IEcoS (Economic Services) Economics Paper-2: Questions 40 - 49 of 82

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Question number: 40

» Global Institutions » World Bank

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Appeared in Year: 2015

Essay Question▾

Describe in Detail

State the World Bank affiliates in the present times.

Explanation

  • Affiliates of World Bank are as follows:
  • IBRD: The International Bank for Reconstruction and Development (IBRD) is a global development cooperative owned by 189 member countries.

    As the largest development bank in the world, it supports the World Bank Group’s mission by providing loans, guarantees, risk management products, and advisory serv

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Question number: 41

» Economic Growth and Development » Theories of Economic Development

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Appeared in Year: 2015

Essay Question▾

Describe in Detail

Mention five stages of Rostow’s Growth theory?

Explanation

  • Professor W. W. Rostow has sought an historical approach to the process of economic development.

    • He refers to five stages of economic growth:

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

      • The modern facilities of science and technolo

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Question number: 42

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

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Appeared in Year: 2016

Essay Question▾

Describe in Detail

Explain the inevitability of the stationary state in classical theory of growth.

Explanation

The main features of the classical theory of growth are:

  • Laissez faire policy: The classical economists believe in the existence of and automatic free market and perfectly competitive economy which is free from any government interference. It is the “invisible hand” which maximizes the national income.

  • Capital Accumulation, the key to prog

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Question number: 43

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

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Appeared in Year: 2016

Essay Question▾

Describe in Detail

Distinguish between inside and outside money.

Explanation

  • Inside money is created inside the private sector. It is mainly used to identify debt which is considered as an asset to the holder but a liability to other such as the debt issuer.

    Inside money includes bank deposits that exist as a result of the loan creation process. It is the dominant form of money in the modern economy and as the economy

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Question number: 44

» Economic Growth and Development » Human Development Index

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Appeared in Year: 2017

Essay Question▾

Describe in Detail

Critically discuss the concept of PQLI and HPI related to growth and welfare.

Explanation

  • PQLI: David Morris tried to look for those indicators, which were the results of the development efforts.

    • Out of hundred and odd indicators, he could find only three which could have universal appeal as ends in themselves and meet the criteria laid down.

    • These are: Life Expectancy (LE), Infant Mortality (IM) and Basic literacy (BL). He

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Question number: 45

» Economic Growth and Development » Sen's Capability Approach to Economic Development

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Appeared in Year: 2017

Essay Question▾

Describe in Detail

Describe Schumpeter’s concept of Innovation.

Explanation

  • Schumpeter assumes a perfectly competitive economy, which is in stationary equilibrium.

    • In such a stationary state, there is perfect competitive equilibrium: no profits, no interest rates, no savings, no investments, and no involuntary unemployment.

    • This equilibrium is characterized by Schumpeter as “circular flow”.

  • In a circular

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Question number: 46

» Balance of Payments » Exchange Rates

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Appeared in Year: 2017

Essay Question▾

Describe in Detail

Describe the merits of flexible exchange rate system.

Explanation

The system of flexible exchange rates operates in an easy, quick, and efficient manner in clearing the foreign exchange market.

  • It ensures an automatic adjustment between the forces of demand and supply.

  • There are smooth and continuous adjustments in the foreign exchange market through appropriate changes in the rates of exchange.

  • The

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Question number: 47

» International Economics » Theories of International Trade

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Appeared in Year: 2017

Essay Question▾

Describe in Detail

State the assumptions of Hecksher Ohlin model and explain the role each assumption plays in the derivation of the main results of the model.

Explanation

According to this theory, countries which are rich in labour will export labour intensive goods and those rich in capital will export capital intensive goods.

Assumptions of the model:

  • It considers a two-commodity, two-country and two factors case. It takes into account labour and capital. It is possible to extend this to multi-commodity and

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Question number: 48

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

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Appeared in Year: 2015

Essay Question▾

Describe in Detail

How is innovation different from invention? Examine Schumpeter’s theory of innovation in the present times.

Explanation

  • Invention refers to the creation of a brand new product or device. Conversely, innovation is an act of making changes to the existing product or the process by introducing new ways or ideas.

  • Schumpeter assumes a perfectly competitive economy which is in stationary equilibrium. In such a stationary state, there is perfect competitive equilib

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Question number: 49

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

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Appeared in Year: 2017

Essay Question▾

Describe in Detail

When it is more effective to pursue a Hirschamanian strategy compared to Nurksian balanced growth model approach? Discuss after explaining the essence of both the models.

Explanation

  • Nurkse idea of balanced growth explains that a synchronized application of capital to a wide range of industries is necessary for the enlargement of market and for breaking the vicious circle of poverty in an underdeveloped country.

    • This idea rests on the balance in demand approach. He does not neglect the supply side of balanced growth.

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