasa asaasa adsa
a
P Pa
iii. Poverty and Unemployment:
et et t t
i.Nie.•Ne The major
t et
i.Nie.N Nie.Nt et resource t
Net nations
i.-Nie.rich
t t
.Nie.Nepoverty
t
Net
i.Nie.unemployment.
t t
i.Nie.Ne
salsaai.lN
ai.N salaala salaala
problems ofi.most
salaala salaala
iare
salaala
and
salaala salaala lsaai.lN
a
da a as a as a as a as a as a as a as adsa
a
P Pa
• This is one of the economic paradoxes.
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
s s s s s s s adsa
PaPdad iv. Economic PaPdad Growth: PaPdad
da a a a a a a a a a a a a a a a
PaPdad PaPdad PaPdad PaPdad a d
P Pa
• The growth and development of an economy and the factors determining them could be
et et et et understood etonly
et through t et
emacro analysis.et et et et et et et et
sa lsaai.lN
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ai.N
l lai.N
ai.N l lai.N
ai.N lai.N
ai.N llai.N
ai.N lai.N
ai.N l l l lsaai.lN
a
da
s
a a asaasa asaasa asaasa asa
asa asaasa asaasa adsa
a
P Pa
v. Economic Policies:
et et et et e.Nt et et et et et et et et et et et
sa lsaai.lN
ai.N a ai.•N Economic
lsaai.lN a lsaai.lN
aipolicies are a i.lN
ai.N
lsanecessary to lsaai.lN
solve
a lsaai.lN
ai.Nthe basicsaproblems,
ai.N to lsaai.lN
overcome
a ai.N the lsaai.lN
obstacles
a ai.N lsaai.lN
a
da
s
a a s
a a s
a a a s
a a a a s
a a s
a a adsa
a
PaPdad Padad PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
andPto achieve growth.
et et et et et et et et
[OR]
sa lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
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ai.N lsaai.lN
ai.N lsaai.lN
a
da a d adsa
a a dadsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a dadsa
a
41.b. Various method of estimating the national income of a country:
sa lsaai.lN
ai.N a aai.lN
ai.N
lsIntroduction a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
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ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
 National Income can be computed at any of three levels, viz., production, income and
expenditure. t t
et et t t e e t t e e t t t t
e e t t e e e e e e et et
sa lsaai.lN
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ai.N lsaai.lN
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ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da d adsa
a d adsa
a dadsa
a d adsa
a d adsa
a dadsa
a s
a aa adsa
a
a
P Pa a
P Pa a
P Pa a
P Pa a
P Pa a
P Pa PaPdad a d
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1. Production or value added method
et et 2. Income
et et method etor
et factor earning et et method i.Ne.Nt et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
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ai.N la lai lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
s s s asaasa s a sa s a adsa
PaPdad 3. Expenditure PaPdad method PaPdad
da a a a a a a a a a a a a a
PaPdad PaPdad PaPdad PaPdad a d
P Pa
Output = Income = Expenditure
sa lsaai.lN
ai.N a lsaai.lN
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ai.N a lsaai.lN
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ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
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a a a s s
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a a s
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PaPdad 1. Product ada
PaPdMethod PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
a
• Product method measures the output of the country.
ai.•N It is also
et et et et et et inventory eNt et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN a lsaaicalled
.lN
ai.N a ai.method.
lsaai.lN a lsaai.lN
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ai.N lsaai.lN
a
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s
a a a s s
aPdaadaproduct is
s
daada a s a s s
da a adsa
PaPdad • The ada
PaPdvalue of the Pfinal PaP
derived by the ada
PaPdsummation of adathe valuesPaadded
PaPdall Pad in the a d
P Pa
a
productive process.
salsaai.lN
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ai.N lsaai.lN
a
s
a a s
da a doublePcounting, s
aPdaada as s
aPdaadfinal
s
a a s
a a adsa
da PaPdad • Pad
ToPaavoid either ada value of P
PaPdthe the a
PaPdad
output. PaPdad a d
P Pa
a
sa lsaai.lN
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ai.N alsaai.lN
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ai.N a lsaai.lN
ai.N lsaai.lN
a
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s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
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ada s
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a
PaPdad 2. Income Pad
PaMethod PaPdaEarning
(Factor PaPdad
Method) PaPdad PaPdad PaPdad a d
P Pa
• This method approaches national income from the distribution side.
et et et et Net et Net et Net et Net et Net et Net et
lsaai.lN
ai.N lsaai.lN
ai.•N Under lsaai.lai.N
this lsaai.lai.N income
method,danational aai.lacalculated
lsis i.N lsaai.adding
lai.N i.lai.N
lsaathe lsaai.lai.N lsaai.la N
sa
da
sa
a a adsa
a saa adsa
a adsby
a
a updaall
saa incomes adsgenerated
a
a adsa
a
PaPdad a d
P Pa a
P Pa d a d
P Pa a d
P Pa a
P Pa d a d
P Pa a d
P Pa
in the course of producing national product.
et et e•t et Nationali.Income et et is calculated et et as domestic et etfactors income et et plus net factor et et incomes ifrom et et
sa lsaai.lN
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ai.N a lsaai.lN
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ai.N lsaai.lN
a
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a a s
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PaPdad abroad.
P Pa
et et et et et t et t et et et et et et et et
sa lsaai.lN
ai.N s
a aa lsaai.lN
ai.N Y=w +lari.lNa+i.NIe + II +a(R-P)
asa
asa salai.lN
asa
ai.N
e
s
a aalsaai.lN
ai.N s
a aa lsaai.lN
ai.N s
a aa lsaai.lN
ai.N s
a aa lsaai.lN
ai.N
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lsaai.lN
a
P Pa
a
et et et et
w = wages,et t r= rent, i = interest, II
e.Nt et
=
e.Nt et
profit, R = Exports and ePt =t Imports
et t et et
lsaai.lN
ai.N lsaai.lN
ai.N l a i .lN
a i .Ne l a i .lN
a i la i.lN
a i lsaai.lN
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e
lsaai.lN
ai.N
e
lsaai.lN
ai.N lsaai.lN
a
sa s
a aa asaasa asa
asa asaasa adsa adsa s
a aa adsa
da PaPdad 3. The PaPdad PaPdad (Outlay Method) PaPdad a d
P Pa
a a d
P Pa
a
PaPdad a d
P Pa
a
Expenditure Method
• To calculatet the expenditure of a society tit tincludes personal consumption expenditure,
et et e.Nt et e.Net e.Nt et e.Ne e.Nt et e.Nt et et et
salsaai.lN
ai.N l ai .lN
ai l
netadomestica i .lN
ai investment, l a i .lN
a i government l a i .lN
a i
expenditure l
on a i .lN
a i
consumption l a i .lN
a
as i well as lsaai.lN
capital ai.N lsaai.lN
a
da asa
asa s
a aa s a s
a aa s a s
a aa s a s
a aa s a s
a aa s a s
a aa adsa
a
PaPdad P Pdad PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
goods and net exports.
et et e•t et GNP = Ci.N+eNtIe+ t G + (X-M)
i.NeNe
t t
i.NeNe
t t
i.NeNe
t t
i.NeNe
t t
i.NeNe
t t
sa lsaai.lN
ai.N a lsaai.lN
ai.N la lai. la lai. la lai. la lai. la lai. la lai. lsaai.lN
a
da
s
a
P Pa
C= Private consumption expenditure, I=Private Investment Expenditure,
et et et et G= Government et et et et
Expenditure; X-M= Netet eExports.
t et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da
s
asa asaasa s
a aa adsa
a
P Pa
et et 42.a)i.Primary
Nie.Nt et and secondary
t t
i.Nie.Ne
functions t t of commercial
i.Nie.Ne
t t banks:
i.Nie.Ne et et et et et et
sa lsaai.lN
ai.N la la la la la la la la lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da asaasa asaasa asaasa asaasa sa
a a s
a aa s
a aa adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
(A) PRIMARY FUNCTIONS

sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
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s
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PaPdad PaPdad
1. Accepting PaPdad
Deposits PaPdad PaPdad PaPdad PaPdad a d
P Pa
It implies that commercial banks are mainly dependent on public deposits. There aret two
et et et et et et et et eNt et
t et et e et e et
sa lsaai.lN
ai.N a lsaai.lN
ai.N types of a aai.lN
ai.N
lsdeposits, which a
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ai.N discussed
lsaaiare a i.lN
lsaaas ai.follows alsaai.lN
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ai.N a lsaai.lN
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a a s
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a
P Pa
❖ Demand Deposits
et et et et ❖ Time Deposits
Net et et et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
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s
a a adsa
a s
a aa s
a aa s
a aa s
a aa s
a aa adsa
a
PaPdad a d
P Pa PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
2. Advancing Loans
lsaai.lN
et et
ai.N lsaai.lN
et et
ai.N
• It lrefers
ai.N
et et to granting
ai.N lai.N
ai.N
t et
eloans
lai.N
et et
to individuals
ai.N lai.N
et et
and businesses.
ai.N lsaai.lN
et et
ai.N lsaai.lN
et et
ai.N lsaai.lN
a
sa a a l a l sa al a l a a adsa
da
s
a a
PaPdad dadsasa daadsasa aPdaadasin d s
ada s a d s
ada d s
ada d a
•PaPaCommercial
PaPbanks grant P
loans the P a a P a a P
form of overdraft, cash credit, and discounting
P P aP a P aP a
bills of exchange.
salsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et et et(B) SECONDARY et et FUNCTIONS et et et et et et et et et et

sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
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a
P Pa
The secondary functions can be classified under three heads, namely, agency functions,
et et et etgeneral utility et et functions,i.Nand et et other functions. et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaalai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
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a a adsa
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P Pa
1. Agency Functions
et et et etIt impliesi.that et et commercial etbanks
et act as.Nagents et et of customers et et by performing et et various.NeNt et
sa lsaai.lN
ai.N a lsaai.lNai.N a lsaalN ai.N a lsaai.lN
ai.N a lsaai lai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lai lai. lsaai.lN
a
da
s
a a functions.
s
a a s
a a s
a a s
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a a asaasa adsa
a
P Pa
 Collecting Cheques
et et e e  Collecting
t t et et Income i.Ne.Nt et et et et et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaalai alsaai.lNai.N a lsaai.lN
ai.N a lsaai.lN
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ai.N lsaai.lN
a
da
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PaPdPaying
a s
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a a s
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PaPdad ada PaPdad
Expenses PaPdad PaPdad PaPdad PaPdad a d
P Pa
a
et et et et 2. General eUtility
t et Functions et et et et et et et et et et
sa lsaai.lN
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ai.N a lsaai.lN
ai.N lsaai.lN
a
da
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a a s
aPdaada
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ada a s a s s
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PaPdad ItPimplies that commercial
PaPdad banks provide
PaPda some ada
PaPdutility services adacustomers.
PaPdto PaPdad a d
P Pa
a
• Providing Locker Facilities

et et et et et t et t et t et et et et et et
salsaai.lN
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s
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ai.N s
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ai.N
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a
da PaPdad PaPdad
a
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a
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a
P Pa
a
3. Transferring Funds
et et et etIt refers to et et
transferring of t et
efunds fromlaione et ebank
t to another. et et Funds are ettransferred
et byet et
sa lsaai.lN
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a
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PaPdad PaPdadof draft, telephonic
means PaPdad PaPdadand electronic
transfer, PaPdadtransfer. PaPdad PaPdad a d
P Pa
et et et et et et et et et t et et et et et et
lsaai.lN
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ai.N lsaai.lN i.Ne
a[OR] lsaai.lN
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ai.N lsaai.lN
ai.N lsaai.lN
a
sa s
a aa sa
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dada
a s
ada a s
adaa s
a aa s
a aa adsa
da PaPdad PaPdad PaP PaPdafunction PaPdadiagram: PaPdad PaPdad a d a
42.b) Keynes psychological law ofa consumption with P Pa
lsMeaning of Psychological lawlaof consumption

sa lsaai.lN
ai.N a aai.lN
ai.N a lsaai.lN
ai.N a i.lN
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a
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The law implies that there is a tendency on the part of the people to spend on consumption less
et et than t the full increment
.NeNet
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of income.t
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t
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t
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t
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t
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PaPdad Assumptions:
P Pa
• The other variables such as income distribution, tastes, habits, social customs, price
et et et et et et et et t t et t t t e e e e et et
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a
sa sa
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a aa adsa
da PaPdad PaPdad PaPdad PaPdad a d
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a a d
P Pa
a
PaPdad a d
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a
• Existence of Normal Conditions: The law holds good under normal conditions. People
et et et etmay spend the
et et whole of iincreased
et et income et on
et consumption. et et et et et et
sa lsaai.lN
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ai.N a lsaai.lN
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a
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a a • Existences
a a of a Laissez-faire s
a a s
a a
Capitalist s
ada law operates s
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PaPdad PaPdad PaPdad PaPdad Economy: PaPdaThe PaPdad in a rich Pcapitalist a d
P Pa
economy where there is no government intervention.
sa lsaai.lN
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a
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PaPdad The three Pad
Papropositions of ada law Diagrammatically,
PaPdthe PaPdad ada three propositions
PaPdthe PaPdad PaPdad a d
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a
sa lsaai.lN
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sa lsaai.lN
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sa lsaai.lN
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et et .NeNet
t
salsaai.lN
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ai.N alsaai.lN
ai.N a lsaai.lN
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ai.N lsaai.lN
a
da asasa asasa s
a a s
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a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
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PaPdad Explanations PaPdad PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
Proposition (1): When income increases from 120 to 180 consumption also increases from 120 to
et et 170etbut et the increase et etin consumptionet et is less than et the et eincome,
et increasei.Nin t 10 isetsaved.
et et et
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Proposition (2): When income increases to 180 and 240, it is divided in some proportion between
et et consumption
t
.NeNet
by.N170
eNt etand 220 and tsaving by 10Nand
.NeNet
t
. eNet
20 respectively.
t
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t
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t
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sa lsaai.lN
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Proposition (3): Increases in income to 180 and 240 lead to increased consumption 170 and 220
et et
andetincreased
et
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et et
20 and 10 than
et et
before. et et et et et et et et
sa lsaai.lN
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43.a) Types of Unemployment:
et et
Unemployment
e.Nt et
is eproblem
t facedewhen t there are people, who are
e.Nt et e.Nt et
willing to work e.Nt et
and able to et et
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a aa s ajobs. s
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P Pa
a
1. Cyclical Unemployment
et et ie.Nt eUnemployment
t et et exists during et ethe
t downturn et ephase
t of trade et ecycle
t in the et et
economy. et et
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a
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a a  In a business s
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PaPdad PaPdad cyclePduring PaPdad of recession
the period ada depression,
PaPdand PaPdadincome and output
PaP fall. a d
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a
et et 2. Seasonal
et et Unemployment et et et et et et et et et et et et
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s s
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a aduring certain s
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PaPdad PaPdad PaPdad PaPdad Pad PaPdad PaPdad a d
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➢ In agriculture and agro based industries like sugar, production activities are only in some
et et t season.
t t t t t t t t t t t t t
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3. Frictional Unemployment (Temporary Unemployment)
et et
et eFrictional
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et et
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et et
due to imbalance et et
between et et
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and demand et et
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 This is because of immobility of labour, lack of necessary skills, break down of machinery,
et et shortage ofNraw
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4. Educated Unemployment
et et
et Sometimes educated
e.Nt et
peopleetare underemployed e.Nt et
or unemployed e.Nt et
when qualification
e.Nt et
does e.Nt et
not
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5. Technical Unemployment
et et et et et et et t et et eNt et eNt et et et
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technological unemployment.
[OR]
et et et et et t e.Nt et et t et et et et et et
lsaai.lN
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ls43.b)ai.N Objectives lsaai.lNi.Ne
aand l a i .lN
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a
sa
da
sa
a a s
a aa Methodology
s
a aa s a of Econometrics:
sa
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The objectives of econometrics:
et et eNt et et et et et et et e.Nt et et et et et
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phenomena. PaPdad PaPdad PaPdad PaPdad PaPdad a d
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et et  ie.It t ehelps
t to prove et etthe old and t et
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sa lsaai.lN
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 It helps to establish new theories and new relationships.

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s
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da PaPdad  It helps adatest the ada a
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hypotheses and Pestimation PaPdparameter.
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et et .NeNet
t
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et et The et eMethodology
t etof
et Econometrics:
t t
i.Nie.Ne et et et et et et et et
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a
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 Statement of the theory or hypothesis
lsaai.lN
et et  ie.Specification
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et ethe
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sa ai.N a a N a ai.N a ai.N a ai.N a ai.N a ai.N a ai.N a
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 Specification of the econometric model of the theory
ls
et et t et
eObtaining the t et
edata et et et et et et et et et et
sa lsaai.lN
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 Estimation of the parameters of the econometric model
et et eNt et et et Forecasting et et et et et et et et et et
sa lsaai.lN
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aai.lN alsatesting
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ai.N a ai.N or prediction
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 Using the model for control or policy purpose.
sa lsaai.lN
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ls44.a)ai.N Functions a
.lN
lsaaiofai.N a lsaai.lN
ai.N a lsaai.lN
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ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a Money : s
a a s
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a
P Pa
salsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
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a
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sa lsaai.lN
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et et et t et et et et et et et et et et et et
lsaai.lN
ai.N aai.lN
ls1. i.Ne
aPrimary lsaai.lN
Functions ai.N lsaai.lN
ai.N lsaai.lN
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a
sa s
a aa sa
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a aa s
a aa s a s a s a adsa
da PaPdad PaPdad PaPdad PaPdad aPdaada a a
PaPdad
a a
PaPdad a d
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a
i) Money as a medium of exchange: Money has thePquality of general acceptability, and all
exchanges take place
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et et t t e e e et t t t e e e e et et et et et et
sa lsaai.lN
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ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a d s
ada a d s
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a
P Pa ii) MoneyP as Pa a measure PofPavalue: The a
P Psecond P Pa function P
important a
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is that
the value of goods and services.
sa lsaai.lN
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PaPdad 2. Secondary PaPdad Functions: PaPdad PaPdad PaPdad PaPdad PaPdad a d
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i) Money as a Store of value: Savings done in terms of commodities were not permanent. This
et et .NeNet
t t et
edisappeared eNt et savings are
.NeN
t et et t .NeNet
t
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t
lsaai.lN
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lai.lN
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alai lai. alai lai.
now doneain
lai.lN i.Ne of money.
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a
sa asasa asasa asasa asasa asasa asasa asasa adsa
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ii) Money as a Standard of Deferred Payments: In the absence of money, the borrowed amount
et et could
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t t only
t et in termsNof
i.Nie.N i. ie.Negoods andi.services.
t t Nie.Nt et t t
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t t
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sa lsaai.lN
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3. Contingent Functions:
et et i) Basiset et of the Credit et et System: iMoney et et is the basis et eof
t the Credit et System.
et Business et et transactions et etare
sa lsaai.lN
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ai.N a lsaa.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a d s
ada either in cash a d s
adaor on credit. a d s
ada a d s
ada a d s
ada a d s
ada ad s
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a
et et ii) Money
et et facilitates et etdistribution eof
t et National Income: et et The task et of
et distribution t of
i.Ne.Ne
t national.N
income
t t
i e.Ne
sa lsaai.lN
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ai.N la lai la lai lsaai.lN
a
da
s
a a s
a a complexadunder s
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a a s
a a asaasa asaasa adsa
a
PaPdad was exceedingly PaPdad P Pad the barter
PaPdad system. PaPdad PaPdad PaPdad a d
P Pa
et et 4. Otheret et Functions: et et et et et et et et et et et et
sa lsaai.lN
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ai.N a lsaai.lN
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ai.N a lsaai.lN
ai.N lsaai.lN
a
da a a i) Money ahelps
s a a to maintain
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s s
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s
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PaPdad P Pdad PaPdad P Pad Pad PaPdad PaPdad a d
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firm has to keep assets in the form of liquid cash.
et et et t et et et et et t et et et t et t
lsaai.lN
ai.N aai.lN
lsii) i.Ne
aMoney lsaai.lN
represents ai.N Generalizedlsaai.lN
ai.NPurchasing lsaai.lNi.Ne
aPower: lsaai.lN
Purchasing ai.N power ai.lN
lkept
e
ai.N in termssaof N
lai.money
ai.N
e
lsaai.lN
a
sa
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s
a aa s
a aa sa
a a s
a aa s
a aa asa
asa a asal adsa
a
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can be put to any use.
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
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ai.N a lsaai.lN
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a
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et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et et et et et et et [OR]
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a s s
a a s
a a s
a a s
a a s
a a s
a a adsa
ada
PaPd44.b)Objectives PaPdadof IMF: PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
a
 To promote international monetary cooperation among the member nations.

et et et et et t e.Nt et et t et et et et et et
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afacilitate faster
a lsaai.lNaiand balanced a lsaai.lN i.Ne
agrowth lsaai.lN
of sinternational
a ai.N lsaai.lN
trade.
a ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a aPdaada
s
aPdaada
s
aPdaada a a s
a a s
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PaPdad P To ensurePexchange ratePstability PaPdad competitive
by curbing PaPdadexchange depreciations.
PaPdad a d
P Pa
 To eliminate or reduce exchange controls imposed by member nations.

et et et et e.Nt et e.Nt et e.Nt et e.Nt et e.Nt et et et
sa lsaai.lN
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a i a l a i .lN
a i a l a i .lN
a i a l a i .lN
a i a lsaai.lN
aiof a lsaai.lN
ai.N lsaai.lN
a
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s
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a a s a establish multilateral
s
a a s a trade s
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a payment s
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a in respect
s
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transactions instead of bilateral trade agreements.
et et et et  Toi.Npromote et et the flow et eoft capital from et etdevelopedi.Nto et developing
et nations.
et et et et
sa lsaai.lN
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ai.N a lsaai.lN
ai.N lsaai.lN
a
s
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da P
a solve the ada a
PaPdad PaPdproblem PaPdad
of international PaPdad
liquidity. PaPdad PaPdad a d
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sa lsaai.lN
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a
as s
a a a s a s s
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da PaPd45.a)
ada Adam Smith PaPdad Theory of PaPdAbsolute
ada Cost
PaPdadvantages:
ada a
P Pa
• Adam Smith argued that all nations can be benefitted when there t is free tradet and
et et eNt et et et et et et et et et e et e et
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ai.specialization
a lsaai.lN
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in terms ofa i.lN
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lsaatheir a
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ai.N advantage.
lsaaicost a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
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et et
The Theory eNt et et t et et et et et et e.Nt et et et
lsaai.lN
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ai.According lsaai.lNi.Ne lsaai.lN lsaai.lN
ai.N basis ofsainternational
ai.N lsaai.lN
ai.Nwas absolute lsaai.lN
aicost lsaai.lN
ai.N lsaai.lN
sa
da
sa
adaada • s
adaada
a to aAdam Smith,
s
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s
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a s
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a
advantage. a d adsa
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a
PP PP PP PP PP PP PP P Pa
• Trade between two countries would be mutually beneficial when one country produces a
et et eNt et et et et t et et et et et et et et
lsaai.lN
ai.N lsaai.lN
ai.commodity .lN
lsaaiatai.Nan
absolute lsaai.lNi.Ne advantage
acost lsaai.lN lsaai.lN
ai.Nover thesaother lsaai.lN
ai.N countrysawhich ai.N in turn i.lN
ai.N
lsaaproduces lsaai.lN
a
sa s
a aa sa
a a s
adaa s
adaa ada ada s
ada a adsa
da PaPdad PaPdad P aP
da P aP
da P aP
da P aP
da P ad
P a P aP
da a
another commodity at an absolute cost advantage over the first country.
sa lsaai.lN
ai.N .N N
alai lai.
Assumptions a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da dasasa s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
PaPad PaPdad PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
• There are two countries and two commodities (2 x 2 model).
et et t t
i.Nie.Ne
t t
i.Nie.Ne
t t
i.Nie.Ne
t t
i.Nie.Ne et et et et et et
lsaai.lN
ai.N salaala alaala factor ofsalsaala salaala lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
adaa•dasLabour isathe
sa daadsasonly
a a a adsa
adaadaproduction.
s s s
da PP PP adaadas
PP PP
a a
PaPdad
a a
PaPdad
a a
PaPdad a d
P Pa
a
• Labour units are homogeneous.

et et t t
i.Ne.Ne
t t
i.Ne.Ne
t t
i.Ne.Ne
t t
i.Ne.Ne
t t
i.Ne.Ne
t t
i.Ne.Ne
t t
i.Ne.Ne
sa lsaai.lN
ai.N aalai
•salThe i
salaala of a commodity
i
salaala is measured
i
salaala by the amount
i
salaala of labour aalai
salrequired salaala
i lsaai.lN
a
da adaadas
cost or price
adaadas adaadas adaadas adaadas adaadas
to produce
adaadas
it. a d adsa
a
PP PP PP PP PP PP PP P Pa
• There is no transport cost.
sa lsaai.lN
ai.N lai.lN
ai.N
Illustration lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da asa
asa s
a aa s
a aa s
a aa s
a aa sa
a a s
a aa adsa
a
P Pa
Absolute cost advantage theory can be illustrated with the help of the
sa lsaai.lN
ai.N lsaai.lN
following
a ai.N example. a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
y
Absolute Cost Advantage
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a a2a
s s
a a s
a a adsa
a
P Pa
Country India China Indi
0
lsaai.lN
et et
ai.N
et et
ai.N (Output
lsaai.lN per
lsaa
et et
ai.N unit ofsalabour)
i.lN lsaai.lN
et et
ai.N lsaai.lN
et et
ai.N lsaai.lN
aet et
ai.N lsaai.lN
et et
ai.N lsaai.lN
et et
ai.N lsaai.lN
a
sa s
a aa s
da a
a a a s
a aa s
a aa
8 s
a aa s
a aa adsa
da PaPdad Pad
Pa20 PaPdad 8 PaPdad PaPdad PaPdad PaPdad a d
P Pa
a
Wheat
China
Cloth 6 14
et et et et et et et et et et et et et et xalaai.lN et et
salsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a
.lN
lsaai6 ai.N ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a s adsa
a
PaPdad PaPdad PaPdad PaPdad PaPdad0 PaPdad
Cloth PaPdad a d
P Pa
1
et et et et et et et et et et et et Figure et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai4
.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
da PaPdad PaPdad PaPdad PaPdad PaPdad 7.1
PaPdad PaPdad a d
P Pa
a
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
From the illustration, it is that India has an absolute advantage in the production of wheat
et et
over China and China has
et t et t
an absolute advantage in
et t
the production
et t et t
of cloth over
et t
India. et t
e e e e e e e
sa lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a a d adsa
a
P Pa Therefore, P PaIndia should P Pa specializeP P a P P a P
in the production of wheat and import cloth from P a P P a P P a
China. China should specialize in the production of cloth and import wheat from India. This kind
et et Nie.Nt et be mutually t t
i.Nie.Ne beneficial e.Nt eboth
t et t t t
i.Nie.Ne
t t
i.Nie.Ne
t t
i.Nie.Ne
lsaai.lN
ai.N of trade i.would i.Nito India i.Ne China.
i.Nand lsaai.lN
sa salaala
a as salaala a as salaala a as salaala salaala
a as salaala salaala
a as a as a as adsa
a
P Pa
a
[OR]
sa lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N alsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a s s
a a s
a a s
a a s
a a s
a a s
a a adsa
45. ada
PaPdb)Scope of PaPdad Finance:PaPdad
Public PaPdad PaPdad PaPdad PaPdad a d
P Pa
a
et et Theetsubject
et ‘Public et eFinance’
t includes
et et five major et esub-divisions,
t et eviz.,
t PublicNRevenue, et et Public et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lai.N a lsaai.lN
ai.N lsaai.lN
a
s s s s s s s adsa
PaPdad Expenditure, PaPdad Public Debt, PaPdaFinancial Administration Pand
aPdaadaFiscal Policy.
da a a a a ada a a a a a a a
P Pa
et et 1.alPublic et et et et et et et et et et et et et et
salsaai.lN
ai.N ai.N Revenue
aai.lN a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da a d s
ada s ad s
ada a d s
ada a d s
ada a d s
ada a d s
ada a d s
ada a d adsa
a
P Pa Public revenue P Pa deals with P Pathe methodsP of Paraising public P Parevenue such P Paas tax and non-tax, P Pa the P Pa
principles of taxation, rates of taxation, impact, incidence and shifting of taxes and their effects.
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
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This part studies the fundamental principles that govern the Government expenditure, effects of
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The budget is the Annual master financial plan of the Government.

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Taxes, subsidies, public debt and public expenditure are the instruments of fiscal policy.
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46. a) Analysis the functions of NITI analogue:
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ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et Positive et et Consumption et etExternality et et et et et et et et et et

sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a a s s
ada s
aPdaadaa private Psecurity
s
aPdaada
s
daadpatrol a s adsa
PaPdad ➢ When ada residents
PaPdsome PaPdaof a localityPhire agencyPaP
to a
their ada the
PaPdarea, a d
P Pa
a
other residents of the area also benefit from better security without bearing cost.
salsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a Negative
a s
Consumption
a a s
Externality
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
➢ A person smoking cigarette gets may gives satisfaction to that person, but this act causes
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et .NeNet
t
salsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da asasa asasa s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et ethardship
et (dissatisfaction)
et et toie.Nthe
t et non-smokers t t who are driven
i.Nie.Ne
t t to passive
i.Nie.Ne
smoking.
t t
i.Nie.Ne et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
a la la la la la la lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a asaasa asaasa asaasa sa
a a adsa
a
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Positive Production Externality
et et ➢ e.NtThe
et ideal location et et for beehives et et is orchards e(first
t et growing efields).
t et While bees
et et make honey, et et
sa lsaai.lN
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ai a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
aPdaadahelp in the
they Palso s
da a s
da a s
ada benefits aaccrue s
a a s
da a adsa
a
PaPdad Papollination
Pad ofPaapple
Pad blossoms. The
PaPda P Pdad to bothPaproducers
Pad a d
P Pa
(honey as well as apple).
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a Negative
a s
Production
a a s
Externality
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
➢ Negative production externalities include pollution generated by a factory that imposes
et et etcosts
et on others. et eThe
t emissions et etand effluents et eof et et air andi.N
t a factory.Ncause et et pollution. et et
sa lsaai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lai.lN
ai.N lai lai.N la lwater
ai.N lai.lN
ai.N lsaai.lN
a
asa asaasa asaasa asaasa asaasa adsa
a
P Pa
[OR]
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
PaPdadThe Arguments
47.b) PaPdad against planning:PaPdad PaPdad PaPdad PaPdad PaPdad a d
P Pa
et et 1.alaaLoss et et et et et et et et et et et et et et
salsaai.lN
ai.N ai.N of freedom
i.lN a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s s
a a s
a a s
aPdaada a s a s s
da a adsa
PaPdad ➢ The absence PaPdad of freedom PaPdadin decisionPmaking may act adaan obstacle
PaPdas ada economic
PaPdfor Pad
Pagrowth. a d
P Pa
a
➢ Regulations andt restrictions are the backbone of a planned teconomy.

et et t e et t e et t e et e et e et et et et et
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
2. Elimination of Initiative
et et i.NUnderet et centralized et et planning,i.Nthere et et will be no eincentive
t et fori.Ninitiatives
et et and innovations.
et et et et
sa lsaai.lN
ai.N a lsaalai.N alsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
s
a a s
ada s
a a s
aPdaadamay cause
s
daada s
aPdaada
s
a a adsa
da PaPdad  Planning
a
PaPdafollows PaPdadprocedurePand
routine stagnation
PaP inPgrowth. PaPdad a d
P Pa
et et 3. High et etcost of Management et et et et et et et et et et et et

lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
sa
da a d ada No doubt
s a
a d s
d
a
athe
a fruits of ad s
adaa
planning suchaas
d sa
adindustrialization,
a ad sa
ada social justice a d s a
ada and regional a d s a
adabalance a d adsa
a
are good.
et et ai.NPlan
et et formulation et etand implementation et et involve et eengagement
t eof
t etan army ofNestaff t et for data Net et
sa lsaai.lN
ai.N a lsalai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lai.N sa lsaai.lai.N lsaai.lN
a
da d s
ada collection da s a d a s a d a s a d a s a d as a d a a dadsa
a
a
P Pa P Pa and administration.
a d a
P Pa d a
P Pa d a
P Pa d a
P Pa d a
P Pa d a
P Pa
et et et et
4.alaaDifficulty in advance et et calculations et et et et et et et et et et
sa lsaai.lN
ai.N i.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s s
ada s
dada s
a a s
a a s
da a s
a a adsa
a
PaPdad  Advance PaPdacalculations Pain
Paa precise PaPdad are impossible
manner PaPdad Pad
to makePadecisions PaPdad the
regarding a d
P Pa
consumption and production.
et et et t et t et t et et e.Nt et et et et et
lsaai.lN
ai.N  lsaai.lNi.Neis also very
aIt lsaai.lN i.Ne
adifficult to lsaai.lN
put i.Ne calculations
athe lsaai.lN
ai.Ninto practice lsaai.lN
aiunder lsaai.lN
planning. ai.N lsaai.lN
ai.N lsaai.lN
a
sa s
a aa s
a aa s
a a a s
a aa s
a aa sa
a a s
a aa adsa
P Pa
a
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
et et et et
*************
et et
AlletThe
et
Best *************
sa lsaai.lN
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ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
ai.N lsaai.lN
a
da
s
a a adsa
a adsa
a adsa
a s
a aa s
a aa s
a aa adsa
a
PaPdad a d
P Pa a d
P Pa ad
P Pa PaPdad PaPdad PaPdad a d
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
salsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa
sa lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N alsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N a lsaai.lN
ai.N lsaai.lN
a
da
s
a a s
a a s
a a s
a a s
a a s
a a s
a a adsa
a
P Pa

12th Economics Mod Question Paper

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et et et et et et PTA MODEL t t – 1 ANSWER t t KEY – 2019-2020

et et II. Answer t t any sevenNquestions.

et et eNt etR. Hicks defined et et as, “Ani.N et t et et et et et t et et

et et Net et Net et Net et Net et Net et et et et et

et et 24. Gold et eStandard:

directly linked with gold.

25. Commercial Banks:t

28. Meaning of Seed Ball:

31. Demerits if Socialism:

32. Difference between Classism and Keynesianism:

1. Short-run equilibrium Long-run equilibrium

et et 38. Causes t t of water N

et et 41.a. NScope et et of Micro eEconomics:

(A) PRIMARY FUNCTIONS

et et et et(B) SECONDARY et et FUNCTIONS et et et et et et et et et et

• Providing Locker Facilities

lsMeaning of Psychological lawlaof consumption

 It helps to establish new theories and new relationships.

 To promote international monetary cooperation among the member nations.

 To eliminate or reduce exchange controls imposed by member nations.

• Labour units are homogeneous.

The budget is the Annual master financial plan of the Government.

➢ Itt replaced the tPlanning Commission from 13 th August, 2014.

b) Shared National Agenda

banks. It is generally of two types.

et et • ie.A t etpolicy canNbe et eteffectivelyi.N et et

et et Positive et et Consumption et etExternality et et et et et et et et et et

➢ Regulations andt restrictions are the backbone of a planned teconomy.

et et 3. High et etcost of Management et et et et et et et et et et et et

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