What do you understand by ‘parametric shift of a line’? How does a line shift when its (i) slope decreases, and (ii) its intercept increases?
Considering the equation of a straight line as
b = ma + ÃŽÂμ
Where m = slope of straight line, m > 0
ÃŽÂμ = intercept on vertical axis, ÃŽÂμ> 0
Also, when a increases by 1 unit, the value of b increases by m units.
The parameters ÃŽÂμ and m are parameters of a graph.
As the value of m increases, the straight line rotates upward around the same vertical intercept. This movement is an example of parametric shift of the graph.
(i) A straight line rotates downward around the same vertical intercept as its slope decreases.
(ii) A straight line shifts parallelly upward when its intercept increases.
Differentiate between devaluation and depreciation.
What is a barter system? What are its drawbacks?
Write down some of the limitations of using GDP as an index of welfare of a country.
Explain the relation between government deficit and government debt.
From the following data, calculate Personal Income and Personal Disposable Income.
Rs (crore)
(a) Net Domestic Product at factor cost 8,000
(b) Net Factor Income from abroad 200
(c) Undisbursed Profit 1,000
(d) Corporate Tax 500
(e) Interest Received by Households 1,500
(f) Interest Paid by Households 1,200
(g) Transfer Income 300
(h) Personal Tax 500
Why should the aggregate final expenditure of an economy be equal to the aggregate factor payments? Explain.
Give the relationship between the revenue deficit and the fiscal deficit.
Discuss the issue of deficit reduction.
Are fiscal deficits inflationary?
What is the difference between ex ante investment and ex post investment?
In the above example, if exports change to X = 100, find the change in equilibrium income and the net export balance.
What are the instruments of monetary policy of RBI?
How is the exchange rate determined under a flexible exchange rate regime?
Explain why the tax multiplier is smaller in absolute value than the government expenditure multiplier.
Suppose C = 100 + 0.75Y D, I = 500, G = 750, taxes are 20 per cent of income, X = 150, M = 100 + 0.2Y . Calculate equilibrium income, the budget deficit or surplus and the trade deficit or surplus.
Does public debt impose a burden? Explain.
Are the concepts of demand for domestic goods and domestic demand for goods the same?
What are the important features of a capitalist economy?
Define budget deficit and trade deficit. The excess of private investment over saving of a country in a particular year was Rs 2,000 crores. The amount of budget deficit was ( – ) Rs 1,500 crores. What was the volume of trade deficit of that country?
Differentiate between balance of trade and current account balance.