From the point of view of equity, the resources should be distributed among the different states so that each state receives a fair share of revenue.

The main sources of External public debt are IMF, World Bank, IDA and ADB etc. Loan from other countries and the Governments

Modern States have to build the base for the economic development of the country by creating social and economic infrastructure.

(i) Money market is the mechanism through which sthort term funds are loaned and borrowed.
(ii) It designates financial instittutions which handle the purchase, sale and transfer of short term credit instruments.

1. Bank of Bengal (1809)
2. Bank of Bombay (1840)
3. Bank of Madras (1843)

Brazil, Russia, India, China and South Africa

In 1963, IMF established compensatory financing facility to provide additional financial assistance to the member countries, particularly primary producing countries facing shortfall in export earnings

(i) Demand for money means the demand to hold money, that is, to keep one’s resources in liquid form instead of in some form of investment.
(ii) It means the desire to hold money in liquid cash as against spending the money.

(i) Scarcity of goods happens either due to fall in production (eg. farm goods) or due to hoarding and black marketing.
(ii) This also pushes up the price.
(iii) This has happened is Venezula in the year 2018.

i. Barter system was introduced by Mesopotamia tribes.
ii. Phoenicians adopted bartering of goods with various other cities across oceans.
iii. Babyloninan’s also developed an improved barter system, where goods were exchanged for goods.

i. Seasonal Unemployment type of unemployment occurs during certain seasons of the year.
ii. In agriculture and agro based industries like sugar, production activities are carried out only in some seasons.
iii. These industries offer employment only during that season in a year.

1. Statistics is not suitable to the study of qualitative phenomenon
2. Statistical laws are not exact:
3. Statistics table may be misused:
4. Statistics is only one of the methods of studying a problem.

Simple Correlation:
If only two variables are taken for study then it is said to be simple correlation. Ex. Y= a + bx
Multiple Correlations:
If three or more than three variables are studied simultaneously, then it is termed as multiple correlation.
Ex: Determinants of Quantity demanded
Qd = f (P, Pc, Ps, t, y)
Where Qd stands for Quantity demanded, f stands for function.

1. Statistics is necessary for the formulation of policies to start new course, according to the changing environment.
2. There are many educational institutions owned by public and private engaged in research and development work to test the past knowledge and evolve new knowledge.
3. These are possible only through statistics.

1. Capital gains arise when a capital asset such as a house, other property, stocks or shares, etc. is sold at higher price than was paid for it at the time of purchase.
2. Capital gains are excluded from national income.

Indian rupee was devalued three times since 1947.
1. On 29th September, 1949.
2. On 6th June, 1966
3. On 1st July, 1991

(i) Absolute Advantage (Adam Smith, 1776)
(ii) Comparative Advantage (David Ricardo, 1817)

The value of multiplier depends on MPC Multiplier =(K) = 1/1-MP

(i) PC
(ii) Microwave oven
(iii) Television
(iv) CD player
(v) Radio
(vi) Fan
(vii) Cell phones
(viii) Electric Iron
(ix) Washing machine

(i) Presence of greenhouses gases in the atmosphere increases the global temperature.
(ii) Depletion of Ozone layer

This means that increased income is unlikely to lead to fall in either consumption or saving. Thus with increased income both consumption and saving increase.

Macro economics suffers from certain limitations. They are:
1. There is a danger of excessive generalisation of the economy as a whole 
2. It assumes homogeneity among the individual units.
3. There is a fallacy of composition. What is good of an individual need not be good for nation and viceversa. And, what is good for a country is not good for another country and at another time.
4. Many non - economic factors determine economic activities; but they do not find place in the usual macroeconomic books

Sustainable development is concerned with the welfare, of present and future generation.

(i) TRIMS (Trade Related Investment Measures) are related to conditions or restrictions in respect of foreign investment in the country
(ii) It calls for introducing equal treatment for foreign companies on par with national companies.

According to Adam smith, there are four canons or maxims of taxation. They are as follows.
(i) Economical
(ii) Equitable
(iii) Convenient
(iv) Certain
(v) Efficient and flexible

Induced investment is the expenditure on fixed assets and stocks which are required when level of income and demand in an economy goes up.

Capital gains arise when a capital asset such as a house, other property, stocks or shares, etc. is sold at higher price than was paid for it at the time of purchase. Capital gains are excluded from national income.

Financial planning is nothing but techniques of planning in which resources are allocated in terms of money

PT = MV + MlVl
\(P=\cfrac { { MV1 }+{ MV 1} }{ T } \)

(i) In economic system both private and public sectors co-exist.
(ii) It work together towards economic development.