UGC NTA NET/JRF Exam, December-2024 Economics

A Regressive Tax is one in which the tax rate progressively decreases as the tax base (income) increases. Thus, the greater tax burden falls on the poor.

The main benefit cited for regressive taxes is that they will increase the rate of capital formation in the country because the wealthy class, who have the ability to save, will have to pay less tax, and their savings will be used in capital formation.
Conversely, the poor class, who will have to pay more tax, will be compelled to work harder.

The correct matching of List-I with List-II is:

Demographic dividend is related to the increase in the population of the wage-earning age group.
Demographic Dividend : The demographic dividend refers to the potential for accelerated economic growth that arises from a shift in a country's age structure, specifically an increasing share of the working-age population (typically 15 to 64 years old) and a decreasing dependency ratio, which contributes to a larger volume of production creation.

Given,
Therefore, the correct option (d)

Analysis of Each Statement:
Statement A: It is the benefit that individuals and countries obtain by participating in international trade.

This is a correct definition of gains from trade. Gains from trade refer to the benefits countries and individuals receive from trading goods and services.

Statement B: It is the gross benefit to economic agents resulting from an increase in trade.

This is partially correct but not precise. The term "gross benefit" is used less often compared to "net benefit," which accounts for costs. However, it doesn't entirely contradict the concept.

The provided solution marks this as incorrect, likely due to the emphasis on "gross" over "net" in formal economic definition.

Statement C: It is the Producer Surplus minus the Consumer Surplus.

This statement is incorrect. Gains from trade are not calculated by subtracting Consumer Surplus from Producer Surplus. Instead, they are often represented as the sum of the two.

Statement D: It is the net benefit to economic agents resulting from an increase in trade.

This is a correct definition. Gains from trade are correctly viewed as the net benefit.
Statement E: It is the sum total of Producer Surplus and Consumer Surplus.
This is a correct definition. Gains from trade are often measured as the total sum of the increase in Producer Surplus and Consumer Surplus.

The correct option is (b) Only B, C.

The correct matches are :

To solve this, we need to apply the Input Output model from the Leontief framework. The formula to find the output levels is:

X= (I-A)⁻¹D
Where:
X = Output Vector
I = Identity Matrix
A = Input-Output Matrix
Step 1:
Step 2: Now find the inverse of the matrix
Step 3:
Calculation:
Now, dividing each by 0.635:

(A) Two Heads from two coins:
Sample Space: (HH,HT,TH,TT)
Probability: 1/4
(B) Getting a Queen from a deck of cards:
Total cards: 52, Queen cards: 4
Probability: 4/52 =  1/13
(C) Getting one white ball (3 white, 7 black):
Total balls: =10 White balls: 3
Probability: 3/10
(D) Getting an even number froma single die roll:
Sample Space: {1,2,3,4,5,6}
Even numbers: {2,4,6}
Probability:= 3/6 = 1/2
Arranging in Increasing Order of Probability:
A = 1/4 = 0.25
B = 1/13≈0.0765
C=3/10= 0.3
D = 1/2 = 0.5
The correct order is (B, A, C, D), which corresponds to option (d).