UPSC Economics Quiz Notes PDF

11 Dec 2024 22:19

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UPSC Economics Quiz Notes PDF

29 Nov 2024 08:05

भू-राजस्व व्यवस्थायें –

✍️ रैयतवारी व्यवस्था – थामस मुनरो और कैप्टन रीड के द्वारा शुरु की गई इस व्यवस्था को प्रायोगिक तौर पर सर्वप्रथम मद्रास प्रेसीडेंसी (तमिलनाडु) के बारामहल (1792) में लागू किया गया। तमिलनाडु, मद्रास, बंबई प्रेसीडेंसी के कुछ हिस्सों, असम तथा कुर्ग के कुछ हिस्सों सहित यह व्यवस्था ब्रिटिश भारत के लगभग 51% भू-भाग पर लागू की गयी। इसके अंतर्गत किसानों को भू-स्वामी मानकर लगान का निर्धारण किया गया। इसमें 20-30 वर्षों पर लगान का पुनर्निर्धारण किया जाता था।

✍️ महालवाड़ी बंदोबस्त – इस व्यवस्था के तहत गांव की बिरादरी अपने प्रतिनिधियों (मुखिया या लम्बरदार आदि) के माध्यम से रकम चुकाने का भार अपने ऊपर लेती थी। यह व्यवस्था उत्तर प्रदेश, मध्यप्रांत, पंजाब में अर्थात भारत के कुल 30% भूमि पर लागू थी।

✍️ माटिन बर्ड – को उत्तरी भारत में भूमि का व्यवस्था का प्रवर्तक के नाम से स्मरण किया जाता है।

✍ नील दर्पण – यह दीनबंधु मित्र द्वारा 1860 में लिखित नाटक था, जिसमें नील की खेती करने वाले कृषकों की दयनीय दशा का वर्णन था। नील के रंग बनाने का उद्योग भारत में 18वीं सदी के अंत में शुरु किया गया था।

✍️ स्थायी बंदोबस्त – यह व्यवस्था लॉर्ड कार्नवालिस ने सर जॉन शोर के सुझावों पर 1793 में लागू की थी। इसके तहत लगान की एक निश्चित मात्रा, जो जमींदारों द्वारा देय थी, हमेशा के लिए निर्धारित कर दी गई। जमींदार अपनी सेवाओं के लिए एक हिस्सा (1/11) अपने पास रखता था। यह व्यवस्था बंगाल, बिहार, उड़ीसा तथा बनारस के क्षेत्रों एवं कर्नाटक (19%) पर लागू थी।

Land Revenue Systems –

✍️ Ryotwari System – This system was started by Thomas Munro and Captain Reed and was the first to implement it on a pilot basis in Baramahal (1792) of Tamil Nadu. This system was implemented on about 51% of the land area of British India, including parts of Tamil Nadu, Madras, Bombay Presidency, parts of Assam and Coorg. Under this, the rent was fixed by considering the farmers as the owners of the land. In this, the rent was re-fixed every 20-30 years.

✍️ Mahalwari Settlement – Under this system, the village fraternity used to take the burden of paying the amount through its representatives (chieftains etc.). This system was applicable in Uttar Pradesh, Madhya Pradesh, Punjab i.e. on total 30% land of India.

✍️ Martin Bird is remembered as the originator of the land system in northern India.

✍️ Neel Darpan – This was a play written by Dinabandhu Mitra in 1860, in which the pathetic condition of the farmers cultivating indigo was described. The industry of making indigo dyes was started in India in the late 18th century.

✍️ Permanent Settlement – This system was implemented by Lord Cornwallis in 1793 on the suggestions of Sir John Shore. Under this a fixed amount of rent, which was payable by the zamindars, was fixed forever. The zamindar kept a share (1/11) with himself for his services. This system was applicable to the areas of Bengal, Bihar, Orissa and Banaras and Karnataka (19%).

UPSC Economics Quiz Notes PDF

21 Nov 2024 07:33

📖 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

18 Nov 2024 08:08

PM Vishwakarma Yojana 2023

A scheme to empower India’s traditional artisans and craftsmen 🔨🪚

On India’s 77th Independence Day, PM Modi announced the launch of the Vishwakarma Yojana, a scheme to benefit individuals skilled in traditional craftsmanship, especially from the OBC community🇮🇳

Aim: To preserve and nurture the Guru-Shishya parampara or family-based practice of traditional skills by artisans and craftspeople working with their hands and tools

Key Features and Benefits:

- Introduction on Vishwakarma Diwas (September 17), aligning with Hindu mythology

- Coverage of 18 traditional trades including carpentry, boat making, blacksmithing, locksmithing, pottery, goldsmithing, and more

- Credit support of up to Rs 1 lakh in the first tranche and Rs 2 lakh in the second tranche, with a 5% concessional interest rate

- Skill enhancement opportunities, incentivized toolkits, and promotion of digital transactions

- Issuance of PM Vishwakarma certificate and ID card, enhancing professional identity

- Financial support of up to ₹15,000 for procuring modern tools, enhancing efficiency

- Focus on improving product quality and expanding global reach

- Urban and rural coverage, generating employment for around 15 lakh citizens annually

- Skill development programs with a stipend of Rs 500 per day during training

Alignment with Government Schemes:

- Comparable to successful schemes like Jan Dhan Yojana, PM SvaNidhi, and Ujjwala

- Empowers artisans, strengthens agri-tech sector, and supports women self-help groups

- Includes provision of 15,000 drones and necessary training

The Vishwakarma Yojana is a groundbreaking initiative that has the potential to uplift rural trades, foster cultural heritage, enhance social inclusion, and boost economic growth.

#gk #gs

UPSC Economics Quiz Notes PDF

15 Nov 2024 07:23

🚩 Difference between banks and NBFCs 🚩

📌 NBFCs business activities are akin to that of banks as they can lend & make investments

📌 NBFCs cannot accept demand deposits

📌 They cannot issue cheques as they do not form part of the payment & settlement system.

📌 Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation is not available to depositors of NBFCs, unlike in case of banks

UPSC Economics Quiz Notes PDF

15 Nov 2024 07:23

⭐ Statutory Liquidity Ratio (SLR)

The Statutory Liquidity Ratio (SLR) serves as a monetary tool managed by the central bank, RBI, to regulate liquidity. It represents a portion of the Net Time and Demand Liabilities (NTDL) of commercial banks that they must keep in the form of approved assets like gold, cash, government securities, or other RBI-sanctioned securities. Banks often meet SLR requirements by investing in government securities to generate interest. In contrast to the Cash Reserve Ratio (CRR), each commercial bank retains its SLR in its vault. The Reserve Bank of India determines the specific SLR percentage, and it fluctuates with the prevailing economic conditions. As of June 2021, the RBI has set the SLR at 18%, mandating that all banks under its purview maintain 18% of their Net Time and Demand Liabilities in their possession.

❤️ Why is SLR fixed?
✔️To prevent the commercial banks from over-liquidating.
✔️To control the inflation, i.e., by increasing the SLR percentage, the inflation in the country can be brought under control.
✔️Similarly, during the recession, the SLR percentage can be decreased in order to increase the bank credit.
✔️To ensure the solvency of commercial banks.
✔️Since banks mostly prefer to invest in government securities, the necessity to maintain SLR has created opportunities for the government to sell their debt instruments and securities.


❤️ Which Institutions Maintain SLR?
✔️All the scheduled and non-scheduled commercial banks. However, it is a mandatory requirement for the Scheduled Commercial Banks (SCB), as they are the major players in the financial system.
✔️Urban Cooperative Banks (UCBs)
✔️State and Central Cooperative Banks

❤️ Components of SLR
⏺Liquid Assets: Easily convertible assets like gold, treasury bills, government-approved securities, government bonds, and cash reserves. It also includes securities under Market Stabilisation Schemes and Market Borrowing Programmes.
⏺Net Demand and Time Liabilities (NDTL):
➖ Demand Deposits: Liabilities payable on demand, including current deposits, demand drafts, balances in overdue fixed deposits, and the demand liabilities portion of savings bank deposits.
➖ Time Deposits: Repaid on maturity, requiring waiting until the lock-in tenure is over. Examples include fixed deposits, time liabilities portion of savings bank deposits, and staff security deposits.
⏺SLR Limit: Ranges from an upper limit of 40% to a lower limit of 23%.


❤️ Working of Statutory Liquidity Ratio
✔️Every bank is required to hold a specific portion of their Net Demand and Time Liabilities (NDTL) in the form of cash, gold, or other liquid assets by the day's end.
✔️The ratio of these liquid assets to the demand and time liabilities is known as the Statutory Liquidity Ratio (SLR).
✔️The Reserve Bank of India (RBI) has the authority to increase this ratio, with an upper limit of 40%.
✔️An increase in the SLR restricts the bank's ability to inject money into the economy.
✔️RBI manages the flow of money and price stability to operate the Indian economy, with SLR being one of its monetary policies.
✔️SLR, along with other tools, plays a crucial role in ensuring the solvency of banks and maintaining cash flow in the economy.

UPSC Economics Quiz Notes PDF

08 Nov 2024 07:39

Capacity cost

🧤- Capacity Cost is associated with the capability to produce and deliver a certain level of output.

🧤- It is an expenditure or cost incurred by a company to expand its business operations.

🧤- These costs may include items such as lease agreements on larger facilities, purchase and depreciation of new equipment, as well as increased costs to operate and maintain those larger or newer assets.

🧤- For any business, it is difficult to avoid costs like insurance, rent payments, property taxes, depreciation on equipment, etc. These are examples of capacity costs.

Advantages

- This type of cost helps to ensure that the production costs are kept low while maximizing profits.
- Improves the quality of the product produced & enhances the efficiency of the processes.
- Helps reduce the amount of inventory held by a company, which can help to reduce overhead costs.

Disadvantages
- High cost of energy and infrastructure
- Limited access to capital
- Lack of reliable transportation networks

UPSC Economics Quiz Notes PDF

06 Nov 2024 07:29

⬆️ 🚩🚩🚩🚩🚩🚩 🚩🚩 🚩🚩🚩🚩🚩

📣 Money Supply – Meaning
According to the modern economy, money incorporates cash and bank deposits. Depending on what sort of bank deposits are being incorporated, there are many measures of money. These are founded and created by a structure, including two types of establishments which are known as central banks and commercial banks. Let’s know more about them in the following lines.

🎤 Central bank
A central bank is a significant establishment in the modern economy. Almost every nation has a central bank. India’s central bank, the Reserve Bank of India (RBI), was founded in 1935. The central bank has various significant operations.

It supplies and issues the currency of the nation and regulates the money supply of the country through various methodologies like bank rate, open market operations, and differences in reserve ratios. It functions as a banker to the government and as a custodian or guardian to the foreign exchange reserves of the economy. It also functions as an overseer to the nation’s banking structure.

🔥 Commercial bank
A commercial bank is that sort of establishment which is the money-generating part of the economy. In the following segment, we will understand the commercial banking system in detail. It accepts deposits from the public and lends parts of these funds to those who want to borrow.

The rate of interest paid by the banks to the depositors is less than the rate levied from the borrowers. This difference between these two types of interest rates is known as the spread, which is the profit earmarked by the bank.

UPSC Economics Quiz Notes PDF

06 Nov 2024 07:24

🚩 Difference between banks and NBFCs 🚩

📌 NBFCs business activities are akin to that of banks as they can lend & make investments

📌 NBFCs cannot accept demand deposits

📌 They cannot issue cheques as they do not form part of the payment & settlement system.

📌 Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation is not available to depositors of NBFCs, unlike in case of banks

UPSC Economics Quiz Notes PDF

02 Nov 2024 08:19

📍 BUDGET DEFICIT

💡 A budgetary deficit is referred to as the situation in which the spending is more than the income. Although it is mostly used for governments, this can also be broadly applied to individuals and businesses.

💡 In other words, a budgetary deficit is said to have taken place when the individual, government, or business budgets have more spending than the income that they can generate as revenue.


📍 GENDER BUDGETING

💡 GB is concerned with gender sensitive formulation of legislation, programmes and schemes; allocation of resources; implementation and execution; audit and impact assessment of programmes and schemes; and follow-up corrective action to address gender disparities.

💡 A powerful tool for achieving gender mainstreaming so as to ensure that benefits of development reach women as much as men.

💡 Does not seek to create a separate budget but seeks affirmative action to address specific needs of women.

💡 Monitors expenditure and public service delivery from a gender perspective.

💡 Entails dissection of the Government budgets to establish its gender differential impacts and to ensure that gender commitments are translated in to budgetary commitments.


📍 WHAT IS A FISCAL DEFICIT ?

💡 The fiscal deficit is the difference between the government’s total expenditure and its total receipts (excluding borrowing). A fiscal deficit occurs when this expenditure exceeds the revenue generated.

▪︎ Fiscal deficit is when a government’s total expenditures exceed the revenue that it generates (excluding money from borrowings).

▪︎ The deficit does not mean debt, which is an addition of annual deficits.

UPSC Economics Quiz Notes PDF

02 Nov 2024 08:19

📍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

15 Oct 2024 05:32

📍MONEY MULTIPLIER

💡 It is the ratio of broad money (M3) divided by Reserve Money (M0)

💡 Therefore, Broad money (M3) = Reserve Money (M0) x money multiplier

💡 In other words, when Reserve money increases, Broad money will also increase. Monetary Aggregates.

💡 The New Monetary Aggregates are as given below:

1. Reserve Money (M0) = Currency in circulation + Bankers’ Deposits with the RBI + ‘Other’ deposits with the RBI.

2. Narrow Money (M1) = Currency with the Public + Demand Deposits with the Banking System + ‘Other’ deposits with the RBI.

3. M2 = M1 + Savings Deposits of Post-office Savings Banks.

4. Broad Money (M3) = M1 + Time Deposits with the Banking System.

5. M4 = M3 + All deposits with Post Office Savings Banks (excluding National Savings Certificates).

UPSC Economics Quiz Notes PDF

06 Oct 2024 04:05

📌White Revolution 2.0👇

✔️Mains Points 👇

UPSC Economics Quiz Notes PDF

05 Oct 2024 04:44

💰GST Collection of Previous Months
🔸January 2024 – 1.72 lakh crore
🔸February 2024 – 1.68 lakh crore
🔸March 2024 – 78 lakh crore
🔸April 2024 – 10 lakh crore
🔸May 2024 –73 lakh crore
🔸June 2024 –74 lakh crore
🔸July 2024 –82 lakh crore
🔸August 2024 – 1.75 lakh crore
🔸September 2024 – 1.73 lakh crore

UPSC Economics Quiz Notes PDF

05 Oct 2024 04:44

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

01 Dec 2024 07:47

FAQ on new PAN card

The Income Tax Department will send a new one for free
PAN card with QR code until then your old PAN card will work.

Question- How different will the new PAN card be?

Answer- According to Union Minister Ashwini Vaishnav This new version of PAN Card (PAN Card 2.0) will only have new features. There will be no change in people's PAN number. Your number will remain the same. A QR code will be given on this card. It will contain all the information of taxpayers. With the new PAN card with qR code, things like paying tax, registering a company, opening a bank account will become easier.

Question- Will my existing PAN card be closed?
Answer- No, upgrading old PAN card or issuing new PAN card will not change the number i.e. your PAN number will remain the same. If the PAN number is to remain the same, it is clear that there is no question of the old card becoming useless. Ashwini Vaishnav also clearly said that old PAN card will not be considered invalid. You will continue to do all your work with old PAN card till the new card reaches your hands.

Q- Will we get new PAN card free?
Answer- Yes you will get a new PAN card free of charge, existing PAN card holders need not to apply anywhere or fill any form for new card. New PAN Card will be sent to your home by Income Tax Department.

Question- What new features will be available in the new PAN card?
Answer- The new card will have QR code facility. In the new PAN card, the technology of the card will be completely upgraded, so as to make its use easy and secure. An integrated platform will be created for all services related to the PAN card. Security features will also be installed in the new PAN card to prevent fraud and provide financial security to the cardholder.

Question- Why is a new PAN card required?
Answer- According to Ashwini Vaishnav Currently the software that operates the PAN card is 15 to 20 years old. These softwares often cause problems. Hence, the system will be prepared digitally in the new PAN card. so that things like complaints, transactions, tax filing can be processed quickly. Apart from this, the new PAN card system will also prevent fake PAN cards and fraud. The new system is needed because PAN card will act as universal ID in future.

UPSC Economics Quiz Notes PDF

29 Nov 2024 08:05

📍 INTERNATIONAL MONETARY FUND (IMF)

💡 The IMF has 189 members. India is a founding member.

💡 It is headquartered in Washington.

💡 The current Managing Director (MD) of the International Monetary Fund is Bulgarian Economist Kristalina Georgieva, who has held the post since 1 October 2019.

💡 Gita Gopi- nath was appointed as Chief Economist of IMF in 2018. Christine Lagarde was the MD before Kristalina Georgieva.

IMF Objectives

💡 To promote international monetary cooperation.

💡 To facilitate balanced growth of international trade for the economic growth of all member countries.

💡 To promote exchange rate stability, maintain orderly exchange rate arrangements; and advise against competitive exchange rate revaluation. To help members in times of BoP crisis.



📍 FUNCTIONS OF IMF

IMF monitors the world's economies, lends to members in economic difficulty on the external account and provides technical assistance.

To elaborate, the work of the IMF is of three main types:

💡 Lending to countries with BoP difficulties. For example, India needed forex resources in 1991 to meet its import and debt servicing needs. India's credit rating in the global markets was not high. IMF gave India credit.

💡 Surveillance which involves the monitoring of economic and financial developments of every member country and the provision of policy advice, aimed especially at crisis- prevention and resolution.

💡 Appraisal of the exchange rate policies of member countries.

💡 Provides countries with technical assistance and training in its areas of expertise.

💡 Plays an important role in the fight against money-laundering and terrorism.



📍 BENEFITS TO MEMBER COUNTRIES OF THE IMF

💡 Member get BoP assistance as IMF is like a last resort lender.

💡 Member have the opportunity to influence other members' economic policies.

💡 Member get technical assistance in banking, fiscal affairs, and exchange matters.

💡 Member have increased opportunities for trade and investment.

UPSC Economics Quiz Notes PDF

21 Nov 2024 07:33

📍 INTERNATIONAL MONETARY FUND (IMF)

💡 The IMF has 189 members. India is a founding member.

💡 It is headquartered in Washington.

💡 The current Managing Director (MD) of the International Monetary Fund is Bulgarian Economist Kristalina Georgieva, who has held the post since 1 October 2019.

💡 Gita Gopi- nath was appointed as Chief Economist of IMF in 2018. Christine Lagarde was the MD before Kristalina Georgieva.

IMF Objectives

💡 To promote international monetary cooperation.

💡 To facilitate balanced growth of international trade for the economic growth of all member countries.

💡 To promote exchange rate stability, maintain orderly exchange rate arrangements; and advise against competitive exchange rate revaluation. To help members in times of BoP crisis.



📍 FUNCTIONS OF IMF

IMF monitors the world's economies, lends to members in economic difficulty on the external account and provides technical assistance.

To elaborate, the work of the IMF is of three main types:

💡 Lending to countries with BoP difficulties. For example, India needed forex resources in 1991 to meet its import and debt servicing needs. India's credit rating in the global markets was not high. IMF gave India credit.

💡 Surveillance which involves the monitoring of economic and financial developments of every member country and the provision of policy advice, aimed especially at crisis- prevention and resolution.

💡 Appraisal of the exchange rate policies of member countries.

💡 Provides countries with technical assistance and training in its areas of expertise.

💡 Plays an important role in the fight against money-laundering and terrorism.



📍 BENEFITS TO MEMBER COUNTRIES OF THE IMF

💡 Member get BoP assistance as IMF is like a last resort lender.

💡 Member have the opportunity to influence other members' economic policies.

💡 Member get technical assistance in banking, fiscal affairs, and exchange matters.

💡 Member have increased opportunities for trade and investment.

UPSC Economics Quiz Notes PDF

18 Nov 2024 08:08

🔘Jivhala Scheme

In News

Jivhala scheme offers loans to Yerwada jail inmates in Maharashtra.

About

◾️Jivhala scheme is a loan scheme named Jivhala launched by the Maharashtra Department of Prisons.

◾️It is for the inmates who are serving sentences in various jails across Maharashtra.

◾️The scheme, was implemented by the Department of Prisons and Maharashtra State Cooperative Bank.

◾️It has been started in Pune’s Yerawada Central Jail.

◾️The credit scheme, named Jivhala, means affection in Marathi.

◾️It is primarily for inmates who are undergoing a prison sentence of more than three years.

◾️In the initial phase of this scheme, a Rs 50,000 loan will be given.

◾️The interest rate that will be applicable is 7%.

◾️Out of the interest that will be earned by the bank, 1 per cent will be contributed by the bank to the prisoners’ welfare fund.

◾️For issuing this loan no guarantor or mortgage is required

UPSC Economics Quiz Notes PDF

15 Nov 2024 07:23

🔥📣 RBI Policy Rates

➡️ Policy Rates

📌 Repo rate: It is rate at which RBI lends to its clients generally against government securities.

📌 Reverse Repo Rate: It is rate at which banks lend funds to RBI.

📌 Marginal Standing Facility (MSF) Rate: It is rate at which scheduled banks can borrow funds overnight from RBI against government securities. It is very short term borrowing scheme for scheduled banks.

📌 Bank Rate: It is rate charged by central bank for lending funds to commercial banks. It influences lending rates of commercial banks. Higher bank rate will translate to higher lending rates by banks.

📌 Cash Reserve Ratio (CRR): It is amount of funds that banks have to keep with RBI. The RBI uses CRR to drain out excessive money from system.

📌 Statutory Liquidity Ratio (SLR): It is amount that banks have to maintain a stipulated proportion of their net demand and time liabilities (NDTL) in form of liquid assets like cash, gold and unencumbered securities, treasury bills, dated securities etc.

UPSC Economics Quiz Notes PDF

15 Nov 2024 07:23

✔️ Key Differences Between FERA and FEMA

❤️ FERA
✔️FERA is an acronym for Foreign Exchange Regulation Act.
✔️It was passed by the Parliament of India in 1973. The act came into force on 1st January 1974.
✔️FERA Act was repealed by the Vajpayee government in 1998.
✔️It was enacted to regulate foreign exchange and payments in India. Its main objective was to conserve forex transactions.
✔️The rules and regulations of FERA on foreign exchange were conservative and restrictive.
✔️This act came into force when the forex position in the country was not good.
✔️Comparatively, FERA Act is lengthier as it has 81 sections.
✔️Under this act, the definition of the term ‘Authorized person’ was narrow.
✔️Under this act, the citizenship of an individual was the basis for determining his/her residential status.
✔️Under FERA, no provisions were made for IT.
✔️Violation of the provisions of FERA has been considered a criminal offence and the punishment for contravention was imprisonment.
✔️Violation of FERA was a non-compoundable offence i.e. the offence cannot be compromised. Moreover, the accused was not allowed any assistance from the lawyer.
✔️The appeals were sent to the Supreme Court.
✔️According to FERA, an individual should obtain permission from the RBI to carry out forex transactions.


❤️ FEMA
✔️FEMA is an acronym for Foreign Exchange Management Act.
✔️FEMA Act was passed by the Parliament of India in 1999 to replace the FERA. It came into force on 1st June 2000.
✔️FEMA is currently active in the country.
✔️It was enacted to remove the stringent regulations on foreign exchange and promote orderly management of foreign exchange and payments. Its main objective was to manage the forex transactions.
✔️The approach of FEMA Act toward foreign exchange is flexible.
✔️This act was introduced when the strict provisions of FERA were hampering the growth of the Indian economy.
✔️FEMA has 49 sections and is shorter than the FERA.
✔️Under this act, the definition of the term ‘Authorized person’ is broad and it has included the banks under it.
✔️Under this act, the basis for determining the residential status was that an individual should be residing in India for the past 6 months.
✔️Provisions on IT were introduced under the FEMA Act.
✔️Violation of the provisions of FEMA has been considered a civil offence and the punishment for contravention was a monetary penalty. If an individual fails to pay the penalty on time, he/she may be imprisoned.
✔️Violation of FEMA is a compoundable offence and the charges can be compromised or removed. FEMA provides the accused the right to obtain legal assistance from a lawyer.
✔️A special director and a special court were introduced under FEMA to address the appeals.
✔️Under FEMA, no such pre-approval or permission of RBI is required to carry out forex transactions.

UPSC Economics Quiz Notes PDF

08 Nov 2024 07:39

Classification of market on the basis of degree of competition

1. Perfect market: The perfect market is one where there are a large number of buyers and sellers having perfect knowledge of demand, supply and prices.

2. Imperfect market: The market in which the conditions of perfect competition are lacking are characterised as imperfect market. The following situations, each based on the degree of imperfections, may be identified.

a. Monopoly market: Monopoly is a market situation in which there is only one seller of a commodity. When there is only one buyer of a product, the market is termed as a monopsony market.

b. Duopoly market: A duopoly market is one which has only two sellers of a commodity. The market situation in which there are only two buyers of a commodity is known as duopsony market.

c.Oligopoly market: Market in which there are more than two but still a few sellers of a commodity is termed as an oligopoly market.
A market having a few (more than two buyers is known as oligopsony market.

d. Monopolistic competition: When a large number of sellers deal in heterogeneous and differentiated form of a commodity, the situation is called monopolistic competition.
Ex. Choice between various makes of insecticides, fertilizers and equipments.

UPSC Economics Quiz Notes PDF

06 Nov 2024 07:24

➡️ Aggregate Demand and its Components

Aggregate demand is the sum of all final goods and services, minus intermediate goods and services, that are available to final users within a country at a given point in time. This is the total dollar value of all purchases of both household and business spending and government spending. Aggregate demand can be generated by changes in income (factors affecting expenditure) or any combination of other factors that change how much people spend on various goods and services.

✅Components Of Aggregate Demand
There are four components in Aggregate Demand
➖Private Consumption Expenditure (C)
➖Investment Expenditure(I)
➖Government Expenditure(G)
➖Net Exports (X-M)

✅Aggregate Demand = C+I+G+(X-M)

➖Private consumption expenditure (C) or Household consumption expenditure
It refers to the expenditure on the final consumer’s goods and services by the households to satisfy their wants.

➖Investment expenditure (I)
It refers to the expenditure incurred on capital goods by private firms to increase their production capacity. These capital goods are in the form of machinery, building, land, etc.

➖Government expenditure (G) refers to the expenditure incurred by the government on the purchase of goods and services to meet the needs of the people in the economy.

➖Net Exports (X-M) It refers to the difference between exports and imports i.e., X-M
Where X stands for Exports and M stands for Imports.


✅Aggregate Demand In Two-Sector Model
In a two-sector model, it is assumed that Aggregate demand is a function of Consumption and Investment also.

Aggregate Demand In Two-Sector Model = C+ I

Where,
C= consumption expenditure
I = Investment


✅Important Concepts About Aggregate Demand
➖Aggregate demand is a function of Consumption and investment only.
➖The investment expenditure is assumed to be autonomous which means it will remain constant at all the levels of income.
➖The investment curve will be a straight line, parallel to the X-axis as it is not affected by the change in income level.
➖Consumption will be positive even at zero level of income as the minimum level of consumption is done for survival. This consumption is known as ‘Autonomous consumption’.
➖The slope of the consumption curve is positive which shows that when income increases consumption also increases.
➖The starting point of the AD curve is above zero as there is always a minimum level of consumption and investment in the economy.

UPSC Economics Quiz Notes PDF

06 Nov 2024 07:24

🔥📣 RBI Policy Rates

➡️ Policy Rates

📌 Repo rate: It is rate at which RBI lends to its clients generally against government securities.

📌 Reverse Repo Rate: It is rate at which banks lend funds to RBI.

📌 Marginal Standing Facility (MSF) Rate: It is rate at which scheduled banks can borrow funds overnight from RBI against government securities. It is very short term borrowing scheme for scheduled banks.

📌 Bank Rate: It is rate charged by central bank for lending funds to commercial banks. It influences lending rates of commercial banks. Higher bank rate will translate to higher lending rates by banks.

📌 Cash Reserve Ratio (CRR): It is amount of funds that banks have to keep with RBI. The RBI uses CRR to drain out excessive money from system.

📌 Statutory Liquidity Ratio (SLR): It is amount that banks have to maintain a stipulated proportion of their net demand and time liabilities (NDTL) in form of liquid assets like cash, gold and unencumbered securities, treasury bills, dated securities etc.

UPSC Economics Quiz Notes PDF

02 Nov 2024 08:19

📍 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

02 Nov 2024 08:19

🔹Board for Financial Supervision(BFS)🔹

The Reserve Bank of India performs the supervisory function under the guidance of the Board for Financial Supervision (BFS). The Board was constituted in November 1994 as a committee of the Central Board of Directors of the Reserve Bank of India under the Reserve Bank of India (Board for Financial Supervision) Regulations, 1994.

➡️Objective
The primary objective of BFS is to undertake consolidated supervision of the financial sector comprising Scheduled Commercial and Co-operative Banks, All India Financial Institutions, Local Area Banks, Small Finance Banks, Payments Banks, Credit Information Companies, Non-Banking Finance Companies and Primary Dealers.

➡️Constitution
The Board is constituted by co-opting four Directors from the Central Board as Members and is chaired by the Governor. The Deputy Governors of the Reserve Bank are ex-officio members. One Deputy Governor, traditionally, the Deputy Governor in charge of supervision, is nominated as the Vice-Chairman of the Board.

In April 2018, a Sub-committee of the Board for Financial Supervision was constituted, under Para 11 & 12 of the Reserve Bank of India (Board for Financial Supervision) Regulations, 1994. The Sub-committee performs the functions and exercises the powers of supervision and inspection under the Reserve Bank of India Act, 1934 and the Banking Regulation Act, 1949, in relation to Payments Banks, Small Finance Banks, Local Area Banks, small Foreign Banks, select scheduled Urban Co-operative Banks, select Non-Banking Financial Companies and Credit Information Companies. The Sub-committee is chaired by the Deputy Governor in charge of supervision and includes the three Deputy Governors and two Directors of the Central Board as Members.

➡️BFS Meetings
The Board is required to meet normally once every month. It deliberates on inspection reports, periodic reviews related to banking and non-banking sectors and policy matters arising out of or having relevance to the supervisory functions of the Reserve Bank.

The BFS oversees the functioning of Department of Banking Supervision (DBS), Department of Non-Banking Supervision (DNBS) and Department of Co-operative Bank Supervision (DCBS) and gives directions on regulatory and supervisory issues.

➡️Functions

➖Fine-tuning the supervisory processes adopted by the Bank for regulated entities;

➖Introduction of off-site surveillance system to complement the on-site supervision of regulated entities;

➖Strengthening the statutory audit processes of banks and enlarging the role of auditors in the supervisory process;

➖Strengthening the internal defences within supervised institutions such as corporate governance, internal control and audit functions, management information and risk control systems, review of housekeeping in banks;

➖Introduction of supervisory rating system for banks and financial institutions;

➖Supervision of overseas operations of Indian banks, consolidated supervision of banks;

➖Technical assistance programme for cooperative banks;

➖Introduction of scheme of Prompt Corrective Action Framework for weak banks;

➖Guidance regarding fraud risk management framework in banks;

➖Introduction of risk based supervision of banks;

➖Introduction of an enforcement framework in respect of banks;

➖Establishment of a credit registry in respect of large borrowers of supervised institutions; and

➖Setting up a subsidiary of RBI to take care of the IT requirements, including the cyber security needs of the Reserve Bank and its regulated entities, etc.

UPSC Economics Quiz Notes PDF

15 Oct 2024 05:32

Classification of market on the basis of degree of competition

1. Perfect market: The perfect market is one where there are a large number of buyers and sellers having perfect knowledge of demand, supply and prices.

2. Imperfect market: The market in which the conditions of perfect competition are lacking are characterised as imperfect market. The following situations, each based on the degree of imperfections, may be identified.

a. Monopoly market: Monopoly is a market situation in which there is only one seller of a commodity. When there is only one buyer of a product, the market is termed as a monopsony market.

b. Duopoly market: A duopoly market is one which has only two sellers of a commodity. The market situation in which there are only two buyers of a commodity is known as duopsony market.

c.Oligopoly market: Market in which there are more than two but still a few sellers of a commodity is termed as an oligopoly market.
A market having a few (more than two buyers is known as oligopsony market.

d. Monopolistic competition: When a large number of sellers deal in heterogeneous and differentiated form of a commodity, the situation is called monopolistic competition.
Ex. Choice between various makes of insecticides, fertilizers and equipments.

UPSC Economics Quiz Notes PDF

05 Oct 2024 05:03

📉Updated GDP List

Moody’s – 7.1% (CY24), 6.5% (CY25)
Moody Ratings – 2% (CY24), 6.6% (CY25)
ADB – 7% (FY24), 7.2%(FY25)
S&P – 6.8% (FY25), 6.9% (FY26), 7% (FY27)
World Bank – 7% (FY25)
Goldman Sachs – 6.7% (CY24), 6.4% (CY24)
SBI – 7%
Deloitte – 7 – 7.2% (FY25)
India Ratings – 7.5% (FY25)
FICCI – 7% (FY25)
IMF – 7% (FY25), 6.5% (FY26)

UPSC Economics Quiz Notes PDF

05 Oct 2024 04:44

📍 BANK BOARD BUREAU

💡 It is an autonomous body of the Government of India tasked to improve the governance of Public Sector Banks, recommend selection of chiefs of government-owned banks and financial institutions and to help banks in developing strategies and capital raising plans.

💡 The Bureau is also engaging with the Public Sector Banks (PSBs) to help build capacity to attract, retain and nurture both talent and technology - the two key differentiators of business competencies in the days to come.

💡 In its endeavor, the Bureau is mindful of the need to have a fully empowered board in each and every PSB. While the Bureau is working towards attracting the best personages on the boards, it is these boards which should drive the overall strategy of a bank within its risk capacity and also act as custodians who should reconcile the diverse interests of various stakeholders.

UPSC Economics Quiz Notes PDF

05 Oct 2024 04:44

🔍❓ 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