IEcoS (Economic Services) Economics Paper-2: Questions 9 - 17 of 82

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Question number: 9

» International Economics » Theories of International Trade

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Appeared in Year: 2018

Essay Question▾

Describe in Detail

State and prove Stopler-Samuelson theorem of international trade. What is the magnification effect?

Explanation

  • The H-O theory determined that the labour- abundant country specializes in the export of labour- intensive commodity while capital-abundant country specializes in the export of capital-intensive commodity.

    • The theorem developed by Stopler-Samuelson stated that commencement of free international trade would benefit the relatively abundant factor and

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Question number: 10

» Economic Growth and Development » Theories of Economic Development

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Appeared in Year: 2018

Essay Question▾

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Discuss W. W. Rostow’s stages theory of economic development.

Explanation

Professor W. W. Rostow has sought an historical approach to the process of economic development. He refers to five stages of economic growth:

Image of the Rostows MOdel of Development

Image of the Rostow’S MOdel of Development

  • Traditional society: According to him, the structure of the traditional society was based on primitive technology and orthodox ideas of the people. The modern faciliti

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Question number: 11

» Economic Growth and Development » Concepts of Economic Growth and Development and Their Measurement

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Appeared in Year: 2018

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Explain the role of banks and stock markets in economic growth.

Explanation

  • Role of banks: Banks play an important role in the growth of the economy. It helps the people to save their deposits and lend to the people who are in need of loans for various purposes.

    The banks perform a very significant function of credit creation in the economy. This way, it helps to circulate the money into the economy.

  • Banks promote deposits a

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Question number: 12

» Theory of Employment, Output, Inflation, Money and Finance » The Classical Theory of Employment and Output and Neo Classical Approaches

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Appeared in Year: 2018

Essay Question▾

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What is liquidity trap? Discuss the effectiveness of monetary policy and fiscal policy in this context?

Explanation

At a very low rate of interest, the liquidity preference becomes perfectly elastic and the speculative demand for money is infinitely elastic.

  • This portion of the curve indicates the position of absolute liquidity preference of the people. At a very low rate of interest, people will hold with them as inactive balances any amount of money they come t

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Question number: 13

» Theory of Employment, Output, Inflation, Money and Finance » Classical Theory on Money » Neutrality of Money

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Appeared in Year: 2018

Essay Question▾

Describe in Detail

Explain the neutrality of money.

Explanation

The neutrality of money is an economic theory which states that changes in the money supply only affect nominal variables and not the real variables.

  • In other words, an increase or decrease in the money supply can change the price level but not the output of the economy.

  • According to classical theory, the nominal variables move in proportion to chang

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Question number: 14

» Economic Growth and Development » Theories of Growth » Classical Approach Adam Smith, Marx and Schumpeter

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Appeared in Year: 2018

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Explain the basic features of Kaldor’s model of growth and distribution.

Explanation

  • The Kaldor model follows the Harrodian dynamic model and Keynesian techniques of analysis. The other neo-classical economists treat the technology as exogenous but he provides a framework for relating the genesis of technical progress to capital accumulation.

  • The short-period supply of aggregate goods and services is inelastic and irresponsive to an

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Question number: 15

» Economic Growth and Development » Concepts of Economic Growth and Development and Their Measurement

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Appeared in Year: 2018

Essay Question▾

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Discuss Poverty-Inequality-Growth triangle in the process of sustainable economic development.

Explanation

Poverty is defined as the proportion of population living below the poverty line. Inequality refers to the disparities among the whole population in terms of income and wealth.

Growth refers to the percentage change in mean welfare of a household.

Image of the Development Strategy

Image of the Development Strategy

  • The above figure shows the poverty-inequality-growth triangle wherein t

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Question number: 16

» Financial and Capital Market » Financial and Capital Market » Banking and Insurance

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Appeared in Year: 2018

Essay Question▾

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Describe the elements of an optimal Insurance Contract.

Explanation

  • The Insurance contracts are used to set out the rules and regulations that state certain conditions, the guidelines that must be met, and anything that is excluded from the insurance.

    • These guidelines must be met by both parties; the insurer and insured. The insurer is essentially guaranteeing that he will pay in the case of need for set amount of m

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Question number: 17

» Economic Growth and Development » Concepts of Economic Growth and Development and Their Measurement

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Appeared in Year: 2011

Essay Question▾

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Examine the impact of policies of liberalization, privatization and globalization on poverty and inequality.

Explanation

India embarked on big-bang economic reforms 25 years back in 1991. It is well-known that GDP growth has been much higher in the post-reform period.

  • However, GDP is only one metric. Ultimately, the success of reforms depends on whether the well-being of people, particularly that of poor, increased over time.

  • In this context, let’s examine the impact o

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