Indian Economy Quiz 3

An indirect tax is charged on producers of goods and services and is paid by the consumer indirectly. It is not directly levied on the income of a person. Instead, he/she has to pay the tax along with the price of goods or services bought by the seller. The person paying the tax to the government and the person bearing the liability to pay the tax are thus, two different people.

Companies issue stocks and bonds (securities) to the public to raise funds. A company decides to sell stock when it needs long-term access to capital.

Three Important Methods for Measuring National Income are - Income Method, Product/ Value Added Method and Expenditure Method.

The primary market is the part of the capital market that deals with the issuance and sale of equity-backed securities to investors directly by the issuer. Investors buy securities that were never traded before.

RBI is required to maintain a Gold and Foreign Exchange Reserves of ₹200 Crore of which at least ₹115 Crore should be in Gold. This is called Minimum Reserve System.

The Reserve Bank of India (RBI) is vested with the responsibility of conducting monetary policy. This responsibility is explicitly mandated under the Reserve Bank of India Act, 1934.

The World Bank Group works with developing countries to reduce poverty and increase shared prosperity, while the IMF serves to stabilize the international monetary system and acts as a monitor of the world's currencies. When a country faces serious balance of payments problems because of structural weaknesses that require time to address, the IMF can assist through an Extended Fund Facility (EFF).

Opportunity cost is the value of the next best alternative forgone as a result of making a decision. When economists refer to the “opportunity cost” of a resource, they mean the value of the next-highest-valued alternative use of that resource.

Gross National Product (GNP) is the total value of all finished goods and services produced by a country's citizens in a given financial year, irrespective of their location. GNP also measures the output generated by a country's businesses located domestically or abroad.

The World Bank Chennai is the extension of the World Bank headquartered in Washington, DC. The Chennai office offers corporate financial, accounting, administrative and IT services for the Bank's offices in around 150 countries.