Determination of Income and Employment — Economics STD 12 Commerce — Question

Central Bank has the sole authority of printing currency notes. What are its advantages?

Classify whether the following trans actions will be recorded in current account or capital account.

1. Purchase of shares of Tata by Microsoft.
2. Imports of computer spare parts from America.
3. Borrowings from World Bank.
4. Repayment of loan by Indian Government taken from Japan.
5. Gifts received from a relative in Australia.
6. Purchase of Land in China.
7. Import of machinery.

Distinguish between the nominal exchange rate and the real exchange rate. If you were to decide whether to buy domestic goods or foreign goods, which rate would be more relevant? Explain.

What do we study in Macroeconomics?
OR
What does Macroeconomic theory deal with?

Show diagrammatically the impact on equilibrium level of output of increased government spending.

Distinguish between revenue deficit and fiscal deficit.

Explain the role of Government budget in allocation of resources.

What is current replacement cost?

Give two examples of Microeconomic studies.

Explain the concept of 'deficit' in balance of payments.