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TODAYS PLAN
Q-1:“What may be the development for one may
be the destruction for the other.” Explain the
statement with appropriate examples.
(2014,2017)
It is true to say that what may be the development
for one may be the destruction for the other.
Sometimes the developmental goals of people may
be conflicting in nature and prove destructive for
others. For example,
I. Construction of dam could be a development
goal for the industrialist but it is a conflicting
goal as it would affect the lives of the people
living in that area as the local people may get
displaced and their livelihood may get
disrupted.
II. If there is slum near the high rise buildings
then the people of that high rise building will
have the developmental goal to remove the
slum from that locality which will be a
conflicting goal as it would displace the slum
people.
Q-2: What is the main criteria used by the World
Bank in classifying different countries? What are
the limitations of this criteria, if any? In what
respects is the criteria used by the UNDP for
measuring development different from the one
used by the World Bank? (2014,2017)
The main criterion used by the World Bank in classifying
different countries is per capita income.
Limitations of using average income for comparison:
I. Average income hides the disparity.
II. Average income does not tell us the distribution of
income among the people.
III. It is just a material criteria for the comparison.
The criteria used by the UNDP for measuring
development is different from the one used by the World
Bank on the following basis:
I. World Bank uses PCI as a criteria for comparing the
countries whereas UNDP uses PCI, health status
and educational levels for the comparison.
II. The criteria used by the World Bank is just a
material criteria whereas the criteria used by the
UNDP is both material and non-material criteria.
III. The criteria used by the World Bank does not give
us a real picture of development as it is given by
the UNDP.
Q-3: Give five reasons for the rising importance
of the tertiary sector in production.
(2012,2015,2017)
Five reasons for the rising importance of the
tertiary sector in production are:
a. Rise in the basic services provided by the
government.
b. The development in the primary and secondary
sectors has led to the development of the tertiary
sector.
c.Due to the rise in income people have started
spending on the various kinds of services.
d. Due to the development of new kinds of
services like IT sector services.
e. Due to the introduction of the new economic
policy liberalisation, privatisation and
globalisation, the trade expanded all over the
world and the role of service sector became
significant.
Q-4:In what ways can employment be increased
in urban areas ? (2010,2011)
1. Strengthening the tourism sector: By opening more hotels,
amusement parks, and restaurants, the demand for employment
in this sector will increase.

2. Improving infrastructure: Opening more schools, hospitals,

and providing transportation facilities will generate more
employment in urban areas.

3. Strengthening the information technology sector: This involves

opening more call centres, cyber cafes, and software
development units.

4. Providing Credit at reasonable rate of interest so people

can open their own businesses

5. Education and Health

Q-5:‘Self-Help Groups’ help borrowers to
overcome the problems of lack of collateral.”
Examine the statement.(2013,2017)
This is a new idea to organize rural poor particularly women
who pool their savings. Generally, this group has 15-20
members. Members belong to the neighbourhood so that they
can meet and save regularly.
Saving per member varies from 25 to 100 or more, depending
on the economic condition of the member.

When the group is regular in saving for a year or two then the
group is eligible for getting loan from the bank. Bank provide
loan in the name of the group and then the SHG gives loan to
its members at very low rate of interest.

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.
Q- 6:Describe the vital and positive role of
credit with examples. (2016,2011)
Credit : Credit is an agreement between the
lender and the borrower in which the borrower
promises to pay the lender in the future.

Positive role of credit: Credit plays a positive role

when the borrower is able to return the loan
amount on time and also made some profit with
the use of that money. For example: Salim, a shoe
manufacturer took a loan from different sources
to complete the order of 3000 pair of shoes, in
the end he delivered the order, made profit and
repaid the loan.
Q-7:What are the two categories of sources of
credit? Mention four features of each.(2013)
The two categories of sources of credit are formal sector
credit and informal sector credit. Four features of formal
sector credit are:
a. Formal sector credit sources includes banks and
cooperatives.
b. Mostly people in the urban areas and the well-off
households use it.
c.Formal sector credit need proper documents and
collateral before lending.
d.They charge less rate of interest in comparison to that
of informal sector. Thus the cost of borrowing is less.

Four features of informal sector credit are:

a. Informal sector credit sources includes moneylenders,

friends, relatives, traders etc.
b.Mostly people in the rural areas and the poor
households use it. Many a times informal sector don’t
ask for documents and collateral as they know the
borrowers personally.
c.They charge high rate of interest in comparison to that
of formal sector. Thus the cost of borrowing is high.
Read the extract and answer the questions that follows:

Today, the world has been converted into a large village with the help of
efficient and fast
moving transport. Transport has been able to achieve this with the help of
equally developed communication system. Therefore, transport,
communication and trade are complementary to each other. Today, India is
well-linked with the rest of the world despite its vast size, diversity and
linguistic and socio-cultural plurality. Railways, airways, waterways,
newspapers, radio, television, cinema and internet, etc. have been contributing
to its socio-economic progress in many ways. The trades from local to
international levels have added to the vitality of its economy. It has enriched
our life and added substantially to growing amenities and facilities for the
comforts of life. It is thus, evident that a dense and efficient network of
transport and communication is a prerequisite for local, national and global
trade of today.

30.1-Why is there a need to interlink with the world?

30.2-Infer the importance of means of transportation and communication for
socioeconomic progress?
30.3How does trade strengthen the economy of a country?
 1. There is need to interlink with
the world for development,
advancement, globalization
etc.

2. 2 i). They are the very basis

of industries and trade of
country.
ii). Create job employment
opportunities
iii). Help to grow economy

3. . Trade between nation and

countries are the index to its
economic prosperity.
4. ii). It generates employment
Q-8: Explain by giving examples how
multinational corporations are spreading their
products in different ways. (2013,2014,2016)
The following are the three ways in which multinational corporations
are spreading their products in different ways:
❏ Buying up the local companies: This is most common route for
MNC investment and expanding production. MNCs can do so
because they have huge wealth. For example: Cargill Foods an
American MNC has bought Indian company named Parakh Food.
Now the control on the large marketing network and the four oil
refineries has shifted to the Cargill Food. Cargill Food has now
become the largest producer of edible oil in India.
❏ Joining hand with local companies: Sometimes the MNCs join
hands with the local companies and do the production. In this
process, the local companies get twin benefits: (i) they get
foreign investment and («) MNCs provide newer technology to
them for the production. For example: In 1995, Ford Motors an
American company joined hand with the Indian company called
Mahindra and Mahindra (manufacturer of jeeps and trucks).
❏ By placing orders: Sometimes MNCs just place orders with small
producers around the world for the production of garments,
footwear and sports items. After that, the products are supplied
to the MNCs and sold under the brand name of the MNCs.
Q-9: Analyse any five positive effects of
globalization on the Indian economy.(2017)
The five positive effects of globalization on the Indian
economy are:
● Producers: The big producers who join hands
with the MNCs are getting the profit and
expanded their business across the globe.
● The Indian producers got foreign investment
and newer technologies from the MNCs.
● The Indian producers are getting an opportunity
to reach beyond the domestic market.
● Workers: MNCs helped in reducing the
unemployment in India.
● Buyers: The buyers are getting variety of brands
with quality at cheaper rates.
Q-10:How is the government of India trying to
attract more foreign investment? Explain with
examples. (2011,2013)
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.
Q-11: How has foreign trade been integrating
markets of different countries in the world?
Explain with examples.
1) Foreign trade creates an opportunity for the producers to reach
beyond the domestic markets.: Producers can sell their produce
not only in markets located within the country but can also
compete in markets located in other Countries of the world.

2) Similarly for the buyers, import of goods produced in another

country is one way of expanding the choice of goods beyond
what is domestically produced.
3) With the opening of foreign trade, goods travel from one market
to another AND Choice of goods in the market rises.
4) Prices of similar goods in two markets tend to become equal.
5) Producers in the two markets or to say two countries now
closely compete against each other even though they are
separated by thousands of kilometres.
6) These foreign trade connects the markets of different countries.
For example, if there are a large number of foot-wear brands
available in the Indian markets. A consumer who is aware of
international trends can choose between a local brand like Bata,
Lakhani Phoenix and international brands like Adidas, Nike,
Reebok, etc.
Q-12:Describe any three possible development
goals of landless rural labourers. (2016)
The three possible development goals of
landless rural labourers are:
I. Have basic facilities and more days of
work.
II. Better wages.
III. Quality education to their children in
the nearby government school.
Q-13:Explain how public sector contributes to
the economic development of a nation.
 I. It promotes rapid economic development through
infrastructure creation.
II. It creates employment opportunities.
III. It generates financial resources for further
development.
IV. It ensures equality of income wealth and thus a
balanced regional development.
V. The public sector plays a vital role in contributing to
the Human Development Index via its functioning in
health and education service
Q-14:Why didn’t shift out of primary sector
happen in case of employment although there
has been a change in the share of the three
sectors in GDP? (2016,2018)
A remarkable fact about India is that while there has
been a change in the share of the three sectors in GDP,
a similar shift has not taken place in employment
● This is because Not enough jobs were created in
the secondary and tertiary sectors.

● More than half of the workers in the country are

working in the primary sector, mainly in
agriculture, producing only about one sixth of the
GDP.

● In contrast to this, the secondary and tertiary

sectors produce the rest of the produce whereas
they employ less about half the people.

● IIt means that there are more people in

agriculture than is necessary. Even if we move a
few people out, production will not be affected. In
other words, workers in the
agricultural sector are underemployed.
Q-15:Name the sector that is the largest
employer in India. Why does this sector
produce only a quarter of the national GDP?
(2016,2012)
Primary sector is the largest employer sector in
India. This sector produce only a quarter of the
national GDP because there is a problem of
disguised unemployment in this sector. Though
almost 60% people of India are engaged in this
sector but all are not required there. Many of them
are extra people. They are forced to be in this
sector as there is less job opportunities in the other
sectors.
Q-16:Explain the interdependence of all three
sectors giving examples from transportation
system.(2014,2017)
Tertiary sector does not produce any good but it
helps in the production of goods in the primary
and the secondary sectors. For example:
a. In the primary sector, we need the service of
transportation for getting the supply of the
agricultural inputs and also for selling the food
grains in the market or supplying the agricultural
raw materials to the agro- based industries.
b. In the secondary sector, we need the help of
transportation for bringing the raw materials
and taking the final products to the market.
C. Transportation is required in the service
sector as well such as for providing medical
facilities to the people and other services like
fire services etc.
Q-17:wHAT IS cREDIT. Why is cheap and
affordable credit important for the country’s
development? Explain any three
reasons.(2012,2016,2018)
Cheap and affordable credit is crucial for the country's development due
to the following factors:

i). More lending would lead to higher incomes and encourage people to
invest in agriculture, engage in business and set up small scale industries.

ii). Cheap credit means more income would be left with the borrower to
reinvest rather than return as interest. This leads to an acceleration of
economic activity.

iii). Cheap credit would also allow weaker sections of society to enter the
formal sector of lending and rid them of exploitation at the hands of
informal moneylenders. Thus, it may hmprove the economic condition of
the poor and landless
Q-18:Why is modern currency accepted as a
medium of exchange without any use of its
own? Find out the reason.(2015)
Modern currency accepted as a medium of
exchange without any use of its own due to the
following reasons:

a. In the modern times, currency notes and coins

are used as a medium of exchange.

b.These are not made of any precious metals even

though used as a medium of exchange because the
government of the country authorizes the currency.

c.As the law legalizes the use of rupee, so no

individual can refuse a payment made in rupees.

Therefore, rupee is widely accepted as a medium of

exchange.
Q-19:Why do lenders ask for a collateral while
lending? Give any three reasons. (2015)
The lenders ask for a collateral while lending due to
the following reasons:

a. It is an asset that the borrower owns and given to

the lender as a guarantee that he will repay the
loan.

b.If the borrower is unable to repay the loan then

the lender has the right to sell it and get the money
back.

c.By this the borrower is bound to pay the loan

within the defined time period.
Q-20:Examine any three conditions which
should be taken care of by Multinational
Companies to set up their production
units.(2017)
Multinational Companies to set up their
production units are:

a.Labour: There should be easy availability of

cheap and skilled labour for the industries. This
will help in reducing in the cost of production
and maximizing the profit.
b.Market: The markets should be close to the
production units so that there should be less
expenditure on the transport cost.
c. Government policies: The government policies
of that particular countries should be in favour
of the company such as flexibility in labour laws
etc.
Q-21:Define the term liberalization. Explain the reasons
why the Indian Government started the policy of
liberalization in 1991. (2014 D)
Or
‘Barriers on foreign trade and foreign investment were
removed to a large extent in India since 1991’. Justify the
statement. (2016 D)
 Removing barriers or restrictions set by the government on foreign
trade and foreign investment is what is known as liberalization. The
Indian Government removed these barriers because:

● Liberalization of trade and investment policies allows Indian

producers to compete with producers around the globe leading to an
improvement in performance and quality of products.

● After the barriers on foreign trade and foreign investment were

removed to a large extent, goods could be imported and exported
easily and also foreign companies could set up factories and offices in
India. This has led to an increase in trade with different countries.

● Businesses are allowed to make decisions freely about what they wish
to import or export due to the liberal policies of the government.

● Doors of investment opened up for MNCs. They have been investing

large sums of money in India and have been seeking to earn large
profits.
Q-22:“Technology has stimulated the
globalisation process.” Support the statement
with examples.
Analyse the contribution of fast transport in
globalisation

(2014,2015,2016, 2020)
Role of technology in globalization:
i). There have been many improvements in the transport section
which helps in export and
import of goods. This increases trade relations between countries.
ii). Since technology improves efficiency, the process of exchange
has become faster and
cheaper.
iii). Development in information and communications technology
has been the most
beneficial since information can be now sent in seconds across
the world.
iv). Development in IT also has led to the production of services
through outsourcing like call
centres, online teaching etc.
v). Telecommunications have improved contact between people.
People living in two
different countries can easily be in touch with minimal prices.
Q-23: Why do we need to expand formal
sources of credit in India? Explain
 We need to expand formal sources of credit in
india because:
● i). There is no organisation which supervises the
credit activities of lenders in the informal
● sector.
● if). There is no one to stop them from using
unfair means to get their money back.
● iii). Formal sources of credit are less risky and
they charge less rate of interest.
● iv). The RBI supervises the functioning of formal
sources of loans
Q-26: Why do banks and cooperative societies
need to lend more? Explain(2011,2012,2014)
Banks and cooperative societies need to
lend more:
i. This would lead to higher incomes
ii. People could borrow cheaply for a
variety of needs.
iii. They could grow crops and set up
small-scale industries etc.
iv. Cheap and affordable credit is crucial
for the country's development
V. It is also important to save and reduce
the dependence on informal sources of
credit
1/2 Markers
Q-24Explain any three loan activities of
banks(2011,2012, 2014, 2019)
Loan activities of banks in India.
(i) Banks provide loans for various
economic activities.
(ii) Banks intermediate between those
who have surplus funds and those who
are in need of
these funds.
(iii) Banks offer very less interest on
deposits than what they demand on
loans
Q-25:Why do MNCs setup their offices and
factories in those regions where they get cheap
labour and other resources? (2016)
MNCs setup their offices and factories in
those regions where they get cheap
labour and other resources so that they
can reduce their cost of production and
maximize the profit.
Q-27:State any two goals of development other
than income. (2016,2018)
The two goals of development other
than income are freedom and security.
Q- 28:Suggest any one way to solve
under-employment situation in rural areas.
(2013,2015)
To solve the problem of
under-employment in the rural areas,
the government should help the people
in opening their own business by
providing bank loans at lower or no
interest rate

Government can invest in storage

services that will aid the farmer in
agriculture as well as increase
employment
Q-29: When we produce goods by exploiting the
natural resources, in which category of
economic sector such activities come? (2018)
When goods are produced by exploiting
the natural resources, it is an activity of
the primary sector.
Q-30:Define:
1. Infant mortality rate
2. Literacy rate
3. Net attendance ratio
BMI (2012,2016)
1. Infant mortality rate. It indicates the number of children
that die before the age of 1 year as a proportion of 1000 live
children bom in that particular year.

2. Literacy rate. It measures the proportion of literate

population in the 7 and above age group.

3. Net Attendance ratio. It is the total number of children of

age group 6 to 10 attending school as a percentage of total
number of children in the same age group.

4. BMI stands for Body Mass Index. It is calculated by dividing

the weight of a person in kilograms (kgs) by the square of
his/her height in metres. It is an indicator of the level of
nourishment in adults.
Q-31: What was the most important sector of
economic activities at the earliest stages of
development? (2013,2014)
Primary sector was the most important
sector of economic activities at the
earliest stages of development.
Q-32: How does the use of money make it
easier to exchange things? Give an example.
(2017)
Money makes the things easier as
(i) It is in the form of authorised paper
currency which gives the guarantee of
the mentioned
price to the owner.
(ii) It has general acceptability.
(iii) Its price remains constant compared
to other commodities.
(iv) It can be stored easily and doesn't
need much space
Q-33: Why can one not refuse a payment made
in rupees in India? (2016)
One cannot refuse a payment made in
rupees in India because it is authorized
by the government of the country.
Q-Explain the objectives of National Rural
Employment Guarantee Act 2005. (2015,
2014, 2013)
Main objectives of the NREGA 2005 are:

○ to implement the Right to Work in

200 districts of India.
○ to guarantee 100 days of
employment in a year by the
Government. In case the Government
fails, it offers unemployment
allowance.
○ to give preference to the type of work
that will help increase the production
from land.
Q- Explain the meaning of 'Currency'.(2015,
2019)
Any form of money that is approved by
the government and used by the public
for trading is known as currency. It can
be soft money in the form of rupees or
hard money in the form
of coins. Every country has its own
currency. For example, currency of India
is Rupees
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