Paper 3 December 2008

7/23/2019 Paper 3 December 2008

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ECONOMICS

PAPER III

11i"'f-' t f i f-

III

NOTE:

This

paper is

of

two hundred

200)

marks

containing four 4) sections.

D 0108

Candidates

are

required to attempt the questions contained in these

sections

according to the detailed instructions given therein.

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Note:

SECTION- I

~ '

Answer

the

five

questions from

the para

given

below_

Each

answer

should not exceed 30 words_

Each question carries

five marks_

(5x5=25 marks)

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(5x5=25 ~

Answer the following questio ns from the para given below. Each answer should not

exceed

3

words. Each question carrier 5 marks.

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tfr-7

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5)

Jtifft ?llTr,

Nurkse's basic argument

resembles Rosenstein

Rodan's; indeed he

cites Rodsn'

s

famous example

of the shoe

factory to

support

his

case_ Low

real

income, Nurkse

says,

is a reflection of low

productivity,

which

in

tum is due largely

to

the

lack

of capital.

The

lack

of

capital

is a

result

of the

small capacity to save, and

so the cycle is complete _

The inducement

to

invest,

in

tum, is limited

by the size

of the market- a

modem

variant of Adam Smith's dictum that

the

division of labour is

limited

by

the

extent of

the market _ But a crucial determinant of the size of the market is productivity_ Capacity

to

buy means

capacity

to produce_

And

productivity depends largely, though

by

no

means

entirely,

on the degree

to

which

capital

is used

in

production_ But, for any

individual entreprenf<ur, the use of capital is inhibited, to start with, by the

small

size of

the market _

Another

vicious circle_ To escape the vicious circle of poverty, Onf< cannot

count

on

individual invesbnent decisions

to

do the trick Even though in economically

backward areas

Say's law

may

be

valid in

the

sense

that

there

is no

deflationary gap,

it

never

is

valid in the sense that

the

output of

any

single

industry, newly

set up

with

capital equipment,

can

create ita own demand _ Technical Discontinuities

call for

jumps in the rate of output, but

the

small

and

inf<lastic

demand

in a low-income

country tends to make such jumps

risky, if

not

altogether unpromising_

D-0108

'

P.T.O.



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' '' '' 'M'HJ

q=r(\

1. How low real

iru:ome, according

to Nurkse, is

reflection of

low productivity

?

~

it

8 ~

q ; ~

illPI i f@ <liM

iB

~

'&

D 0108

'



2. How

size

of the market acts

as

a

constraint to

inducement to

invest

3.

Comment on the

view

th t

capacity to

buy

implies capacity

to

produce

?

j .P j

~

ili UR•.<l j

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'&1''

B \

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D 0108

P.T.O.



4. Why

individual

invesbnent decisions

cannot help

in escaping the

vicious

circle of

poverty ?

fOpffi % ~

i

i j

qf<WiM f'q l\>:j if'i

<:TGP:l<li" \i)

00

5. Why the

small

and iTif<lastic

demand in

a low-income

country

tends to make the

jumps

brought about by

technical discontinuities

in

the rate of

output

risky

?

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~

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if'il

"&:#'&

D 0108

'



Note:

D-0108

SECTION-

II

~ I I

This part has fifteen 15)

definitional

questions

of 5)

marks

each to be

answered in upto (30) words_

(5x15=75 marks

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15)

.R l ' 1 ~ ' . R ' l

; - ~ 5) ~

' 1

.R l

iB

B<: 30)

ij

I

(5x15=75 ~

P.T.O.



7. Distinguish between l\1arginal

Rate

of

Transformation (MRT)

in production

and

J\ farginal

Rate

of substitution in consumption.

j ; ; ; : 1 1 ~ < <;<: a\<

?Pi\l ;

j i \w.H R < < : f T ; : f ~ <;<: #;" iJ<"" I

8. What

is

the

meaning

of

Ufe-qcle

hypothesis

?

~ ~ J F F h • . H i

<8 <f' 1 iJ< .l '&

D 0108



9 E:xplam

the

coru:ept of money multiplier.

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'r'f<l'

< il R Fl Jf

<8

~ <8: ~ ~

10.

What

is

Hicks-neutral technical

progress?

<VHlW.l M i ~ o l i o '.Jl1 iP '&

D 0108

9

P.T.O.



11.

Why

does capitalism decay in

Schumpeter s theory

of economic development

?

f ~ i l;

~ . l i l i Fn

i l; i j

o j _ i 1 q ; ~

if ij 1;1' ' ¥ 1

12.

Distinguish

between merit

good

and

public good.

u (i P:fin) a\<: n ; < i _ f ~ < J i

iV1< i\

i l; iJ<

D 0108



13

Which internationally

traded

services

are not

covered under

GeTif<ral

Agreement on

Trade

in Services (GATS) ?

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<i iRJ o/':I< 'T i

<. 1=1 t 'f ~ i\i W:I

'JR B

EfTiR

illR

t i f

nf1f+R1

(GATS) j $ ~

~ < P ~ % 1

14 hat

is

meant

by

a Rf<strictive MoT\f<tary Policy ?

''.fof< :i•r i'1ili

1W ~ <B if l1 ill .\ '&

D 0108

n

P.T.O.



15 How

s

industrial productivity

measured

n India ?

w

:i i J l i T i l ~

< o c 1 1 ~

<8 '11'Fl

n

.T<fl<:

z n '&

16. What is

meant

by

Sustainable

development

?

''JWII"b:i ~ <8 <f' 1 iJl'.\ '&

D 0108



17 Ust the

main

characteristics of

Indian

population as per 2001 census

2001 < JR"l"('JI"' l

%

>H<f\ 1 •HfiWll < 'Pffl ~ i \ iB ( '>

0

4.<; ~

18

What are

the

bio-chemical compoTif<nts of

the

Green

Revolution?

~

i I ; ~ M { { H f ~ , H i '¥<f, if'l1 if'l1

'&

D 0108

P.T.O.



19.

Distinguish

between Type-1 and Type-ll

Error

< 1 ~ H ill R:

< 1 ~ H l ~ ; f ?

#; ill

20.

What

are

the

applications

of cliffererd:iation

and

integration techniques

in

economics

?

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#;

if ' l ~ f '&

D 0108



Note:

SECTION-

III

"UI"'rn'- III

This part has five short-essay type

questions

of

(12)

marks each to be

answered in upto (200) words_ The candidste

may

select

one elective

and answer

all

five (5) questions_

(Ux5=60

marks)

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-n\

(200) 'F< i'i i j

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fin:iT 'T<Ji iB

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<R: '11;;i\

.R i i iB

B<: it

I

(Ux5=60

~

Elective -

I

fo l'lftf<l I

21.

Explain how will

you estimate a

linear regression equation which

is

piecewise linear

with

a

joint or knot) at x ~ x

if

(a)

x

is known

(b) X

0

is unlmown

~ l i T i l n m < W T ~ g f ~ + H n'1°<h<:O\, Jh x ~ x 'T{ Ji'm ('11 :r;io) %

<:11'.1

m

i % n ' ,

iB <W<FT'l

m,

>R:

(a)

X

0

09'&

(b) x iJ=Gl(l '

22.

Define

multicollinf<arity_

Explain

how

it

would

be detected in

a

multiple

regression

equation

and what are its

consequeru:es

?

23. Given a sample of 50 observations and 4

explanatory

variables, what can be said about

auto correlation if :

(b) ~ -2.50

50

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1'l:

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Jfl <:T<h(l1

'

* .

(b) ~ -2.50

D-0108

P.T.O.



24 Consider

the

three-equation modeL

Y1 ~ 1 3 1 3

Y3 Y12 x2

1'-:

Y 2 ~ f 3 2 1 Y1 + 323

Y3 Yn

xl y22 x2 1"2

Y 3 ~ Y 3 3 x3 1L3

Where

Yv y

2

and

y

3

are endogenous and ": • '?_and X J

are

exogenous. Discuss the

identification of each of the equations of the model based on the order and rank

conditions.

"if'"'Hi1'1-,<li{O\

lf"¥1

'n

iJi't

Y1 ~ f 3 1 3 Y3 y12 x ILl

Y 2 ~ f 3 2 1 Y1 + 323 Y3 Yn xl y22 x2

1"2

Y 3 ~ Y 3 3 x3 1L3

~

Y1• y

2

ill'R:

y

3

<i"if.ii'l"il

' if<:

x _

'0_

<fu: 3 ~ " i l '&I

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#uiT

~ . l R

('tJi ) 'n iJ:PJfu

- . . ' ' ' f. . -- ----

'11'*1

<\;" 'F"l< i"

fH

'<h{ l

<P 'l'Z\"i'Fl <P<Fl + < ~ < ' '

J1

o. I

25. Discuss fully

the

ARIJ\.iA model of time-series. To what extent,

it is

clifferent

from

ARMA

model?

<:T'f'l

~ #;-

ARIMA '11"¥1

<#'If' WZf i\

fqihHi 1 'lZf

f i n : " \ ~ ( : "

"ilili"

ARMA i\

f\m

'&

OR 3roW

Elective-

II

f.:J'lftf\1

I I

21. Discuss

the assumptions

of'Rf<vealedPrefereru:e

Theory'

of demand. Howisthistheory

an

improvement over the

earlier theories

of

demand

?

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- .

:q;:r;

<li"

''

' 1 ' 1 1 ~

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<P lF'AliJl <P14 + ' •w

1 .,.,,. m

'lZf -,..,.,

:q;:r;

<li"

~ . .

,.

' J k ~ ' R i f 1 . < ; k 1

<'li" :am; <:J:'H

22. Discuss the Bertrand solution of duopoly. How does it differ

from

the Cournot

solution?

f\;:M<fojiffi:

i' ,- $ <J'l1'F'f

<# fqii'>+ ~ " Z f ~ <J'l1'JR

i\

fim '.J<liV f\r;;

'&

23.

What

is

meant

by

equilibrium

in

the

moTif<y

market? How is

LM Curve derived

in

the

money

market ?

' W

i':fJR i j

i8 i f ' f ill'.\

'&

' W i':fJR

i j LM

i'fi.li" i 8 iJ'FRl"'l fin: :'l'<ffi: "fl1F''1 Ji'Fl1

'&

24 Discuss Hicksian model

of

trade

cycle in tenns of multiplier-accelerator interaction.

- ~ -'<- ~ f, f - 'f. - - - -

' J " A ' M ~

iJl(l·

'Z'<' <' i" W 'Pl '1 'f W

' '

<\i t'f' { 1 ' 1 ~ lf:o/'1 <P<Fl + <I<''

J1

0,

I

25. E:xplam Endogenous

growth

theory as propounded by Paul. M. Romer.

'11"1 '1'1

iJ-,:p:

j;PJ '.fol':nftil <'fm -,8 "'ll"W 1 j;W ~ ~ I

D-0108

OR

3roW



Elective - III

R 'lftf<l

III

21. Critically comment on the emerging International Monetary System_

T>v# ¢1Mhi"1

'; W

;:r:m-,_;]T n

<>ll<oih+(l1ili

~ 1

22. Give a critical account of the problems which developing economics like India are

facing

in

the wake

of

VIITO

stipulations_

VIITO ~ · i l - ~ ' 1 ~ w W r1<liRil'4'9 ;;;•.l '''W.wi f:iR m < i \

<lii <:TI'1+

<R:

'

'Fl<lii ; ; ; ~ < 1 »

+ l<li i'i'llu 1

23.

What

is

meant

by Euro-Curreru:yJ\.farkets

?

What

factors,

in

your

opinion,

contributed

to

the

growth

of Euro-Currency l\1arketa' ?

''IUM<Ji'tW

' 1 1 ~ ' <lii if ' i <>l .J

'&

;;;l' P . \ . - ~

q ; J ; ~ - j ) ' <# i j fiFl

-0)

~ " '

ft>:n

24. Distinguish between fixed

and

flexible exchange rate systems_ Which one of the two

you

will prefer and why ?

tt>.n: iih: f q f ~ w l <:<: 'f<W.n.W: - ~ il'FW 1 illiri\

;;;n

1"<:1?: <li'ti'; iih: <Pi'i

25. Critically examine the international debt problems of the developing countries_ How

can these problems be overcome ?

l i T l k o i h d l < l i ~ l 1

m W :

TJ<: lim

(R] i\ <lii" '1711 Jfi

'&

OR

I roW

Elective - IV

R 'lftf<l

IV

21.

Discuss the main trends in agricultural production in India in the

wake

of

economic

refonns_

22. What

are the

major

weaknesses

of

the existing agricultural price policy in India ? How

can these weaknesses, in your opinion, be overcome ?

we

il f J B ~ -,pb- <:T'<'if'ii-

<P -;pm if'l i '&

~ ? I

il i ' l <Pl:p:f n i l i l

<lii"

'1711 Jfi

' I

D-0108

P.T.O.



23.

Describe the

structure

of agricultural markets in India and its major

short:omings.

w e il

%

;zi"<lr ill'R: -;pm <B i"f li"'l 1

24 Do VIITO provisions ensure the sustainable agricultural

development

in India ? Elaborate.

i f f VIITO

'J9'T"'l T ~ ~ B

q f ~ f A M iJi1# '& 1i\fiwn<: i

~ I

25.

Discuss

the

signilicaru:e of the amendments

made

in J\.finimum

Wages Act

1948 for the

functionllig of

labour markets

in

India.

w e il JP:l

i": f.iiTi.l <P <lil'i<dei %

ttrJ: 'f'' iR

R'1t=r:r:l, 1948

il li8J: Tf'l:

<:1Tl•n %

"lZR1

f..

<li' o Fl +

<I<''-"".

I

OR

roW

Elective-

V

f.:J'lftf<l v

21.

Describe

the methodology adopted by the

Commission

on Agricultural

Costs

and

Prices

(CAIT) for detenninllig the ]l..fuillnumSupportPrices (MSP) of agricultural commodities.

< l«l<i\

<#

'f'' iR

Wl".l"' (MSP) f'q•Jfu %

ftw "11'1#

q

iJ<F'i'lTf

j;.HI

ill'FITS:

<B'l

.J IIFiT iB i"f li"'l

I

22.

Discuss

the environmental

coru:em.s

that have

emerged

during the post-refonns period

in India

.;; . . - . ' . . f..

w e

'1 { \ D > ~ "<liR

<" i" ~ 1 < H

'1'11'"1{111'""1 :m:\<a:: J l ?'H

<R iJ<ICJ 'FI <Po Fh+ < ~ <

_,

o.

I

23. lni:rastructural

facilities are

the nerves

of the process of

development

of a

developing

economy

like India . Elaborate.

·

.

' ~ - ' . . . . . ; ; f . ' · · · ~ ~ ~ ' '

•re .,,.. ' 9 ' ' ~ ill'.f'&:f<'R .ll - ~

'1'9'T·;

'

1«H ~ ' - . I

24 Discuss the effects of finaru:ial sector

refonns

in India.

we

il ffi i"li"<:J:•nn

i"li"'.rw<"i'i jT Jh

' J 'H

"'l"

'l'f

illl•.1h+c'H

~ I

D-0108



Note:

SECTION- IV

"UI"'rn'- I V

This

part

has

OTif<

question

of

(40)

marks

to

be

answered

in

upto

1000

words_

(40x1=40 marks

B1

l 'T<l' W1

;;r-,_;f-n-

z 0

<B ' 1 f:iruiB

~

-,_;v;w;

'T<l'

\fJR

1 0 0 0 ) ~ - i j ~ l

(40x1=40 ~

26.

Explain the impact

of economic

refonns on poverty

and

unemployment

in India_

Critically

analyse the

efficacy of

the policy

measures

introduced in India in this

respect.

we l fOpffi <n -i:RJJfllfi

n

iWfl<.Ri <:J:•Fif i"li"'J'F1 <#

v:rw:n

1 B1 w<:Pl l we l Jh

~

<Jl 'f --'i' ?WI wm' Tf'l: iJ:r-,;f;;r=Jl(l1ili

~

~

Rj3JW:IT

Explain the role

of

energy

sector in

the

economic

development

of India_ Do you

find

any crisis

in the power

sector_

Give

a

critical account of the power

policy

of the

government_

we %-

iWfl<.Ri l

t

fi

<P •fl:l<B <P

v:rw:n

1 if' 1 iJ<N

t fi l

<:i<R '11#

'&

<:V<liV <P t <B iJ<R'FRl(l1ili i i'llu 1

D-0108



FOR

OFFICE

USE ONLY

Marks

Obtained

.

~

.

~

.

~

.

~

i ]i ]i ]i

z

:E§

z

:E§

z

:E§

z

:E§

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n

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0

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00

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•

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•

'

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M

w i

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n

'

'

@

M 00

G

w

i

i

•

w w %

n TI %

'

%

%

i

;m

Total l\1arks Obtamed (in

words)

_

(in figures) _

Signature & Name of the Coordinator _

Evaluation)

Date_

D-0108

Documents

Paper 3 December 2008