BASIS	NEFT	RTGS
Meaning	NEFT is a system of online money transfers where the payment is made in a near real-time basis.	RTGS is an electronic payment system where the funds are transferred at the same time when the transaction took place.
Introduced in	2005	2004
Ceiling limit	No such limit, but the maximum amount per transaction is restricted to Rs. 50,000.	Minimum - 2 lakh, Maximum - No limit
Appropriate for	Small value transaction	High-value transaction.
Processing	Comparatively Slow	Fast

Demonetisation is the act of stripping a currency unit of its status as legal tender.
(i) It occurs whenever there is a change of national currency.
(ii) The current form or forms of money is pulled from circulation, often to be replaced with new coins or notes.
(iii) On 8 November 2016, the Indian Prime Minister Mr. NarendraModi announced the demonetization of all Rs.500 and Rs.1000 bank notes of the Mahatma Gandhi Series.

The following are the frequent methods of credit control under selective method:
1. Rationing of Credit
2. Direct Action
3. Moral Persuasion
4. Method of Publicity
5. Regulation of Consumer’s Credit
6. Regulating the Marginal Requirements on Security Loans

(i) RBI introduced the Banking Ombudsman Scheme in 1995.
(ii) Under this scheme, the complainants can file their complaints in any form, including online and can also appeal to the Ombudsman against the awards and the other decisions of the Banks.

(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.

a. Value of M1 = 800 + = Rs. 2100 billion. 1000 + 100 + 200
b. Value of M2 = 2100 = Rs. 2700 billion. (M1) + 300 + 100 + 200

(i) Fiat money includes items that are designated as money that are intrinsically worthless.
(ii) Commodity money are things like gold or silver which have alternative uses other than money.
(iii) They can be used in dental fillings or as jewelry.

(i) The essential feature of deflation is falling prices, reduced money supply and unemployment.
(ii) Though falling prices are desirable at the time of inflation, such a fall should not lead to the fall in the level of production and employment.

Wage-price spiral is used to explain the cause and effect relationship between rising wages and rising prices or inflation.

Keynes extended his equation in the following form:
n = p (k + rk') or p = n/(k + rk')
Where,
n = total money supply
p = price level of consumer goods
k = peoples' desire to hold money in hand (in terms of consumer goods) in the total income of them
r = cash reserve ratio
k' = community’s total money deposit in banks, in terms of consumers goods

The Marshall equation is expressed as:
M = KPY
Where
M is the quantity of money
Y is the aggregate real income of the community
P is Purchasing Power of money
K represents the fraction of the real income which the public desires to hold in the form of money.

(i) M1 and M2 are known as narrow money
(ii) M3 and M4 are known as broad money

(i) The field of exchange also went on extending with growing economic development.
(ii) The exchange of goods is now extended to distant lands.

i. According to Say‘s Law, full employment is maintained by an automatic and self adjustment mechanism in the long run.
ii. But Keynes had no patience to wait for the long period for he believed that – In the long run we are all dead.
iii. It is not the automatic adjustment process which removes unemployment.
iv. But unemployment can be removed by increase in the rate of investment.

The amount that households, firms, the governments and the foreign purchasers would like to spend on domestic output.

Nominal GDP measures gross domestic product in current rupees. Real GDP measures gross domestic product by adjusting Nominal GDP for price changes

When the total value of commodity exports of a country exceeds the total value of commodity imports of that country, it is said that the country has a ‘favourable’ balance of trade.

i) difference in the endowments of factors of production between countries, and
ii) differences in the factor proportions required in production.

1. There are two countries and two commodities (2 x 2 model).
2. Labour is the only factor of production.
3. Labour units are homogeneous.
4. The cost or price of a commodity is measured by the amount of labour required to produce it.
5. There is no transport cost.

1. External trade
2. Foreign trade
3. Inter-regional trade

a) Internal Trade and
b) International Trade.

The reason that both equations are true is because of the identity MPS + MPC = 1. This is true because there are only two things that one can do with one's income - consume and save.

i. The MPC is the marginal propensity to consume.
ii. It is the fraction of an increase in income that is consumed.
iii. The MPS is the marginal propensity to save.
iv. It is the fraction of an increase in income that is saved.
v. The MPC and the MPS must always sum to 1 since there are only two things that one can do with one's income - consume and save.

(i) Hicks has combined the k and β mathematically and given it the name of the Super Multiplier.
(ii) The super multiplier is worked out by combining both induced consumption and induced investment.

The rate of discount which makes the discounted present value of expected income stream equal to the cost of capital.

Objective factors are the external factors which are real and measurable. These factors can be easily changed in the long run.

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.

(i) The Average Propensity to Consume \(\frac { c }{ y } \)
(ii) The Marginal Prosperity to Consume =\(\frac { \triangle c }{ \triangle y } \)
(iii) The average Propensity to Save =\(\frac { s }{ y } \)
(iv) The Marginal Propensity to Save =\(\frac { s }{ y } \)

Y = National Income
C = Consumption Expenditure
I = Investment Expenditure
G = Government Expenditure
(X – M) = Net Exports

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

(i) The multiplier assumes that those who earn income are likely to spend a proportion of their additional income on consumption.
(ii) In practice, people tend to spend their additional income on other items
(iii) Such expenses are known as leakages.

The term investment means purchase of stocks and shares, debentures, government bonds and equities.

(i) Autonomous Investment
(ii) Induced Investment

(i) Gross Domestic Product (GDP) is the total value of output (goods and services) produced by the factors of production located within the country's boundary in a year.
(ii) The factors of production may be owned by anyone-citizens or foreigners.
GDP = GNP - Net income earned from abroad

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.

GDP is the total market value of final goods and services produced within the country during a year.
GDP by expenditure methods at market prices = C + I + G + (X - M)

Net Domestic Product = GDP - Depreciation.

Keynes theory of employment was based on the view of the short run. According to him, the factors of production such as capital goods, supply of labour, technology and efficiency of labour remain unchanged while determining the level of employment.

The Government of India passed in 1951 the State Financial Corporation Act and SFCs were setup in many states.

The system by which the central bank fixes ceiling or maximum amount of loans and advances for every commercial bank.

An increase in business activities after the lowest point. (ie) depression

(i) The symbol of Indian rupee came into use on 15^th July, 2010.
(ii) India is the 5^th Country to accept a unique currency symbol.

M₁ and M₂ are narrow money as they includes currency plus demand deposits in banks and other deposits.

(i) Creeping inflation is slow moving and very mild the rise in prices will not be perceptible but spread over a long period
(ii) This is also known as mild inflation of moderate inflation.

Globalisation is nothing but connect the nations together through international trade and aiming at global development.

y = C + I + G + (X - M)
C - Consumption Expenditure (Households)
I - Investment Expenditure (Firms)
G - Government Expenditure (Government)
(X-M) - Net Exports (External Sector)

i) The USA
ii) West Germany
iii) Australia and
iv) Japan

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