(i) Models in Mathematical Economics are developed based on Economic Theories, while Econometric Models are developed based on Economic Theories to test the validity of Economic Theories in reality through the actual data.
(ii) Regression Analysis in Statistics does not concentrate more on error term while Econometric Models concentrate more on error terms  

1. Sir M. Vishveshwarya (1934) made the first attempt in laying foundation for economic planning in India through his book, "Planned Economy of India". It was a 10 year plan.
2. Jawaharlal Nehru (1938) set-up "National Planning Commission" by a committee but due to the World War II it did not materialize.
3. In 1940,8 leading industrialists of Bombay presented a 15 Year Bombay Plan.
4. In 1944 S. N Agarwal gave the Gandhian Plan focusing on the agriculture and rural economy.
5. M.N. Roy in 1945 drafted People's Plan aiming at mechanisation of agricultural production.
6. In 1950 J.P. Narayan advocated Sarvodaya Plan which was inspired by Gandhian Plan and with the idea of Vinoba Bhave.
7. It gave importance to agriculture, small and cottage industries.
8. After considering all the plans in the same year Planning Commission was set up to formulate Five Year Plan in India by Jawaharlal Nehru.
9. Nehru was the first Chairman of Planning Commission, Government of India.

(i) The law of conservation of matter and energy, emphasizes that in any production system "what goes in must come out".
(ii) All resources extracted from the environment eventually become unwanted wastes and pollutants.
(iii) Production of output by firms from inputs results in discharge of solid, liquid and gaseous wastes.
(iv) Waste results from consumption activities by households.
(v) Thus material and energy drawn from environment are used for production and consumption and returned back to the environment as wastes.
(vi) \(\mathrm{R}=\mathrm{W}_{1}+\mathrm{W}_{2}\)
(vii) Input = Output

(i) Trade blocks cover different kinds of arrangements between or among countries for mutual benefit.
(ii) Free Trade Area, Customs Union, Common Market and Economic Union.

1. Credit Creation means the multiplicátion of loans and advances.
2. Every loan creates its own deposits.
3. It is assumed that all banks are obliged to keep the ratio between cash and its deposits at a minimum of 20 %.
4. The banks do not keep any excess reserves.
5. There are no drains in the supply of money.
6. Now, when a customer deposits Rs.1000 in a bank, the bank creates a deposit of Rs.1000 in his favour.
7. Bank deposits have increased by Rs.1000.
8. It is required to keep only a cash reserve of 20 %, i.e. Rs.800 is excess cash reserve.
9. The bank lends out this Rs.800 to the public.
10. The debtor deposits this money with another bank B.
11. Bank B is creating a deposit of Rs.800.
12. Bank B has also excess cash reserve of Rs.640.
13. It could in turn, lend out Rs.640.
14. The total deposits will now grow into Rs.1000 + 800 + 640 +........ till ultimately the excess cash reserve ends.
15. When this stage is reached, the total of the above will be Rs.5000.
16. Money Multiplier \( \frac{1}{20 \%}=\frac{1}{20} \times 100=5\)
Credit creation = 1000 x 5 = Rs.5000

(i) On the basis of speed there are four types of inflation - Creeping inflation, Walking Inflation, Running inflation, Galloping inflation.
(ii) Demand-Pull inflation, Cost-Push inflation.
(iii) On the basis of inducement - currency inflation, credit inflation, deficit induced inflation, profit induced inflation, scarcity induced inflation, tax induced inflation.

(i) In the Keynesian model, output is determined mainly by aggregate demand.
(ii) The aggregate demand is the amount of money which entrepreneurs expect to get by selling the output produced by the labourers employed.
(iii) Aggregate demand (spending) is the amount that households, firms, the governments and the foreign purchasers would like to spend on domestic output
Aggregate demand has four components:
1. Consumption demand (C)
2. Investment demand (I)
3. Government expenditure (G)
Net Export ( export - import) (X - M)
AD = C + I + G + (X - M)

(i) The means of production and properties are owned by private and public.
(ii) Public and Private Sectors co-exist private sectors are profit motivated and public sectors aims at maximum social welfare.
(iii) The national plans prepared by the central planning authority is accepted by all sectors.
(iv) Basic economic problems are solved through the price mechanism and state intervention.
(v) Though the private can own resources, produce and distribute goods and services, the overall control on the economic activities is with the government.