IMPORTANT POINTS (ECONOMICS)TO REMEMBER:- • Tools, machines, buildings can be used in production over many years, and are called fixed capital. • There are four requirements for production of goods and services - land and other natural resources such as water, forests, and minerals, labour, i.e. people who will do the work, physical capital, i.e. the variety of inputs required at every stage during production and human capital. • Raw materials and money in hand are called working capital. • Every production is organised by combining land, labour, physical capital and human capital, which are known as factors of production. • During the rainy season (kharif) farmers grow jowar and bajra. • To grow more than one crop on a piece of land during the year is known as multiple cropping. • The Green Revolution in the late 1960s introduced the Indian farmer to cultivation of wheat and rice using high yielding varieties (HYVs) of seeds. • Farmers of Punjab, Haryana and Western Uttar Pradesh were the first to try out the modern farming method in India. • Population becomes human capital when there is investment made in the form of education, training and medical care. • Human capital is the stock of skill and productive knowledge embodied in them. • People as Resource’ is a way of referring to a country’s working people in terms of their existing productive skills and abilities. • Primary sector includes agriculture, forestry, animal husbandry, fishing, poultry farming, mining, and quarrying. • Manufacturing is included in the secondary sector. • Trade, transport, communication, banking, education, health, tourism, services, insurance etc. are included in the tertiary sector. • Market activities involve remuneration to anyone who performs i.e., activity performed for pay or profit. • Non-market activities are the production for self-consumption. • The quality of population depends upon the literacy rate, health of a person indicated by life expectancy and skill formation acquired by the people of the country. The quality of the population ultimately decides the growth rate of the country. Illiterate and unhealthy population are a liability for the economy. Literate and healthy population are an asset. • .Sarva Siksha Abhiyan is a significant step towards providing elementary education to all children in the age group of six to fourteen years by 2010. • Unemployment is said to exist when people who are willing to work at the going wages cannot find jobs. • Seasonal unemployment happens when people are not able to find jobs during some months of the year. • In case of disguised unemployment people appear to be employed. The work requires the service of five people but engages eight people. The field requires the service of five people and the three extra people are disguised unemployed. • A paradoxical manpower situation is witnessed as surplus of manpower in certain categories coexist with shortage of manpower in others. • Poverty means hunger and lack of shelter. It also is a situation in which parents are not able to send their children to school or a situation where sick people cannot afford treatment. Poverty also means lack of clean water and sanitation facilities. It also means lack of a regular job at a minimum decent level. Above all it means living with a sense of helplessness. • Vulnerability to poverty is a measure, which describes the greater probability of certain communities (say, members of a backward caste) or individuals (such as a widow or a physically handicapped person) of becoming, or remaining, poor in the coming years. • A person is considered poor if his or her income or consumption level falls below a given .minimum level. necessary to fulfill basic needs. • The poverty line is estimated periodically (normally every five years) by conducting sample surveys. These surveys are carried out by the National Sample Survey Organisation (NSSO). • National Rural Employment Guarantee Act (NREGA) 2005 was passed in September 2005. The Act provides 100 days assured employment every year to every rural household in 200 districts. • National Food for Work Programme (NFWP), which was launched in 2004 in 150 most backward districts of the country. The programme is open to all rural poor who are in need of wage employment and desire to do manual unskilled work. It is implemented as a 100 per cent centrally sponsored scheme and foodgrains are provided free of cost to the states. Once the NREGA is in force, the NFWP will be subsumed within this programme. • Prime Minister Rozgar Yozana (PMRY) is another scheme which was started in 1993. The aim of the programme is to create self-employment opportunities for educated unemployed youth in rural areas and small towns. They are helped in setting up small business and industries. • Rural Employment Generation Programme (REGP) was launched in 1995. The aim of the programme is to create self employment opportunities in rural areas and small towns. A target for creating 25 lakh new jobs has been set for the programme under the Tenth Five Year plan. • Swarnajayanti Gram Swarozgar Yojana (SGSY) was launched in 1999. The programme aims at bringing the assisted poor families above the poverty line by organising them into self help groups through a mix of bank credit and government subsidy. • Pradhan Mantri Gramodaya Yozana (PMGY) launched in 2000, additional central assistance is given to states for basic services such as primary health, primary education, rural shelter, rural drinking water and rural electrification. • Food security means availability, accessibility and affordability of food to all people at all times. • Food security depends on the Public Distribution System (PDS) and government vigilance and action at times, when this security is threatened. • A Famine is characterised by wide spread deaths due to starvation and epidemics caused by forced use of contaminated water or decaying food and loss of body resistance due to weakening from starvation. • Indira Gandhi, the then Prime Minister of India, officially recorded the impressive strides of the Green revolution in agriculture by releasing a special stamp entitled .Wheat Revolution. in July 1968. The success of wheat was later replicated in rice. • Buffer Stock is the stock of foodgrains, namely wheat and rice procured by the government through Food Corporation of India (FCI). • The FCI purchases wheat and rice from the farmers in states where there is surplus production. The farmers are paid a pre-announced price for their crops. This price is called Minimum Support Price. • Price lower than the market price also known as Issue Price. • The food procured by the FCI is distributed through government regulated ration shops among the poorer section of the society. This is called the public distribution system (PDS). • In the wake of the high incidence of poverty levels, as reported by the NSSO in the mid-1970s, three important food intervention programmes were introduced: Public Distribution System (PDS) for food grains (in existence earlier but strengthened thereafter); Integrated Child Development Services (ICDS) (introduced in 1975 on an experimental basis) and Food-for-Work** (FFW) (introduced in 1977.78). • Subsidy is a payment that a government makes to a producer to supplement the market price of a commodity. Subsidies can keep consumer prices low while maintaining a higher income for domestic producers. • average income which is the total income of the country divided by its total population. The average income is also called per capita income. • Infant Mortality Rate (or IMR) indicates the number of children that die before the age of one • year as a proportion of 1000 live children born in that particular year. • Literacy Rate measures the proportion of literate population in the 7 and above age group. • Net Attendance Ratio is the total number of children of age group 6-10 attending school as a • percentage of total number of children in the same age group. • Human Development Report published by UNDP compares countries based on the educational levels of the people, their health status and per capita income. Life Expectancy at birth denotes, as the name suggests, average expected length of life of a person at the time of birth. • Gross Enrolment Ratio for three levels means enrolment ratio for primary school, secondary school and higher education beyond secondary school. Per Capita Income is calculated in dollars for all countries so that it can be compared. It is also done in a way so that every dollar would buy the same amount of goods and services in any country. • When we produce a good by exploiting natural resources, it is an activity of the primary sector. • most of the natural products we get are from agriculture, dairy, fishing, forestry, this sector is also called agriculture and related sector. • The secondary sector covers activities in which natural products are changed into other forms through ways of manufacturing that we associate with industrial activity. It is the next step after primary. The product is not produced by nature but has to be made and therefore some process of manufacturing is essential. it is also called as industrial sector. • After primary and secondary, there is a third category of activities that falls under tertiary sector and is different from the above two. These are activities that help in the development of the primary and secondary sectors. These activities, by themselves, do not produce a good but they are an aid or a support for the production process. the tertiary sector is also called the service sector. • The value of final goods and services produced in each sector during a particular year provides the total production of the sector for that year. • the sum of production in the three sectors gives what is called the Gross Domestic Product (GDP) of a country. It is the value of all final goods and services produced within a country during a particular year. GDP shows how big the economy is. • The unorganised sector is characterised by small and scattered units which are largely outside the control of the government. • Since money acts as an intermediate in the exchange process, it is called a medium of exchange. • Collateral is an asset that the borrower owns (such as land, building, vehicle, livestocks, deposits with banks) and uses this as a guarantee to a lender until the loan is repaid. • Interest rate, collateral and documentation requirement, and the mode of repayment together comprise what is called the terms of credit. • Investment made by MNCs is called foreign investment.
Posted on: Sun, 27 Oct 2013 18:54:17 +0000
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