Indian Economy Quiz 5

Per capita income (PCI) is a measure of the amount of money earned per person in a nation or geographic region. It is calculated by dividing the national income by its total population.

The existence of Black money leads to the creation of a parallel economy. It makes the monetary policies less effective as the government cannot account properly for the money which is not formally included in the system.

The terms 'microeconomics' and 'macroeconomics' were first coined by a Norwegian economist, Ragnar Frisch.

The statement is taken from Keyne's Investment Demand Function. According to Keynes Investment expenditure refers to the creation of new assets i.e. an addition to the stock of existing capital assets.

Bank rate is the rate charged on the loans offered by the Central bank to the commercial banks without any collateral. It is also considered as the rate at which the central bank discounts the bills of the commercial banks. Bank rate is a quantitative credit control measure under the monetary policy of the government as it controls the overall supply of money in the economy.

The euro (symbol €) is the single currency for 19 EU member countries, introduced in 2002 after more than 40 years of treaties and negotiations.

Capital output ratio is the amount of capital needed to produce one unit of output.

Rate of interest is determined by Liquidity preference. Liquidity Preference Theory is a model that suggests that an investor should demand a higher interest rate or premium on securities with long-term maturities that carry greater risk because investors prefer cash or other highly liquid holdings.

Classical economics or classical political economy is a school of thought in economics that flourished, primarily in Britain, in the late 18th and early-to-mid 19th century. Its main thinkers are held to be Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Robert Malthus, and John Stuart Mill.

Disinvestment is when governments or organizations sell or liquidate assets or subsidiaries. Disinvestment in India is a policy of the Government of India, wherein the Government liquidates its assets in the Public sector Enterprises partially or fully.