CHAPTER WISE

STRATEGY OF CLASS 10
+ FULL ECONOMICS
 CHAPTER : 1

DEVELOPMENT
 STRATEGY: DEVELOPMENT CHAPTER

Theory -
Questions -

Important topics-
● Definitions- National Income, Per capita
Income, Public Facilities, BMI and
Sustainable Development

● Comparison of per capita income and HDI

● More important criteria than per capita

income

● Why goals can be conflicting?

 DEVELOPMENT

● “Development can be defined as

bringing about social change that
● allows people to achieve their human
potential.”

● Development is a broader term than

growth.
❏ Different people can have different
developmental goals which may even
be conflicting.

❏ People always seek a mix of goals.

Apart from income, people also seek
other goals like:

- Equal treatment
- Freedom
- Respect
- Security
 DEVELOPMENTAL GOALS OF DIFFERENT
CATEGORIES OF PERSONS

Category of Person Developmental Goals / Aspirations

Landless rural More days of work and better wages.

labourers

Prosperous farmers Assured a high family income through

from Punjab higher support prices for their crops and
through hardworking and cheap
labourers.

Urban unemployed Regular jobs, better wages, social

youth security etc.

A girl from a rich She gets as much freedom as her brother

urban family and is able to decide what she wants to
do in life.

An adivasi from Better wages and living conditions,

Narmada valley proper education, identity among public,
should be able to enjoy Fundamental
Rights.
 COMPARING COUNTRIES

1. Income is
considered to be
one of the most
important
attributes.

2. Countries with 3. Income of the

higher income are country : is the
more developed than income of all the
others with less residents of the
income. country.
Comparisons through Per Capita Income

Per capita income or average income

measures the average income earned per
person in a given area in a specified year.

World Bank classifies the countries on the basis

of their per capita income.
World Bank publishes World Development Report
(WDR) every year to compare the nations on the
basis of Per Capita Income.

Countries with per capita income of US$ 12,056

per annum and above in 2017, are called rich
countries.

Countries with per capita income of US$ 955 or

less are called low-income countries.

India comes in the category of low middle

income countries because its per capita income in
2017 was just US$ 1820 per annum.
 Limitations of Per Capita
Income Method

Hides Disparities

Unequal distribution of Income

Ignores Social aspect of life.

 Other Attributes to be considered
besides Income :
State Infant Literacy Per Net
Mortality Rate % Capita Attendance
Rate per (2011) Income Ratio (per
1,000 live for 100 person) Infant Mortality Rate (IMR): The number of
births 2015-16 Age 14-15 children dying at less than 1 year of age,
(2017) (Rs.) 2013-14 divided by the number of live births that year.

Haryana 30 82 1,80,174 61
Literacy Rate: The proportion of literate
Kerala 10 94 1,63,475 83
population in the 7 and above age group.

Bihar 35 62 34,409 43
Net Attendance Ratio: The total number of
children of age group 14 and 15 years attending
school as a percentage of total number of
children in the same age group.
Highest in the respective category
PUBLIC FACILITIES - WHAT & WHY?
Body mass index (BMI) is a value derived from the
mass and height of a person.

Universal SI Unit of BMI- Kg/m

For Instance:

1. Ideal weight of 14 years Girl: 18.5 and 24.9

2. Ideal weight of 14 years Boy : 18.5 and 24.9

Human Development Report (HDR)

Useful method to measure development

HDR published by UNDP (United Nations

Development Programme)

Compares countries based on the

educational levels, health status, and per
capita income

India occupies 131 Rank as per 2019

Report.
SUSTAINABLE DEVELOPMENT

● Development that meets the needs of

the present without compromising the
ability of future generations to meet
their own needs.

● Need for sustainable development :

- Limited availability of resources.

- Over-exploitation will deplete these

resources.
Ques : Dividing the total income of
country with its population, we get

I. Per-Capita income
II. National income
III. Average Income
IV. Total Income

(a) Only III

(b) I and II
(c) All of the above
(d) None of these
 CHAPTER : 3

MONEY & CREDIT

 STRATEGY: MONEY AND CREDIT

Theory -
Questions -

Important topics-
● Role of RBI
● Barter system and its disadvantages
● Money : medium of exchange - 3 reasons
● How do Banks earn?
● What are terms of credit?
● What is debt trap? How does it occur?
● Why should banks increase lending in
villages?
● Role of SHG and Grameen Bank
 BARTER SYSTEM
It is a medium in which
goods/services are exchanged
directly without a common
unit.

Double coincidence of wants :

What a person desires to sell
is exactly what the other
wishes to buy.
 MONEY

● Acts as an intermediate in the exchange

process.

● Eliminates the need for double

coincidence of wants.

FORMS OF MONEY

CURRENCY
DEPOSITS +
Paper Notes CHEQUE

Coins
 Why money is accepted as a medium of
exchange?

Currency is authorised by the government of the

1
country

In India, the Reserve Bank of India issues currency

2
notes on behalf of the central government.

No individual can legally refuse a payment made

3
in rupees in india.

4 Rupee : widely accepted as a medium of exchange

 DEMAND DEPOSIT
DEPOSITS WITH BANKS

Since the deposits in the bank accounts can

be withdrawn on demand, these deposits are
called demand deposits.
1. People
deposits extra
cash into banks.
CHEQUE

Paper instructing the bank to pay a 2. Banks accept 3. People can

specific amount from the person’s their deposit & also easily withdraw
account to the person in whose name pay an amount as money
the cheque has been issued. interest on the whenever they
deposits. require.
 BANKS LOAN ACTIVITIES

● Banks keep small proportion of their

deposits as cash with themselves. (Indian
banks hold 15% )

● This is kept as provision to pay the

depositors who wants to withdraw
deposited money at any time.

● The rest of deposit money is used by banks

to extend loans to the people.

● Benefit- Banks charge higher rate of

interest on loans than they provide at
deposits.

● In this way banks mediate between those

who have surplus funds & those who are in
need.
 SECTORS OF CREDIT

FORMAL
INFORMAL

Banks
Moneylenders,
traders & employers
Cooperatives

Relatives & Friends

 Credit (loan) refers to an agreement
ADVANTAGE DISADVANTAGE in which the lender supplies the
borrower with money, goods or services
Helps to increase Credit may push the in return for the promise of future
earnings person into a debt payment.
trap. I.e, crop failure
Terms of Credit :
(i) Comprises : Interest rate, collateral
& documentation requirement, and the
mode of repayment.

(ii) The terms of credit vary

substantially from one credit
arrangement to another.

(iii) They may vary depending on the

nature of the lender and the borrower.
 COLLATERAL
An asset that the borrower owns and
uses this as a guarantee to a lender
until the loan is repaid

i.e, land, building, vehicle, livestocks,

deposits with banks).

If the borrower fails to repay the loan,

the lender has the right to sell the
asset or collateral to obtain payment.
LOANS FROM COOPERATIVES

1. Another major
source of cheap
credit in rural
areas.

2. Members of a 3. i.e, farmers

cooperative pool cooperatives,
their resources for weavers
cooperation in cooperatives,
certain areas workers
cooperatives, etc.
 FORMAL SECTOR: FUNCTIONS OF RBI

RBI supervises the functioning of formal

sources of loans.

The RBI monitors the banks in actually

maintaining cash balance.

The RBI assures that small cultivators, small

scale industries, to small borrowers are also
able to access loan facilities.

Banks have to submit their info to RBI

periodically.

RBI issues currency notes in India on behalf of

central government.
 INFORMAL SECTOR

No organisation supervises their credit activities.

Lend money at very high interest rates.

Practice unfair means to get their money back.

Graph shows, almost 85% of the loans taken by

poor households in the urban areas are from
Formal and informal sources of credit for people in urban informal sources.
areas.
 Why poor household are still dependent on
informal sources of credit ?

1. Lack of
banks in rural
areas.

2. Even when they 3. Absence of

are present, getting collateral in
a loan from a bank informal sector
is much more makes the
difficult. process even
more easier.
 SELF HELP GROUP

● A typical SHG has 15-20 members

usually belonging to one neighbourhood.

● Saving per member varies from Rs 25 to

Rs 100 or more, depending on the ability
of the people to save.

● If the group has regular savings, it

becomes eligible for bank loans.

● Loan is sanctioned in group’s name & the

group is responsible for loan repayment.

● SHGs help borrowers overcome the

problem of lack of collateral, and get
timely loans at reasonable rates.
 HOMEWORK QUESTIONS :

WHAT IS GRAMEEN BANK? WHO MADE IT

AND IN WHICH NATION?
Ques : Ram and Shyam are small farmers.
Ram has taken credit 1.5% per month on <
20000 from a trader while Shyam has taken
credit at 8% per annum from bank on the
same amount. Who is better off?

(a) Ram is better because he has to do no

paperwork.
(b) Shyam is better because his interest
payment is less.
(c) Ram is better because he has not paid
any collateral.
(d) Both Ram and Shyam are equal so no one
is better off.
 CHAPTER : 2

SECTORS OF INDIAN
ECONOMY
 STRATEGY: SECTORS OF INDIA
ECONOMY

Theory -
Questions -

Important topics-
● Why is tertiary sector important?
● Examples of Primary, Secondary &
Tertiary
● Primary has most employment but not
enough share in GDP, why?
● How can we generate employment in
villages?
● NREGA
● Public vs private sector
● Organised vs Unorganised sector
● Why does govt. Invest in public sector?
 Sectors of Indian Economy

On the basis of nature On the basis of working On the basis of

of job conditions ownership

Primary Organised Private

Secondary Unorganised Public

Tertiary
 PRIMARY SECTOR SECONDARY SECTOR
TERTIARY ACTIVITIES
Includes economic It processes natural
activities involving resources.
extraction & production
of natural resources. 1. Helps in the
development of
the primary &
Provides raw materials to Converts raw materials
secondary sectors.
the secondary sector. provided by primary
activities into finished or
semi-finished goods.

Greater dependence on A shift of economic 3. Also includes

2. Examples: some essential
this sector indicates an activities from Primary to
Transport, storage, services provided
underdeveloped economy. Secondary sectors by professional
communication,
indicates a developing banking, etc. e.g., doctors,
economy. lawyers, teachers,
etc.
Example: Agriculture, Example: Manufacturing
mining, and forestry. and construction.
FINAL PRODUCT VS INTERMEDIATE PRODUCT
GROSS DOMESTIC PRODUCT

It is the value of all the final

goods & services produced
within a country during a
particular year.

GDP shows how big the

economy is.

In India, the mammoth task of

measuring GDP is undertaken
by a central govt. ministry.
 Historical Changes in the Sector

PRIMARY SECTOR

● Most important sector in earlier stages.

● Most people were employed into this

sector.

● With change in farming methods,

production increased.

SECONDARY SECTOR

● With the introduction manufacturing :

factories came up and started expanding.

● People who worked on farms now began to

work in factories in large numbers.
TERTIARY SECTOR

● Developed countries : most of the working

people are employed in this sector.

In the year 2013-14,

the tertiary sector
has emerged as the
largest producing
sector in India
replacing the
primary sector.
 Why tertiary sector becoming so
important in India ?

Increase in demand for basic services

Helps in development of Primary &

Secondary activities

Increase in income level

Increasing importance of info &

communication tech.
 Where are most of the people employed?

The graph shows that the primary sector continues

to be the largest employer even now. WHY ?

● No enough jobs in the secondary & tertiary

sectors.
 DISGUISED SEASONAL
UNEMPLOYMENT UNEMPLOYMENT

People appear to be It is a situation in which

employed, but are people are not able to
actually not employed. find jobs during some
months of the year.

This usually happens Because of the seasonal

among family members character of agriculture
engaged in agricultural in India agricultural
activities. labourers find work only
during busy seasons as
sowing, harvesting.
 WAYS OF CREATING MORE EMPLOYMENT

1 Construction of dams or canals to irrigate farms

can generate a lot of employment

Local bank should provide cheap agricultural

2 credit to the farmers for farming to improve their
production.

3 Govt. should Identify, promote and locate

industries and services in semi-rural areas.

4 Emphasis on education and training centres

 MGNREGA, 2005

● Guarantees 100 days of

employment to all in a year in
rural areas.

● If the government fails in its

duty to provide employment, it
will give unemployment
allowances to the people.
 Organised Sector Unorganised Sector

● Registered with the govt. ● Not registered with govt.

● Rules & Regulations given in

various acts like, Minimum Wages ● Rules and regulations are there but not
Act, Factories Act, etc. followed.

● Fixed working hours payment for

overtime (high salary). ●
● Long working hours. No payment for
● Job security. overtime (low salary.
●
● Provision for paid holidays, ● No job security.
gratuity, provident funds.
● No such provision of paid holidays,
● i.e, clerk, doctor, teacher, etc. gratuity, etc.

● i.e, : a daily wage labourer, worker/

helper in shop, etc.
 People needing protection in unorganised sector

RURAL AREAS URBAN AREAS

Landless Agricultural Small scale industry

labour workers

Small & Marginal Farmers Casual workers i.e,

construction, trade
Sharecroppers & Artisans
Street vendors, rag
pickers, head load workers.

Social discrimination : majority of workers belongs

from scheduled caste, tribes & backward classes.
 Public Sector Private Sector

● Owned by individual
or group of
● Most of the assets individual.
are owned by the
govt. ● Here, Services are
offered by the owner
● Govt. provides all of the firm.
services.
● The private sector
● Govt. raises collects money for
money for various the services they
activities through provide.
taxes.
● Activities in the
● In public sector private sector are
the motive is not guided by the motive
profit earning. to earn money.

● i.e, Railways, post ● i.e, Tata Steel and

offices Reliance
 Roles of Government in providing
services

Developing infrastructure : Govt. have to

undertake heavy spending i.e, construction
of roads, bridges, railways, electricity, etc.,

Provides healthcare facilities and

education

Attention to human development aspects

: Availability of safe drinking water,
housing, nutrition.
Ques : ATM is an example of

(a) primary sector

(b) secondary sector
(c) tertiary sector

Ques : The goods that are used as raw

materials for further production are
known by which name?

(a) Final goods

(b) Consumer goods
(c) Material goods
(d) Intermediate goods
 CHAPTER : 5

Globalisation and The

Indian Economy
 STRATEGY: MONEY AND CREDIT

Theory -
Questions -

Important topics-
● Definitions- Globalisation, MNCs, Foreign
Investment, Foreign Trade, SEZs
● What is SEZs and Why?
● How do MNCs set up production across
nations?
● Positive and Negative role of
Globalisation on workers and producers.
● Benefits of Globalisation on consumers.
● WTO, Unfair trade- how can we solve?
 PRODUCTION ACROSS
INDUSTRIES
● Till mid-20th century, production was
largely organised within countries.
Situation before the emergence
● Colonies such as India exported raw ● of MNCs
materials & food stuff and imported
finished goods.

● The main channel connecting distant

countries- Trade.
MULTINATIONAL COMPANIES (MNCs)

1. A company that
owns or controls
production in more
than one nation

2. Set up offices &

factories for 3. Aim- Low cost of
production in regions production &
where they can get greater profits.
cheap labour & other
resources.
Conditions required to set up
MNCs

Closeness to
Market

Favourable Cheap skilled &

government unskilled labour
policies.
 ● MNCs provide money for additional
investments, like buying new machines
for faster production.

● MNCs might bring with them the latest

technology for production.
1. MNCs set up production jointly
with local companies
Most Common Route for MNC : to buy up local
companies & expand production.

Wealthy MNCs can do this easily.

2. Take over small companies
Parakh Foods- owned 4 oil refineries & had a
large marketing network in India. 3. Giving Contracts to local producers
Bought by Cargill Foods - large American
Company.

Cargill is now the largest manufacturer of

edible oil in India making 5 million pouches
daily.
 FOREIGN TRADE

It is the exchange of capital, goods, and

services across international borders or
territories.

Foreign trade thus results in integration of

markets in different countries.
FOREIGN TRADE & EFFECT ON
FOREIGN TRADE & EFFECT ON
 SEZ’s : Step to attract foreign
investment

1. Industrial zones,
called Special
Economic Zones
(SEZs), are being
set up.

2. Have world class 3. Companies who

facilities: electricity, set up production
water, roads, transport, units in the SEZs do
storage, recreational not have to pay
and educational taxes for an initial
facilities period of 5 years.
 Case Study : Chinese toys in india

● Chinese manufacturers exports toys to India,

where toys are sold at a high price.

● Chinese toys being cheap & have latest in

design became more popular in Indian
market.

● Within a year 70-80% of Indian toys were

replaced with Chinese toys.

● Indian buyers have a greater choice of toys

and at lower prices.

● For the Chinese toy makers, this provides an

opportunity to expand business.

● Indian toy makers, faced losses, as their toys

are selling much less.
 GLOBALISATION
Process of rapid integration or interconnection
between countries.

More & more goods & services, investments,

technology 7 people are moving between
countries.

Large part of foreign trade controlled by MNCs.

 FACTORS RESPONSIBLE FOR
GLOBALISATION

Technology

Development in transportation &

communication : Made much faster
delivery of goods across long
distances possible at lower costs.

Liberalisation of Foreign
Trade & Foreign
Investment Policy
TRADE BARRIER : government-induced
restrictions on international trade, eg. tax on
imports.

After independence, In order to prevent indian

producers, govt. put barriers on foreign trade &
foreign investment.

LIBERALISATION : Removing barriers or

restrictions set by the government.

Trade, businesses are allowed to make

decisions freely about what they wish to import
or export.
 TRADE POLICY, 1991 : LIBERALISATION &
GLOBALISATION

Barriers on foreign trade and foreign

investment were removed to a large extent.

This meant that goods could be imported

and exported easily and also foreign
companies could set up factories and offices
here.
 WORLD TRADE ORGANISATION

● An organisation whose aim is to

liberalise international trade.

● WTO establishes- rules regarding

international trade, & sees that these
rules are obeyed.
●
● Total members : 164.

● Critics of WTO :
(i) Favours developed nations.

(ii) WTO rules have forced the

developing countries to remove trade
barriers
 IMPACT OF GLOBALISATION

● Govt. has also allowed flexibility in the

labour laws to attract foreign investment.

● Companies hire workers ‘flexibly’ for short

periods to reduce the cost of labour for the
company.

● Globalisation has enabled some large

Indian companies to emerge as
multinationals themselves i.e, tata motors,
infosys, asian paints.

● Services like data entry, accounting,

administrative tasks, engineering are done
cheaply in India & exported to the
developed countries.
Industries like batteries, plastics, toys, dairy
products & vegetable oil are some examples which
have been hit hard due to competition.

Uncertain employment : employers these days

prefer to employ workers ‘flexibly’

Long working hours and work night shifts on a

regular basis during peak seasons.

Wages are low and workers are forced to work

overtime to make both ends meet.
FAIR GLOBALISATION : Some possible
steps that government can take:

● It can ensure that labour laws are properly

implemented and workers get their right.

● It can support small producers initially to

expand their business till they get in
competing stage.

● Trade and investment barriers can be used

to create a check.

● It can negotiate at WTO for fairer rules.

Govt. can collaborate with other developing
countries to tackle dominated of developed
countries in WTO.
Ques : The most common route for
investments by MNCs in countries around the
world is to:

(a) set up new factories

(b) buy existing local companies
(c) form partnerships with local companies

Ques : Why did the Indian Government

restricted foreign trade after independence?

(a) To protect domestic producers

(b) To increase competition
(c) To know the international level of quality
(d) All of the above
IMPORTANT QUESTIONS
Ques : The cost of _______has fallen.
This has enabled much greater volumes
of goods being transported by
_______.

(a) Air transport, airlines

(b) Road transport, four wheelers

(c) Rail transport, railways

(d) None of the above

Ques : Which of the following statements
are true about MNCs?

(a) A MNC is a company that owns or

controls production in more than one
nation.

(b) MNCs set up offices and factories for

production in regions where they can get
cheap labour and other resources.

(c) This is done so that the cost of

production is low and the MNCs can earn
greater profits.

(d) All of the above

Assertion : Due to foreign trade, producers in
different countries closely compete with each
other.

Reason : Foreign trade leads to similar prices of

good across boundaries, and the producers who
do not offer competitive prices may lose the
market share.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : A tax on imports makes the market
for imported goods lucrative in terms of earning
higher profits.

Reason : Taxes are imposed to ensure smooth

trade between nations and higher tax revenues
for the governments of the countries.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : Local businesses may set up joint
production process with MNCs and earn higher
profits.

Reason : MNCs can provide money for additional

investments, like buying new machines for faster
production

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Ques : Give the meaning of WTO. Mention any
two.

Ans : WTO means World Trade Organisation.

The two shortcomings of the WTO are:

a. WTO favours developed nations in its trade
policies.

b. Lack of transparency : decision making is

dominated by few countries.

c. Forces developing countries to liberalise their

economies more, which further affects the domestic
producers of that country.
Ques : How is the government of India trying to
attract more foreign investment? Explain with
examples.

Ans : The government of India trying to attract more

foreign investment through the following ways:

a. SEZ (Special Economic Zone): Governments are

creating SEZs where they provide world class
facilities for electricity, roads, water, transport,
recreational and educational facilities. MNCs will
not have to pay taxes for the initial period of five
years if they set up their production units in the
SEZs.

b. Flexibility in Labour Laws: Governments has

given the permission to the MNCs to hire the
workers flexibly i.e., hiring the workers on temporary
basis and also ignoring the labour laws. This will
help the MNCs in reducing their labour cost and
the total cost of production.
Ques : Explain the role of MNCs in the
globalisation process.

Ans : Globalisation can defined as the process of

rapid interconnection or integration between the
markets.

MNCs play a vital role in promoting globalisation

process as:

a. By producing goods and services at global level.

b. Goods and services are sold at global level.
c. Investments, technology and people are moving
between countries.
d. It gives opportunity to the local producers to
reach beyond the domestic market.
e. MNCs by the foreign trade connects/ integrates
the markets in the world.
Ques : What is a trade barrier? Why did the
Indian government put trade barriers after
independence? Explain.

Ans : Restrictions set by the government to increase

or decrease (regulate) the foreign trade is what
called trade barrier.

Due to the following reasons the Indian government

put barriers to foreign trade and foreign investment
after independence:
a. The Indian government wanted the domestic
producers to face the global competition.

b. By this competition the Indian producers will also

get a chance to improve their quality.

c. Removal of trade barriers will allow the producers

of different countries to trade with India.
IMPORTANT QUESTIONS
Ques : Which of the following statements
about money are true?

a) Money cannot buy you a

pollution-free environment.

b) Money cannot ensure that you get

unadulterated medicines.

c) Money may also not be able to

protect you from infectious diseases.

d) All of the above.

Ques : In which state in India is the
infant mortality rate lowest?

(a) Kerala
(b) Bihar
(c) Uttar Pradesh
(d) Punjab

Ques : Per capita income is:

(a) income per person

(b) income per family
(c) income per earning person
(d) income per month
Ques : The ........... helps in maintaining the
nutritional levels of poor people by
providing food at lower cost.

(a) BMI body mass index

(b) PDS public distribution system
(c) GNI gross national income
(d) HDI human development index
Assertion : Suppose the literacy rate in a state is
78% and the net attendance ratio in secondary
stage is 47%.

Reason : More than half of the students are

going to other states for elementary education.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : Different people have different
developmental goals.

Reason : The capitalist approach to development

is detrimental to poor section of the society.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : A high average income is not
indicative of the overall well-being or human
development in a country.

Reason : Average income does not cover

indicators like level of literacy rate, health
facilities and public facilities in a country.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Study the data given below and answer the
questions that follow: Some comparative
data on Punjab, Kerala & Bihar

Ques : Which state has the highest infant

mortality rate?

Ans : Bihar has the highest infant mortality

rate.

Ques : Why does this state have the highest

infant mortality rate? Give two reasons.

Ans : Due to the following two reasons, Bihar

has the highest infant mortality rate:
(i) Low income.
(ii) Poor medical facilities.
Ques : What may be development for one may
not be development for the other." Explain by
giving examples.

Ans : Different people have different developmental

goals such as :

● Industrialists may want more dams to get

more electricity. But this may submerge the
land and disrupt the lives of people who are
displaced - such as tribals.

● A farmers wants to sell food grains at a

higher price but a low earning person wants to
purchase it at low prices.

● More wages means development for a worker,

but it affect negatively a businessman.
Ques : What is Per Capita Income? Why is "Per
Capita Income" not an adequate indicator of
economic development of a country? Explain.

Ans : Per capita income is the total income of the

country divided by its total population It is not an
adequate indicator because:

● It does not tell us how this income is

distributed.

● Life expectancy and Infant Mortality Rate are

other important criteria for measuring
development.

● Education and literacy level are other

indicators of development.

● Pollution free environment, less corruption,

gender equality etc. are also important.
IMPORTANT QUESTIONS
Ques : The type of unemployment in which
more number of people work than actually
needed is known as

(a) disguised unemployment

(b) seasonal unemployment
(c) underemployed
(d) over employed

Ques : GDP of a country is based on :

(a) total value of good and services

(b) final value of goods and services
(c) initial value of goods and services
(d) all of these
Assertion : In India, the primary sector is the
largest employer.

Reason : The demand for services has increased

enormously.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : The development of agriculture and
industry leads to the development of service
sector.

Reason : As the primary and secondary sectors

develops, the demand for transport, storage
structures, banks, insurance, etc., increases.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : Reliance industries is a privately -
owned Firm.

Reason : Government is a major stakeholder is

reliance industries.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : GDP shows how big an economy is.

Reason : GDP is the value of all goods and

services produced within the domestic territory of
a country in a year.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Ques : Compare the employment conditions prevailing in the organised & unorganised sector?

Organised Sector Unorganised Sector

1. Registered with the govt. 1. Not registered with govt.

2. Rules & Regulations given in

various acts like, Minimum 2. Rules and regulations are there but
Wages Act, Factories Act, etc. not followed.

3. Fixed working hours payment for 3. Long working hours. No payment for
overtime (high salary). overtime (low salary.

4. Job security. 4. No job security.

5. Provision for paid holidays, 5. No such provision of paid holidays,

gratuity, provident funds. gratuity, etc.

6. i.e, clerk, doctor, teacher, etc. 6. i.e, : a daily wage labourer, worker/
helper in shop, etc.
Ques : Describe the provisions of National Rural
Employment Guarantee Act, 2005.

Ans : Mahatma Gandhi National Rural Employment

Guarantee Act:

a. This act was passed in the year 2005.

b. According to this Act, 100 days of guaranteed
employment is provided to all those who are able
to work and are in need of work in the rural areas.
c. Unemployment allowance is provided to the
workers if the government is not able to provide
them work within 15 days.
d. This act helps in providing income and livelihood
to the people in the rural areas.
Ques : Differentiate b/w private and public sector with
examples.

Public Sector Private Sector

1. Most of the assets are 1. Owned by individual or

owned by the govt. group of individual.

2. Govt. provides all 2. Here, Services are offered

services. by the owner of the firm.

3. Govt. raises money for 3. The private sector collects

various activities money for the services
through taxes. they provide.

4. In public sector the 4. Activities in the private

motive is not profit sector are guided by the
earning. motive to earn money.

5. i.e, Railways, post 5. i.e, Tata Steel and

offices Reliance
Ques : Ram and Shyam are small farmers.
Ram has taken credit 1.5% per month on <
20000 from a trader while Shyam has taken
credit at 8% per annum from bank on the
same amount. Who is better off?

(a) Ram is better because he has to do no

paperwork.
(b) Shyam is better because his interest
payment is less.
(c) Ram is better because he has not paid
any collateral.
(d) Both Ram and Shyam are equal so no one
is better off.
Ques : Bank laying down norms for bank is

(a) RBI
(b) SBI
(c) syndicate bank
(d) all of these

Ques : Raghav has surplus money so he

opens a bank account and deposits in it.
Whenever he needs money, he can go to
his bank and withdraw from there. This
kind of deposit with the banks are known
as

(a) demand deposit

(b) term deposit
(c) fixed deposit
(d) surplus deposit
Ques : Which among the following lenders
will possibly not ask the borrower to sign
the terms of credit?

(a) Banks
(b) Moneylenders
(c) Cooperatives
(d) Private agencies

Ques : Which of the following is not a

feature of Self Help Groups (SHGs)?

(a) It consists of 15-20 members or more.

(b) Here members pool their savings
which acts as collateral.
(c) Loans are given at nominal rate of
interest.
(d) It is an informal source of credit.
Assertion : The modern currency is used as a
medium of exchange; however, it does not have a
use of its own.

Reason : Modem currency is easy to carry

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : The terms of deposit are same for all
credit arrangements.

Reason : Credit arrangements are very complex

process so to remove the complexities same terms
of deposits are used.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Assertion : Banks charge a higher interest rate on
loans than what they offer on deposits.

Reason : The difference between what is charged

from borrowers and what is paid to depositors is
their main source of income.

(a) Both assertion and reason are true and reason is

the correct explanation of assertion

(b) Both assertion and reason are true but reason is

not the correct explanation of assertion.

(c) Assertion is true but reason is false

(d) Both assertion & reason are false.

Ques : Why is there a great need to expand
formal sector of credit in India? Explain any
three reasons.

Ans : Due to the following reasons it is necessary for

the banks and the cooperative societies to increase
their lending facilities in the rural areas:

a. There is limited availability of the formal sector

credit sources in the rural areas.

b. The poor borrowers are bound to take loan from

the moneylenders at high rate of interest.

c. Due to high rate of interest they are not able to

repay the loan and caught in debt- trap.
Ques : Describe any four advantages of Self-Help
Groups for the poor.

Ans : The four advantages of Self-Help Groups for

the poor are:

a. When the group is regular in saving for a year or

two then the group is eligible for getting loan from
the bank.

b. Bank provide loan in the name of the group and

then the SHG gives loan to its members at very
low rate of interest.

c. Loan matter is taken very seriously, as if any one

member is not able to repay the loan then it is
followed by other members and because of this
feature, they get loan from the bank even though
they have no collateral.
Ans :

d. Loan is provided to help them to create self-

employment opportunities.

e. SHG helps women in making them financially self

reliant and provides platform to discuss and act on
a variety of social issues.
 Ques : What are the two categories of sources of credit? Mention four features of each.

INFORMAL SECTOR FORMAL SECTOR

RBI supervises the functioning of formal

No organisation supervises their credit activities.
sources of loans.

Lend money at very high interest rates. The RBI monitors the banks in actually
maintaining cash balance.
Practice unfair means to get their money back.
The RBI assures that small cultivators, small
scale industries, to small borrowers are also
Graph shows, almost 85% of the loans taken by able to access loan facilities.
poor households in the urban areas are from
informal sources.
Banks have to submit their info to RBI
periodically.