Indian Economy Quiz

In economics, Gresham's law is a monetary principle stating that “bad money drives out good”. For example, if there are two forms of commodity money in circulation, which are accepted by law as having similar face value, the more valuable commodity will gradually disappear from circulation.

The product or value-added method is a way of computing the national income of a country. This system is also known as output or inventory method.

In early development, investment opportunities for those who already have wealth multiply so owners of capital can accumulate wealth. At the same time, there is an influx of cheap rural labour to the developing cities, which drives down wages. Therefore, in early development, inequality increases.

Population growth rate is affected by birth rates, death rates, immigration, and emigration. A high growth rate of population is characterised by high birth and low death rates.

Risk-bearing is the most essential function of an entrepreneur. He has to pay to all the other factors of production in advance. There are chances that he may be rewarded with a handsome profit or he may suffer a heavy loss. Therefore, risk-bearing is the final responsibility of an entrepreneur.

A prime cost is the total direct costs of production, including raw materials and labour. Indirect costs, such as utilities, manager salaries, and delivery costs, are not included in prime costs. The prime cost equation is equal to the cost of raw materials plus direct labour. All the prime costs are variable costs and they are directly attributable. They do not include indirect variable costs and any fixed costs.

The estimate of National Income in India was, for the first time, prepared by Dada Bhai Naoroji in 1876 for the year 1867-68.

A Consumer Price Index (CPI) is designed to measure the changes over time in general level of retail prices of selected goods and services that households purchase for the purpose of consumption. Such changes affect the real purchasing power of consumers' income and their welfare.

In the post-independence period, economic reforms were first introduced in India under P.V. Narasimha Rao Government in 1991.

Bondholders are creditors of a corporation. A bondholder is an investor who acquires bonds issued by an entity such as a corporation or government body. If the stockholder also owns corporate bonds, then that shareholder becomes the creditor. bondholders enjoy certain protections and priority over stock (equity) holders.