Classification of goods and stocks
Goods and stocks The economic wealth, or well-being, of a country does not necessarily depend on the mere possession of resources; the point is how these resources are used in generating a flow of production and how, as a consequence, income and wealth are generated from that process. Flow of production People combine their energies […]
Role of the state in Economy
ROLE OF THE STATE Three possible roles for the State/Government in the economy: (i) Regulator of the economic system (where the state takes important economic decisions, announces the required kind of economic policies, takes the sole responsibility to get them implemented and controlling and punishing those who don’t oblige to those economic decisions). (ii) As a producer and/or […]
Important terms in Indian Economy
Adam Smith (1723 – 1790): Regarded as the father of modern Economics. Author of Wealth of Nations. Aggregate monetary resources: Broad money without time deposits of post office savings organisation (M3). Automatic stabilisers: Under certain spending and tax rules, expenditures that automatically increase or taxes that automatically decrease when economic conditions worsen, therefore, stabilising the economy automatically. Autonomous change: A […]
Sectors/structure of the economy
Sectors of The Economy Economic activities have two parts — market activities and non-market activities. Market activities involve remuneration to anyone who performs i.e., activity performed for pay or profit. These include production of goods or services including government service. Non-market activities are the production for self-consumption. These can be consumption and processing of primary […]
Types of economies and economic system
Types of economies Depending upon the shares of the particular sectors in the total production of an economy and the ratio of the dependent population on them for their livelihood, economies are given different names, such as: (i) Agrarian Economy the share of its primary sector is 50 per cent or more in the total […]