ECONOMICS- CH 1 DEVELOPMENT

LEARNING OBJECTIVES:
• To understand the concept of development.
• To define development and recognize that different people have different
developmental goals.
• To differentiate between individual and national development.
• To understand why average income is not a sufficient measure of development.

SECTION – A
1. Read the data given below and answer the question:
State Infant mortality rate per Literacy rate%
1000 live births (2018) (2017-18)
Haryana 30 82
Kerala 7 94
As per the data given above, why has Kerala a low infant mortality rate?
(a) It has adequate provision of basic health and educational facilities.
(b) It has adequate provision of basic health and cultural facilities.
(c) It has adequate provision of basic social and educational facilities.
(d) It has adequate provision of basic health and technical facilities.
Ans. (a) It has adequate provision of basic health and educational facilities.
The literacy rate is inversely proportional to the infant mortality rate. The higher the
level of education, the lower the level of infant mortality rate. In the given data, it is
observed that Kerala has a higher literacy rate than Haryana which is the reason for
the low infant mortality rate in Kerala.
2. Read the following data and answer the question that follow:
Some comparative Data on Haryana, Kerala and Bihar
State Infant Mortality Literacy Net Attendance
Rate (per thousand Rate % Ratio (per 100
person)
person)
Haryana 30 82 61
Kerala 7 94 83

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 Bihar 32 62 43
How much is the Net Absence Ratio of Haryana? Choose the appropriate option
from the following:
(a) 39 (b) 27 (c) 38 (d) 18
Ans. (a) 39
The Net Attendance Ratio per 100 in Haryana is 61. To calculate the Net Absence
Ratio, students must subtract the Net Attendance Ratio from 100.
Net Absence Ratio = 100 – 61 = 39
3. Under the sustainable development goals, social equality with regard to access to
resources is one of the most pressing challenges. Accordingly, which of the following
crises is related to the statement above?
(a) Damage to infrastructure due to floods
(b) Scarcity of clean water for consumption
(c) Damage to crops caused by heavy rains
(d) Combating water-borne diseases in rural India
Ans. (b) Scarcity of clean water for consumption
Scarcity of clean water for consumption damages social equality because some
regions have abundance of these resources while other regions face a scarcity.
4. Which of the following statements defines Sustainable Development?
(a) Sustainable use of natural resources without considering the need of the future
generation.
(b) Present generation fulfils its needs while considering the needs of the future
generation as well.
(c) It means utilization of natural resources by the past, present and future
generation.
(d) To meet the needs of the future generations even if the needs of the present
generation go unmet.
Ans. (b) Present generation fulfils its needs while considering the needs of the future
generation as well.
5. Suppose there are four families in your locality, the average per capita income of
whom is
10,000. If the income of three families is 6,000, 8,000 and 14,000 respectively, what
would be the income of the fourth family?
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(a) 5,000 (b) 10,000 (c) 12,000 (d) 15,000
Ans. (c) 12,000
It is given that the average per capita income is 10000 (only for calculation purposes)
10000 = (X + 6000 + 8000 + 14000) /4
Hence, X = 40000 – 28000 = 12000
6. Which one of the following is a developmental goal of the factory workers?
(a) Better wages (b) Better technology
(c) More hours of work (d) More labour work
Ans. (a) Better wages
Factory workers are not paid enough wages to reduce the overall cost of production.
Hence, their ideal developmental goal is more wages- suited according to their work.
In the following questions 7 and 8, a statement of assertion (A) is followed by a
statement of Reason (R). Choose the correct answer out of the following
choices.
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct
explanation of Assertion (A)
(c) Assertion (A) is true but Reason (R) is false
(d) Assertion (A) is false but Reason (R) is true
7. Assertion (A): Kerala has low Infant Mortality Rate.
Reason (R): Kerala has adequate provision of basic health and educational facilities.
Ans. (a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion (A)
8. Assertion (A): Development involves thinking about the ways in which we can
work towards achieving goals of holistic growth.
Reason (R): Holistic growth is economic growth.
Ans. (c) Assertion (A) is true but Reason (R) is false.

SECTION – B
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9. Study the picture and answer the questions that follow:

(a) What could be the developmental goal for the shown area?
(b) Can there be conflicting developmental goals for the people in the picture?
Ans. (a) The developmental goal for the people living in a slum will be provision of
sturdy but affordable houses and other living conditions including food, water and
health facilities.
(b) Yes, people from similar class can also have conflicting developmental goals.
10. “Different persons can have different developmental goals.” Support the
statement with an example.
Ans. “Different persons can have different developmental goals”. People have
different developmental goal because they come from different background.
Development goal for farmer might be irrigation facilities for an unemployed youth it
may mean employment opportunities.
11. Why is average income considered as an important criterion for development?
Give one reason.
Ans. Average income represents the total income of a country divided by the total
population. If the average income is adequate to meet the basic requirements and
other facilities, then country is considered developed.
SECTION – C
12. “Money cannot buy all the goods and services that a person may need to live
well”. Explain the statement with suitable examples.
Ans. Money cannot buy all the goods and services that a person may need to live
well. Income by itself is not a completely adequate indicator of material goods and
services that citizens are able to use. For example, normally, money cannot buy a
pollution free environment or ensure that a person gets unadulterated medicines,
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unless a person can afford to shift to a community that already has all these things.
Money may also not be able to protect individual from infection, disease, unless the
whole of our community takes preventive steps.
13. ‘The question of sustainability of development raises many fundamentally new
issues about the nature and process of development’. Explain it with examples.
Ans. (i) Sustainable development has continued to evolve as that of protecting the
world’s resources while its true agenda is to control the world’s resources.
(ii) Environmentally sustainable economic growth refers to economic development
that meets the needs of all without leaving future generations with fewer natural
resources than those we enjoy today.
(iii) The essence of this form of development is a stable relationship between human
activities and the natural world, which does not diminish the prospects for future
generations to enjoy a quality of life at least as good as our own.
(iv) Example: Crude oil that we extract from the earth is a non-renewable resource.
Still its explorations are being done non-judiciously.
14. What is meant by economic development? What are the two bases of measuring
economic development of a country?
Ans. Economic development means the rate of production is greater than the rate of
increase in population and the rate of growth of GDP is high enough to fulfill the basic
needs of the population.
Two basis of measuring development of a country are:
(i) Average or per capita income.
(ii) National income and public facilities.
15. "The future generation may not have sufficient resources as compared to the
present generation." Explain the statement by giving suitable examples.
Ans. The future generation may not have sufficient resources as compared to the
present generation. This can be asserted in the following ways:
(i) Resources like groundwater are getting overused every day. They might get
exhausted very soon.
(ii) Even renewable resources like hydropower may get exhausted.
(iii) Newer resources keep on adding to the line but they all have limited life due to
their overuse.
SECTION – D
16. ‘Per capita income is not considered a true measure of development.’ Comment.
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Ans. When the total income of a country is divided by its total population, it is called
per capita income or average income. It is not considered a true measure of
development because of the following reasons:
(i) It does not indicate how this income is distributed among the people as
population is a variable component.
(ii) Life expectancy and infant mortality rate can be used as other criteria for
measuring development.
(iii) Literacy rate and health status of people in the country can be the other criteria
for measuring development.
(iv) A corruption-free society, gender equality, pollution-free environment,
investments in the health and education sector, etc. are some other indicators of
measuring development.
17. How has the World Bank classified countries? What are the limitations of this
report?
Ans. The World Bank classifies countries according to the Per Capita Income:
(i) Countries with a per capita income of more than US $49,300 per annum and
above are called rich countries.
(ii) Countries with per capita income less than US $2500 are called poor countries.
(iii) Countries with per capita income between the range of US $49300 - $2500 are
called middle income countries.
The limitations of this report can be explained in the following points:
(i) It considers only income. Other aspects of life are ignored.
(ii) The World Development Report (WDR) only talks about income per person and
not the economic gap between different communities and classes.
SECTION – E (Case Study Based Questions)
18. For comparing countries, their income is considered to be one of the most
important attributes. Countries with higher income are more developed than others
with less income. This is based on the understanding that more income means more
of all things that human beings need. Whatever people like, and should have, they
will be able to get with greater income. So, greater income itself is considered to be
one important goal. Now, what is the income of country? Intuitively, the income of
the country is the income of all the residents of the country.
This gives us the total income of the country. However, for comparison between
countries, total income is not such a useful measure. Since, countries have different
populations, comparing total income will not tell us what an average person is likely
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to earn. Are people in one country better off than others in a different country?
Hence, we compare the average income which is the total income of the country
divided by its total population. The average income is also called per capita income.
In World Development Reports, brought out by the World Bank, this criterion is used
in classifying countries. Countries with per capita income of US$ 12,056 per annum
and above in 2017, are called rich countries and those with per capita income of US$
955 or less are called low-income countries. India comes in the category of low
middle income countries because it’s per capita income in 2017was just US$1820
per annum. The rich countries, excluding countries of Middle East and certain other
small countries, are generally called developed countries.
Read the following source and answer the questions given below.
i) The passage given above relates to which of the following options?
a) education b) income c) health d) all of these
Ans. D) all of these
ii) The income of the country is the income of: -
a) few states of the country
b) tax collected from public
c) deposits in the bank accounts
d) all the residents of the country
Ans. D) all the residents of the country.
iii) The income which is the total income of the country divided by its total population
is known as:
a) average income b) per capita income c) revenue income d) all of the above
Ans. B) per capita income
iv) India comes in which of the following categories of countries based on Per Capita
Income?
a) Rich countries
b) Low-income countries
c) Low middle income countries
d) Highest income countries
Ans. C) Low middle income countries