1. Distinguish between Less developed countries and Developed countries.

On the basis of the per capita income of a country, it is decided whether a country is a developed or not.

 1. The United Nations classified the countries with per capita GNP of $ 350 or less as less developed.
 2. The Organization for Economic Cooperation and Development has classified the countries with per capita income of $ 425 or less as under developed countries.
 3. The World Bank in its World Development Report 1997, has classified the countries which has per capita income of $ 765 or less as less developed countries.
 4. In 1995 India’s per capita income was $340 and hence India is regarded as a less developed country.

 2.Define Poverty? Explain the concepts of Absolute Poverty and Relative Poverty?

Poverty – It is defined as a phenomenon in which certain sections of the society are not capable of meeting the basic needs for their subsistence living.
Poverty line:- The amount of consumer expenditure required to purchase the minimum quantities is known as poverty line. The population whose level of income or consumption expenditure is below this quantum is considered to be below poverty line.

Absolute poverty:- It refers to the situation where the minimum required quantities of cereals, pulses, milk etc. are not met in money terms.
Relative poverty:- Relative poverty is measured by taking the income levels of the top five to ten percent of population and compared with the bottom five to ten percent of the population which gives the relative levels of poverty.

3. Differentiate between Involuntary Unemployment and Voluntary Unemployment. What is the relevance of disguised unemployment to India?

  Unemployment is one of the most important problems of the Indian economy.    The concept of unemployment is very important to any economy.

Unemployment: Unemployment is defined as the stock of those individuals who are not gainfully employed in any productive work or who are unable to find work at the prevailing wage rate.

Kinds of Unemployment: There are generally two types of unemployment that is Voluntary and Involuntary unemployment.

Voluntary unemployment: It arises because individuals prefer not to work for reasons of affluence or leisure or their expected wage rate is much higher than the existing market wage rate. This situation is mostly found in the developed market economies.

Involuntary unemployment: It refers to the situation where the individuals are prepared to undertake jobs at the providing wage rate but do not find jobs. This unemployment prevails mostly in under developed countries. 

J.M. Keynes was the first to distinguish between involuntary and voluntary unemployment.

Disguised Unemployment: It refers to the stock of gainfully employed individuals who work below their capacity. It is the most commonly prevalent situation in Indian agriculture. The Marginal productivity of disguised unemployment is zero or negative. 

     Disguised unemployment and open employment are the parts of involuntary unemployment.

4. Explain various programs launched by the government for the promotion of employment.

 The Government of India implemented a number of employment generation programs to solve the problem of unemployment. They are

  i) Rural Works Program ( R.W.P.)
  ii) Marginal Farmers and Agricultural Labourers( M.F.A.L)
  iii) Small Farmers Development Agencies. (S.F.D.A.)

   Majority of employment generation programs were targeted at rural population. New programs meant for urban employed are to be designed to reduce the incidence of educated unemployment.

5. What are the factors causing regional imbalances? Explain the indication of rural disparities.

 The existence of regional imbalances are quite natural in every country. The factors that are responsible for regional imbalances are as follows:-

   1) Variation in resource endowments.
   2) Some historical reasons like colonial exploitation.
   3) Unequal distribution of wealth and incomes among the people living in various regions.
   4) Because of the selective and discriminatory approach of the British, there has been a large growth in Maharashtra, West Bengal etc., which were the key centers of their trade.

Indicators of regional disparities:-

   1) Per capita income of the region.
   2) Rate of industrial growth.
   3) Rate of agricultural growth.
   4) Rate of generation and Utilization of infrastructural facilities.
   5) Social indicators of development

6.  Explain the different concept of inflation and the concept of structural inflation useful  in the context of India.

Inflation is one of the most important  problems of Indian economy. Inflation is one of the major macro economic issues in the economic policy making. 

Inflation- Meaning:- Inflation is a state in which there is a sustained rise in general price level accompanied by a fall in the value of money. When the inflation exists, the volume of money exceeds the value of goods and resources. Inflation situation is described through a dictum “too much money chases too few goods.”

Concepts of Inflation:- Generally, there are two types of inflationary situation. They are Demand–pull inflation and Cost push inflation.
Demand–pull inflation:- Rise in aggregate demand due to increase in investment expenditure which causes an increase in general price level is known demand pull inflation.
Generally for India demand–pull inflation is relevant on account of deficit financing.

Cost-push inflation:- Inflation fuelled by rise in costs of production either due to domestic or international factors is called cost–push inflation. It occurs when a sustained rise in the general price level is caused due to an autonomous increase in costs.
Structural inflation:- The more relevant concept of inflation to India is known as structural inflation. Mismatch between primary, secondary and tertiary sectors relations causing inflation which is known as structural inflation. It occurs when there is an interaction between primary and secondary sectors which results in inflationary spiral. Fortunately, India has not experienced any inflationary spiral. It is rampant in Latin
America.

7. Explain briefly the social and infrastructural needs of our country.

    The needs of social and infrastructural facilities are increased in the countries like India.

Social and Infrastructural Facilities:

1. The social service sector includes education, health, sanitation and drinking water.
2. Infrastructural facilities included transport, power, housing, irrigation.
3. The development of these sectors will decide the Human Development in India.
4. Human Development Index is a composite index based on life expectancy in general
health level, rate of literacy, education, sanitation and percapita income.

8. What is ‘cost push inflation’?

 The increase the cost of production pushes the general level in an economy.  This is called cost push inflation.

Cost pushes inflation factors:

1.    When the employees demand higher  wages
2.    When the import prices  rise
3.    When the producers want more profits

9. Write about Human Development Index. Who advocated this concept?   

Human Development Index is a collective index based on life expectancy, general health level, literacy rate, education, sanitation facilities, percapita  income and the standard  of living. Economists like Amrtya Sen advocated this concept of Human Development Index.  This concept evaluates development and distinguishes it from underdevelopment.

10. What are the indicators of regional imbalances?

  The indicators of regional disparities are

1.  The percapita income of  the region
2.  Rate of Industrial growth
3.  Rate of agricultural growth
4.  Rate of generation and utilization of infrastructural facilities
5.  Social indicators of development.