Indian Economy Quiz 7

Five Rural Regional Banks (RRBs) were set up on 2 October 1975 on the recommendations of the Narsimha Committee on Rural Credit. The purpose was to include rural areas into the economic mainstream since around 70% of the Indian population was rural.

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 Centre earns money through several taxes, such as corporate tax, income tax, goods and services tax, Union excise duty and customs duty. A part of the taxes is shared with state governments. The taxes, which are not shared with states include a surcharge on income tax, some cesses like education and road.

Commission for Agricultural Costs and Prices (CACP) is a decentralised agency of the Government of India. It was established in 1965 as the Agricultural Prices Commission, and was given its present name in 1985.

Gandhiji believed that means Justify end. For Gandhi, the end is satya or truth which requires no justification and the means- ahimsa or non-violence must be justified not only with reference to the end but also in itself. Every act must be justified with reference to satya and ahimsa.

Interest rates are determined by RBI who actively commit to maintaining a target interest rate. They do so by intervening directly in the open market through open market operations (OMO), buying or selling Treasury securities to influence short-term rates.

Ceteris paribus is a Latin phrase that generally means “all other things being equal.” In economics, it acts as a shorthand indication of the effect one economic variable has on another, provided all other variables remain the same.

A free good is a good that is not scarce, and therefore is available without limit. A free good is available in as great a quantity as desired with zero opportunity cost to society.

In India, one-rupee coins and notes and subsidiary coins are issued by the Central Government. The Indian 1-rupee note (₹1) is the smallest Indian banknote in circulation and the only one being issued by the Government of India, as all other banknotes in circulation are issued by the Reserve Bank of India.

Producer surplus is the difference between how much a person would be willing to accept for given quantity of a good versus how much they can receive by selling the good at the market price. The difference or surplus amount is the benefit the producer receives for selling the good in the market.