2008 I08/1
ECONOMICS
Paper 1
Tllil!' 3 Hours J {A1axinwm Marl,s.' :WO

INSTRUCTIONS
Each question IS printed both in English and in Kaflnadu.
AnsuJers must he v..Jrittcn in the medium specified (English or Kannada) ill the Admission Ticket issued fo you, which must be stafrd cleurly on the cover of the answer book in the prol'ided for this jJl1llJosc. In of any doubt In the Kanrwda text, pleusc r4er to English text.
ThiS four purts
A 20 marks
B 100 mark.,;
C 90 marks
D 90 marks

Marh' allotted tn each question arc indicated In each part.
All qucstlilliS III Part Part nand Part C are compulsory. An8u'cr three quc8tiotis In Part D.


08/1 (4
PARTB lOx 10= 1O0 Ansu'cr each question in about 100 wo,.ds. Each question carries 10 marIo;, Define and distingutsh between each of the f'ollOloing pairs of concepts:
2.
National Product at Market price and Factor cost

3.
Absolute advantage and Comparative advantage

4.
Economies of Scale and Economies of Scope

5.
Primary deficit and Budgetary deficit

6.
Mutual Funds and Venture Capital Funds

7.
Explicit costs and External costs

8.
Marginal Rate of Substitution and Marginal Rate of Technical Substitution

9.
Accelerator and Super Multiplier

10.
Demand pull and Cost punh inflation

11.
Laffer curve and Lorenz curve


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08/1 161
PART C
Answer each question in about 150 words. Each question carries
15 marks.

12.
Explain the technique of estimating Gross National Product. Is it a satisfactory indicator of economic welfare? Substantiate your answer.

13.
Describe Samuelson's Revealed Preference Theorem. How is it superior to Indifference Curve Analysis?

14.
Explain the objectives and composition of fiscal policy. How does it promote economic stability?

15.
\That is budget? Illustrate the significance of budgetary analysis.

16.
Examine the main concerns of Hong Kong Ministerial Conference.

17.
Discuss the causes of the recent financial crisis. "'11at initiatives vmuld you suggest to manage the crisis


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0811 (8 I
PARTD 3x30=UO
AnsI-ocr any three of the follo/Ding questions, each in about 300 words. Each question carries 30 marks.
18.
Explain the Cobb-Douglas production function and its usefulness in economic analysis.

19.
Explain the determinants of investment decisions. Discuss the natuff' of investments for promoting employment and income.

20.
Distinguish between progressive and proportional taxation. How can progressive taxation help in ensuring distributional equity?

21.
Vllat are the different kinds of disequilibrium in Balance of Payments Suggest measures to solve the problem of structural disequilibrium in Balance of Payments.

22.
What is budgetary deficit? Analyse its implications for the economy.


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2008
ECONOMICS
Paper 2
HourH j AfuxunuJrI lHad's :WO

INSTRUCTIONS
Each quc8twn IS pnnted both in English and in KanlJuda.
Ansu!crs be writtC'n in the mediurn specified rEIlRl,sh or Kannadrjj Ul the AdmISSion Ticket issued to you, must be stated clear!...,' on the cot'er of the booh III the prot1lded for this purpose, In case of doubt in the KCllilJodu te."t, please refer to English text.
TllIS paper has four parts:
A 20 marks
B lOll marks
C gil marks
D gil marks

olloftcr! to each questIOn orc indicated in each part.
AlI qllestiolls III Part .tt, Part 13 and Part Care compuz..wry Answcr any three qUpstlOllS 1fI Part D.




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08/2
PAHTA 4x5=20 Answer each question ill about 50 u'ords. Each question carries 5 marhs.
1. Define and explain the following with reference to the Indian economy

Human Development
(bJ Inclusive Growth



Non-Performing Assets


Rural Infrastructure Development Fund


131 08/2

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08/2 [4 I

PARTB lOx 100]00
Answer each question in about 100 words. Each quest/'on carries In.ar/cs'.
2.
Explain the structure and characteristics of the unorganised Sector in India. Discuss the possibilities of organising labour and provision of social security in this sector.

3.
vVhat is micro-finance? Examine the trends in the grOvth of Groups in Karnataka under various programmes,

4.
Discuss the Competition Act 2002. Vhat are the powers and functions of the Competition Commission of India?

5.
Discuss the Public Distribution System in India. How far has it ensurL,d food security for the poor in the country?

6.
Examine the impact of the Global Financial Crisis on the IndIan economy.

7.
Give a comparative analysis of the criteria adopted b.y the 10th, 11til nnd 12th Finance Commissions for devolution of resources across the States.

8.
Discuss the structure of dL1centraiised planning in Karnataka. Explain tbe functions of District Planning Committee.

9.
Explain the mam features of Karnataka Rural Emplo.yment GUflrantL'c Scheme Vhat are th0 shelf of projects admissible under it

10.
Examine tlw Provision of Urban Amenities in Rural Areas (PUHAi as n neo-Gandhian model.


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08/2 I
11. Consider the following data for Dharwad district in Karnataka State
Life expectancy at birth 61·9 years
Infant Mortality Rate 65 per thousand
Adult Literacy Rate 71·61 percent
Female Literacy Rate 54·6 percent
Iv) Gross Enrolment Ratio 84·30 percent
Income Index

On the basis or the UNDP formula,

State the maximum and l111111mUm values for different variable..,;.


Calculate Health Index.


Calculate Education Index.


Calculate Human Develupment Index.


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08/2 PART C Gx15=UU
Ansu'cr each question in about 150 words. Each question carries 15 marIn"
12.
Explain the methodology adopted by High Power Committep on Redressal of Regional Imbalances for identification of regional imbalances In Karnataka State. What are the major recommendations of'the Committee?

13.
Assess the trends in fi!5cal imbalances in India in recent years. Vhat tlw indicators of it Examine the role of FRBM Act 1ll fiscal management in India.

14.
Examine the place of agriculture in Karnataka economy. Explain Ow objcctives and basic features of Karnataka's New Agricultural Policy. Hov," far may it help to achieve a growth rate of 4·5 percent during till' XI Plan


15. Explain t.he debate on farm size, productivity and profitability'. Are tIll' vwws Amartya Sen und findings of G.R. Saini t:ontradit:tor)'
16. Vhat 18 capital account convertibility Di>icU8S the nw.lU)' recommendations of Tnraporc Committee in this regard. Vhat arL· initiatIves taken by the Go'ernment of India in this reg::lrd
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08/2

17. Consider the following information about India's foreign trade for the years 1999 -2002
Year Unit Value Index Volume Index
Exports Px Imports Pm Exports qx Imports qm 705·0 69R·()
1999 ­2000 604·0 450·0 46H!
2000 2001 624·0 487·0 571·0
2001 -2002 618·0 493·0 593·0 78:J·O


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For the above estimate

Gross terms of trade (yeanvisc)


Net terms of trade (yeunvise)


Income terms of trade (yean-vise) Explain how they arc estimated.


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08/2 I12I
PARTD Answer any three of the follo[ving questions, each in about 300 words. Each question carries 30 marhs.
18.
Examine the regional pattern of distribution of industries in Karnataka State. Evaluate the policy measures undertaken to promote development of industries in backward areas.

19.
Discuss the various components of Agreement on Agriculture. -Vhy dops it adversely alfect developing countries Vvllat are the priority issues for Indian agriculture at present?

20.
Examine the trends in human development across the districtti as brought out by Karnataka Human Development Report 2005. Identify the major requirements to promote higher level of human development in tIlE' State.

21.
Distinguish between income poverty and human poverty. Examine trends in povert:y in India. Critically evaluate the poverty alleviation programmes in India.


22. Consider the following datu about the Indian budget
1I1 crrJn's/
Revenue receipts 54,B50
(iii Capital receipts :J9,010
Loan recoveries and other receipts

Market borrowing and other liabilities

Total receipts


Revenue expenditure


Capital expenditure (vii Total expenditure


Interest payments
93,9GO
7:1,510 31,BOO 1,05,310 21,500

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08/2 (14
From the above data, define and estimate the following
(al Fiscal deficit
Revenue deficit

Budgetary deficit


Primary deficit



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