Department of Pre-University Education. II PUC Economics Model Questions and Answers. Unit 6: Economic Infrastructure

Transcription

1 Department of Pre-University Education II PUC Economics Model Questions and Answers Unit 6: Economic Infrastructure

2 1 Mark Questions 1. What do you mean by Economic Infrastructure? Economic Infrastructure refers to the facilities and services which support Economic development. 2. Give the meaning of Transport. Movement of passengers and Goods from one place to another place is called as Transport. 3. What is Nagpur Plan? It is the 10 year plan prepared at Nagpur of Maharastra in 1943 for the development of Roads in India. 4. Expand NHDP National High Ways Development Project. 5. Where is the South-Western Zonal Railways Office? HUBLI 6. Name the Railways Gauges. Broad Gauge, Meter Gauge, Narrow Gauge. 7. Expand OYWS Own Your Wagon Scheme. 8. What is Project Uni-gauge? It is the Project to convert all the railway lines in the country in to Broad Gauge. 9. Expand SCI The Shipping Corporation of India. 10. Where is the Hindustan Shipping Yard? Vishakapatna. 11. What are Liners? The Shipping vessels used in Transporting passengers and light Goods. 12. Give the meaning of overseas Transport. Transportation of Goods and passengers by Ships on oceans and seas is called over seas Transport. 01

3 13. In which year the Air transport was Nationalised? Expand NACIL. National Aviation Company of India limited. 15. Where is the International Airport in Bangalore? Devanahalli. 16. What is the Name of International Airport in Kolkota. Netaji Subash Chandra Bose. 17. Give the meaning of . Sending Messages, informations, Photos through internet is called Expand TRAI. Telecom Regulatory Authority of India. 19. Which is the biggest Telecom organisation of Public Sector in India? BSNL- Bharath Sanchar Nigam Limited. 20. Expand SIM. Subscribers Identity Module. 21. What is communication System.? The system in which written informations, Messages are transferred from one to another. 22. Give the Meaning of FAX. Sending informations, documents, photos immediately by using Electronic device and telephone. 23. Expand STD Subscribers Truck Dialing. 24. Write the meaning of Money Market. The term money market refers to the institutional facilities available for borrowing and lending of short term funds. 25. What do you mean by Gilt Edge Securities Market.? Gilt Edge Securities Market is the Market where Government and Semi Government Securities are bought and sold. 02

4 26. Expand NBFCs Non Banking Financial Companies. 27. What do you mean by Nationalisation of Banks? Taking over the ownership and Administration of Banks working in private Sector by the Government is called Nationalisation of Banks. 28. When the RBI was started.? What is Monetary Policy.? The policy of measures implemented by the Central Bank to control credit money. 30. What is Cash reserve Ratio (CRR)? The ratio of total deposits of Commercial Banks to be kept in RBI in the form of cash. 31. Give the meaning of open Market Operation. Buying and Selling of Government Securities by the RBI is called Open Market operation. 32. Who is the Chairman of Committee on Banking Sector Reforms? M. Narasimham 33. What is the principle of cooperation? All for one and one for all. 34. Which Cooperative Bank Lends long term loans to Agriculture? PLDB Primary Land Development Bank 35. In which year Cooperative Movement was started in India.? In the year Give an example for Non-Credit Cooperative Society. Consumers Cooperative Society. 37. Name the system followed by RBI to issue Money. Minimum Reserve System 38. Expand NABARD. National Bank for Agricultural and Rural Development.

5 39. Which Cooperative Society gives short term loans to Agriculture Sector.? Primary Agricultural Credit Cooperative Society. 40. Which is the Leader of Money market in India? The Reserve Bank of India. RBI. 41. Which is called as Liquid Gold.? Petroleum. 42. Expand NTPC. National Thermal Power Corporation. 43. Where is the Atom Power Station in Karnataka? Kaiga of Karwara District. 44. What is Hydel Power.? Electricity produced by using force of water. 45. Expand ONGC. Oil and Natural Gas Commission. 03

6 2 Marks Questions 1. Name the four types of roads in India. a) National Highways. b) State Highways. c) District Main Roads. d) Village Roads. 2. Name any four Railways Enterprises in India. a) Wheel and Axel plant Yalahanka. (Bangalore) b) Railway Coach factory Perambur. (Tamil Nadu) c) Railway Locomotive plant Varanasi. (U.P) d) Integrated Coach factory Kapurtala. (Assam) 3. Name any four Air Transport institutions in private sector. a) Jet Airways Ltd. b) King Fisher Airlines Ltd. c) SAHARA Airlines Ltd. d) Deccan Aiatron Ltd. 4. Name any four Ship building yards in India. a) The Hindustan Ship building yard Vishakapatna. b) The MazaGoa Ship building yard Mumbai. c) The Garden Rich Ship building yard Kolkata.. d) The Goa Ship building yard Marmagoa 5. What are the services available in Post Office. a) Postal Service b) Registered Post service c) Registered Parcel Service d) Money order e) Postal life insurance f) Savings Bank Account g) Sale of National Savings Certificate h) Quick Mail Service i) Sale of Examination application 6. Name the various Telecommunications Services. a) Postal Service b) Telephone c) television d) FAX e) Internet f) Radio 7. Which are the public sector Telecommunications Institutions in India? a) BSNL Bharath Sanchar Nigam Ltd. b) MTNL MahaNagar Telecom Nigam Ltd. c) VSNL Videsh Sanchar Nigam Ltd. 04

7 8. Name any four Private Sector Mobile Telephone Service companies in India. a) Airtel b) Idea c) TATA Indicom d) Vodafone 9. What are the differences between Money Market and Call Money Market. Money Market Call Money Market 1. Short term Market (180 days) 1.Very short term (1 week) 2. Interest rate consistant 2.Interest rate Inconsistant 3..Guarantee called for 3.Guarantee not necessary. 4. No volatile 4. More volatile 10. What are the types of Capital Market? 1. Primary Capital Market (New Issue Market) 2. Secondary Capital Market (Old Issue Market) 11. Explain the differences between Primary Capital Market and Secondary Capital Market. Primary Capital Market SecondaryCapital Market 1.New issues market 1. Old issues market 2. Investors only buy Securities 2 Investors buy & sell Securities 3. Prices decided by the company 3 prices decided by the Market Forces 4. Transaction between company & 4.Transaction among Investors. Investors. 12. Mention the two stages of Nationalisation Commercial Banks in India. Ist stage: 14 Commercial Banks which had deposits of more than Rs.50 crores were Nationalised on IInd stage: 6 Commercial Banks which had deposits of more than Rs. 200 crores were Nationalised on Name any four New Banks of private sector in India. 1) HDFC Bank Ltd. 2) ICICI Bank Ltd. 3) Kotak Mahindra bank Ltd. 4) Indus Ind Bank Ltd. 05

8 14. Mention the main recommendations of M. Narasimham Committee. 1) Reduction in CRR and SLR. 2) Deregulation of Interest rates. 3) No more Nationalisation 4) Disinvestment from Public Sector banks. 5) Computerisation 6) private sector banks. 15.Mention the New Services of Commercial Banks. 1) Core Banking Service 2) Venture Capital Supply 3) Housing loans 4) Insurance Service 5) Mutual funds 6) Funds for micro financing 16. What do you mean by CRR and SLR? CRR is that portion of total deposits of Commercial Banks to keep with RBI in the form of cash. SLR refers to that portion of total deposits of Commercial Banks to keep with themselves in the form of cash and liquid assets. 17. What are the Quantities Measures followed by RBI to control credit? 1) Open Market Operation 2) Variation in bank rate 3) Changes in Cash Reserve Ratio (CRR) 4) Changes in Statutory Liquidity Ratio (SLR) 18. Which are the Non-Conventional Energy Sources? 1) Solar energy 2) Wind energy 3) Bio gas 4) Gobar gas 5) Tidal energy 6) Bio disel (fuel) 19. Name four Atomic Power stations in India. 1) Tarapur Nuclear Power Station Maharastra 2) Kalpakam Nuclear Power Station TamilNadu 3) Kaiga Nuclear Power Station Karnataka 4) Rana Pratap Sagar Nuclear Power Station Rajastan 20. Name any two Thermal Power Stations in India. 1) Thermal Power Station in Shakti Nagar in Raichur District of Karnataka 2) Thermal Power Station in Ramagundam of Andhra Pradesh 06

9 5 Marks Questions: 1. Discuss the structure and developments of Road Transport in India. India has the biggest Road Transport Network in the world. According to Nagpur plan (1943) the roads have been classified into four types: 1) National Highways (NHs) 2) State Highways (SHs) 3) District Main Roads (DMRs) 4) Village Roads ( VRs) According to the nature of Roads there are two types: a) Surfaced Roads (Pakka roads) 15,17,000kms b) Unsurfaced Roads (Kachha roads) 18,23,000kms India has total of 33,40,000 kms of roads out of which 66,754 kms of NHs and 1,40,000 kms of SHs and rest are DMRs and VRs. About 85% of passengers and 65% of goods transportation is carried on by Road Transportation. Development of Road Transport: Nagpur plan has provided the foundation for the development or roads in India. The National Highways Authority of India (NHAI) was constituted in NHAI has implemented NHDP National Highways development Project comprising Golden Quadrilateral Road about 6000 kms that connects four Metro Cities- Delhi, Mumbai, Kolkata, Chennai. Another important Corridor Road Project of about 7000 kms that connects Kanya Kumari to Srinagar and Silchar to Porbandar is also implemented. NHAI allows the Private Sector to participate under PPP- (Public Private Partnership) in construction, maintenance and operation of roads on BOT Build, Operate and Transfer agreements. State Highways development projects have also been implemented in various states under PPP Public private Partnership. 07

10 Eg: KRDC (Karnataka Road Development Corporation) has implemented KSHIP (Karnataka State Highways Improvement Project). Villages Roads are also developed under Pradhan Mantri Gram Sadak Yojana. GOI has further liberalised the provisions relating to foreign investment for the development of roads. 2. Discuss the major reforms in Banking sector. The finance Ministry of Government of India appointed the Committee in August 1991 and April 1998 under the Chairmanship of M. Narasimham to recommend reforms on Banking Sector. Narasimham Committee submitted its reports in 1991 and in Based on the recommendations of reports the following reforms have been implemented: Reduction in CRR and SLR: The Government has reduced CRR (Cash Reserve Ratio) from 15% to 5% and SLR (Statutory Liquidity Ratio) from 38% to 25% which banks have to maintain as per Banking regulation act of 1949 and RBI act of Deregulation of interest rates: Now Commercial Banks are free to decide interest on deposits as well as loans subject to minimum floor rates and maximum ceiling rates. Banks decide interest rate depending on market forces. This is called as Market decided interest rate. Access to capital market: Nationalised banks now enabled to access capital market for funds through public issue. Government share of paid up capital is fixed to 51% in public sector banks. Freedom of operation: Banks are now free to open new branches, upgrading branches and closing unprofitable branches. The RBI has very less role to play now. Effective Supervision: RBI has constituted Board for Financial Supervision to promote proper working of banks and Financial Institutions and to bring about Transparency in services. 08

11 Competition for better services: More and more Private Sector banks are allowed and provision for foreign banks created competitive atmosphere in Banking Services. Computerisation of Banking Measures to check NPA (Non Performing Assets) Local Area Banks (LABs) are permitted in different areas, to improve the savings and investment in rural sector. Autonomus Status to Public Sector banks for Administration. Consumer s grievances cell service. The above reforms have changed positively the whole Banking system in India. 3. Discuss the kinds of Cooperative Societies. Cooperative Society is s form of organisation where in persons voluntarily associate together on the basis of equality for the promotion of their economic interests under the co-operative principle All for one and one for all. In India co-operative movement started in the year The year 2005 has been celebrated as The centenary year of Co-operative Movement in India. During this period various types of Co-operative Societies have been developed. Types of Co-operative Societies I Credit Cooperative Societies: Those societies that provide credit facilities are called credit cooperative societies. 1) Agricultural Credit Cooperative Society: a) Short term Agricultural Credit Cooperative Societies, Such as i) Primary Agricultural credit cooperative societies at village level. ii) Central Cooperative Bank at District level. iii) State Cooperative Bank (State Apex Bank) at State level b) Long term Agricultural Credit Cooperative Societies, Such as i) Primary Land Development Bank (PLDB) ii) Central Land Development Bank (CLDB) or Land Bank. 09

12 2) Agricultural Non-Credit Cooperative Societies: These credit societies extend credit facilities to Non-Agricultural purposes. For eg: * Urban credit cooperative banks * Employees credit cooperative societies, * Industrial credit Cooperative societies. II Non-Credit Cooperative Societies: Those credit societies which do not provide any credits but work to promote other interests are called Non Credit Cooperative Societies. * Agricultural produces marketing cooperative society (APMCS) * Horticulture produces marketing cooperative society (Hopcoms) * House building cooperative societies * Consumers cooperative societies * Coconut growers cooperative societies 4. Explain the Non-conventional energy sources. Various sources of power, which is needed, for the functioning and development of economic activities can be divided in to two groups: I Conventional Energy Sources coal, petroleum, electricity II Non-conventional Energy Sources: In recent years the importance of Non-conventional energy sources is more and more. Various sources are: Solar energy: Power produced by using rays of the sun is called Solar Power. This is eco friendly power. Solar Power is used to heat the water, cooking, lighting and some small industrial purpose. Recently solar energy is used to pump the water from bore wells. Technological research is on to use in running the vehicles. 10

13 Wind energy: Power generated by using forces of is called wind power. Tamil Nadu is producing and using more wind power. There are many wind mills in Chitradurga, Gadag and other districts in Karnataka. India is the 5 th biggest wind power using country in the world. Research and development works are on in this field. Biogas: Gas collected art of bio degradable substances is called Biogas. This can be used in household needs like lighting, cooking etc. Government supports the use of biogas by providing subsides for plants. Gobar gas: Gas collected out of animal dung is called Gobar gas which can be used for cooking, lighting, water heating etc subsides and incentives are given by the Government to construct Gobar gas plants. It is a potential energy source of rural life for household purposes. Bio fuel: Bio fuel is used along with petrol and diesel. Sugarcane, Neem oil, Jatropa are the sources for Bio diesel Government provides incentives to grow more and more such plants which give Bio fuel. Tidel energy: Ocean waves force is a source to produce electricity. Efforts are on, in Kutch of Gujarat, Sudarbans in west Bengal to use tidal energy. Geo thermal energy: This is also potential source of energy. Researches and developments are going on in this field. Total power produced by using all these sources in is said to be 7.5% of the total power produced in the country. 11

14 10 Marks Questions: 1. Explain the importance of transport in economic development? Transport means the movement of men and materials from one place to another place. It is a public utility service which gives place and time utility to goods and services. It plays an important role in the development of economy and civilization. Transport links production, distribution and consumption. It has been rightly remarked If agriculture and industry are the body and bones of a National organism, transport is compared to nerves. Transport helps over all development of a country as the saying goes Moving wheels reflect civilization. Importance of Transport: Development of market: Transport expands the markets for various types of goods. It plays a key role in connecting a link between producers and consumers. It establishes proper link among various markets so that the volume of trade is expanded. Transport helps in carrying goods to different corners of the country there by facilitates the development of regional, national and international markets for goods and services. Large scale productions: With the development and expansion of market demand in created for various produced goods and services that results in large scale production. Stability in price: A good and cheap transport facilitates to maintain price stability by quick transport of goods from production place to consumption point. Efficient use of resources: Transport for efficient utilization of vast natural and human resources found in different parts of the country. 12

15 Mobility of labour and capital: The movement of labour and capital from one place to another place and one use to another is possible by means of transport, that helps the effective and efficient use. Development of agriculture: Transport helps agricultural activities by providing inputs of framing and transporting agricultural outputs to market places. Development of industry: Transport helps the industrial development by facilitating regular and prompt movement of raw materials, fuel and labour to the factories and finished industrial products to the marketing centers. Helps trade development: Transport contributes to the development of inland as well as international trade of the country. Generates more employment opportunities. Balanced regional development. Faster growth of cities and towns. Helps to efficient administration. Helps to get more revenue to government. Increases national income. Plays a major role in a national defence. Helps to develop tourism. Useful in meeting emergencies. Transport plays a key role in social and cultural development. Transport narrows vastness of the country. It establishes co-ordination and cooperation among various activities in the country. 13

16 2. Discuss the functions of RBI. Reserve Bank of India is the Central Bank of India. RBI was established on 1st April 1935 according to RBI act of 1934, as a private share holders bank with a share capital of Rs. 5 crores. RBI was nationalised on by the Government of India. The management and supervision of RBI is entrusted to a Central board of directors of 20 members. Chief of RBI is called as Governor. At present D. Subbarao is the Governor of RBI. Head Quarters of RBI is located in Mumbai. It has four Regional Offices at Delhi, Mumbai, Kolkata and Chennai. Functions of RBI: RBI performs all the functions similar to that of the Central Banks of other countries. RBI functions are classified in to 3 groups. a) Traditional functions b) Development functions c) Other functions a) Traditional Functions: 1. Issue of Currency Notes: RBI has the sole authority of issuing currency notes in the country. RBI issue all notes starting from Rs. 2 to Rs denominations. One rupee note and other coins less than one rupee are issued by the Ministry of finance. RBI follows minimum reserve system of note issue according to which Rs. 200 crores of reserve (Rs. 115 crores Gold and Rs. 85 crores worth foreign exchange) is maintained. 2. Banker to the Government: RBI acts as a banker, agent and advisor to the Government. RBI accepts the deposits of state and Central Governments, RBI receives money, makes payments on behalf of Governments. It provides credit and manager public department. RBI represents Government at International institutions. It raises the loans on behalf of the Government. It suggests to Government on finance, banking, planning and foreign trade. 14

17 3. Banker to Banks: a) RBI controls all other banks in the country. b) Accepts the deposits of commercial banks. c) Lends to all banks against securities. d) Maintains cash reserve ratio CRR funds. e) Suggests, Directs and extends cooperation to all banks. f) All banks have to submit their reports of transactions. 4. Controller of credit: RBI regulates the credit generated by commercial banks to control inflation or deflection in the economy. RBI adopts Quantitative measures like: a) Bank rate policy b) Open market operation c) Changes in CRR d) Changes in SLR Qualitative measures are: a) Margin requirements for loans. b) Moral suation. c) Issuing Directions. d) Direct measures. 5. Lender of last resort: RBI acts as the lender of last resort to all banks in the country. During the time of financial needs commercial banks can get money from RBI against securities. 6. Leader of Money Market: RBI is at the apex of banking system and acts as Leader of money market. It controls the activities of different components of the money market such as Commercial banks and Financial institutions. 7. Custodian of Foreign Exchange: RBI preserves and provides foreign exchange of the country. It maintains the external value of Rupee and determines exchange rate. 8. Clearing house: RBI provides the facilities to all commercial banks to clear their internal transactions. It works as clearing house. Mutual claims of Banks are settled through book adjustments maintained by RBI. 15

18 b) Development functions: 1. Finance to agriculture development: RBI indirectly supplies credit to agriculture through NABARD National Bank for Agriculture and Rural Development 2. Finance to industries: RBI provides credit facilities to industrial development through IFCI, IDBI, SFCs, SIDBI etc 3. Finance to Foreign trade: To provide financial facilities to foreign trade RBI started EXIM Bank. c) Other functions: 1. RBI collects, publishes informative data of various economic activities like agriculture, industry, trade, transport, national income etc which are using in policy making. 2. RBI undertakes Research and development (R&D) works regarding Banking, Unemployment, Balance of payments, Poverty etc. 3. RBI takes up Seminars, Discussions, Debates on such important problems like population control, cooperative movement etc 4. RBI inspects transactions of commercial banks and other financial institutions in the country.