ECONOMICS CHAPTER -1
DEVELOPMENT
[Link] is total income of countries not used to make comparisons between them?
A) [Link] income is not used to make comparisons between countries because different
countries have different population size .
[Link] total income will not tell us what an average person is likely to earn.
Q2. What does national development refer to?
A) N.D. refers to the ability of a country to improve the social welfare of the people.
For e.g. by providing social amenities such as quality education, transportation, medical
facilities etc.
Q3. Mention the limitations of per capita income as an indicator of development?
A)1. Per capita income does not tell us anything about the distribution of income. A
poor country with a more equal distribution of income would be better than a richer
country with unequal distribution of income.
2. Per capita income does not measure various facilities and services that influence
quality of life like educational facilities, health care etc.
Q4) What is Development? Mention 3 characteristics or aspects of development?
A)Development is a positive growth or change in economic, social and political aspects of a
country.
1. Different people have different developmental goals.
2. Development for one may be destruction for other.
3. For development people look at a mix of goals.
Q5) ‘Development for one may be destruction for other’ Do you agree with the statement
? Justify your answer.
A) 1. I agree with the statement that D for one may be destruction for other, as people
have different developmental goals , they seek what is more important to fulfil their
desires and aspirations.
[Link] example, the construction of a dam leads to infrastructural development ,
generation of electricity etc. but at the same time it may lead to large scale
displacement of people , loss of livelihood and shelter for many living close to the
dam .
3. Hence construction of dam may be development for some and destruction for
many others.
Q6) What is the main criterion used by the World Bank in classifying different countries?
What are the limitations of this criterion?
Ans) 1. Per capita income or average income measured in dollars is the main criterion used
by the WB to classify different countries as developed or underdeveloped countries.
2. It is calculated by dividing the total income of the country by its population. According to
the World Development Report
Limitations:
1. National income is estimated in the domestic currency of each country. It does not
include the purchasing power of each currency.
2. Per capita income is affected by the size of the population of a country. If a country
has large population, its per capita income will be low despite having large national
income.
3. Per capita income does not tell us anything about the distribution of income in the
country.
4. per capita income is also not a true indicator of development as a country with high
per capita income may lack on many other crucial indicators like education and
health care.
Q7. What is HDI? Mention its variables.
A) Human Development Index is a measure to compare and rank countries on the basis
of development levels of their economy. It is published by UNDP in Human
Development Report.
2. The three variables of HDI are :
Per capita income
Life expectancy at birth
Mean years of schooling for population 25 yrs and above.
Q8) ‘Consequences of environmental degradation do not respect national or state
boundaries’ Justify the given statement
A) Environmental degradation is not restricted to national or state boundaries. Its
consequences are felt in the surrounding states and the neighbouring countries and
sometimes globally.
[Link] in one country may affect other countries in the form of climate change or
global warming.
2. Deforestation in one state can disturb rainfall patterns of adjoining areas.
Q9) In what respects is the criterion used by UNDP for measuring development different
from the one used by the world Bank?
ANS)[Link] compares the development of countries on the basis of literacy rate ,gross
enrolment ratio and health status whereas W.B. uses only per capita income as the
indicator for development.
[Link] ranks countries on the basis of development , a total of 189 countries are ranked
whereas WB divides countries into 3 categories
(i) High income countries
(ii) Middle income countries
(iii) Low income countries
[Link] has a broader concept of development as compared to World Bank
Q10. Why does Kerala have low infant mortality rate?
Ans) Kerala has low Infant Mortality rate because it has adequate provision of basic
health and educational facilities.
Q11. Explain the following terms
(i) Net Attendance Ratio
(ii) Literacy Rate
(iii) Average Income
(iv) Life expectancy
(v) IMR
Q11. Besides income, what are other developmental goals of people?
Ans) Apart from income people also look for the following:
Respect and dignity
Clean pollution free environment
Safe working conditions
Job security
[Link] do we use averages ? Are their any limitations to their use ?
Ans) Averages are used for comparison when data are large and complex for better
understanding. Total income is not a useful measure as it does not indicate what an
average person is likely to earn.
Limitations:
1. It hides disparities in the distribution of income. A country may be rich but there
may not be equal distribution of income. A small number of people may be
extremely rich and the masses may be poor .
( Give example from textbook, both table and explanation pg 9)
Q13)Why is Sustainable Development essential for economic growth?
Ans. Sustainable Development is essential for economic growth because:
(i) Natural resources are not unlimited. They should be used judiciously.
(ii) For ensuring good quality of life and health resources need to be preserved.
(iii) Over use of natural resources may lead to their exhaustion.
(iv) Conserving the environment is crucial for development.