Economics

Chap-1
Development

1.(i) What is development? Mention any two features of development.

(ii) What is national income?
(iii) What is per capita income?
Or
Define the term, ‘average income.’
Answer: (i) Development is a comprehensive term which include increase in real per capita income,
improvement in living standard of people, reduction in poverty, illiteracy, crime rate, etc.
Features
(a) Different persons have different developmental goals.
(b) Income is a major component of development.
(ii) National income is defined as the total value of all the goods and services produced within a country
plus net income coming from abroad.
(iii) When the total national income is divided by the total population, it is called the per capita income.
Per Capita Income = National Income / Population

2. (f) State the criteria used to compare the different countries by the Human Development Report
published by the United National Development Programme (UNDP).
(ii) Which is the new area of knowledge in which scientists, economists, philosophers and other
social scientists are working together?
(iii) What is meant by Human Development?
(iv) What is Sustainable Development?
(v) Which organisation measures HDR? Mention any three major indicators of / HDR.

Answer: (i) Per capita income, life expectancy at birth, literacy rate and other basic necessities like clean
drinking water, sanitation etc.
(ii) Sustainability of development.

(iii) It is the process of enlarging people’s choices as well as raising the level of wellbeing so that they can
lead a purposeful and a creative life. Though the national income and the per capita income are the
indicators of human development, but it includes many other elements like consumption, health,
environment, education, freedom, security, non-violent atmosphere, etc.

(iv) Sustainable Development is that process of economic development which aims at maintaining the
quality of life of both the present and the future generations without harming the natural resources and
environment.

(v) UNDP :
(a) Educational level
(b) Health status
(c) Per capita income
3. (i) Mention any two important aspects of our lives other than income.
(ii) How can we achieve our hopes and possibilities in the present world ?
(iii) What is ‘Public Distribution System ’ (PDS) ? iv) Mention two developmental goals of landless
rural labourers.
(iv) Why has Kerala a higher Human Development Index than Punjab in spite of low per capita
income?

Answer: (i) Health and Education.

(ii) Through Democratic political process.
(iii) It is a system through which the Government distributes ration to the poor at a reasonable rate
through the ration shops.
(iv) (a) More days of work and better wages.
(b) Quality education for the children.
(v) (a) Because it has low infant mortality rate, (b) It has higher literacy rate.

4. Mention any four characteristics of development.

Answer: (i) Different people have different developmental goals.

(ii) What may be development for one may not be development for the other. It may be destructive for
the other.
(iii) Income is the most important component of development, but along with income, people also seek
equal treatment, good health, peace, literacy, etc.
(iu) For development, people look at mixed goals.

5. Describe any three features of developed country.

Answer: (i) As per the World Bank Report 2012 any country with per capita income of US$ 12,276 per
annum and above is termed as rich or developed country. ‘
(ii) Such countries have high literacy rate.
(iii) Most of the people of these countries are engaged in service sector.

6. What is PCI? Where it is used?

Answer: PCI is Per Capita Income. It is calculated by dividing the National Income of the country by
population.
Uses:
(i) It is used to compare different countries.
(ii) The World Bank has divided the countries into rich or low income countries on the basis of per Capita
income.

Q7.Money in your pocket cannot buy all the goods and services that one need’.
With reference to the given statement mention any four things which money can not buy for an
individual.
Answer: (i) Peace
(ii) Pollution free environment
(iii) Good health (iu) Freedom

8. ‘What may be development for one may not be development for the other.’ Explain by giving
examples.
Or
With the help of an example show two groups who may have different notions of development.

Answer: It is true that development for one may not be development for the other.
(i) More wages means development for a worker, but it can go against the entrepreneur.
(ii) A rich farmer or trader wants to sell foodgrains at a higher price but a poor worker wants to purchase
it for low prices.
(iii) Construction of a dam means more and cheap power, but people, who will lose their habitat will
demonstrate.
(iu) To get more electricity, the industrialists may want more dams. But this may submerge the agricultural
land, and disrupt the lives of the people.

9. What is national development? What are the aspects covered under the national development?

Answer: National development is a comprehensive term which includes improvement in living standard of
the people, increase in per capita income, providing social amenities like education, medical care, social
services, etc. to the citizens of the country.
(i) Under national development, a country uses its resources in a fair and just way.
(ii) Under this only those programmes and policies are implemented which would benefit a large number
of people.
(iii) Under national development, countries focus more on social infrastructure which includes education,
health and other social services.

10. What contributes to the human development?

Answer: There are many economic as well as non-economic factors which contribute to the human
development.
(i) Living a long and a healthy life.
(ii) To have education, information and knowledge.
(iii) Enjoying a decent standard of living.
(iv) Enjoying basic fundamental rights like freedom, security, education, etc.
(v) To have equality and enjoyment of human rights.

11. What is the significance of Human Development Index?

Answer: (i) HDI is used to measure level of development of a country.

(ii) It has been published by UNDP and according to it countries has been ranked.
(iii) It is a comprehensive approach which cover all the major aspects of life.
(iv) Apart from income, education, health status, life expectancy, etc., are considered for measuring
economic development of a nation.

12. ‘Human development is the essence of social development.’ Explain.

Answer: (i) Human development focuses on the people.

(ii) It is concerned with the well-being of the people, their needs, choices and aspirations. All these help in
building a right kind of society.
(iii) It is all about the enlarging or widening the choices for the people. It is the building of human
capabilities, such as to lead a long and a healthy life, to have education, information and knowledge, to
have opportunities of livelihood, etc.
(iv) Human development focuses on the expansion of basic choices.

13. ‘Money cannot buy all the goods and services that one needs to live well.’ Explain.

Answer: (i) Money or material things that one can buy with it is one factor on which our life depends. But
the quality of our life also depends upon non-material things like equal treatment, freedom, security,
respect of others, etc.
(ii) Money cannot buy us a pollution free environment, unadulterated medicines, peace, etc.
(iii) There are many facilities like schools, colleges, parks, hospitals which an individual cannot afford. All
these are to be provided by the government/society.
(iv) Money possessed by an individual even can not provide us a type of government which take decisions
for the welfare of the common people.

14. What are the limitations of the per capita income criteria of development ?
Or
What is Per Capita Income? Can it be regarded as the sole indicator of economic development of a
country? Give four valid arguments to support your answer.

Answer: (i) Per capita income is the average income of a country.

(ii) Per capita income criteria takes into account only the economic aspect of life and ignores the social,
aspect of life.
(iii) Per capita income criteria ignores education, health, life expectancy, sanitation etc.
(iv) Per capita income criteria also ignores non material things like peace, pollution free environment,
democracy, etc.
(v) Though Punjab has higher per capita income as compared to Kerala but it has been ranked lower on
Human Development Index because it is far behind than Kerala in literacy rate and has higher infant
mortality rate than Kerala.

15. “Average income is an important criterion for development.” Explain.

Answer: (i) Average income gives us an idea what an average person is likely to get out of the total
national income.
(ii) Average income is used to classify the countries into rich, poor or developing nations.
(iii) Average income is used to make economic policies.

16. Besides income, what can be the other attributes to compare economic development?

Answer: (1) Of course, for comparing economic development of countries, their income is considered to
be one of the most important attributes. This is based on the understanding that more income means
more of all things that human beings need. That is why, the World Bank uses Per Capita Income to
compare economic development.

(2) Apart from income, educational levels of the people and their health status are considered as
measures to compare economic development of a nation.
(i) Infant Mortality Rate (IMR) : This indicates the number of children that die before the age of one year
as a proportion of 1,000 live children born in that particular year. ‘
(ii) Literacy Rate : This measures the proportion of literate population in the 7 years and above age group.
(iii) Net Attendance Ratio : This 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.
(iv) Life Expectancy at birth : It denotes average expected length of life of a person at the time of birth.

17. What is infant mortality rate ? Suggest two measures to keep the infant mortality rate low.
Or
What is the meaning of ‘Infant Mortality Rate ’ (IMR) ? Give two main reasons for low IMR in
Kerala.

Answer: (1) The number of children that die before the age of one year per 1,000 children born alive in a
particular year is called Infant Mortality Rate.
(2) Measures to keep Infant Mortality Rate low :
(i) Provision of basic health.
(ii) Provision of proper educational facility.
(iii) Proper functioning of Public Distribution System.

Q18. What is the criterion to determine if adults are undernourished?

Answer: (i) The criterion to determine if adults are undernourished is Body Mass Index, popularly known
as BMI.
(ii) In order to calculate it, first the weight of the person in kg is taken. Then, we take height in meters. The
weight is divided by the square of the height.
(iii) If this figure is less than 18.5, then the person would be considered undernourished. However, if this
BMI is more than 25, then a person is overweight.
Q19. “Consequences of environmental degradation do not respect national or state boundaries.”
Justify the statement.

Answer: (i) Consequences of environmental degradation do not respect national or state

Boundaries. This issue is no longer a regional or national issue.

(ii) Our future is linked together. Sustainability of development is essential for all the mankind and it is our
common responsibility to save the environment.

(iii) These days it is a matter of discussion among different countries of the world.

(iv) Global warming, acid rain, etc., are not to be controlled by one nation. It is a global matter of thinking
and finding the solutions

Q20. What do you mean by public facilities ? Why are they important ? Name two public facilities available in India.

Answer: Public facilities are the essential facilities for the community at large and are provided by the government.

Important :

They are important because there are many services like education, health, transportation etc., which have become cheap and
affordable if provided, collectively.

Public facilities : Rail transport and – . government schools.