UPSC Economics Quiz Notes PDF

19 Sep 2024 05:26

📌Estimation of National income in India👇

📌Main Point 👇

UPSC Economics Quiz Notes PDF

17 Sep 2024 05:47

📌Bonds

✔️Green Bond

Also known as Climate Bonds
-Bonds which are used to fund projects that have positive environmental & climate benefits.
-Eg. Sovereign Green Bond by GoI

✔️Blue Bond

Bonds to raise fund for sustainable maritime sector/aquatic ecosystem /
-Eg. Seychelles launched world’s first sovereign blue bond

✔️Yellow bonds

Bonds for raising  funds for solar energy generation

✔️Transition bonds

Bonds to raise fund for transitioning to a more sustainable form of economy

UPSC Economics Quiz Notes PDF

17 Sep 2024 05:47

📌Agriculture Innovation Mission for Climate (AIM4C)

✔️Is a joint initiative launched by UAE and USA in 2021, with aim of addressing climate change and hunger by promoting innovative and climate-smart agricultural systems

✔️Three major stakeholders in the mission:- Government partners, Innovation-sprint partners, Knowledge partners

✔️Objectives:-  Increasing investments in smart agriculture and innovative agricultural technologies, creating frameworks for knowledge sharing and technical discussions and developing platforms for stakeholders to take climate-related actions.

✔️India recently joined AIM4C

UPSC Economics Quiz Notes PDF

17 Sep 2024 05:47

📌Environmental Kuznets curve (EKC)

✔️EKC:- Hypothesised relationship between  environmental degradation and per capita income.

✔️In the early stages of economic growth,  environmental quality declines, but beyond some level of per capita income  the trend reverses.

✔️This implies that environmental impacts per capita are an inverted U-shaped function of per capita income.

UPSC Economics Quiz Notes PDF

15 Sep 2024 15:16

📌Estimation of National income in India👇

📌Main Point 👇

UPSC Economics Quiz Notes PDF

15 Sep 2024 15:14

📌Unified Pension Scheme(UPSC)

📌Main Points 👇

🔹1st:-

🔹2nd:-

🔹3rd:-

UPSC Economics Quiz Notes PDF

15 Sep 2024 15:13

📌Civil Registration System (CRS)

📌Main Points👇

🔹1st:-

🔹2nd:-

🔹3rd:-

🔹4th:-

🔹5th:-

UPSC Economics Quiz Notes PDF

12 Sep 2024 05:34

📍 LIQUIDITY ADJUSTMENT FACILITY

#Monetarypolicy

💡 Banks need liquidity to meet their daily mismatches between need and availability.

💡 RBI helps them with a limited amount on a short-term basis through LAF.

💡 Liquidity Adjustment Facility (LAF) was introduced by RBI in 2000. It is the window through which RBI adjusts liquidity (credit) in the market against the collateral of government securities.

💡 When banks borrow under LAF, they do so at Repo rate. Banks undertake to repurchase the security at a later date, be it over night or a few days.

💡 Reverse Repo is when RBI borrows short-term from the market (absorbs excess liquidity) based on government securities and repurchases them. The rate at which it borrows is called Reverse Repo rate as it is the reverse of the Repo.

UPSC Economics Quiz Notes PDF

09 Sep 2024 09:27

✅ Special Mention Account (SMA)
Assets or accounts designated as Special Mention Accounts exhibit signs of poor asset quality within the first 90 days or before they are classified as Non Performing Assets (NPA).

💡 In order to identify accounts that may eventually become NPAs or stressed assets, the RBI developed the Special Mention Accounts (SMA) categorization in 2014.

💡 This classification is justified by the possibility that some accounts will shortly become NPAs. Here, early detection will help to better address the issue.

💡 Special Mention Accounts come in four varieties: SMA-NF, SMA 0, SMA 1, and SMA 2.

💡 The Special Mention Accounts are typically divided into categories based on their duration. For instance, the overdue time for SMA-1 is between 31 and 60 days. On the other hand, an asset will become SMA -2 if it is overdue by 61 to 90 days.

💡 However, some assets designated as “Special Mention” are chosen based on other variables that represent illness or anomalies in the account (SMA -NF).

💡 Non-financial indicators of the stress on an asset are taken into account in the case of SMA -NF.

UPSC Economics Quiz Notes PDF

08 Sep 2024 08:36

📍MEANS OF DEFICIT FINANCING

#Publicfinance

➡️ PRINTING CURRENCY

💡  is the last resort for the government in managing its deficit. But it has the biggest handicap that with it the government cannot go for the expenditures which are to be made in the foreign currency.

💡 printing fresh currencies does have other damaging effects on the economy:

○ It increases inflation proportionally. (India regularly went for it since the early 1970s and usually had to bear double digit inflations.)

○ It brings in regular pressure and obligation on the government for upward revision in wages and salaries of government employees—ultimately increasing the government expenditures necessitating further printing of currency and further inflation—a vicious cycle into which economies entangle themselves.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:15

Economic growth

🌱Economic Growth is the positive change in the indicators of economy.

🌱Economic Growth refers to the increment in amount of goods and services produced by an economy.

🌱Economic growth means an increase in real national income / national output.

🌱It refers to an increase over time in a country’s real output of goods and services (GNP) or real output per capita income.

🌱Economic growth is single dimensional in nature as it only focuses on income of the people.

🌱Earlier, economic growth was only measured in terms of Gross Domestic Product (GDP).

🌱At present, it is measured in terms of GDP, Gross National Income (GNI) and Per Capita Income.

🌱Economic Growth is the precursor and prerequisite for economic development.

🌱Indicators of economic growth are GDP, GNI and per capita income.

🌱Economic growth relates a gradual increase in one of the components of GDP; consumption, government spending, investment or net exports.

🌱It is also considered as a traditional measure of development which indicates the quantitative rise of economy.

🌱Economic growth only looks at the quantitative aspect. It brings quantitative changes in the economy.

🌱Economic growth is concerned with increase in economy’s output.

🌱It focuses on production of goods and services.

🌱Economic growth is more relevant metric for assessing progress in developed countries.

🌱Economic growth is relatively narrow concept as compared to economic development.

🌱It is for short term/short period.

🌱It is a material/physical concept.

🌱Economic growth is measured in certain time frame/period.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:15

1.Capitalist Economy: In a capitalist economy (or free-market economy), all the factors of productions are under the ownership and control of private individuals for profit. Basically, private property is the foundation and profit motive is the driver of the capitalist economy.

2.Socialist Economy: In a socialist economy, the factors of production are collectively owned and controlled by the community, indicated by the State. In this economy, there is a central planning authority which decides the allocation of resources among the members of the community.

3.Mixed Economy: Mixed Economy is a combination of a capitalist and socialist economy, wherein both markets and government decide the allocation of resources. In a mixed economy, a system is found that contains the features of both a controlled economy and market economy, and so there is a co-existence of the public and private sectors in this type of economy.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:15

What is economy

👁An economy (from Greek οίκος – "household" and νέμoμαι – "manage") is an area of the production, distribution and trade, as well as consumption of goods and services by different agents.

👁In general, it is defined 'as a social domain that emphasize the practices, discourses, and material expressions associated with the production, use, and management of resources'.

👁 A given economy is the result of a set of processes that involves its culture, values, education, technological evolution, history, social organization, political structure and legal systems, as well as its geography, natural resource endowment, and ecology, as main factors.
👁These factors give context, content, and set the conditions and parameters in which an economy functions.

👁In other words, the economic domain is a social domain of interrelated human practices and transactions that does not stand alone.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:11

🔍❓ Tax and Non Tax revenue receipts

✔️ The receipts that do not create any liabilities and do not lead to a claim on the government are called revenue receipts.

✔️ These revenue receipts are non-redeemable and can be classified into two categories, namely: tax revenue and non-tax revenue.

✔️ Tax revenues are the vital components of revenue receipts like direct taxes, enterprises, and indirect taxes such as customs duties, excise taxes, and service tax.

✔️ Non-tax revenues, on the other hand, are the recurring income that is earned from sources other than taxes by the government.

🔴 Some of the major sources of non-tax revenue are mentioned below:

➡️ Interests

➡️ Power Supply Fees:  This includes fees received by the central power authority of any nation. In the case of India, this includes fees received by the Central Electricity Authority.

➡️ Fees: They are the charges that cover the cost of recurring services that are provided and imposed by the government.

➡️ Fines and Penalties

UPSC Economics Quiz Notes PDF

04 Sep 2024 08:32

📍 GDP : LIMITATIONS IN COVERAGE

#Nationalincome

The measurement of national income encounters many coverage issues, as the following:

💡 The GDP does not capture black money, which may be generated by two means: illegal activities like smuggling and also by unreported incomes due to tax evasion. Thus, parallel economy poses a serious hurdle to accurate GDP estimations.

💡 In the rural economy, a considerable portion of transactions occurs as barter economy. The GDP does not cover it.

💡 Quite a large portion of the economy is in the informal sector-small and marginal farmers, landless labourers, vegetable vendors, domestic help, and so on. These are outside official GDP estimates.

💡 The national income accounts do not include care economy-domestic work and housekeeping.

💡 Social Services, such as voluntary and charitable work, are ignored as they are unpaid.

UPSC Economics Quiz Notes PDF

19 Sep 2024 05:26

📌Malnutrition in India👇

📌Main Point👇

UPSC Economics Quiz Notes PDF

17 Sep 2024 05:47

📌Human Capital Index

✔️It was launched in 2018 as part of the Human Capital Project, a global effort to accelerate progress toward a world where all children can achieve their full potential.

✔️Released by World Bank

✔️It measures the following criteria :-

✅Mortality rates of children under 5 years
✅Expected years of Quality-Adjusted Schooling
✅Health Environment as indicated by:-  Rate of stunting in children under 5 years and Adult survival rates

✔️India has ranked 115 out of 157 countries

UPSC Economics Quiz Notes PDF

17 Sep 2024 05:47

📌Liquidity Trap

✔️A liquidity trap is an economic phenomenon that occurs when the central bank's efforts to stimulate the economy through monetary policy become ineffective.

✔️In a liquidity trap, interest rates are already low, but people and businesses are still not investing or spending enough to boost the Economy.

UPSC Economics Quiz Notes PDF

17 Sep 2024 05:45

📌Corporate Debt Market Development Fund(CDMDF)

✔️About👇

✔️The Corporate Debt Market Development Fund (CDMDF) is a backstop facility for specified debt funds during market dislocations.

✔️The fund is intended to provide liquidity support in the event of a financial crisis.

✔️The proposed Corporate Debt Market Development Fund(CDMDF) will have an initial corpus of Rs 3,000 crore contributed by mutual funds.

✔️The government has approved a 10-time leverage of the fund (Additional corpus), thus Corporate Debt Market Development Fund(CDMDF) may raise funds up to Rs 30,000 crore.

✔️Contributions to the fund can be done by the specified debt-oriented mutual fund schemes and asset management companies of mutual funds.

✔️This fund is guaranteed by the National Credit Guarantee Trust Company (NCGTC) and the backstop facility will be managed by SBI Mutual Fund.

✔️Recently:- the Securities and Exchange Board of India (SEBI) has introduced the ‘Corporate Debt Market Development Fund’ to prevent financial crisis.

UPSC Economics Quiz Notes PDF

15 Sep 2024 15:16

📌Malnutrition in India👇

📌Main Point👇

UPSC Economics Quiz Notes PDF

15 Sep 2024 15:13

📌Technical Recession

📌Main Points 👇

🔹1st:-

🔹2nd:-

🔹3rd:-

🔹4th:-

🔹5th:-

UPSC Economics Quiz Notes PDF

15 Sep 2024 15:10

📖 Concept of National Income 📖
==============================

National income estimates are the most reliable macroeconomic indicators of an economy. Therefore, it is essential for students to be aware of National Income Concepts. Changes in national income measure the rate of growth of the economy.

Similarly, changes in the structure of national income of an economy reflect the changing significance of different sectors. In India,
national income, as also per capita income, have been continuously increasing. In more recent years, the rate of growth of national income has
accelerated. It indicates that the economy has been growing at a faster rate in recent years than in the past. Along with this, the structure of national income has also undergone a change, the tertiary sector has emerged as the dominant sector of the economy.

National income accounting comprises of four concepts of calculations- GDP, NDP, GNP, NNP.

1. Factor cost is the input cost that producer has to incur in the process of production. It includes cost of capital – loan inetrest, prices of raw materials, labour, power, rent, etc. Can be termed as Production cost.

2. Market cost is calculated after adding indirect taxes to the factor cost of the product. It is basically the cost at which the goods reach the market. Also termed as EX-FACTORY PRICE. In India we calculate income at factor cost because of non-uniform taxes.

➖National Income:The sum total of factor of incomes accruing to the residents of the country, both from their activities within and outside the economic territory is the national income of the country.

➖National income is calculated for a particular period, normally a financial year (In India, financial year means April 1 to March 31 of next year). Net factor income from abroad is added to the domestic product to get the value of National Income.

➖National Income = C + I + G + (X – M)
Where,C = Total consumption expenditure
I = Total investment expenditure
G = Total government expenditure ; X – M = Export – Import


🔹 Gross Domestic Product (GDP)
Gross domestic product is the value of all final goods and services produced within the boundary of a nation during one year. In India one year means from 1st April to 31st March of the next year.
GDP calculation includes income of foreigners in a Country but excludes income of those people who are living outside of that country.

🔹 Net Domestic Product (NDP)
NDP is calculated by deducting the depreciation of plant and Machinery from GDP.
NDP = Gross Domestic Product – Depreciation

🔹 Gross National Product (GNP)
GNP is the value of all final goods and services produced by the residents of a country in a financial year (i.e., 1st April to 31st March of the next year in India).
While Calculating GNP, income of foreigners in a country is excluded but income of people who are living outside of that country is included. It is the GDP of a country added with its income from abroad.
GNP = GDP + X – M
Where,X = income of the people of a country who are living outside of the Country

and     M = income of the foreigners in a country

➖India’s  GNP is always lower than its GDP.
➖This is the national income according to which the IMF ranks nations.
➖It allows for knowledge of factors in production behaviour and pattern of an economy’s dependence on outside world, nature of human resources internationally, position in world economics.
➖It indicates both qualitative as well as quantitative aspects of an economy in a more exhaustive fashion than GDP.

Intermediate products = one production unit purchasing from other for resale

Final product = all goods and services purchased for consumption and investment , and not for resale

Value added = Value of output – Intermediate cost

Gross value added = net value added + depreciation

Indirect tax = all taxes levied on production, finally paid by consumer of buyer Ex – sales tax, excise, customs

Subsidies = Financial help given by the government to the production units for selling the product at lower prices.

UPSC Economics Quiz Notes PDF

12 Sep 2024 05:34

📍 SLR

#Monetarypolicy

💡 The Statutory Liquidity Ratio commonly known as SLR is a monetary tool employed by the central bank (RBI) to manage the liquidity.

💡 SLR is a proportion of the Net Time and Demand Liabilities (NTDL) of commercial banks, which are supposed to be retained by them in the form of gold, cash, government securities or any other RBI approved securities and bonds.

💡 Mostly the banks maintain SLR by investing in government securities, as it will earn them interest.

💡 Unlike the Cash Reserve Ratio (CRR), the SLR is maintained in the own vault of every commercial bank.

💡 The percentage of SLR is fixed by the Reserve Bank of India and varies according to the economic condition prevailing in the country.

💡 As of June 2021, RBI has fixed SLR at 18%, which means all the banking institutions falling under the guidelines of RBI are required to maintain 18% of their Net Time and Demand Liabilities in their vault.

UPSC Economics Quiz Notes PDF

08 Sep 2024 08:36

📍 RECESSION

Major traits of recession can be summed up as follows:

💡 There is a general fall in demand as economic activities take a downturn.

💡 Inflation remains lower or/and shows further signs of falling down.

💡 Employment rate falls/ unemployment rate grows.

💡 Industries resort to ‘price cuts’ to sustain their business.

💡 In the financial year 1996–97, the Indian economy was taken up by the cycle of recession, due to a general downturn in domestic as well as foreign demands, initiated by the South East Asian Currency Crisis of mid-1990s. The whole plan of economic reforms in India was derailed and it was only by the end of 2001– 02 that the economy was able to recover.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:15

Economic development


🌳Economic development is the quantitative and qualitative change in an economy.

🌳Economic development refers to the reduction and elimination of poverty, unemployment and inequality with the context of growing economy.

🌳Economic development means an improvement in the quality of life and living standards, e.g. measures of literacy, life-expectancy and health care.

🌳Economic development includes process and policies by which a country improves the social, economic and political well-being of its people.

🌳Economic development is multi-dimensional in nature as it focuses on both income and improvement of living standards of the people.

🌳Economic development is concerned with the happiness of public life.

🌳Economic development comes after economic growth. It is a positive impact of economic growth.

🌳Economic development also refers to:

🌱provision of sufficient and effective physical and social infrastructures

🌱equal access to resources

🌱participation of all in economic activities

🌱equitable distribution of dividends of economy.

🌱Economic development= Economic growth + standard of living

🌱It refers to increase in productivity.

🌱Indicators of economic development are:

Human Development Index (HDI)

Human Poverty Index (HPI)

Gini Coefficient

Gender Development Index (GDI)

Balance of trade

Physical Quality of Life Index (PQLI)

🌱Economic development is the ends of development.

🌱Achieving economic development is linked with end of poverty and inequality.

🌱It is more abstract concept.

🌱Economic development focuses on distribution of resources.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:15

Differences Between Economics and Economy

The points given below are substantial with respect to the difference between economics and the economy:

1.Economics can be defined as the social science which stresses on the behaviour, interactions and decisions of economic agents regarding the satisfaction of their wants when the resources are limited. On the other hand, Economy refers to an organized system, which encompasses production, distribution, consumption and exchange of goods and services and level of employment in a nation or region.

2 Economics is theoretical, as it contains theories, models and principles. As against, the principles and theories of the economics are practically applied in economy.

3.Economics analyses the way in which individuals, families, organizations and nations make choices in the face of scarcity of resources. Conversely, the economy tells you about the way resources are allocated among different members of society.

4.The primary focus of economics is on how individuals, families, firms and nations, behave and interact, how they make choices, how society uses its limited resources, and how economies work. On the contrary, the main focus of the economy is on how the company’s economic affairs are organized and conducted

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:15

Types of economy


1 .A market-based economy is one where goods and services are produced and exchanged according to demand and supply between participants (economic agents) by barter or a medium of exchange with a credit or debit value accepted within the network, such as a unit of currency.

2. A command-based economy is one where political agents directly control what is produced and how it is sold and distributed.

3.A green economy is low-carbon, resource efficient and socially inclusive. In a green economy, growth in income and employment is driven by public and private investments that reduce carbon emissions and pollution, enhance energy and resource efficiency, and prevent the loss of biodiversity and ecosystem services.

4.A gig economy is one in which short-term jobs are assigned or chosen via online platforms.

5..New economy is a term that referred to the whole emerging ecosystem where new standards and practices were introduced, usually as a result of technological innovations.

6.The global economy refers to humanity's economic system or systems overall.

UPSC Economics Quiz Notes PDF

07 Sep 2024 08:11

Money laundering:

"Money laundering is the illegal process of concealing the origins of money obtained illegally by passing it through a complex sequence of banking transfers or commercial transactions."

Money laundering typically includes three stages: placement, layering and integration stage.

✏️Placement is the first step of money laundering which is the process of moving the money into the legitimate source via financial institutions, casinos, financial instruments etc. and at the same time, hiding its source.

✏️The second stage is “layering”, also referred as “structuring stage”. It breaks the funds into small transactions and makes it difficult to detect and find out about the laundering activity. It usually entails international money movement, so the law enforcement agencies won’t be able to track the financial gains from illegal proceedings so easily.

✏️The third stage is Integration stage, In this stage, money is now returned to the criminals legitimately after it has been placed in the financial system, often breaking it into different multiple smaller financial transactions. Criminals can now retrieve their illicit funds in a legal way after fully integrating them into a legitimate source, and are able to use them for any purpose.

"Anti-money laundering (AML) refers to the laws, regulations and procedures intended to prevent criminals from disguising illegally obtained funds as legitimate income."

⏺Prevention of Money Laundering Act (PMLA), 2002 is an Act of the Parliament of India enacted by the government to prevent money-laundering and to provide for confiscation of property derived from money-laundering. PMLA and the Rules notified there under came into force with effect from July 1, 2005.

UPSC Economics Quiz Notes PDF

04 Sep 2024 08:32

📍 POTENTIAL GDP

#Nationalincome

💡 Potential output is what the economy can produce without destabilizing the macroeconomic fundamentals like inflation, interest rates, fiscal deficit and so on.

💡 It is the optimum production that can be achieved over the long term.

💡 The actual GDP is what is produced, and the difference between potential output and actual output is referred to as output gap or GDP gap. It indicates the policies that need to be followed, either to accelerate or decelerate the growth rate.

💡 Sustainability is crucial in deciding on potential output. Sustainability is in terms of prices, fiscal deficit, current account deficit (exports cannot be boosted by devaluing the exchange rate as it can be dysfunctional), financial sector not accumulating Non- Performing Assets (NPAs), etc.

UPSC Economics Quiz Notes PDF

04 Sep 2024 08:32

🔘The Aadhaar-enabled Payment System (AePS)

In News

The Aadhaar-enabled Payment System (AePS) in India has recently faced exploitation by cybercriminals, leading to unauthorized access to users’ bank accounts.

About

◾️The AePS is a bank-led model that allows online interoperable financial transactions at Point of Sale (PoS) or micro-ATMs through the Business Correspondent (BC) of any bank using the Aadhaar authentication.

◾️It was taken up by the National Payments Corporation of India (NPCI) – a joint initiative of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA).

◾️The AePS is meant to provide easy and secure access to banking services for the poor and marginalized sections of society, especially in rural and remote areas.

◾️It eliminates the need for OTPs, bank account details, and other financial information.

◾️Transactions can be carried out with only the bank name, Aadhaar number, and captured fingerprint during Aadhaar enrollment.