NTA UGC NET/JRF Exam, Dec. 2020/June 2021 Economics

Measures that result in an increase in the money supply in the economy
1. Central bank buying government securities! This action transfers money to the public, which increases the money supply.

2. Government borrowing from the central bank: This releases money to the central bank, which can then be released into the market through loans and other means.

The government can then spend this money on the public through subsidies and direct benefit transfers. Other measures that can increase the money supply
include: Printing more money, Reducing interest rate Quantitative easing, Reducing reserve ratio for lending, and expansionary fiscal policy.

• Correct statements are:-
A. Purchase of government securities from the public by Central Bank.
B. Borrowing by the government from the Central Bank.
E. Minting of more money by the Central Bank forcirculation.

β₀ and β₁ are regression coefficient (or parameters), the true population values of which are unknown, and Xi is the value of the regressor X corresponding to the value Yᵢ of Y₁.

A random error term Ui (also called a stochastic error term).
In the classial linear regression model, Xi and Ui are assumed to be not correlated.
Xi = explanatory variable/independent Variable
Ui = error term.

If the factor market is perfectly competitive and the product market or commodity market is monopolistic then in a perfectly competitive market, if the firm's price is given for the factor service, if does not affect the units to be purchased by the firm, due to which the supply curve or cost curve of the factor is parallel to the X-axis i.e. AFC MFC.

But the commodity is incomplete in the market.
Due to competition or monopoly, the MRP curve will lie below the price (VMP) curve of marginal product.
In case of incomplete competition or monopoly in commodity market, Marginal Revenue (MR) of a commodity is less than price (AR) so marginal revenue product (MRP) will be less than value of Marginal Product (VMP) MRP<VMP because MR<P (in perfect competition both AR and MR curves slope downwards).

Lump-sum tax on monopoly can affect the firm's profit, but it doesn't change the firm's output or prices.

A government might impose a lump-sum tax on a monopoly to intervene because a monopoly's prices aren't regulated by free-market competition. If a monopolist pays tax in lump sum, he can not shift this burden to the consumer.

The incidence of tax will be entirely on himself. The lump sum tax paid by the monopolist is taken into account of his fixed cost. Due to this, his marginal cost of production does not get affected and there is no shift in cost curve.

The Ministry of Environment and forests (MoEF) in India was established in 1985, after being a federal department of environment in 1980.

The MOEF is the central government's nodal agency for planning, coordinating, and overseeing the implementation of India environmental and forestry programs and policies.
2. The Central Pollution Control Board (CPCB), statutory organisation, was constituted in September, 1974 under the water (Prevention and Control of Pollution) Act, 1974.

3. Environment Protection Act was enacted in 1986.

4. The National Environment Appellate Authority (NEAA) Act of 1997 was a key piece of legislation in India's environmental governance.

The Act established NEAA as a quasi judicial entity to address environmental issues and protect environmental rights. The NEAA was replaced by the National Green Tribunal (NGT) in 2010.

Disjoint sets are those sets whose intersection with each other results in a null set.
In set theory, sometimes we notice that there are no common elements in two sets or we can say that the intersection of the sets is an empty set or null set.

(2) Complement of a Universal set is a null set; A empty set, often known as the null set, is the Universal set's complement. The intersection set is made up of the
components that are shared by both sets.
A set that contains all of the elements from both sets A and B is called a union of two sets.
(3) If X ∩ Y = ф, then X-Y ≠ X is incorrect statement. X ∩ Y , denotes all the elements in X which are not the element of X-Y denotes all the elements of Y are deleted from X.
So, the resultant is the element of X only.
(4) X - Y = X ∩ Y̅ is the correct statement.
Y̅ denotes all the element left after excluding all elements of Y.X - Y̅ denotes that all elements of Y are deleted from X.
X ∩ Y̅ denotes all elements of X after deleting Y elements.
Hence, X- Y = X ∩ Y̅ is true.

The base year used for estimating India's GDP at constant prices is 2011-12. The base year was revised from 2004-05 to 2011-12 in 2015, after adapting the sources and methods in line with the SNA 2008.

GDP at constant prices is also know as real GDP or inflation-corrected GDP It is calculated by expressing values in terms of a base period, where the prices in the base period is substituted for that in the current period.

Inequalities in income are measured by:-
A. Lorentz Ratio
B. Theil's Index
C. Palma ratio
Important points:- Income inequality is often measured using the gini coefficient, which is a widely used index that compares the distribution of income to a perfectly equal distribution:
What it measures:
The Gini coefficient measures how far an economy's income distribution deviates from perfect equality. It's calculated by dividing the area between the Lorenz curve and the 45-degree line by the area under the 45- degree line.

How it's used.
The Gini coefficient is a number between 0 and 1, with 0 representing perfect equality and 1 representing perfect inequality. It can be used to directly compare the income distribution of two populations, regardless of their size. However, the Gini coefficient has some limitations, including:

1. Its not easily additive or decomposable
2. It doesn't respond in the same way to income transfers between people at different ends of the income distribution
3. Different income distributions can have the same gini coefficient.
Other ways to measure income inequality include:- Generalized entropy (GE) index this index incorporates sensitivity parameter that allows you to vary the weight given to inequalities at different parts of the income spectrum
Palma ratio
This ratio divides the percentage of total income received by the top 10% of people by the percentage received by the bottom 40%.

Here are some statements about foreign direct investment (FDI) in India in 2020.
1. FDI flow- In 2020, India received $ 81.97 billion in FDI, which was a 10% increase from the previous year.

2. FDI in the first five months from April to August 2020, India received $ 35.73 billion in FDI, which was the highest ever for the first five months of a financial year.

3. Top investor countries
→ In 2020-21, Singapore was the top investor country with 29% of FDI, followed by the U.S.A. (23%) and Mauritius (9%)

4. Sectoral distribution.
→The services sector was the largest recipient of FDI in 2020-21, followed by computer software and hardware, telecommunications, and trading.