IV. Give short answer
1. Define National income.
National income is a measure of the total value of goods and services produced by an economy over a period of time, normally a year
2. What is meant by Gross domestic product?
Gross Domestic Product is the total value of output of goods and services produced by the factors of production within the geographical boundaries of the country.
3. Write the importance of Gross domestic product.
• Study of Economic growth
• Problems of inflation and deflation
• Estimate the purchasing power
• Guide to economic planning
• Comparison with developd countries of the world
• Study of Public sector
4. What is per capita income?.
• Per capita income is obtained by dividing the National income by the population of a country.
• Per capita income = National income / Population
• It is an indicator to show the living standard of people in a country.
5. Define the value added approach with example.
• In the value-added approach the value added by each intermediate goods is summed to estimate the value of the final goods.
• The sum of the value added by all the intermediate goods used in production gives us the total value of the final goods produced in the economy.
• Eg. To measure the market value of a cup of tea is, to add the value of each intermediate goods used to produce it such as tea powder, milk and sugar.
• Value added method: Tea powder + Milk + Sugar = Tea
Value of intermediate goods = Value of final goods
6. Write the name of ecnomic policies in India.
• Agricultural policy
• Industrial policy
• New economic policy
7. Write a short note
i) Gross National Happiness(GNH)
ii) Human Development Index(HDI)
Gross National Happiness:
• The term Gross National Happiness was coined in 1972.
• The king of Bhutan said in an interview, "Gross National Happiness is more important than Gross National Product".
• The UN General Assembly urged its member countries to follow the example of Bhutan and said happiness "a fundamental human goal"
• The four pillars of GNH are:-
• Sustainable and equitable socio - economic development, environmental conservation, preservation and promotion of culture and good governance.
Human Development Index (HDI):
• This concept was introduced by Mahbub ul Haq, a Pakistani economist.
• The HDI is a composite index of life expectancy at birth, adult literacy rate and standard of living measured as a logarithmatic function of GDP, adjusted to purchasing power parity.