Class 10 economics chapter 1 notes

chapter-1 

Economics

Developement

Question 1. Development of a country can generally be determined by

        i.            its per capita income

     ii.            its average literacy level

   iii.            Health status of its people

   iv.            all the above

Answer : (iv) all the above
Explanation: UNDP publishes its human development report comparing the countries on the basis of educational level of the people, their health status and per capita income.

Question 2. Which of the following neighbouring countries has better performance in terms of human development than India?

        i.            Bangladesh

     ii.            Sri Lanka

   iii.            Nepal

   iv.            Pakistan

Answer : (ii) Sri Lanka
Explanation: HDI of Sri Lanka is 73 which is much higher than Bangladesh, Nepal and Pakistan which have 139,145 and 147 respectively.

Question 3. Assume there are four families in a country. The average per capita income of these families is Rs 5000. If the income of three families is Rs 4000, Rs 7000 and Rs 3000 respectively, what is the income of the fourth family?

        i.            Rs 7500

     ii.            Rs 3000

   iii.            Rs 2000

   iv.            Rs 6000

Answer : (iv) Rs 6000
Average per capita income=sum of income of all the families number of families

Question 4. What is the main criterion used by the World Bank in classifying different countries? What are the limitations of this criterion, if any?
Answer: Per Capita Income is the main criterion used by the World Bank in classifying different countries. The limitation of this criterion are:

• Per capita income is useful for comparison but it doesn't show the distribution of income.
• It also ignores other factors such as infant mortality rate, literacy level, healthcare, etc.
• Per capita income does not give the true picture as there is a huge population which does not earn at all like children and the senior citizens but they are also included while calculating per capita income. National income rises but its distribution make the rich richer and the poor poorer.

Question 5. In what respects is the criterion used by the UNDP for measuring development different from the one used by the World Bank?
Answer: World bank only uses per capita income for measuring development while UNDP uses many other factors like infant mortality, healthcare facility education level which help in improving the quality of life and helps in making the citizens more productive. As per HDI- 2014, India's rank is 135. On the other hand, the World Bank uses per capita income as the only criterion for measuring development and classifying the countries as rich and poor. Per capita income is useful for comparison, it does not tell us how income is distributed.

Question 6. Why do we use averages? Are there any limitations to their use? Illustrate with your own examples related to development.
Answer: We use averages because they are useful for comparing differing quantities of the same category.
For example, to compute the per capita income of a country, averages have to be used because there are differences in the incomes of diverse people. However, there are limitations to the use of averages. This does not show the distribution of thing between people. For an example, suppose in a country, the annual income of a rickshaw puller is Rs 8,000 while an MNC employee earns an annual package of Rs 12,00,000. The average income of this country, therefore, will be Rs 6,05,000. Here actual income or status remains unknown. One can clearly consider this as a rich country thereby ignoring the income disparity between two individuals. Averages are useful for comparison, they also hide disparities.

Question 7. Kerala, with lower per capita income has a better human development ranking than Maharashtra. Hence, per capita income is not a useful criterion at all and should not be used to compare states. Do you agree? Discuss.
Answer: No, I do not agree with the statement that per capita income is not a useful criterion at all. Kerala, with lower per capita income has a better human development ranking than Maharashtra because, human development ranking is determined using a combination of factors such as health, education, and income. So, this does not imply that per capita income is not useful. Rather, per capita income is one of the development factors and can not be neglected. The World Bank uses per capita income as the criterion for measuring development and comparing states. But this criterion has certain limitations because of which determination of Human Development Index (HDI) is done using this criterion along with some other development factors like health, education etc. If the rate of population growth, is higher than the rate of growth of national income, this will lead to fall in per capita availability of goods and services and economic welfare.

Question 8. Find out the present sources of energy that are used by the people in India. What could be the other possibilities fifty years from now?
Answer: The present sources of energy that are used by the people of India are electricity, coal, crude oil, cow dung and solar energy. At present, consumption of energy in India is too high in comparison to its production and reserves. India's known reserves of oil are expected to last about 30-40 years only. So, therefore, other possibilities fifty years from now could include ethanol, bio-diesel, nuclear energy and better utilisation of wind energy, solar energy, geothermal energy, hydrogen energy, tidal energy, wave energy, hydroelectric energy and biomass energy especially with the imminent danger of oil resources running out.

Question 9. Why is the issue of sustainability important for development?
Answer: Sustainable development means that the development at present should not hamper the needs of the future generation of society and it should take place without damaging the environment. The issue of sustainability is the most important for development because development must be in tandem with the future. If natural resources are not sustained then development will stagnate after attaining a certain point of time. Exploiting resources unethically will ultimately undo the development that a country may have achieved. Hence in the future those resources will not be available for further progress.
Consequences of environmental degradation do not respect national or state boundaries; this issue is no longer region or nation  specific.Our future is linked together. Sustainability of development is comparatively a new area of knowledge in which scientists, economists, philosophers and other social scientists work together.
Sustainable development is important because it saves national budget, fulfils the needs of the people, conserves natural resources, helps in the coordination between the natural resources and people and conserves natural resources for future generation.

Question 10. “The Earth has enough resources to meet the needs of all but not enough to satisfy the greed of even one person”. How is this statement relevant to the discussion of development? Discuss.
Answer: The Earth has enough resources to meet the needs of all but not enough to satisfy the greed of even one person". This statement is relevant to the discussion of development as both resources and development go hand in hand. For the sustainability of development, the maintenance of resources is very crucial. Needs can be fulfilled whereas greed can never be satisfied because greed increases with every want to be fulfilled. As the statement claims, the Earth has enough resources- renewable as well as non-renewable to satisfy everyone's needs; however, these need to be used with a view to keep the environment protected so that a balance of production and use is maintained and shortages are avoided.

Question 11. List a few examples of environmental degradation that you may have observed around you.
Answer: Few examples of environmental degradation:

• Deforestation
• Soil erosion
• Falling levels of groundwater
• Depletion of the ozone layer and combustion from automobiles causing extreme air pollution
• Water Pollution

Question 12. For each of the items given in Table 1.6, find out which country is at the top and which is at the bottom.
Answer:

TABLE 1.6 SOME DATA REGARDING INDIA AND ITS NEIGHBORS FOR 2004
Country	Per Capita Income in US$	Life Expectancy at birth	Literacy Rate for 15+ yrs population	Gross Enrollment Ratio for three levels	HDI Rank in the world
Sri Lanka	4390	74	91	69	93
India	3139	64	61	60	126
Myanmar	1027	61	90	48	130
Pakistan	2225	63	50	35	134
Nepal	1490	62	50	61	138
Bangladesh	1870	63	41	53	137

        i.            As per the Per Capita Income in US:Topcountry−SriLankawith4390:Topcountry−SriLankawith4390; Bottom country - Myanmar with 1027$.

     ii.            Considering the life Expectancy at birth: Top country - Sri Lanka has 74; Bottom country - Myanmar has 61.

   iii.            Literacy Rate for 15+ yrs population: Top country - Sri Lanka has 91; Bottom country - Bangladesh has 41.

   iv.            Gross Enrollment Ratio for three levels: Top country - Sri Lanka is 69; Bottom country - Pakistan is 35.

      v.            According to the HDI Rank in the world: Top country - Sri Lanka ranks 93; Bottom country - Nepal ranks 138.

Question 13. The following table shows the proportion of undernourished adults in India. It is based on a survey of various states for the year 2001. Look at the table and answer the following questions.

State	Male (%)	Female (%)
Kerala	22	19
Karnataka	36	38
Madhya Pradesh	43	42
All Sates	37	46

        i.            Compare the nutritional level of people in Kerala and Madhya Pradesh.

     ii.            Can you guess why around 40 percent of people in the country are undernourished even though it is argued country? Describe in your own words.

Answer : (i) The nutritional level of people of Kerala is quite higher than the people – both males and females of Madhya Pradesh. Their ratio of the under-nourished is less than that of Madhya Pradesh i.e more per cent of males and females are undernourished in Madhya Pradesh. 
(ii) There is enough food in the country, even then 40% of the people in the country are undernourished because:

• A large number of people are so poor that they cannot afford nutritious food.
• In most of the states, the Public Distribution System (PDS) does not function properly and the poor people cannot get food items at cheaper rates.
• There is a lack of educational and health facilities in many parts of the country. So many people remain backward and poor. As such, they are unable to get nutritious food.

Revision Notes

 

1. The idea of development or progress has always been with us.
2. We have aspirations or desires about what we would like to do and how we would like to live.
3. In this chapter, we shall make a beginning for understanding development.
4. It is only through a democratic political process that these hopes and possibilities can be achieved in real life.

·         WHAT DEVELOPMENT PROMISES – DIFFERENT PEOPLE, DIFFERENT GOALS:

·         1. People seek things that are most important for them, i.e., that which can fulfill their aspirations or desires.
2. In fact, at times, two persons or groups of persons may seek things which are conflicting.
3. So two things are quite clear:
(i) Different persons can have different developmental goals.
(ii) What may be developed for one may not be developed for the other. It may even be destructive for the other.

·         INCOME AND OTHER GOALS:

·         1. What people desire are regular work, better wages and decent price for their crops or other products that they produce. In other words, they want more income.
2. People also seek things like equal treatment, freedom, security, and respect for others.
3. In some cases, these may be more important than more income or more consumption because material goods are not all that you need to live.
4. Money, or material things that one can buy with it, is one of the factors on which our life depends on non-material things mentioned above.
5. There are many things that are not easily measured but they mean a lot to our lives. These are often ignored.
6. However, it would be wrong to conclude that what cannot be measured is not important.
7. Similarly, for development people look at a mix of goals.
8. The developmental goals that people have are not only about better income but also about better income but also about other important things in life.

·         NATIONAL DEVELOPMENT:

·         1. It is very important to keep in mind that different persons could have different as well as conflicting nations of a country’s development.
2. National development means thinking about fair and just path for all, whether there is a better way of doing things.

·         HOW TO COMPARE DIFFERENT COUNTRIES OR STATES?

·         1. Usually, we take one or more important characteristics of persons and compare them based on these characteristics.
2. For comparing countries, their income is considered to be one of the most important attributes.
3. Countries with higher income are more developed than others with less income.
4. The income of the country is the income of all the residents of the country. This gives us the total income of the country.
5. For comparison between countries, total income is not such useful measure.
6. Hence, we compare the average income which is the country divided by its total population. The average income is also called per capita income.
7. In World Development Report brought out by the World Bank, this
8. Countries with per capita income of USD 12736 per annum and above in 2013, are called rich countries and those with per capita income of USD 1570 or less are called low-income countries.
9. India comes in the category of low middle-income countries because its per capita income in 2013 was just US$1570 per income.

·         INCOME AND OTHER CRITERIA:

·         1. Let us compare the per capita income of Maharashtra, Kerala, and Bihar.
2. Maharashtra has the highest per capita income and Bihar is at the bottom.
3. So, if per capita income were to be used as the measure of development, Maharashtra will be considered the most developed state of the three.

·         PUBLIC FACILITIES:

·         1. Money in your pocket cannot buy all the goods and services that you may need to live well.
2. Income by itself is not a completely adequate indicator of material goods and services that citizens are able to use.
3. Normally, your money cannot buy the pollution-free environment or ensure that you get unadulterated medicines unless you can afford to shift to a community that already has all these things.
4. Money may also not be able to protect you from infectious disease unless the whole of your community takes preventive steps.

·         HUMAN DEVELOPMENT – Development of an individual in such a way that he can able to earn and fulfill his materialistic desire.

·         SUSTAINABILITY OF DEVELOPMENTS:
1. Since the second half of the twentieth century, a number of scientists have been warning that the present type, and levels, of development are not sustainable.
2. Resources are replenished by nature as in the case of crops and plants.
3. In the case of groundwater, if we use more than what is being replenished by rain then we would be overusing this resources.
4. Consequences of environmental degradation do not respect national or state boundaries; this issue is no longer region or nation-specific.
5. Sustainability of developments comparatively a new area of knowledge in which scientists, economists, philosophers and other social scientists are working together.

 

Test Paper

1.     There are 4 families with per capita income Rs.40,000, Family A earns Rs.39,000, Family B earns Rs.45,000, Family C earns RS.28,000. What is the income of Family D? (1)

a.      Rs.46,000

b.     Rs.44,000

c.      Rs.48,000

d.     Rs.45,000

2.     Development goal for a prosperous farmer is (1)

a.      To get loan from bank

b.     To get irrigation facility

c.      To get his children educated

d.     To get farming implements

3.     Development goal of a girl in a rich urban family is (1)

a.      Freedom

b.     Going to school

c.      Get married

d.     Learning cooking

4.     Which of the following levels of the people can compare human development index of countries? (1)

a.      Composition of society

b.     Type of Government

c.      The health of people

d.     Environment of country

5.     Which of the given refers to economic development? (1)

a.      Increase in standard of living

b.     Increase in per capita incomes

c.      Increase in security

d.     Increase in rate of population

6.     Give one example how rich and poor have conflicting goals of development. (1)

7.     Which area of the world has the largest crude oil reserves? (1)

8.     Give three examples where an average is used for comparing situations. (1)

9.     What do people need to get more income? (1)

10.Why is total income not a useful measure for Comparison between two countries? Explain the reason. (3)

11.Mention any four characteristics of Development. (3)

12.Explain some of the important ideas of the section (income and other goals) in your own words. (3)

13.Do the following two statements mean the same? Justify your answer. (3)

                                i.            People have different developmental goals.

                             ii.            People have conflicting developmental goals

2.     With the help of an example, show how two groups may have different notions of development. (5)

3.     Why do people's development goals vary? Explain with examples. (5)

Answers

1.      

c.      Rs.48,000
Explanation: Since the average income is equal to Rs.40, 000. Therefore total income of four families = Rs.40,000 ×× 4 = Rs.1,60,000
Income of family D = Rs.1,60,000 - Rs.39,000 - Rs.45,000 - Rs.28,000 = Rs.48,000

2.      

c.      To get his children educated
Explanation: A prosperous farmer wants high income for his crops. He also wants his children to be able to get education and settle abroad.

3.      

c.      Freedom
Explanation: She wants to get as much freedom as her brother and is able to decide what she wants to do in her life. She also wants to pursue her studies abroad.

                         

c.      The health of people
Explanation: The Human Development Index (HDI) is a statistical tool used to measure a country's overall achievement in its social and economic dimensions The social and economic dimensions of a country are based on the health of people, their level of education attainment and their standard of living. It was created to emphasize that people and their capabilities should be the ultimate criteria for assessing the development of a country, not economic growth alone.

5.      

b.     Increase in per capita incomes
Explanation: Per capita income is often used to measure an area's average income. This is used to see the wealth of the population with those of others. Per capita income is often used to measure a country's standard of living. Therefore with the increase in country's per capita income there will be improvement in its standard of living. High level of per capita income and high standard of living are the main characteristics of developed countries.

6.     We can take the example of dams. It is a known fact that industrialists will benefit from dams as their need for electricity is fulfilled, but it will have a negative effect on the poor people who may be displaced and not rehabilitated.

7.     The Middle East countries of the world have the largest crude oil reserves.

8.     We can use averages for comparing the following situations:

                                i.            Average income of two countries,

                             ii.            average speed of two vehicles over a distance,

                           iii.            average height of the students in two different classes of a school.

2.     People need a secure job, better wages, good educational and medical facilities and decent price for crops to get more income.

3.     Total income is not a very useful or conclusive standard for comparison between the economic conditions of two countries because it does not reveal the disparities in the economy. It does not show how the distribution of income among the different sections of the society. It only shows the income of a country in aggregate.
For instance, consider two countries A and B both having a total income of Rs.5,00,000. But suppose country A is having more population than country B. Therefore, the income will be distributed among more number of people and hence each person will get a smaller share of income (per capita income). So, even if the total income is same, people of the two countries will not have similar income pattern.

4.     Characteristics of development are as follow from the present condition:

                                i.            Development is linked with the desire to improve the present condition.

                             ii.            Development involves thinking about the questions and about the ways in which we can work towards achieving our desired goals.

                           iii.            There can be different development goals for different persons.

                           iv.            Development for one may not be developed for other. It may even be destructive for other. Many industries or malls are being constructed by taking away the land from the farmers. This is no doubt development for the industrialists or the big businessmen, but it is not development for the poor people as they are losing their land.

                              v.            Per capita income is the most important factor to calculate development.

5.     The primary deciding factor of section is the income of an individual. However, the other goals are also sought with almost equal importance. Here, apart from finding ways to get more income, people often look for such things like security, equal treatment, freedom and respect.
These happen to be the most important goals in the life of an individual. The main factor on which life is dependent is money or income; however, the quality of our life depends on a number of non-material factors.

6.     Both the statements are true but their meanings are different. Two people may have different developmental goals but they need not always be conflicting. For example, the developmental goal of different people may differ according to their status. A girl from a rich family may want the same freedom as her brother, may want to go on foreign trips, own a costly mobile, may want to study abroad etc. But a girl from a poor family will consider going to school and enjoying with friends as her developmental goal. Here the developmental goals are not conflicting. An example of conflicting developmental goal can be the construction of a flyover to reduce waiting period at a railway crossing. This can be a developmental goal for an office goer. But if the construction of the flyover necessitates demolition of slums, it can be contradictory for the slum dwellers. But on the other hand, 24-hour electricity supply would be a developmental goal for almost each and every person.

7.     Let's take the example of raising the height of the Sardar Sarovar Dam on the river Narmada. The local community was not in favour of this as it would displace them. The local community felt that due to this project they would get less water for irrigation and there will be greater environmental degradation. However, the government’s notion of development, in this case, was that by raising the height of the dam, they would be able to provide more water to the people of Saurashtra region of Gujarat, which always suffered from water scarcity. In addition, according to the government, more electricity would be generated with this measure, which would benefit all the people living in that area. So, even though the government took it up as a developmental project, the local people felt threatened by this project and opposed it. So we see that the notion of development of the local people was very much different from that of the government.

8.     Different people have different goals. Each one of them seeks different things. They seek things that are most important for them, i.e. those things which can fulfil their aspirations or desires. A person may want to fulfil his basic amenities and some others may want to earn more for their family to get a high class lifestyle. A girl may want the same amount of opportunities and freedom as her brother, while her brother may not like this. A landless rural labourer may desire more days of work and better wages, whereas prosperous farmers may desire assured high family income and opportunity for their children to be settled abroad. In fact, at times, two persons or groups may seek things which are conflicting. For example, to get more electricity, industrialists may want more dams, but this may submerge the land and disrupt the lives of people who are displaced. They may resent this and may prefer small check dams or tanks to irrigate their fields.