Important Questions

Balbharti Maharashtra State Board 11th OCM Important Questions Chapter 1 Introduction of Commerce and Business Important Questions and Answers.

Maharashtra State Board 11th Commerce OCM Important Questions Chapter 1 Introduction of Commerce and Business

Select the correct option and rewrite the sentence

Question 1.
The difficulty of finance is solved by ……………….
(a) advertising
(b) transport
(c) banks
Answer:
(c) banks

Question 2.
A retailer does not come into direct contact with a …………….
(a) manufacturer
(b) consumer
(c) wholesaler
Answer:
(a) manufacturer

Question 3.
Returns in employment is called …………….
(a) fees
(b) salary
(c) profit
Answer:
(b) salary

Question 4.
Fishing is …………… type of primary industry.
(a) agricultural
(b) extractive
(c) genetic
Answer:
(b) extractive

Question 5.
Mercantile agents are the middlemen who help …………….
(a) trade
(b) industry
(c) employees
Answer:
(a) trade

Question 6.
Business includes …………. and ……………
(a) production
(b) distribution
(c) consumption
Answer:
(a) production

Question 7.
…………….. means buying and selling within the countrv.
(a) Home Trade
(b) Foreign Trade
Answer:
(a) Home Trade

Question 8.
Publicitv creates …………….
(a) value
(b) utility
(c) demand
Answer:
(c) demand

Question 9.
The problem of risk is overcome by ……………
(a)transport
(b) warehousing
(c) insurance
Answer:
(c) insurance

Question 10.
A courier agent is a ………………
(a) professional
(b) businessman
(c) employee
Answer:
(c) employee

Question 11.
The activity that removes difficulty of risk is ………………
(a) insurance
(b) transport
(c) advertising
Answer:
(a) insurance

Question 12.
Building of dams is an activity done under ……………… industry.
(a) primary
(b) secondary
(c) tertiary
Answer:
(b) secondary

Question 13.
Re-export is similar to …………….
(a) import
(b) export
(c) entrepot
Answer:
(c) entrepot

Question 14.
When goods and services are purchased from another country it is called as ………………. trade.
(a) export
(b) import
(c) entrepot
Answer:
(b) import

Match the pairs

Question 1.

Group A	Group B
(a) Non-economic activity	(1) Salary
(b) Business	(2) Gardening
(c) Insurance	(3) Carrying goods
(d) Retail Trade	(4) Export
(e) Secondary Industry	(5) Trade on small scale
	(6) Poultry
	(7) Profit
	(8) Textile industry
	(9) Risk coverage
	(10) Trade on large scale

Answer:

Group A	Group B
(a) Non-economic activity	(2) Gardening
(b) Business	(7) Profit
(c) Insurance	(9) Risk coverage
(d) Retail Trade	(5) Trade on small scale
(e) Secondary Industry	(8) Textile industry

Question 2.

Group A	Group B
(a) Industry	(1) Home trade
(b) Warehousing	(2) Remove difficulties of trade
(c) Import Trade	(3) Link between producer and retailer
(d) Wholesaler	(4) Supply
(e) Auxiliaries to Trade	(5) Creates time utility
	(6) Demand
	(7) Creates place utility
	(8) External trade

Answer:

Group A	Group B
(a) Industry	(4) Supply
(b) Warehousing	(5) Creates time utility
(c) Import Trade	(8) External trade
(d) Wholesaler	(3) Link between producer and retailer
(e) Auxiliaries to Trade	(2) Remove difficulties of trade

Question 3.

Group A	Group B
(a) Banking	(1) Home Trade
(b) Trade	(2) Problem of distance
(c) Industry	(3) Difficulty of place
(d) Insurance	(4) Risks in business
(e) Transport	(5) Production of goods
	(6) Buying and Selling of goods
	(7) Finance
	(8) Marketing
	(9) Export trade
	(10) Import trade

Answer:

Group A	Group B
(a) Banking	(7) Finance
(b) Trade	(6) Buying and Selling of goods
(c) Industry	(5) Production of goods
(d) Insurance	(4) Risks in business
(e) Transport	(3) Difficulty of place

Question 4.

Group A	Group B
(a) Morning Walk	(1) Social objective
(b) Genetic Industry	(2) Foreign Trade
(c) Import Trade	(3) Warehousing
(d) Employment Generation	(4) Horticulture
(e) Business Risk	(5) Non-economic activity
	(6) Economic objective
	(7) Internal trade
	(8) Mining
	(9) Insurance
	(10) Banking

Answer:

Group A	Group B
(a) Morning Walk	(5) Non-economic activity
(b) Genetic Industry	(4) Horticulture
(c) Import Trade	(2) Foreign Trade
(d) Employment Generation	(1) Social objective
(e) Business Risk	(9) Insurance

Give one word, phrase or term

Question 1.
An activity that creates form utility
Answer:
Industry

Question 2.
The industry that depends upon primary industry for production.
Answer:
Secondary industry

Question 3.
Part of business that is concerned with the distribution of goods.
Answer:
Commerce

Question 4.
Specialised intermediaries in trade who bring together the buyers and sellers.
Answer:
Mercantile Agents

Question 5.
Monetary returns of a professional.
Answer:
Fees

Question 6.
The industry that depends upon nature.
Answer:
Primary Industry

Question 7.
Trade in which goods are sold to other country.
Answer:
Export

Question 8.
An aid to trade which solves the problem of finance.
Answer:
Banking

Question 9.
An activity which is performed for money consideration.
Answer:
Business

Question 10.
Name the industry which is concerned with reproduction of plants and animals.
Answer:
Genetic

Question 11.
Agencies which help in the smooth conduct of business.
Answer:
Auxiliaries to Trade

Question 12.
Trade transactions between two countries.
Answer:
Foreign Trade

Question 13.
An activity motivated by profit.
Answer:
Business

Question 14.
The type of trade in which goods are sold in large quantities.
Answer:
Wholesale trade

Question 15.
Trade within the country.
Answer:
Internal trade

Question 16.
An occupation in which services are rendered for money.
Answer:
Profession

Question 17.
Human activities conducted for earning money.
Answer:
Business

Question 18.
A type of trade that sells the goods directly to ultimate consumers.
Answer:
Retail Trade

Question 19.
Trade that takes place between the traders of two different countries.
Answer:
External trade

Question 20.
An aspect of business which is concerned with the production of goods.
Answer:
Industry.

State True or False

Question 1.
Advertising is not useful for trade.
Answer:
False

Question 2.
Entrepot trade is a combination of home trade and foreign trade.
Answer:
False

Question 3.
Playing game is a non-economic activity.
Answer:
True

Question 4.
Wholesale trade is a trade done on small scale.
Answer:
False

Question 5.
Business is done with social objectives also.
Answer:
True

Question 6.
Human wants are limited.
Answer:
False

Question 7.
Business includes industry and commerce.
Answer:
True

Question 8.
Commerce is concerned with production of goods.
Answer:
False

Question 9.
Industry is concerned with the supply side of goods.
Answer:
True

Question 10.
Transport creates time utility.
Answer:
False

Question 11.
Business and Commerce have same meaning.
Answer:
False

Question 12.
Industry represents demand side while commerce represents supply side.
Answer:
False

Question 13.
Intermediaries are unavoidable in modern distribution system.
Answer:
True

Question 14.
The scope of commerce is wider than business.
Answer:
False

Question 15.
Industrial developments creates employment opportunities.
Answer:
True

Question 16.
The aim of business is to make profit only.
Answer:
False

Question 17.
The object of business is to earn profit.
Answer:
True

Question 18.
Trade means buying and selling of goods.
Answer:
True

Question 19.
The scope of commerce is limited.
Answer:
False

Question 20.
Profession and Business is one and the same thing.
Answer:
False

Question 21.
Warehousing creates time utility only.
Answer:
False

Question 22.
Transport has place utility.
Answer:
True

Question 23.
Coal mining is a manufacturing industry.
Answer:
False

Question 24.
Commerce is a branch of business.
Answer:
True

Question 25.
Business is a branch of economics.
Answer:
True

Question 26.
Commerce depends more on men than machinery.
Answer:
True

Question 27.
Wholesaler is in direct contact with ultimate consumers.
Answer:
False

Question 28.
Commerce is a wider term than business.
Answer:
False

Question 29.
Risk is inevitable in business activities.
Answer:
True

Question 30.
Tertiary industry depends upon primary and secondary industry.
Answer:
True

Question 31.
Internal traders handle import and export.
Answer:
False

Question 32.
Business can be expanded with the help of mercantile agent.
Answer:
True

Question 33.
Industrial activities take place after commerce finishes its role.
Answer:
False

Question 34.
Changing fashions is one of the important cause of business risk.
Answer:
True

Question 35.
Available resources should be used to its maximum.
Answer:
True

Find the odd one

Question 1.
Mining, Fishery, Plant nursery, Sugar factory.
Answer:
Sugar factory

Question 2.
Buying, Selling, Reselling, Professional services.
Answer:
Professional services

Question 3.
Wholesaler, Doctor, Retailer, Mercantile agent.
Answer:
Doctor

Question 4.
Business, Profession, Trekking, Employment.
Answer:
Trekking

Question 5.
T.V, Print, Radio, Postal services.
Answer:
Postal services

Question 6.
Cell phones, Rail, Water, Air.
Answer:
Cell phones

Complete the sentences

Question 1.
………………… auxiliary takes care of risks in business.
Answer:
Insurance

Question 2.
Fixed income is received in ………………..
Answer:
employment

Question 3.
Specific education and registration is required for a ………………..
Answer:
professional

Question 4.
Commerce = ……………… + auxiliaries to trade.
Answer:
trade

Question 5.
Economic activities are divided into business, ……………….. and employment.
Answer:
profession.

Select the correct option

Question 1.
(Profit motive, Monetary Exchange, Non-economic activity, Barter Exchange, Economic activity)

Group A	Group B
(i) Cooking by mother	—————
(ii) Worker working in a factory	—————
(iii) ————-	Spine of business
(iv) ————-	Buying note book for cash
(v) Wheat exchanged for rice	—————

Answer:

Group A	Group B
(i) Cooking by mother	Non-economic activity
(ii) Worker working in a factory	Economic activity
(iii) Profit motive	Spine of business
(iv) Buying note book for cash	Monetary exchange
(v) Barter exchange	Wheat exchanged for rice.

Question 2.
(Consumer goods, Capital goods, Profession, Social objective, Employment.)

Group A	Group B
(i) ————–	Tea, Milk, Pencil, etc.
(ii) Doctor, Lawyer, CA.	—————-
(iii) ————-	Employer – employer relationship
(iv) Machinery, Plant, Furniture	—————–
(v) Avoid unfair trade practices	————

Answer:

Group A	Group B
(i) Tea, Milk, Pencil, etc	Tea, Milk, Pencil, etc.
(ii) Doctor, Lawyer, CA.	Profession
(iii) Employment	Employer – employer relationship
(iv) Machinery, Plant, Furniture	Capital goods
(v) Avoid unfair trade practices	Social objectives.

Answer in one sentence

Question 1.
What is the reward for business?
Answer:
Reward for business is profit.

Question 2.
What is the reward for employment?
Answer:
Reward for employment is salary or wages.

Question 3.
What is home trade?
Answer:
When buying and selling of goods and services take place with the geographical boundaries of a country, it is called as home trade or internal trade.

Question 4.
What is foreign trade?
Answer:
When buying and selling of goods and services takes place between different countries, it is called as foreign trade.

Question 5.
What is profession?
Answer:
Profession is that part of an economic activity under which a person uses his knowledge and special skill to give service by charging certain fees.

Question 6.
What is the reward for profession?
Answer:
The reward for profession is called fees.

Question 7.
Who acts as an intermediate in trade ?
Answer:
Mercantile agent acts as an intermediate in trade.

Correct the underlined word and rewrite the following sentences

Question 1.
Warehousing creates place utility.
Answer:
Warehousing creates time utility.

Question 2.
Auxiliaries to trade means buying and selling of goods.
Answer:
Trade means buying and selling of goods.

Question 3.
Advertising acts as the intermediaries in trade.
Answer:
Mercantile agent acts as the intermediaries in trade.

Question 4.
Retail trade is a trade conducted on large scale.
Answer:
Wholesale trade is a trade conducted on large scale.

Question 5.
Secondary industry depends upon tertiary industry for production.
Answer:
Secondary industry depends upon primary industry for production.

Question 6.
Transport covers the risks in the business.
Answer:
Insurance covers the risks in the business.

Question 7.
Formal education is required for a businessman.
Answer:
Formal education is required for a professional.

Question 8.
Tertiary industry is a manufacturing industry.
Answer:
Tertiary industry is a service industry.

Explain the following terms/concepts

Question 1.
Industry.
Answer:

1. Industry relates to economic activities which are associated with the conversion of resources into goods. E.g. Processing of goods, mining, breeding and rearing of animals.
2. Industry creates form utility.

Question 2.
Genetic Industry.
Answer:
Industry engaged in reproduction and multiplication of plants and animals is called as genetic industry. E.g. Mangoes provided by primary industry are used for making mango pulp.

Question 3.
Construction industry.
Answer:
Industry engaged in construction of buildings, dams, bridges, roads, etc. is called constructions industry. It creates immovable wealth for a nation.

Question 4.
Tertiary industry.
Answer:
Industry providing supportive services to primary and secondary industries is called tertiary industry. E.g transport, banking, hotel industry, tourism industry, entertainment industry, etc.

Question 5.
Commerce.
Answer:

1. It is that part of business which is related to distribution of goods and services produced by industry.
2. It involves all activities which maintain free flow of goods. It bridges the gap between producers and consumers.

Study the following case/situation and express your opinion.

1. Mr. Utsav is a lawyer. He practice at Mumbai High Court, Mrs. Kruti has disputes with her employer, M/s Shah & Co. for which she approach Mr. Utsav, who advice her to file a petition at Mumbai High Court for which she paid fees of? 10,000 to Mr. Utsav.

Question 1.
Who is Mr. Utsav?
Answer:
Mr. Utsav – a person providing service of lawyer. He is a lawyer by profession.

Question 2.
Who is Client?
Answer:
Mrs. Kruti is a client.

Question 3.
Who is accused?
Answer:
Mr. Shah & Co. is an accused in above case.

2. Globally Local Event company run by Mr. Sneh, conducts a wedding event for Mr. Suresh Jha at Dubai and charged him professional fees Rs 5,00,000/-.

Question 1.
What kind of business the company is doing?
Answer:
Globally Local Event Company is doing a profession of Wedding planner i.e. event organizer.

Question 2.
What is return to professions?
Answer:
The return to profession is called a fees.

Question 3.
Who is client?
Answer:
Mr. Suresh Jha is a client of the company.

3. Neeta Tours conducting tours and travels abroad, Doshi and family booked their tour to America and paid Rs 10,000/- for total tour.

Question 1.
What kind of business done by Neeta Tours?
Answer:
Neeta Tour is doing a business of Tourism – a tour organizer.

Question 2.
What currency is used?
Answer:
Currency used in the above case is Dollar.

Question 3.
Who is Travelers?
Answer:
Neeta Tours.

4. Mr. Bhardwaj an Indian businessman purchased goods from Mr. Chen Tsiany of Rs 1,20,000/ A and sold the same goods to Mr. Thomsan in Britain for Rs 1,50,000/-.

Question 1.
Who is Mr. Bhardwaj?
Answer:
Indian exporter and importer.

Question 2.
What kind of Trade is done by Mr. Bhardwaj?
Answer:
Entrepot Trade.

Question 3.
Who is Mr. Thomsan?
Answer:
Importer

Distinguish between the following

Question 1.
Commerce and Trade.
Answer:

	Commerce	Trade
(1) Meaning	Commerce is a part of business which looks after the distribution of goods and services.	Trade is buying and selling of goods and services.
(2) Scope	Commerce includes trade and auxiliaries to trade.	Trade includes home trade and foreign trade.
(3) Size	Commerce is wider than trade as it includes trade plus auxiliaries to trade.	Trade is narrower than commerce.
(4) Part of	Commerce is a part of business.	Trade is a part of commerce.
(5) Coverage	Commerce covers wider activities as it includes buying and selling as well as support services which help trade.	Trade is confined only to buying and selling. Thus it is more near to buyers.

Question 2.
Trade and Auxiliaries to Trade
Answer:

	Trade	Auxiliaries to Trade
(1) Meaning	It is buying and selling of goods.	These are the agencies or services which facilitate trade.
(2) Objective	To earn profit.	To remove difficulties in trade.
(3) Scope	Trade covers home trade and foreign trade.	It covers banking, insurance, transport, warehousing, etc.
(4) Parties	Basically two parties are involved i.e. buyer and seller.	Number of institutions are involved.
(5) Importance	It is an important part of commerce.	They play subsidiary role in commerce.

 

Balbharti Maharashtra State Board Class 11 Secretarial Practice Important Questions Chapter 5 Members of a Company Important Questions and Answers.

Maharashtra State Board 11th Secretarial Practice Important Questions Chapter 5 Members of a Company

1A Select the correct answer from the options given below and rewrite the statements.

Question 1.
Every person domiciled in India will be a major when he completes ____________ years of age.
(a) 16
(b) 20
(c) 18
Answer:
(c) 18

Question 2.
____________ is an institution where securities are held in electronic form.
(a) Depository
(b) Partnership
(c) One person company
Answer:
(a) Depository

Question 3.
____________ is a legal person.
(a) Company
(b) Trust
(c) Partnership firm
Answer:
(a) Company

Question 4.
____________ person is eligible for membership of a company.
(a) Foreigner
(b) Lunatic
(c) Insolvent
Answer:
(a) Foreigner

1B. Match the pairs.

Question 1.

Group ‘A’	Group ‘B’
(a) Member	(1) Ownership of shares of the company
(b) Shareholder	(2) Cannot become a member
(c) Register of member	(3) List of members
(d) Partnership Firm	(4) Transfer of shares by operation of law
(e) Forfeiture of shares	(5) Persombelow the age of 18 years
	(6) Voluntary sale of shares
	(7) Termination of membership
	(8) Entry of the name in Register of members
	(9) Transfer of shares
	(10) Record of particulars of all the members of the company

Answer:

Group ‘A’	Group ‘B’
(a) Member	(8) Entry of the name in Register of members
(b) Shareholder	(1) Ownership of shares of the company
(c) Register of member	(10) Record of particulars of all the members of the company
(d) Partnership Firm	(2) Cannot become a member
(e) Forfeiture of shares	(7) Termination of membership

1C. Write a word or a term or a phrase that can substitute each of the following statements.

Question 1.
A person can enter into a share purchase transaction on behalf of a minor.
Answer:
A guardian

Question 2.
The firm cannot be a member of the company.
Answer:
Partnership firm

Question 3.
In this family, shares can be registered only in the name of its ‘Karta’.
Answer:
Hindu Undivided Family

Question 4.
Being a registered entity, it can be a member of the company.
Answer:
Co-operative society

Question 5.
They can buy shares of an Indian company.
Answer:
Foreigner

Question 6.
Transfer of shares by operation of law.
Answer:
Transmission of Shares

Question 7.
Cancellation of shares by a company.
Answer:
Forfeiture of Shares

Question 8.
Shares are paid back after a certain period of time.
Answer:
Redeemable Preferences Shares

Question 9.
Holding securities in Electronic form.
Answer:
Dematerialization

Question 10.
Share of profit distributed to shareholders.
Answer:
Dividend

1D. State whether the following statements are True or False.

Question 1.
The member who is the subscriber to the Memorandum of Association of a company is a shareholder.
Answer:
True

Question 2.
A person below the age of 18 years is called a minor.
Answer:
True

Question 3.
The process of removing the name of a member from the Register of member is call admission of a partner.
Answer:
False

Question 4.
A person who has been allotted shares of the company is called a shareholder.
Answer:
True

Question 5.
Transfer of shares is by operation of law.
Answer:
False

1E. Find the odd one.

Question 1.
Minor, Not completed 18 years, Membership of a Company
Answer:
Membership of a company

Question 2.
Co-operative society, Limited Liability, Partnership Firm
Answer:
Partnership Firm

Question 3.
Operation of Law, Death, and Insolvency, Wrongly entered in the Register of members.
Answer:
Wrongly entered in the Register of member

1F. Complete the sentences.

Question 1.
Member invest money in company in return of ____________
Answer:
dividend

Question 2.
Shareholder has right to attend ____________
Answer:
all General Meeting

Question 3.
Member also have right to remove the ____________
Answer:
Auditors

Question 4.
Member means a person whose name is entered in ____________
Answer:
the Register of Members

Question 5.
The investor who owns securities in electronic form is called ____________
Answer:
Beneficial owner

Question 6.
Depository is an institution where securities are held in ____________
Answer:
electronic form/dematerialised form

Question 7.
Foreigner can buy shares subject to provision of ____________
Answer:
FEMA, 1999

1G. Select the correct option from the bracket.

Question 1.

Group ‘A’	Group ‘B’
(1) Transmission of shares	………………………
(2) ……………………..	The foreigner can buy shares

(Compulsory transfer of shares, FEMA Act, 1999)
Answer:

Group ‘A’	Group ‘B’
(1) Transmission of shares	Compulsory transfer of shares
(2) FEMA Act, 1999	The foreigner can buy shares

Question 2.

Group ‘A’	Group ‘B’
(1) Major	……………………….
(2) Limited Liability Partnership	………………………
(3) Hindu Undivided Family	……………………..
(4) …………………..	Official Receiver
(5) Depository	……………………..

(Juristic person, Insolvency of a member, Can hold companies share, NSDL/CDSL, Karta)
Answer:

Group ‘A’	Group ‘B’
(1) Major	Can hold companies share
(2) Limited Liability Partnership	Juristic person
(3) Hindu Undivided Family	Karta
(4) Insolvency of a member	Official Receiver
(5) Depository	NSDL/CDSL

Question 3.

Group ‘A’	Group ‘B’
(1) Owns securities in Electronic-form	……………………
(2) ………………………..	Legally competent to manage one’s own affair
(3) Cannot be a member	…………………….
(4) ……………………….	Voluntary return of shares by member
(5) Additional shares offered free of cost	…………………….

(Lunatic/Insolvent, Bonus Shares, Beneficial owner, Sui-juris, Surrender of Shares)
Answer:

Group ‘A’	Group ‘B’
(1) Owns securities in Electronic-form	Beneficial owner
(2) ‘Sui-Juris	Legally competent to manage one’s own affair
(3) Cannot be a member	Lunatic/Insolvent
(4) Surrender of Shares	Voluntary return of shares by member
(5) Additional shares offered free of cost	Bonus Shares

1H. Answer in one sentence.

Question 1.
What do you mean by Forfeiture of shares?
Answer:
Forfeiture means the cancellation of shares by a company.

Question 2.
What do you mean by Dematerialized form?
Answer:
It means holding Financial Securities in Electronic form and not in physical form.

Question 3.
What does FEMA stand for?
Answer:
Foreign Exchange Management Act 1999.

Question 4.
Who is a depository?
Answer:
The depository is an institution that holds securities in electronic form/dematerialized form and NSDL and CDSL.

Question 5.
Who is the beneficial owner?
Answer:
The beneficial owner is an investor who owns securities in electronic form and has an interest in the securities.

Question 6.
What is FEMA?
Answer:
FEMA 1999, is an Act that aims at facilitating external trade and promote the foreign exchange market in India.

Question 7.
What is the transmission of shares?
Answer:
Compulsory transfer of shares to the legal heir of deceased shareholders is called as the transmission of shares.

Question 8.
Who looks after the shares of an insolvent member?
Answer:
Official Receiver or Assignee looks after the shares of an insolvent member.

Question 9.
What is Class Action Suit?
Answer:
When a group of people with similar harm caused to them sue the opposition party for redressal of harm, is called a Class Action Suit.

Question 10.
What do you mean by the membership of Principal of Estoppel?
Answer:
A member who has disposed (sold) of his shares and yet knowingly allows his name to remain on the register of members and otherwise exercises his membership is estopped from denying that he is a member and is held responsible for the liabilities of membership.

1I. Correct the underlined word and rewrite the following sentences.

Question 1.
Co-operative Society cannot be a member of a company.
Answer:
Karta of HUF cannot be a member of a company.

Question 2.
A foreigner can buy shares subject to provisions of FERA, 1999.
Answer:
A foreigner can buy shares subject to provisions of FEMA, 1999.

Question 3.
Partnership firm is a juristic person.
Answer:
Limited Liability Partnership is a juristic person.

Question 4.
Beneficial owner is an institution that holds a share in electronic form.
Answer:
Depository is an institution that held a share in electronic form.

Question 5.
Transfer of shares is compulsory to transfer of shares to the legal heir of the deceased member.
Answer:
Transmission of shares is compulsory to transfer of shares to the legal heir of the deceased member.

Question 6.
Surrender of Shares means cancellation of shares by the company.
Answer:
Forfeiture of Shares means cancellation of shares by the company.

Question 7.
Right Issue means shares given to existing shareholders free of cost.
Answer:
Bonus Issue means shares given to existing shareholders free of cost.

Question 8.
Part of the profit given to its shareholder is called Interest.
Answer:
Part of the profit given to its shareholder is called a Dividend.

2. Explain the following Terms/Concepts.

Question 1.
Class Action Suit
Answer:
A group of people with similar harm caused, when sues the oppositions party jointly is called Class Action Suit.

Question 2.
Dividend
Answer:
It means a share in the profit of a company which is distributed to equity shareholders and preference shareholders.

Question 3.
Right Issue
Answer:
Right issue means an issue of additional shares to exist equity shareholder again certain price. It is not issued at free of cost.

Question 4.
Bonus Issue
Answer:
Bonus issue means, issue of additional shares to existing equity shareholders free of cost. It is generally done to capitalize the reserves of the company.

Question 5.
Covenants of the Article
Answer:
It means the contents and clauses of the Articles of Association of the company.

3. Answer in brief.

Question 1.
Who can become a Member of the Company?
Answer:

1. A Person: Any person who is competent to enter into a contract i.e. he is above the age of 18 years, and not an insane/lunatic or not an insolvent can become a member of a company.
2. Partnership Firm: A partnership firm can not be registered as a member of the company but the partners may hold the shares of a company in their individual name or as Joint Shareholders.
3. Hindu Undivided Family: As Karta is the head of the Hindu Undivided family business, he can buy shares of the company on behalf of the Hindu Undivided Family, but HUF itself cannot be a member of the company.
4. A Company: If the Memorandum of Association grants, then one company can buy the shares of another company and become a member, but the company itself cannot invest in the shares of its own company.
5. Society: A society that is registered under the Societies Act, can buy the shares of a company and become a member.
6. Trust: A registered trust can become a member of a company in its own name.
7. Non-Resident/Foreigner: A non-resident Indian (NRI) can buy shares in a company. It has to fulfill the conditions specified in the FEMA Act, 1999.
8. Limited Liability Partnership: LLP can become a member of a company as it is a juristic person.

Balbharti Maharashtra State Board Class 11 Secretarial Practice Important Questions Chapter 4 Documents Related to Formation of a Company Important Questions and Answers.

Maharashtra State Board 11th Secretarial Practice Important Questions Chapter 4 Documents Related to Formation of a Company

1A. Select the correct answer from the options given below and rewrite the statements.

Question 1.
The document that contains the constitution of the company is _____________
(a) Article of Association
(b) Prospectus
(c) Memorandum of Association
Answer:
(c) Memorandum of Association

Question 2.
A _____________ company must issue prospectus to the public for capital subscription.
(a) Statutory
(b) Private
(c) Public
Answer:
(c) Public

Question 3.
For alteration in the Articles _____________ resolution is required.
(a) Ordinary
(b) Special
(c) Circular
Answer:
(b) Special

Question 4.
The Domicile clause of the Memorandum of Association states about the _____________ of a company.
(a) capital
(b) liability
(c) registered address
Answer:
(c) registered address

Question 5.
The aims and objectives of a company are stated in the _____________ clause of the Memorandum of Association.
(a) Name
(b) Object
(c) Domicile
Answer:
(b) Object

Question 6.
The _____________ is almost an unalterable document.
(a) Memorandum
(b) Articles
(c) Prospectus
Answer:
(a) Memorandum

Question 7.
The _____________ is primary and supreme document of the company.
(a) Memorandum of Association
(b) Articles of Association
(c) Prospectus
Answer:
(a) Memorandum of Association

1B. Match the pairs.

Question 1.

Group ‘A’	Group ‘B’
(a) Memorandum of Association	(1) Letter issued to a selected group of investor
(b) Articles of Association	(2) Invitation to purchase Shares
(c) Prospectus	(3) Constitution of Company
(d) Civil liability	(4) Letter issued to all shareholder
(e) Offer letter	(5) Invitation for meeting
(f) Book Building Process	(6) Rules regarding Internal Management
	(7) Pay compensation to Investor
	(8) Rules regarding external affairs of the company
	(9) Collecting bank deposits
	(10) Determining issue price of shares

Answer:

Group ‘A’	Group ‘B’
(a) Memorandum of Association	(3) Constitution of Company
(b) Articles of Association	(6) Rules regarding Internal Management
(c) Prospectus	(2) Invitation to purchase Shares
(d) Civil liability	(7) Pay compensation to Investor
(e) Offer letter	(1) Letter issued to a selected group of investor
(f) Book Building Process	(10) Determining issue price of shares

1C. Write a word or a term or a phrase that can substitute each of the following statements.

Question 1.
A constitution or charter of the company.
Answer:
Memorandum of Association

Question 2.
An almost unalterable document of the joint-stock company.
Answer:
Memorandum of Association

Question 3.
The clause of the memorandum provides the name of the state in which the company’s registered office is situated.
Answer:
Domicile Clause

Question 4.
An invitation to the public to subscribe for shares or debentures of the company.
Answer:
Prospectus

1D. State whether the following statements are True or False.

Question 1.
The AOA is an alterable document.
Answer:
True

Question 2.
The company can be registered without MOA.
Answer:
False

Question 3.
Nobody is liable for mis-statements in the prospectus.
Answer:
False

1E. Complete the sentences.

Question 1.
The constitution of a joint-stock company is called _____________
Answer:
Memorandum of Association

Question 2.
The rules regarding internal management are given in the _____________
Answer:
Articles of Association

Question 3.
The document which is a charter or constitution of a company is the _____________
Answer:
Memorandum of Association

Question 4.
The primary basic document of a company is the _____________
Answer:
Memorandum of Association

Question 5.
The _____________ is sub-ordinate document to memorandum.
Answer:
Articles of Association

Question 6.
In the case of Public Company Limited by Shares or Guarantee, the last word should be _____________
Answer:
Limited

Question 7.
The last word in case of Private Company Limited by shares should be _____________
Answer:
Private Limited

Question 8.
Resolution which requires 3/4th majority of votes in favour of a proposal is called as _____________
Answer:
Special Resolution

Question 9.
Article which require 9/10th of majority in favour is called _____________
Answer:
Entrenched Article

1F. Select the correct option from the bracket.

Question 1.

Group ‘A’	Group ‘B’
(1) Doctrine of Indoor Management	………………………
(2) ……………………..	Financial institution guiding companies
(3) Civil liability	………………………
(4) Act beyond the power of Memorandum	………………………
(5) …………………….	Misleading information in the prospectus

(Mis-statement in a prospectus, Assumption of company acting as per MOA and AOA, Mis-statement in a prospectus, Lead Merchant Bankers, Doctrine of Ultra-vires)
Answer:

Group ‘A’	Group ‘B’
(1) Doctrine of Indoor Management	Assumption of the company acting as per MOA and AOA
(2) Lead Merchant Bankers	Financial institution guiding companies
(3) Civil liability	Mis-statement in a prospectus
(4) Act beyond the power of Memorandum	Doctrine of Ultra-vires
(5) Mis-statement in a prospectus	Misleading information in the prospectus

1H. Answer in one sentence.

Question 1.
What do you mean by special resolution?
Answer:
Resolution which requires 3/4th or 75% majority of votes in favour of a proposal is called a special resolution.

Question 2.
What do you mean by injunction?
Answer:
The injunction is an order from the court to stop the company from doing any act which is Ultra-vires.

Question 3.
What is ordinary resolution?
Answer:
The resolution which requires a simple majority of votes cast in favour or against a proposal, (i.e. 51%)

Question 4.
What is a lien on shares?
Answer:
Lien on shares means a company has a right of possession of shares when the member does not pay off his debts or liabilities to the company.

Question 5.
Explain the term IPO and Book Building Process.
Answer:
IPO: Initial Public Offer is an offer made by the company for the first time to the public to buy the shares of the company.
Book Building Process: It is a process where a company determines the issue price of shares/securities based on demand from the public.

Question 6.
Who are lead merchant bankers?
Answer:
Lead Merchant Bankers are the financial institutions that guide the issuing companies in the matter relating to the issue of shares.

Question 7.
Who is Registrar to issue?
Answer:
Registrar to the issue is the agents who are appointed by the issuing company for collecting application forms and money, maintaining records of investors, etc.

1I. Correct the underlined word and rewrite the following sentences.

Question 1.
Articles of Association is an invitation to the public to buy the shares of a company.
Answer:
The prospectus is an invitation to the public to buy the shares of a company.

Question 2.
Capital Clause describes the liability of the members.
Answer:
The liability Clause describes the liability of the members.

Question 3.
The prospectus must be issued within 120 days from the date of incorporation.
Answer:
The prospectus must be issued within 90 days from the date of incorporation.

1J. Arrange in proper order.

Question 1.
(a) Liability clause
(b) Registered Office clause
(c) Subscription clause
Answer:
(a) Registered Office clause
(b) Liability clause
(c) Subscription clause

2. Answer in brief.

Question 1.
Explain the types of Prospectus.
Answer:
Types of Prospectus:
(i) Abridged Prospectus:

• It contains the main contents of a prospectus in brief.
• It is attached with the application form issued.
• It is issued only in case of a public offer.

(ii) Shelf Prospectus:

• It is an alternative option to print a fresh prospectus for every issue of shares.
• It can be used for all further issues made by the company for up to one year.
• However, for every subsequent issue, a company has to file an ‘Information Memorandum’ with ROC.

(iii) Red Herring Prospectus:

• It is a kind of incomplete prospectus.
• It does not include particulars like the number of shares offered and the issue price of the shares offered.
• It is generally issued at the time of Initial Public Offer (IPO) or under Book Building Process.

(iv) Letter of offer:

• It is issued while making the “Right Issue” to the existing shareholders.
• It contains the details of the offer.

(v) Offer letter:
It is issued to a selected group of investors while making a private placement.

Balbharti Maharashtra State Board Class 11 Secretarial Practice Important Questions Chapter 3 Formation of a Company Important Questions and Answers.

Maharashtra State Board 11th Secretarial Practice Important Questions Chapter 3 Formation of a Company

1A. Select the correct answer from the options given below and rewrite the statements.

Question 1.
Directors declaration form should be filed within ___________ days from the date of incorporation.
(a) 180
(b) 80
(c) 100
Answer:
(a) 180

1B. Write a word or a term or a phrase that can substitute each of the following statements.

Question 1.
ROC allows 21 digit numbers at the time of issuing Certificate of Incorporation.
Answer:
Corporate Identity Number

1C. State whether the following statements are True or False.

Question 1.
A company shall be formed for any lawful purpose.
Answer:
True

Question 2.
First Director of the company appointed by ROC.
Answer:
False

2. Explain the following terms/concepts.

Question 1.
TAN
Answer:
Tax Deduction and Collection Account Number is issued by the Income Tax Department to all persons who are responsible for deducting or collecting tax. It is a 10 digit alphanumeric code.

Question 2.
ROC
Answer:
Registrar of Companies is an authority as per the Companies Act, which can incorporate companies.

Question 3.
Company limited by Guarantee
Answer:
A company where members guarantee to contribute a certain amount of money either to the assets of the company, at the time of winding up of the company, or towards the cost of winding up of the company.

Question 4.
Fiduciary duty
Answer:
It means that a person has to act in good faith and trust which is put upon him by another person.
Eg. Promoters have fiduciary duties towards the company they are setting up. It means they have to act in a manner that protects and promotes the interest of the proposed company.

Question 5.
Prospectus
Answer:
It is an invitation to the public by the Joint Stock Company to subscribe to the shares of the company.
Private company issues “Statement in lieu of Prospectus” in place of ‘framing its own-‘Prospectus’.

3. Answer in brief.

Question 1.
State the steps in Commencement of Business.
Answer:
Commencement of Business: Public companies and private companies not having share capital can commence their business after getting an Incorporation Certificate. But, companies having share capital and which are incorporated after 2nd November 2018 have to obtain a Certificate of Commencement of Business.

Steps in Certificate of Commencement of Business:
(i) Filing of a declaration by Directors:
Every Director has to file a declaration along with the prescribed fees declaring that he has paid the value of shares agreed to be taken by him. Such declaration should be verified by Company Secretary or Chartered Accountant or Cost Accountant. Such declaration should be submitted within 180 days from the date of incorporation.

(ii) File verification of Registered Office:
The company has to also file verification of its registered office with the ROC.

(iii) Obtain license or approval from Sectoral Regulator:
Companies that propose to conduct banking business, insurance business, or proposed to be listed on Stock exchanges need to register with Sectoral Regulators like RBI, Securities and Exchange Board of India, etc. Such companies must submit approval received from Sectoral Regulator to ROC.

(iv) Commencement of business:
After filing the required documents, RQC issues the Certificate of Commencement of Business. Public and Private companies having share capital can now start their business or start the collection of capital. A public company can now issue a prospectus to invite the public for subscribing to its share capital.

Question 2.
Draw a flow chart of Steps in the incorporation of a company.
Answer:
Following steps are undertaken to incorporate a company:
Obtain Digital Signature Certificate (DSC)
↓
Register DSC in the name of Director with MCA
↓
Obtain Director Identification Number (DIN)
↓
Apply for Reservation of Name
↓
Finalize Memorandum of Association and Articles of Association
↓
Signing, Stamping, and Dating of Memorandum and Articles of Association
↓
Prepare other necessary documents
↓
Deciding address for communication
↓
Obtain a statutory declaration
↓
Filing of application and documents for Incorporation with ROC
↓
Obtaining Certificate of Incorporation

Question 3.
State the various types of companies.
Answer:
(i) Based on a minimum number of promoters:
As per Company Act, 2013 (Section 3) Promoters can form 3 types of companies. Such types of companies are based on numbers of Promoters.

(ii) Based on Capital Structure [Section 3(2)]:

• Company Limited by Shares: In this type of company capital is formed by shares and the liability is limited.
• Company Limited by Guarantee: In this company, its members have guaranteed to contribute an amount of money either to the assets /of the company at the time of winding up towards the cost of winding up of the company.
• Unlimited Liability Company: In this company, the liability of members is unlimited, they are liable for all amounts of debts and liabilities.

4. Answer the following questions.

Question 1.
Give the proforma of Certificate of Incorporation.
Answer:

GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS Central Registration Centre Certificate of Incorporation {Pursuant to sub-section (2) of section 7 of the Companies Act, 2013 (18 of 2013) and rule 18 of the Companies (Incorporation) Rules, 2014} I hereby certify that ___________ is incorporated on this ___________ Day of ___________ Two thousand ___________ under the Companies Act, 2013 (18 of 2013) and that the company is limited by shares. The Corporate Identity Number of the Company is ___________ The Permanent Account Number (PAN) of the company is ___________ The Tax Deduction and Collection Account Number (TAN) of the company is ___________ Given under my hand at ___________ this ___________ day of ___________ (month) Two thousand ___________ Digital Signature Certificate For and on behalf of the Jurisdictional Registrar of Companies Registrar of Companies Central Registration Centre Disclaimer: This Certificate only evidences incorporation of the company on the basis of documents and declarations of the applicant (s). This Certificate is neither a license nor permission to conduct business or solicit deposits or funds from the public. Permission of sector regulators is necessary wherever required. Registration status and other details of the company can be verified on www.mca.gov.in

Mailing address as per record available in Registrar of Companies office: ______________________ ______________________

 

Balbharti Maharashtra State Board Class 11 Secretarial Practice Important Questions Chapter 2 Joint Stock Company Important Questions and Answers.

Maharashtra State Board 11th Secretarial Practice Important Questions Chapter 2 Joint Stock Company

1A. Select the correct answer from the options given below and rewrite the statements.

Question 1.
A joint stock company has ___________ life.
(a) short
(b) limited
(c) continuous
Answer:
(c) continuous

Question 2.
A Joint Stock Company has independent ___________
(a) survival
(b) legal status
(c) capital
Answer:
(b) legal status

Question 3.
Shares of company are ___________
(a) transferable
(b) non-transferable
(c) none of these
Answer:
(a) transferable

Question 4.
In a small company, paid-up share capital does not exceed ₹ ___________ or such higher amount as may be prescribed.
(a) ₹ 100 lakh
(b) ₹ 20 lakh
(c) ₹ 50 lakh
Answer:
(c) ₹ 50 lakh

Question 5.
In general business partnership firm maximum ___________ partners are allowed.
(a) 2
(b) 20
(c) 50
Answer:
(c) 50

Question 6.
A Joint Stock company is ___________ person.
(a) real
(b) an artificial
(c) a natural
Answer:
(b) an artificial

Question 7.
Registration is ___________ for every company.
(a) voluntary
(b) compulsory
(c) optional
Answer:
(b) compulsory

1B. Match the pairs.

Question 1.

Group ‘A’	Group ‘B’
(a) Sole Trading Concern	(1) Hindu Succession Act, 1956
(b) Joint Hindu Family Business	(2) Unlimited liability, joint, and several
(c) Partnership Firm	(3) ‘One Many Army’
(d) Reserve Bank of India	(4) Limited liability
(e) Foreign Company	(5) ‘One Man Business’
	(6) Statutory Company
	(7) Hindu Succession Act, 1932
	(8) Public company
	(9) Company incorporated outside India
	(10) Company incorporated within India

Answer:

Group ‘A’	Group ‘B’
(a) Sole Trading Concern	(5) ‘One Man Business’
(b) Joint Hindu Family Business	(7) Hindu Succession Act, 1932
(c) Partnership Firm	(2) Unlimited liability, joint, and several
(d) Reserve Bank of India	(6) Statutory Company
(e) Foreign Company	(9) Company incorporated outside India

1C. Write a word or a term or a phrase that can substitute each of the following statements.

Question 1.
The place for dealing with shares of the company.
Answer:
Share market/Stock exchange

Question 2.
A company has continuous life.
Answer:
Perpetual succession

Question 3.
The form of commercial organization suitable to carry large scale business operations.
Answer:
Joint Stock company

Question 4.
A company opposite to a holding company.
Answer:
Subsidiary company

Question 5.
A company incorporated outside India.
Answer:
Foreign company

Question 6.
A company that is not a private company.
Answer:
Public Company

Question 7.
A company having no limit on the liability of its member.
Answer:
Unlimited Liability company

1D. State whether the following statements are True or False.

Question 1.
A Joint Stock company is an artificial person created by law.
Answer:
True

Question 2.
A joint-stock company is a superior form of business organization.
Answer:
True

Question 3.
The Joint Stock company collects huge capital from the public.
Answer:
True

Question 4.
Part of the profit of the company distributed among the shareholders is known as Dividends.
Answer:
True

Question 5.
There is no Government control and supervision over the working of Joint Stock companies.
Answer:
False

Question 6.
In a private company maximum number of membership is restricted to up to 50.
Answer:
False

1E. Complete the sentences.

Question 1.
A business that is owned and managed by one person is called as ___________
Answer:
Sole Trading Concern

Question 2.
A company incorporated outside India, but having a place of business in India is called ___________
Answer:
Foreign company

Question 3.
An organization in which management is based on democratic nature and ‘One member One vote’ is called as ___________
Answer:
Co-operative society

Question 4.
A feature of Joint Stock company, by which member can sell shares as and when he desires, called as ___________
Answer:
transferability of shares

Question 5.
A business organization owned and manages by family members is called ___________
Answer:
Joint Hindu Family Business

Question 6.
A business organization owned and manages by two or more person collectivity is called as ___________
Answer:
Partnership firm

Question 7.
An incorporated association which is an artificial person created by law having perpetual succession is called ___________
Answer:
Joint Stock Company

Question 8.
A voluntary association of individual formed for providing service to member is ___________
Answer:
Co-operative Society

Question 9.
The liability of ‘Karta’ in JHF business is ___________
Answer:
Unlimited

Question 10.
Life Insurance Corporation of India is an example of ___________
Answer:
Statutory Company

Question 11.
Companies which are incorporated under the Companies Act, 2013 are ___________
Answer:
Registered Company

1F. Select the correct option from the bracket.

Question 1.

Group ‘A’	Group ‘B’
(1) Holding Company	…………………….
(2) Bharat Heavy Electrical Limited	……………………
(3) …………………	Signature of a company
(4) ………………..	Long and stable life
(5) ………………..	Combination of Partnership and Joint Stock Company.

(Common seal, Government company, more than 50% share capital of another company, Perpetual succession, Limited Liability Partnership (LLP))
Answer:

Group ‘A’	Group ‘B’
(1) Holding Company	more than 50% share capital of another company
(2) Bharat Heavy Electrical Limited	Government company
(3) Common seal	Signature of a company
(4) Perpetual succession	Long and stable life
(5) Limited Liability Partnership (LLP)	Combination of Partnership and Joint Stock Company.

1G. Answer in one sentence.

Question 1.
What is a Limited Liability Partnership (LLP)?
Answer:
LLP means where partners have limited liability and the personal assets of partners are not attached.

Question 2.
What is Sole Trading’s concern?
Answer:
It is a form of business organization that is owned, managed, and controlled by one person. It is also called ‘One Man Business’ or ‘One Man Show’.

Question 3.
Who controls the Joint Hindu Family business?
Answer:
‘Karta’ the head of the family controls the business of the Joint Hindu Family.

Question 4.
Which Act controls Joint Hindu Family business?
Answer:
Joint Hindu Family business is governed by Hindu Succession Act, 1956.

Question 5.
What is a Partnership firm?
Answer:
A business organization that is owned, managed, and controlled by 2 or more persons is called a Partnership firm.

Question 6.
What is a Co-operative Society?
Answer:
A cooperative society is a voluntary association of persons formed to achieve certain economic objectives and is governed under Maharashtra State Co-operative Societies Act, 1960. The nature of such a society is service-oriented.

Question 7.
What are the Articles of Association?
Answer:
Articles of Association is a document that describes the internal rules and regulations to manage the company.

Question 8.
What is a Joint-Stock company?
Answer:
A Joint Stock company is an incorporated association, which is an artificial person created by law, having a separate name, a separate legal entity, and a perpetual succession.

Question 9.
What is SEBI?
Answer:
Securities and Exchange Board of India (SEBI) is a body that is established to protect the interest of investors in securities and regulate the security market.

Question 10.
What is an Unlimited Liability company?
Answer:
A company not having any limit on the liability of its members is called an Unlimited Liability company It can be either a private company or a public company or a one-person company.

Question 11.
What is a Private company?
Answer:
A private company is a company that by its articles restricts the right to transfer its share, limits the maximum number of members to 50, and prohibits the issue of prospectus.

1H. Correct the underlined word and rewrite the following sentences.

Question 1.
The liability of shareholders of the company is unlimited.
Answer:
The liability of shareholders of the company is limited.

Question 2.
The member of the Joint Hindu family business is called as partners.
Answer:
The member of the Joint Hindu family business is called as co-parceners.

Question 3.
A Joint Stock Company is a natural person created by law.
Answer:
A Joint Stock Company is an artificial person created by law.

Question 4.
A partnership firm is governed by the Co-operative Societies Act, 1960.
Answer:
Co-operative Society is governed by the Co-operative Societies Act, 1960.

Question 5.
Partnership firm enjoys separate legal entity.
Answer:
The joint Stock company enjoys a separate legal entity.

Question 6.
A dormant company is opposite to a Holding company.
Answer:
A subsidiary company is opposite to a Holding company.

2. Explain the following terms/concepts.

Question 1.
Small company
Answer:

• The amount of paid-up capital is not more than ₹ 50 lakh or such a higher amount as may be prescribed.
• The turnover of its last Profit and Loss account does not exceed 2 crores or such a higher amount as may be prescribed.
• A small company means, company other than a public company.
• A small company is formed as per section 2(85).

Question 2.
Public company
Answer:

• A minimum of 7 members is needed for incorporation and no maximum limit.
• The shares of a public company are easily transferable.
• The minimum paid-up capital is prescribed by the Articles.
• It can invite and accept deposits from the public.
• A company, which is not a private company is called a Public Company.

Question 3.
Statutory company
Answer:

• These companies are incorporated by Special Act.
• Such Special Act is passed in Central or State legislative.
• E.g. Reserve Bank of India, SBI, Unit Trust of India. LIC, etc.

Question 4.
Company Limited by shares
Answer:

• Such companies have share capital.
• The liability of every member is limited to the unpaid amount of face value of shares.
• At the time of winding up of the company, the remaining unpaid amount can be called upon by a member.
• Public and Private companies both may be companies limited by shares.

Question 5.
Unlimited Liability company
Answer:

• The liability of members of such a company is unlimited.
• The members are liable to pay the debts of the company.
• Private property may be used to pay the companies debts.
• Private company Public companies and even One Person, a private company may be formed as unlimited Liability company.

Question 6.
Subsidiary company
Answer:

• Such companies are controlled by holding companies.
• Holding company purchases more than half of the total share capital of the Subsidiary company.
• Holding Company has the power to appoint or remove all or a majority of its directors.
• A subsidiary company is just the opposite of a Holding company.

Question 7.
Evolution of Joint Stock company
Answer:

• In 1760, the industrial revolution took place. Before that production was dependent on manpower.
• Sole Trading concern, Joint Hindu Family Business, and Partnership firm became inadequate to face a new era of production.
• LocaPSmall markets turned into regional, national, and international markets.
• This led to the evolution of the Joint Stock company.

3. Study the following case/situation and express your opinion.

1. Mr. Vishal and Mr. Rahul came together and formed a business under the agreement. They contributed capital by carrying unlimited liability.

Question (a).
What is the form of business in the above case?
Answer:
This is a partnership firm.

Question (b).
Explain the type of agreement and relation between Mr. Vishal and Mr. Rahul.
Answer:
Mr. Vishal and Mr. Rahul both are partners in this partnership firm.

Question (c).
State the liability of partners.
Answer:
The liability of partners is unlimited, joint, and several.

4. Distinguish between the following.

Question 1.
Joint Hindu Family Business and Joint Stock Company.
Answer:

Basis	Joint Hindu Family Business (JHFB)	Joint Stock Company
1. Meaning	It is a business organization owned and managed by members of the Joint Hindu Family.	It is an association of persons formed under the Companies Act, 2013 to run a business.
2. Number of members	There is no limit on the minimum and maximum number of members.	Private Company minimum 2 members and maximum 200 members. Public Company minimum 7 members and maximum unlimited.
3. Registration	Registration is not necessary.	Registration is compulsory under the Indian Companies Act, 2013.
4. Liability	Karta has unlimited liability while Co-parceners have limited liability.	The liability of all members is limited.
5. Stability	It has no stability. Death or insolvency of members may affect stability.	It has a stable business. Death or insolvency of a member will not affect the stability.
6. Capital	Comparatively, it requires limited capital.	It requires a huge amount of capital.
7. Secrecy	It maintains maximum secrecy.	It maintains less business secrecy.
8. Management	Karta is responsible for the management of the business.	The Board of Directors is responsible for the management of the Joint Stock company.
9. Government Control	There is less government control.	There is more government control on working of the Joint Stock company.

5. Answer in brief.

Question 1.
How is a Joint Stock Company is different from Joint Hindu Family Business?
Answer:
Joint Stock Company:

• It is an association of persons formed under the Companies Act, 2013 to run a business.
• Private Company minimum 2 members and maximum 200 members.
• Public Company minimum 7 members and maximum unlimited.
• Registration is compulsory under the Indian Companies Act, 2013.
• The liability of all members is limited.
• It has a stable business. Death or insolvency of a member will not affect the stability.
• It requires a huge amount of capital.
• It maintains less business secrecy.
• The Board of Directors is responsible for the management of Joint Stock company.
• There is more government control on working of the Joint Stock company.

Joint Hindu Family Business (JHFB):

• It is a business organization owned and managed by members of the Joint Hindu Family.
• There is no limit on the minimum and maximum number of members.
• Registration is not necessary.
• Karta has unlimited liability while Co-parceners have limited liability.
• It has no stability. Death or insolvency of members may affect stability.
• Comparatively, it requires limited capital.
• It maintains maximum secrecy.
• Karta is responsible for the management of the business.
• There is less government control.

Question 2.
What are the other types of companies?
Answer:
Other Types of Companies are as follows:

1. Government Company: A government company means a company in which more than 51% of paid-up capital is held by
   • Central Government or
   • one or more State Governments or
   • partly by Central and partly by State Government or
   • Subsidiary Company of Government Company. It may be a private or a public company.
2. Foreign Company: It means a company that is incorporated outside of India, but having business in India.
3. Dormant company: A company that is registered for a future project or has not made any significant accounting transactions in the last two years or has not filed financial statements or annual returns in the last two years is called a Dormant company.
4. Listed Company: A company that has listed any of its securities on any recognized stock exchange is called a Listed Company. Such a company has to follow SEBI’s guidelines and the provisions of the Companies Act, 2013.

6. Justify the following statements.

Question 1.
A Joint Stock company is a voluntary association of individuals.
Answer:

• A company is an association or group of persons.
• A large number of people invest in the company.
• So, there are no restrictions for any person irrespective of caste, creed, sex, etc. The membership is open to all.
• A person at his own wish can become a member of the company.
• A shareholder/member can leave his membership by transferring shares.
• The company neither forces anyone to become a member nor to give away his membership.
• So, a Joint Stock company is a voluntary association of individuals.

Question 2.
A Joint Stock Company is a superior form of business organization.
Answer:

• Commercial organizations like Sole Trading Concern, Partnership firms, Joint Hindu Family are not able to meet all the challenges and various increasing needs of the market.
• The Joint Stock company, therefore, acquires a higher position, as it can fulfill the challenges and increasing needs of the markets.
• The Joint Stock company operates not only at the national level but also at the international level.
• It is managed by specialized or professional persons which bring higher returns to the company.
• This leads to the growth and long existence of the company.
• As the Joint Stock company conducts its activities on a large scale, it provides employment to a large number of members.
• Due to all the above reasons, Joint Stock Company is superior to other forms of business organization.

Question 3.
A Joint Stock Company is not a natural person.
Answer:

• A Joint Stock Company is an artificial person, created by law.
• It has no physical existence, but it has legal existence.
• It is not created by natural birth but can act as a natural person.
• It can enter into a contract in its own name.
• It can purchase and sell property, appoint persons as employees, etc.
• It can open a bank account in its own name and can also raise loans.
• It can file a suit against third parties and can also be sued in a court of law.
• All the above acts are done in the name of the company and the members are not responsible for any of this.
• Thus, a Joint Stock Company is not a natural person.

Question 4.
A Joint Stock company has a long and stable life.
Answer:

• Being an artificial person, the company cannot die by natural death.
• New members join, old members, go, but the company carries its business forever.
• The company is not affected due to the death, insolvency of its members or directors.
• A company has a separate legal status. So it has continuous life.
• As long as a company has sufficient capital and efficient management, it can continue its business for years together.

Balbharti Maharashtra State Board Class 11 Secretarial Practice Important Questions Chapter 1 Secretary Important Questions and Answers.

Maharashtra State Board 11th Secretarial Practice Important Questions Chapter 1 Secretary

1A. Select the correct answer from the options given below and rewrite the statements.

Questions 1.
A secretary is an _____________ of the business.
(a) owner
(b) employee
(c) creditor
Answer:
(b) employee

Question 2.
_____________ is appointed by busy individuals.
(a) Personal secretary
(b) Secretary of Joint Stock Company
(c) Secretary of Government department
Answer:
(a) Personal secretary

Question 3.
_____________ function implies compliance of various provisions of Acts applicable to the organization.
(a) Financial
(b) Statutory
(c) Office
Answer:
(b) Statutory

Question 4.
Every listed company and all other companies having paid-up capital of _____________ or more should have a full-time secretary.
(a) 10 crore
(b) 2 crore
(c) 5 crore
Answer:
(c) 5 crore

Question 5.
_____________ is an organization formed with the motive of providing services and not to earn profits.
(a) Joint Stock Company
(b) Non Profit Association
(c) Co-operative Society
Answer:
(b) Non-Profit Association

Question 6.
The function of a secretary to look after the inward and outward mail is called _____________
(a) Reception
(b) Statutory
(c) Correspondence
Answer:
(c) Correspondence

Question 7.
In ancient Indian history, secretary was referred to as _____________
(a) Scribae
(b) Secretarius
(c) Amatya
Answer:
(c) Amatya

Question 8.
_____________ means ability to adjust oneself to changing situation.
(a) Loyalty
(b) Adaptability
(c) Punctuality
Answer:
(b) Adaptability

Question 9.
A secretary appointed by an institution or organization is called _____________ secretary.
(a) Private
(b) Institutional
(c) Social
Answer:
(b) Institutional

Question 10.
A person who acts as a confidential writer is a _____________
(a) worker
(b) secretary
(c) servant
Answer:
(b) secretary

Question 11.
A person who does writing work for his boss is a _____________
(a) secretary
(b) board of directors
(c) managing committee
Answer:
(a) secretary

Question 12.
In the old Roman empire the secretary was referred to as _____________
(a) Scribae
(b) Chitnis
(c) Amatya
Answer:
(a) Scribae

Question 13.
In ancient Indian literature, the post of secretary is referred as _____________
(a) Sachiva
(b) Scribae
(c) Secretarius
Answer:
(a) Sachiva

Question 14.
The term secretary means a _____________
(a) confidential writer
(b) servant
(c) adviser
Answer:
(a) confidential writer

Question 15.
Secretary should have the knowledge of _____________
(a) accountancy
(b) civics
(c) science
Answer:
(a) accountancy

Question 16.
Every business organization needs a secretary having a knowledge of recording _____________ transactions.
(a) financial
(b) private
(c) illegal
Answer:
(a) financial

1B. Match the pairs.

Question 1.

Group ‘A’	Group ‘B’
(a) Scribae	(1) No legal status
(b) Secretarial Standards and Audit	(2) Companies Act, 1956
(c) Co-operative society	(3) Minimum 5 members
(d) Sports club	(4) Roman empire
(e) Concept of Key Managerial Personnel	(5) To check whether the company comply with a legal requirement
(f) Personal Secretary	(6) IAS
	(7) Minimum 10 members
	(8) Latin civilization
	(9) Companies Act, 2013
	(10) Non-profit association
	(11) has legal status

Answer:

Group ‘A’	Group ‘B’
(a) Scribae	(4) Roman empire
(b) Secretarial Standards and Audit	(5) To check whether the company comply with a legal requirement
(c) Co-operative society	(7) Minimum 10 members
(d) Sports club	(10) Non-profit association
(e) Concept of Key Managerial Personnel	(9) Companies Act, 2013
(f) Personal Secretary	(1) No legal status

Question 2.

Group ‘A’	Group ‘B’
(a) Secretarius	(1) Amatya, Sachiva
(b) Roman Empire	(2) Oldest profession
(c) Indian Literature	(3) Latest profession
(d) Profession of a secretary	(4) Scribae
(e) Secretary	(5) Latin word
	(6) Employer
	(7) Employee

Answer:

Group ‘A’	Group ‘B’
(a) Secretarius	(5) Latin word
(b) Roman Empire	(4) Scribae
(c) Indian Literature	(1) Amatya, Sachiva
(d) Profession of a secretary	(2) Oldest profession
(e) Secretary	(7) Employee

1C. Write a word or a term or a phrase that can substitute each of the following statements.

Question 1.
The state and central government secretaries for various department functions under them.
Answer:
Ministries in the Sachivalaya

Question 2.
The person appointed under the Companies Act, 2013 by the board of directors.
Answer:
Companies Secretary

Question 3.
To check whether the company sticks to the legal and procedural requirement.
Answer:
Secretarial Standards and Secretarial Audit

Question 4.
Secretary appointed by industrialists, professionals, leaders, etc.
Answer:
Personal secretary

Question 5.
The function of a secretary in which they attend to telephone calls, visitors and fix appointments.
Answer:
Reception

Question 6.
The quality of a secretary means kindness and politeness.
Answer:
Courtesy

Question 7.
Position of a secretary in a ministry or department.
Answer:
Administrative head

Question 8.
Act under which Cooperative Societies get registered in Maharashtra.
Answer:
Maharashtra State Co-operative Societies Act 1960

Question 9.
The new concept was introduced under the Companies Act, 2013 regarding company secretary.
Answer:
Key Managerial Personnel

Question 10.
A person doing secretarial work in Ancient Indian History.
Answer:
Sachivaor Amatya

Question 11.
A type of secretary appointed by an institution.
Answer:
Institutional Secretary

Question 12.
Name the profession which is as old as human civilization.
Answer:
Secretary

Question 13.
The information is not supposed to be disclosed by the secretary.
Answer:
Secret and Confidential

1D. State whether the following statements are True or False.

Question 1.
In ancient Indian history, Secretary was referred to as Secretarius.
Answer:
False

Question 2.
An individual alone can be appointed as a Secretary.
Answer:
True

Question 3.
A secretary is a custodian of secret and confidential information of the organization.
Answer:
True

Question 4.
A secretary does not act as a link between management and staff of the organization.
Answer:
False

Question 5.
A company secretary is the oldest type of secretary.
Answer:
False

Question 6.
The managing committee appoints the secretary of the Non-profit association.
Answer:
True

Question 7.
The secretary performs administrative functions.
Answer:
True

Question 8.
The leadership skills of a secretary do not create a team spirit.
Answer:
False

Question 9.
The Board of directors appoints a secretary of a government department.
Answer:
False

Question 10.
The concept of Key Managerial Personnel has been introduced in the Companies Act, 2013.
Answer:
True

1E. Find the odd one.

Question 1.
Individual, Paid employee, Confidential officer, a Government department
Answer:
Government department

Question 2.
Rotary club, Sports club, Co-operative banks, Lions club
Answer:
Co-operative banks

Question 3.
Reception function, Statutory function, Financial function, Accuracy
Answer:
Accuracy

Question 4.
Co-operatives banks, Co-operative housing society, Chamber of Commerce, Consumer Co-operative stores.
Answer:
Chamber of Commerce.

1F. Complete the sentences.

Question 1.
In Roman empire a professional letter writer is called _____________
Answer:
Scribae

Question 2.
Secretary appointed by busy individuals is known as _____________
Answer:
Personal Secretary

Question 3.
An association formed with an objective to provide service to its member is a _____________
Answer:
Co-operative Society

Question 4.
Finance secretary, Defence secretary, Home Secretary are the examples of _____________
Answer:
Secretary of Government department

Question 5.
Secretary is either paid salary or paid _____________
Answer:
an honorarium

1G. Select the correct option from the bracket.

Question 1.

Group ‘A’	Group ‘B’
(1) Chamber of Commerce	…………………
(2) …………………..	Correctness
(3) Key Managerial Personnel	…………………
(4) …………………..	₹ 5 crores or more
(5) ……………………	Latin word

(Joint Stock Company, Non-profit association, Company Secretary, Accuracy, Secretarius)
Answer:

Group ‘A’	Group ‘B’
(1) Chamber of Commerce	Non-profit association
(2) Accuracy	Correctness
(3) Key Managerial Personnel	Company Secretary
(4) Joint Stock Company	₹ 5 crores or more
(5) Secretarius	Latin word

1H. Answer in one sentence.

Question 1.
Lions club is an example of which type of organization?
Answer:
Lions club is an example of a Non-profit association.

Question 2.
The body which looks after the working of Non-profit associations.
Answer:
The Managing Committee looks after the working of the Non-profit association.

Question 3.
Under which act does the Cooperative society in Maharashtra have to get registered?
Answer:
The Co-operative Society in Maharashtra has to get registered under Maharashtra State Co-operative Act, 1960.

Question 4.
Who can appoint Institutional Secretary?
Answer:
The institutional secretary can be appointed by Non-profit Association, Cooperative society, Joint-stock company, and Government Department.

Question 5.
Who can be appointed as a secretary for the Ministry of External Affairs?
Answer:
An IFS (Indian Foreign Services) can be appointed as a secretary for the Ministry of External Affairs.

Question 6.
Who acts as a link between management and staff?
Answer:
Secretary acts as a link between management and staff.

1I. Correct the underlined word and rewrite the following sentences.

Question 1.
Company Secretary must be a member of IAS.
Answer:
Company Secretary must be a member of ICSI.

Question 2.
The term scribae was used in Indian history.
Answer:
The term scribae was used in the Roman empire.

Question 3.
The Co-operative Society is managed by the Board of Directors.
Answer:
The Co-operative Society is managed by of Managing committee.

Question 4.
The Latin name for secretary is Amatya.
Answer:
The Latin name for secretary is Secretarius.

Question 5.
The Secretary of the Lions Club is an example of a Personal secretary.
Answer:
The Secretary of the Lions Club is an example of an Institutional secretary.

2. Explain the following terms/concepts.

Question 1.
Key Managerial Personnel
Answer:
For the efficient working of the company, the Board of directors is assisted by many persons known as key managerial personnel.

Question 2.
Administrators
Answer:
The secretary handles the office administration on behalf of the employer. He assists in making plans, execution of plans, supervision, etc.

Question 3.
Institutional Secretary
Answer:
A secretary appointed by an institution or organization is called an Institutional secretary.
E.g. Secretary of Non-profit association, or Co-operative society or Joint Stock Company, or Government Department.

Question 4.
Government Department
Answer:
The department working under the various ministers of the State and Central Government is called as Government Department.

Question 5.
Courtesy
Answer:
It means showing politeness and kindness while dealing with people, which creates positive impressions about the employer and the organization.

3. Study the following case/situation and express your opinion.

1. Amit is interested to work as an Institutional Secretary but he lacks the willingness to accept challenges, has a bad temper, and is ignorant about operating a computer.

Question (a).
Does lack of computer knowledge affect the performance of Amit?
Answer:
Yes, with the advancement of the technical aspect in business, Amit needs to update his computer knowledge. Most of the correspondence these days is done through emails.

Question (b).
Is willingness to accept challenges an important quality of a secretary? why?
Answer:
Yes, Policies, technology, and business situations keep on changing and a secretary must adapt himself to the situation and face the challenges.

4. Distinguish between the following.

Question 1.
Secretary of a Joint Stock Company and Secretary of a Co-operative Society.
Answer:

Basis	Secretay of a Joint Stock Company	Secretary of a Co-operative Society
1. Meaning	A company secretary is an individual, having prescribed qualifications, appointed by the Board of Directors to carry out ministerial and administrative duties.	A secretary of a Co-operative society is appointed by the Managing Committee to carry out administrative and secretarial duties.
2. Position	He is one of the members of the Key Managerial Personnel.	He is a member of society and voted to become a secretary.
3. Appointment	He is appointed by the Board of Directors.	He is appointed by the managing committee.
4. Qualification	A company secretary must possess the prescribed qualification i.e. Associate Membership of the Institute of Company Secretaries of India (I.C.S.I.)	There is no prescribed qualification for a secretary of a Cooperative society.
5. Government Act	A Joint Stock company is governed by the Indian Companies Act, 2013.	A co-operative society is governed by the Co-operative Societies Act, 1960, and the bye-laws adopted from time to time.
6. Remuneration	Being an employee of a company he gets a salary.	A secretary of a Co-operative society gets a salary if he is appointed as an employee of the Co-operative society. But if he is a member of a managing committee then he gets an honorarium.
7. Basis of Appointment	Generally, a company secretary is appointed on a full-time basis.	A Secretary of a Cooperative society may be appointed on a full-time or part-time basis.

Question 2.
Secretary of a Co-operative Society and Personal Secretary.
Answer:

Basis	Secretary of a Co-operative society	Personal Secretary
1. Meaning	A secretary appointed by the managing committee of the Co-operative society to carry out administrative and secretarial duties.	A secretary is appointed by an individual, businessman, doctor, lawyer, accountant, etc. to assist him in routine business activities.
2. Purpose	He is to assist in safeguarding the common interest of the members.	He is to assist busy individuals in their day-to-day work.
3. Appointment	He is appointed by the managing committee of the society.	He is appointed by businessmen, doctors, lawyers, accountants, etc.
4. Duties	His duties are governed by the Co-operative Societies Act and Bye-Laws of the society.	His duties are decided by the employer who appoints him.
5. Powers	He is given managerial and statutory powers in society as per the Act.	He is given powers by his employer, which are generally limited.

5. Answer in brief.

Question 1.
State any four importances of a Secretary.
Answer:
The importance of a Secretary are as follows:

• Correspondent: Secretary is a professional letter writer and handles the correspondence of the business. He skillfully drafts letters and prepares reports and maintains the goodwill of the business.
• Custodian of secret information: A secretary is closely connected with the top-level management and has access to all the confidential information of the business. He should not disclose these to outsiders.
• Administrator: Secretary acts as an administrator. He efficiently handles office management and also execution duties of the business.
• Legality: Secretary performs various statutory duties. He files returns, maintain books and register as stated by the Act.

6. Justify the following statements.

Question 1.
It is compulsory to appoint a secretary in Joint Stock Company.
Answer:

• Joint Stock Company works on a large scale.
• Hence, every company with paid-up capital of ₹ 5 crores or more must appoint a full-time secretary.
• A company secretary acts as a line of communications between the Board and the staff.
• He acts as the mouthpiece of the Board, as the Directors act only through the secretary.
• Every grievance of the staff is communicated to the Directors through the secretary.
• Thus, It is compulsory to appoint a secretary in Joint Stock Company.

Question 2.
A company secretary is the mouthpiece of the Board of Directors.
Answer:

• A company secretary is normally appointed by the Board of Directors.
• He executes the decisions of the Board and carries out the instructions and orders of the board.
• He acts as a confidential clerk of the Board.
• He has to help the directors in framing the policies of the company and preparing progress reports and other reports.
• A company secretary acts as a line of communications between the Board and the staff.
• He acts as the mouthpiece of the Board, as the Directors act only through the secretary.
• Every grievance of the staff is communicated to the Directors through the secretary.
• Hence, it is compulsory to appoint a secretary in Joint Stock Company.
• Thus, a company secretary is the mouthpiece of the Board of Directors.

Question 3.
Non-Profit Association means an institution formed for providing services.
Answer:

• The non-profit association is a voluntary association established for conducting social, cultural, educational, or economic activities.
• Such associations work for the benefit of the members and for society.
• These associations are service-oriented, which promotes the welfare of society.
• Examples: Rotary clubs, social clubs, sports clubs, educational institutions, recreation clubs, cultural clubs, chamber of commerce, etc.
• Thus, Non-Profit Association means an institution formed for providing services.

Question 4.
The personal secretary must be an individual.
Answer:

• A personal secretary is an individual who is appointed by busy persons like industrialists, businessmen, or professionals to conduct their correspondence and do their personal work.
• Professionals like doctors, lawyers, engineers, chartered accountants or actors, ministers appoint personal secretaries due to their busy schedules in order to do their routine work.
• Therefore, the personal secretary is appointed by people who have to devote their time and energy to discharge more important and challenging duties.
• A personal secretary is also called a personal assistant or private secretary.
• He is entrusted with confidential matters and his duties vary in nature.
• An individual only can perform all such work of a personal secretary.
• Thus, the Personal secretary must be an individual.

Question 5.
A sports club is not a cooperative society.
Answer:

• A cooperative society is a voluntary organization registered under the Co-operative Societies Act.
• It mainly aims at protecting and safeguarding the common interests of its members and the public.
• It also provides various services and amenities.
• Such organizations have to add the word “co-operative” to their names.
• Eg. Co-operative Bank, Consumer Co-operative store, Co-operative Housing Society, etc.
• Therefore, a sports club cannot be a cooperative society, it is a recreation center, where various sports are introduced and training is given to players.
• It is an example of a Non-profit organization.
• Thus, a sports club is not a cooperative society.

7. Answer the following questions.

Question 1.
Explain the importance of a secretary.
Answer:
(i) Expert advice and guidance: A secretary provides advice and guidance to his boss on important matters. He advises the management in taking important policy decisions. Sometimes his decisions are more appropriate than his boss and such decisions may result in the growth of the business.

(ii) Administrator: A secretary acts as an administrator. He has to administer the functions like planning, organizing, directing, and controlling the activities. Routine issues like attending and answering the calls, emails, appointments, drafting letters, reports, speeches, etc. are well administered by the secretary. By doing this he enables the head of the organization to concentrate only on important matters.

(iii) Custodian of Secret Information: A secretary is a custodian of the secret, confidential and important information of his organization. Since he is closely connected with the top management, he participates in the decision-making, policy framing, planning, etc. As the secretary is entrusted with all such secret matters of his organization, he has to keep it confidential and does not leak or disclose to outsiders.

(iv) Correspondent: As a secretary is a person who deals with the writing work, he has to deal with the correspondence of the organization. He has to write different types of letters to different people as well as organizations. Therefore, he should write letters skillfully so that he is able to create and maintain the goodwill of the organization.

(v) Legal compliance office: A secretary is responsible for compliance with legal requirements on behalf of his organization. Maintenance of statutory books and records, filing of returns and statements to concerned authorities, completion of work within the time limit laid down by the law are the responsibilities of a secretary. Therefore, he is called the ‘legal executive’ of his organization.

(vi) Conduct Meeting: Meetings play an important part in different organizations as it is the best means to communicate with each other and take decisions. In the case of a joint-stock company, there are meetings of the shareholders, creditors, Board of Directors, etc. So the secretary of a joint-stock company has to organize, conduct different meetings and has to play a very important role before, during as well as after the meetings.

On the other hand, he is also called the brain, as he suggests and advises the boss, eyes as he watches everything on behalf of his boss, ears because he listens to everybody and hands of his boss as he executes all the decisions and policies of his boss and the organization.

(vii) Link between Management and Staff: A secretary occupies the nucleus (central) position, around which the whole office machinery rotates. He occupies a key position in the administrative setup of the organization. He is a link between the top, middle and lower management. He is also a link between his organization and outsiders like customers, clients, other organizations, government bodies, etc.

(viii) Fulfillment of Secretarial Standards and Secretarial Audit: Secretary keeps a check on whether the company is following all the legal and procedural requirements. This keeps the company free from legal consequences.

Conclusion: A secretary is, therefore, an indispensable officer, office executive, confident, trustworthy, and legal executive of his organization.

Balbharti Maharashtra State Board Class 11 Economics Important Questions Chapter 10 Economic Planning in India Important Questions and Answers.

Maharashtra State Board 11th Economics Important Questions Chapter 10 Economic Planning in India

1A. Choose the correct option and rewrite the sentence.

Question 1.
Statements related to definitions of Economic Planning:
(a) A time-bound programme.
(b) Non-continuous process.
(c) Conscious and deliberate choice of economic priorities.
(d) Making of major decisions.
Options:
(1) a, b, c, and d
(2) b, c, and d
(3) a, c and d
(4) None of these
Answer:
(3) a, c and d

Question 2.
Features of Economic planning:
(a) Continuous process
(b) Mobilisation of resources
(c) Does not require co-ordination
(d) Flexible in approach
Options:
(1) a and b
(2) c, d and a
(3) b, c, and d
(4) a, b and d
Answer:
(4) a, b and d

Question 3.
Targets of 12th Five-year plan:
(a) To focus only on agricultural growth.
(b) To reduce the head-count ratio of poverty by 10%.
(c) To increase investment in infrastructure.
(d) To increase green cover by 1 million hectares.
Options:
(1) b, c, and d
(2) a, c and d
(3) c and d
(4) a and d
Answer:
(2) a, c and d

Question 4.
Functions not related to NITI Aayog.
(a) Knowledge and Innovation Hub.
(b) Centralised planning.
(c) Decentralised planning.
(d) Country’s best friend at the center.
Options:
(1) a
(2) a and c
(3) b and d
(4) d and c
Answer:
b and d.

1B. Complete the correlation:

Question 1.
1st Five year plan : Development of agriculture : : 12th Five year plan : ___________
Answer:
Faster sustainable growth

Question 2.
1997 – 2002 : 9th Five year plan : : 2012 – 2017 : ___________
Answer:
12th Five year plan

Question 3
Economic growth : To achieve GDP growth rate at 8% : : Health : ___________
Answer:
To reduce fertility rate to 2.1%

Question 4.
Prime Minister : Chairperson : : Members of Union Council of Minister : ___________
Answer:
Ex-Officio Members

Question 5.
Features of Economic Planning : : ___________ Target of 12th Five year plan : Economic growth.
Answer:
Mobilisation of Resources

Question 6. ___________ 1966 1969 : : Rolling Plans : 1978 – 1980.
Answer:
Annual Plans.

1C. Suggest the economic terms for the given statements:

Question 1.
It is a new framework for five years plan.
Answer:
NITI Aayog

Question 2.
Lecture series organized by NITI Aayog.
Answer:
Transforming India

Question 3.
A pillar of NITI Aayog.
Answer:
Doubling of Farmer’s Income

Question 4.
A body comprising Chief Ministers of all States and Governors of Union Territories.
Answer:
Governing Council

Question 5.
A team of experts and specialists in NITI Aayog.
Answer:
Special Invitees

Question 6.
A function of NITI Aayog.
Answer:
State’s Best Friend at the center

1D. Arrange in proper order:

Question 1.
Objectives of the five-year plan in order of preference.
(a) Removal of Poverty
(b) Development of Agriculture
(c) To give dynamism to the economy
(d) Development of heavy industries
Answer:
b, d, a, c

Question 2.
The organizational framework of NITI Aayog.
(a) Ex-officio Members
(b) Chairperson
(c) Chief Executive Officer
(d) Vice-Chairperson
Answer:
b, d, a, c

1E. Find the odd word out:

Question 1.
NITI Aayog –
(a) Chairperson
(b) Ex-officio Members
(c) Vice-Chairperson
(d) Vice-Chancellor
Answer:
(d) Vice-Chancellor

Question 2.
The importance given under 12th five years plan to increase –
(a) GDP
(b) banking services
(c) infant mortality
(d) employment
Answer:
(c) infant mortality

Question 3.
Structure of NITI Aayog –
(a) National Development Council
(b) Governing Council
(c) Regional Council
Answer:
(a) National Development Council.

1F. Complete the following statements:

Question 1.
Full time organizational framework of the NITI Aayog consists of ___________
Answer:
Vice-Chairperson and Chief Executive Officer

Question 2.
The vice-chairman of NITI Aayog is appointed by ___________
Answer:
Prime Minister

Question 3.
NITI Aayog was established on ___________
Answer:
1st January 2015

Question 4.
Special Invitees in the Structure of NITI Aayog are nominated by ___________
Answer:
The Prime Minister

Question 5.
Since, 2015, planning commission was replaced by ___________
Answer:
NITI Aayog

Question 6.
The resources needed for planning are mobilised through ___________
Answer:
taxation, domestic savings, deficit financing, etc

Question 7.
In India, planning is generally for a period of ___________
Answer:
five years

Question 8.
The period 1990 – 1992 was considered as ___________
Answer:
Plan Holiday

Question 9.
A body formed to address specific issues is called as ___________
Answer:
Regional Council

1G. Choose the wrong pair:

Question 1.

Group – ‘A’	Group-‘B’
1. Development of Agriculture	(a) 1st five-year plan
2. Growth with stability	(b) 4th five-year plan
3. Improvement in quality of life	(c) 12th five-year plan

Answer:
Wrong Pair: Improvement in quality of life – 12th five-year plan.

Question 2.

Group – ‘A’	Group – ‘B’
1. Planning Commission	(a) 1950
2. NITI Aayog	(b) 2011
3. 1st five-year plan	(c) 1951

Answer:
Wrong Pair: NITI Aayog – 2011.

1H. Choose the correct pair:

Question 1.

Group – ‘A’	Group – ‘B’
1. NITI Aayog	(a) Chairman of NITI Aayog
2. All Chief Ministers of State	(b) Plan Holiday
3. Prime Minister of India	(c) Governing Council
4. 1990-92	(d) Think Tank

Options:
(1) 1 – a, 2 – c, 3 – d, 4 – b
(2) 1 – d, 2 – c, 3 – a, 4 – b
(3) 1 – b, 2 – c, 3 – d, 4 – a
(4) 1 – c, 2 – d, 3 – a, 4 – b
Answer:
Correct pair: (2) 1 – d, 2 – c, 3 – a, 4 – b

2. Identify and explain the concepts from the given illustrations:

Question 1.
Vedant gets his student scholarship directly in his a/c linked with Aadhar.
Answer:
Service Delivery.
It is the important target of the 12th five-year plan. The main aim behind this policy is to prevent corruption.

Question 2.
To solve the problems of the housing society, members form a committee that discusses and solves the issues of the members.
Answer:
Think-Tank.
It is important to function of NITI Aayog to solve the problems of our country.
Think-Tank is a group of experts who are discussing and solve various problems of India.

3. Assertion and Reasoning – Choose the correct answer from the following:

Question 1.
Assertion (A) – NITI Aayog takes note of the dynamic change in the Indian economy.
Reasoning (R) – Considering the economic, social, and technological differences in underdeveloped districts, the body plans to implement various programmes and bring about economic changes.
(i) (A) is true but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iv) Both (A) and (R) are true and (R) is not the correct explanation of (A).

Question 2.
Assertion (A) – In 1950 the government-appointed planning commission.
Reasoning (R) – After independence, India was facing the problem of poverty, unemployment, inequality, low national income, etc.
(i) (A) is true but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).

Question 3.
Assertion (A) – In 1950, India adopted economic planning to accelerate the rate of GDP, employment, export, etc.
Reasoning (R) – In India, the duration of economic planning is 7 years.
(i) (A) is true but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(i) (A) is true but (R) is False.

Question 4.
Assertion (A) – The NITI Aayog has been created a group of experts as a Think Tank.
Reasoning (R) – Think Tank will work on various problems and find out solutions to them.
(i) (A) is true but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).

Question 5.
Assertion (A) – 12th five-year plan encouraged the development of agriculture, education, etc.
Reasoning (R) – Secondary education for all by 2017.
(i) (A) is true but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).

Question 6.
Assertion (A) – In 2015, the planning commission was replaced by NITI Aayog.
Reasoning (R) – To construct a strong state that will help to build a dynamic and strong nation,
(i) (A) is true but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).

4. Distinguish between:

Question 1.
Planned Economy and Unplanned Economy.
Answer:

Planned Economy	Unplanned Economy
(i) In a planned economy all economic decisions are taken by the central planning authority.	(i) In an unplanned economy all economic decisions are taken by market forces of demand and supply.
(ii) Indian economy adopted economic planning in 1950.	(ii) American economy is an unplanned economy.
(iii) Goals/objectives are predetermined.	(iii) Objectives/goals are not predetermined.
(iv) Resources are used deliberately so there is no possibility of wastage of resources.	(iv) There is a possibility of wastage of resources.

Question 2.
Objectives of 10th Plan and Objectives of 11th Plan.
Answer:

Objectives of 10th Plan	Objectives of 11th Plan
(i) The main objective of the 10th Plan was ‘transforming India into the fastest-growing economy of the world.’	(i) The main objective of the 11th plan was towards ‘rapid and more inclusive growth of Indian economy.
(ii) It proposed economic growth at the rate of 8% p.a.	(ii) It proposed economic growth at the rate of 9% p.a.
(iii) Another important aim was to improve software services, IT services, etc.	(iii) Another important aim was to reduce the disparity between rural and urban areas, improving the quality of life of people, etc.

5. Answer the following:

Question 1.
What are the targets of the 12th five-year plan for infrastructure?
Answer:
Targets for infrastructure are:

• To connect all villages of a country with all-weather roads.
• To increase rural television and telephone density to 70%.
• To increase infrastructure investment to 9% of G.D.P.
• To upgrade national and state highways to a minimum two-lane standard.
• To achieve real GDP growth rate at 8%, agriculture growth rate at 4%, and manufacturing and industrial growth rate at 10%.
• To reduce the headcount ratio of poverty by 10%.
• To create 50 million (5 crores) new work opportunities in the non-farm sector.
• To increase average years of schooling to 7 years.
• To eliminate gender and social gap in school enrollment.
• To reduce the total fertility rate to 2.1%.

Question 2.
What is Economic Planning? Give objectives of last three five-year plan.
Answer:
Economic Planning:

• Economic planning is a time-bound programme to achieve certain objectives by allocating available resources.
• In the 10th five-year plan main objective was a reduction of poverty.
• In the 11th five-year plan main objective was faster and more inclusive growth.
• In the 12th five-year plan main objective was faster, sustainable, and more inclusive growth.

Question 3.
State the pillars of NITI Aayog.
Answer:
The pillars of NITI Aayog are as follows:

• Vision Document of India
• Appraisal Document of 12th five-year Plan.
• Transforming India: Lecture series organized by NITI Aayog.
• Doubling of Farmers’ Income
• Outcome Budget and Output-Outcome Framework.
• Global Entrepreneurship Summit 2017
• Launching of Programme to transform identified aspirational districts.

Question 4.
Write a note on the ‘Think Tank’ function of NITI Aayog.
Answer:

• ‘Think-Tank’ is a group of experts who come together, to form an organisation.
• They study the various problems of an economy and try to bring solutions to solve those problems.
• It is counted under a premier policy of the Government of India.
• Its main objective is to find a shared vision of national development with the active participation of the states.
• It provides guidance to foster ‘co-operative federalism’ in the states.

6. State with reasons whether you agree or disagree with the following statements:

Question 1.
No progress has been made in India in 50 years of economic planning.
Answer:
No, I do not agree with the statement.
Starting from, First Five Year Plan in 1951 to over 50 years, India has made progress in almost all spheres and is moving towards globalization in the following ways:

• There has been an expansion of industrial capacity.
• Creation of infrastructure.
• Progress in science and technology.
• Promotion of exports.
• Improvement in human quality.
• Earning foreign exchange, etc.
• Thus, we cannot say that India has made no progress since 50 years of its economic planning.

Question 2.
Planning can break the vicious circle of poverty.
Answer:
Yes, I do agree with the statement.

• In a developing country, poverty becomes both, the cause and effect of poverty.
• In poor or developing countries people earn less, save less, productive investment is low and so their earnings are low.
• This is called the vicious circle of poverty.
• Through economic planning, this vicious circle of poverty can be broken.
• The government through planning raises the rate of investment.
• This leads to a rise in profit, a rise in incomes and savings, and then again more investment.
• Hence, Planning can break the vicious circle of poverty.

Question 3.
The tenth Five Year Plan was completely successful.
Answer:
No, I do not agree with the statement.

• Even though the Tenth Five Year Plan could achieve certain targets like increase in growth rate, savings, investment, FDI,
• exports, etc. it has certain failures also. They are:
• Agricultural production could increase only by 25% as against the target of 4%.
• Due to the use of capital-intensive technology in production unemployment increased.
• Regional imbalances and poverty between states could not be curbed down.
• The private sector was given more importance.

Question 4.
The basic objective of economic planning in India is to bring about economic development.
Answer:
Yes, I do agree with the statement.

• When India got independence, it was caught in the vicious circle of poverty.
• There were many macroeconomic problems like food scarcity, illiteracy, mass communicable diseases, high mortality rate, etc.
• So economists felt that economic planning would be an ideal way to solve these problems and to achieve rapid economic development in India.

7. Answer in detail:

Question 1.
What is Economic Planning? Explain the targets of the 12th five-year plan.
Answer:
Economic planning is a time-bound programme to achieve certain objectives by allocating available resources under the control of a central planning authority.

Prof. H. D. Dickinson defines economic planning as – “Economic planning is the making of major economic decisions such as what and how much is to be produced how, when and where it is to be produced, to whom it is to be allocated, by the conscious decision of the determinate authority, on the basis of a comprehensive survey of the economy as a whole.”

12th Five Year Plan (2012-2017):
This plan emphasizes ‘Sustainable Growth’. This plan focused on the development of the manufacturing sector, agriculture, education, health, and social welfare, etc.
(i) Economic Growth:

• It aims at an average GDP growth rate of 8%.
• It seeks to achieve 4% growth in the agriculture sector.
• Every state’s average growth rate must increase as compared to the 11th plan.

(ii) Poverty and Employment:

• It aims at reducing the head-count ratio of poverty by 10%.
• Generating 50 million employment opportunities in the non-farm sector and providing skill certification.

(iii) Education:

• Eliminating gender and social gap in education.
• Secondary education for all by 2017.
• Access to higher education with reference to skill development.

(iv) Health:

• Reducing rate of infant mortality.
• Reduce total fertility rate to 2.1%
• National Family Health Survey (NFHS – 4) was conducted in 2014-2015. In NFHS-4, reduce malnutrition among the children (0-3 years) was the target.

(v) Infrastructure:

• Increase infrastructure investment to 9% of GDP.
• Achieving universal road connectivity and access to power for all villages.
• To increase electricity by adding 80,000 MW and 55,000 MW of renewable energy capacity.
• Connecting all villages with all-weather roads and upgrading national and state highways to a minimum two-lane standard.
• Modified and accelerated irrigation benefit programme.

(vi) Service Delivery:

• Provision of banking services for 90% of households in India.
• Major welfare benefits and subsidies through Aadhar card.

(vii) Environment:

• Increasing green cover by 1 million hectares every year.

8. Read the following passage and answer the questions given below:

Passage – 1
The Finance Minister of the Central Government presents the Union Budget before the Parliament during the month of February every year. The budget, also referred to as the annual financial statement reflects the estimated receipts and expenditure of the government for a particular financial year that begins on the 1st of April and ends on 31 sc March. Changes in the tax structure are suggested in the budget. Besides this, provisions are also made for allocating expenditure on defense, education, research, and development, etc. The date for presenting the budget has been shifted to the 1st of February every year. This enables the generation of funds well in advance prior to the commencement of the financial year.

Question 1.
What is the duration of the budget?
Answer:
The budget is for one year starting from 1st April to 31st March.

Passage – 2
Access to clean cooking fuel is a huge problem in India. Especially in villages wood is used for cooking purposes. Due to this, women’s experiences headache, breathing issues, eyes and lung problems and sometimes even burnt their sarees or some part of their body. 5 lakh women lose their lives every year because of smoke emitted by the ‘Chula’. After independence, this problem was recognized, but it was difficult to eliminate at the micro/village level. The state government is a very important part of NITI Aayog. They are implementing national policies at the village, district, and state levels.

In Uttar Pradesh. Ballia district was selected by the various experts for clean cooking fuel. It was a huge scheme in terms of the scale of implementation. Dineshwar Giri (Village Pradhan), Ashutosh Jindal (IAS), Dharmendra Pradhan (Minister of state for petroleum and Natural Gas, Government of India), S.T. Sathiavageeswaran (Executive director information system in HPLL), C. S. Chakrabarty (Chief General Manager (IOCL)) have given their huge contribution to make this Yojna a grand success. This Yojna was worked from the bottom level.

Cylinder providers were also supposed to fillup form for the LPG receivers on the ‘Collect App’ which work perfectly in offline scenario and it is in many languages. More than 2 crores gas connection have been made in time less than 11 months. Out of 80 million (8 crores) women targeted,72 million have received the benefits and 10,000 new LPG centers were established and 80 billion was the scheme funding. Data was collected and analyzed with 100% accuracy which resulted in success to a great extent. After receiving LPG connections, the women realized their life could also be happy and easy.

Question 1.
Which Yojana is being highlighted in the above case study?
Answer:
Pradhan Mantri Ujjala Yojana(PMUY).

Question 2.
Why was the Pradhan Mantri Ujjala Yojana (PMUY) successful?
Answer:
In NITI Aayog, policies are implemented from center to state and state to center.
It is implemented at the micro-level or village level by involving all the experts and ministers related to the problem. Data were collected from villages and analyzed with 100% accuracy which resulted in success to a great extent.

Question 3.
How did the Ujjala Yojana succeed in Ballia District?
Answer:
Out of 80 million women targeted, 72 million have received the benefit and 10,000 new LPG centers were established and 80 billion was the scheme funding, within the 4 years.

Question 4.
From which state of India in the above case study.
Answer:
Uttar Pradesh.

Question 5.
What problems did the women face due to the absence of LPG connection?
Answer:
Women were facing many health issues like headaches, eyes and lung issues, breathing problems, burnt their sarees or body part, etc.

Question 6.
What did the women feel after receiving the LPG connection?
Answer:
After receiving an LPG connection, the women realized that their life could also be happy and easy.

Question 7.
Write the name of experts involved in this Yojana.
Answer:
Ashutosh Jindal (IAS), Dharmendra Pradhan (Minister of State for Petroleum and Natural Gas), S.T Sathiavageeswaran (Executive Director, HPCL), C.S. Chakrabarty [Chief General Manager (IOCL)].

Passage – 3
The planning commission of India introduced decentralized planning in the country for the first time during the 7th five-year plan. From the 1st five-year plan, India adopted centralized planning with little variation. In 2014, NITI, Aayog was introduced in which decentralized planning was playing a very important role. Decentralized planning means, where the decision-making in the planning process has been reversed from top to bottom type to a system of the bottom to top type. The decentralized planning is at the grassroots level or planning from below.

In India, the planning process has many tiers as the center, state, district, subdivision, block, and village. In decentralized planning, emphasis has been given to the introduction of district planning, sub-divisional planning and block-level planning, and village-level planning. In India, Governmental activities till 2014 are being performed from central to states and then to local that is to the district level (panchayat amenities) and village level (Gram Panchayat). But the major problem of centralized planning was the lack of optimum utilization of resources. Thus, India adopted decentralized planning by replacing Planning Commission in January 2015.

Question 1.
Which planning was adopted in India since 1st five-year plan?
Answer:
India adopted centralized planning since 1st five-year plan.

Question 2.
What is decentralized planning?
Answer:
In decentralized planning, the decision-making process has been reversed from top to bottom type to a system of the bottom to top.

Question 3.
Give the names of various tiers of the planning commission.
Answer:
It has many tiers like center, state, district, subdivision, block, and village.

Question 4.
Match the following.

Group ‘A’	Group ‘B’
(i) District level	(a) Gram Panchayat
(ii) Taluka level	(b) Zilla Parishad
(iii) Village level	(c) Panchyat Samities

Answer:
(1) – b, (2) – c, (3) – a.

Question 5.
What is the major problem in centralized planning?
Answer:
In centralized planning, resources are not being optimally utilized. There is a wastage of resources at a high level.

Question 6.
When did India adopt decentralized planning?
Answer:
India adopted decentralized planning in the year 2015.

9. Observe the following chart and answer the following:

Question 1.
Who is the chairman of NITI Aayog?
Answer:
Prime Minister.

Question 2.
Who nominates the Vice-chairman and CEO of NITI Aayog.
Answer:
Prime Minister.

Question 3.
What is the part of Councils?
Answer:
Governing Council and Regional Council are the part of councils.

Question 4.
Which ministers are selected as Ex-officio members?
Answer:
Union ministers are selected as Ex-officio members.

Question 5.
How many full-time and part-time members are required?
Answer:
Full times – 5 members and part-time – 2 members.

Balbharti Maharashtra State Board Class 11 Economics Important Questions Chapter 9 Economic Policy of India Since 1991 Important Questions and Answers.

Maharashtra State Board 11th Economics Important Questions Chapter 9 Economic Policy of India Since 1991

1A. Complete the following statements by choosing the correct alternative:

Question 1.
The investment limit of small scale industries has been increasing up to __________ crores.
(a) 10
(b) 5
(c) 1
(d) 3
Answer:
(b) 5

Question 2.
The financial sectors became more competitive due to entry of __________ banks.
(a) public and private
(b) public and foreign
(c) private and foreign
(d) private and co-operative
Answer:
(c) private and foreign

Question 3.
The Government of India announced the NEP on __________
(a) 24th July 1991
(b) 24th Oct 1991
(c) 24th June 1991
(d) 20th June 1950
Answer:
(a) 24th July 1991

Question 4.
__________ is considered to be the father of NEP.
(a) Dr. Manmohan Singh
(b) Rajiv Gandhi
(c) Narsimha Rao
(d) Arun Jetly
Answer:
(a) Dr. Manmohan Singh

Question 5.
Licensing was made __________ under NEP.
(a) compulsory
(b) strict
(c) privatised
(d) liberal
Answer:
(d) liberal

Question 6.
Under NEP unemployment has __________ due to close down of some industries.
(a) declined
(b) increased
(c) stagnant
(d) no change
Answer:
(b) increased

Question 7.
__________ is included in Navratna status.
(a) ONGC
(b) HAL
(c) MTNL
(d) Railways
Answer:
(a) ONGC

1B. Complete the correlation:

Question 1.
Regulate the foreign exchange : FEMA : : Regulate security market : __________
Answer:
SEBI

Question 2.
Disinvestment : ITDC hotel : : Collaboration : __________
Answer:
Maruti-Suzuki

Question 3.
Abolition of MRTP Act : Liberalization : : Convertibility of rupee : __________
Answer:
Globalisation

Question 4.
Airport Authority of India (AAI) : Miniratna : : Hindustan Petroleum Corporation Ltd (HPCL) : __________
Answer:
Navratnas

Question 5.
Indian Oil Corporation : Navratnas : : Central Public Sector Enterprises : __________
Answer:
Maharatna Companies

Question 6.
SEZ : Trade Liberalisation : : IRDA Act : __________
Answer:
Reforms in Insurance Sector

Question 7.
Abolition of Government License : __________ : : Selling of shares of sick public sector : Disinvestment
Answer:
Delicensing

1C. Suggest the economic terms for given statements:

Question 1.
The transfer of ownership from the public sector to the private sector.
Answer:
Privatisation

Question 2.
Abolishment of the permission of Government for new industrial production etc.
Answer:
Delicensing

Question 3.
Selling public sector units to the private sector.
Answer:
Disinvestment

Question 4.
Interaction of the Indian economy with the rest of the world.
Answer:
Globalisation

Question 5.
To take the benefit of advanced technology the companies of two countries work together.
Answer:
Foreign Collaboration

Question 6.
Policy providing incentives to exporters.
Answer:
EXIM Policy

Question 7.
Companies are given full financial and managerial autonomy.
Answer:
Navratnas

Question 8.
Zone to encourage agricultural exports.
Answer:
Agro Export Zones

Question 9.
Act under which firms get the freedom to take investment decisions.
Answer:
MRTP Act

Question 10.
A board was set up to make decisions regarding sick units.
Answer:
Board of Industrial and Financial Reconstruction (BIFR)

Question 11.
Industry requiring compulsory licensing.
Answer:
Cigarettes

1D. Arrange in proper order:

Question 1.
(a) FERA was replaced by FEMA
(b) Shortage of foreign exchange
(c) Introduction of NEP
(d) Delicensing
Options:
(i) a, c, d, b
(ii) b, c, d, a
(iii) d, b, a, c
(iv) c, a, d, b
Answer:
(ii) b, c, d, a

Question 2.
(a) Poor performance of PSUs
(b) LPG policy
(c) Public sector was playing a dominant role
(d) Role of the private sector increased
Options:
(i) a, c, d, b
(ii) b, c, d, a
(iii) c, a, b, d
(iv) d, b, a, c
Answer:
(iii) c, a, b, d

Question 3.
(a) Demand for software engineers increased in developed countries
(b) Role of the private sector increased
(c) Help to earn foreign exchange
(d) Revolution in IT sector
Options:
(i) b, d, a, c
(ii) a, c, d, b
(iii) c, a, b, d
(iv) d, a, c, b
Answer:
(i) b, d, a, c

1E. Find the odd word out:

Question 1.
Indian companies into foreign collaboration- Maruti – Suzuki, Hero – Honda, Mahindra & Mahindra, Tata – Timken
Answer:
Mahindra & Mahindra

Question 2.
Encouragement to exports – EXIM, SEZ, AEZ, FERA
Answer:
FERA

Question 3.
Units in which disinvestment take place – Maruti, ONGC, ITDC, VSNL
Answer:
ONGC.

1F. Complete the following statements:

Question 1.
Before new economic policy, interest rate was determined by __________
Answer:
RBI

Question 2.
The NEP gave dominant position to the __________
Answer:
private sector

Question 3.
At present 100 percent FDI is allowed in __________
Answer:
electricity generation projects

Question 4.
A country may not attain self sufficiency in food production because of __________
Answer:
globalization

Question 5.
An adverse effect of NEP on farmers is __________
Answer:
indebtedness and poverty of poor farmer

Question 6.
The main objective of NEP, 1991 is to plunge India into __________
Answer:
arena of globalisation

Question 7.
Rapid industrial growth took place after abolition of __________
Answer:
MRTP Act

Question 8.
Two industries reserved for public sector are __________
Answer:
railways and atomic energy

Question 9.
National Renewal Board took the responsibility of providing __________
Answer:
compensation to retrenched workers

Question 10.
Public Sector Units (PSU’s) have been categorised into __________
Answer:
Miniratnas and Maharatnas.

1G. Choose the wrong pair:

Question 1.

Group – ‘A’	Group – ‘B’
(i) SEZ	Export promotion
(ii) IRDA	Regulate insurance activities
(iii) FDI	Promote imports

Answer:
Wrong Pair: FDI – Promote imports

Question 2.

Group – ‘A’	Group – ‘B’
(i) Globalization	Borderless economy
(ii) Disinvestment	Less investment
(iii) Privatization	Transferring ownership of PSUs.

Answer:
Wrong Pair: Disinvestment – Less investment

Question 3.

Group – ‘A’	Group – ‘B’
(i) FDI	Foreign Direct Investment
(ii) FEMA	Fund Exchange Management Act
(iii) IRDA	Insurance Regulatory Development Authority

Answer:
Wrong Pair: FEMA – Fund Exchange Management Act.

1H. Match the correct pairs:

Question 1.

Group – ‘A’	Group – ‘B’
1. BHEL	(a) Freedom for investment
2. Compulsory licensing	(b) Agriculture
3. Abolition of MRTP	(c) Navratnas
4. Primary sector	(d) Mixed economy
5. India	(e) Alcohol, Tobacco

Answer:
Correct Pairs: (1) – (c), (2) – (e), (3) – (a), (4) – (b), (5) – (d).

Question 2.

Group – ‘A’	Group – ‘B’
1. Liberalization	(a) 1991
2. NEP	(b) Profit motive
3. Public sector	(c) Removing restrictions
4. Private sector	(d) Service sector
5. Tertiary sector	(e) Welfare motive

Answer:
Correct Pairs: (1) – (c), (2) – (a), (3) – (e), (4) – (b), (5) – (d).

2. Identify and explain the concepts from the given illustrations:

Question 1.
It is the regulator of the securities market in India.
Answer:
Securities and Exchange Board of India (SEBI).
SEBI was established on 12th April 1992. SEBI has the power to approve bye-laws of Securities Exchanges, inspect the books of account of financial intermediaries, registration of brokers and sub-brokers.

Question 2.
Abolition of government license to carry any business or industrial activity.
Answer:
Delicensing.
Except for 18 specified industries of strategic importance, all industries required a license. Later on, only 4 industries required compulsory licensing. They are – Electronic Aerospace and defense equipment, Industrial Explosives, Hazardous chemicals, Drugs and Pharmaceuticals, and Cigarettes.

3. Assertion and Reasoning questions:

Question 1.
Assertion (A): The creation of NRB is an important measure of privatization.
Reasoning (R): To solve the problem of unemployment and poverty among the workers of closed public sector units.
(a) (A) is TRUE but (R) is FALSE
(b) (A) is FALSE but (R) is TRUE
(c) (A) and (R) both are TRUE and (R) is the correct explanation of (A)
(d) (A) and (R) both are TRUE but (R) is not the correct explanation of (A)
Answer:
(c) (A) and (R) both are TRUE and (R) is the correct explanation of (A)

Question 2.
Assertion (A): In India FDI has very limited scope since 1991.
Reasoning (R): Foreign capital is allowed in the Indian economy without any restrictions.
(a) (A) is TRUE but (R) is FALSE
(b) (A) is FALSE but (R) is TRUE
(c) (A) and (R) both are TRUE and (R) is the correct explanation of (A)
(d) (A) and (R) both are TRUE but (R) is not the correct explanation of (A)
Answer:
(b) (A) is FALSE but (R) is TRUE

Question 3.
Assertion (A): In post NEP imports of the country has increased.
Reasoning (R): It helps to solve the problem of inflation.
(a) (A) is TRUE but (R) is FALSE
(b) (A) is FALSE but (R) is TRUE
(c) (A) and (R) both are TRUE and (R) is the correct explanation of (A)
(d) (A) and (R) both are TRUE but (R) is not the correct explanation of (A)
Answer:
(c) (A) and (R) both are TRUE and (R) is the correct explanation of (A)

4. Distinguish between:

Question 1.
Privatisation and Globalisation.
Answer:

Privatisation	Globalisation
1. Privatisation refers to including private ownership in publicly owned enterprises.	1. Globalisation refers to the process of development of the world into a single integrated economic unit.
2. It leads to the transfer of ownership, management, and control to the private sector.	2. It involves the removal of quotas, tariffs, etc. to facilitate greater mobility of factors and goods.
3. It takes place within the country.	3. It takes place all over the world.
4. By privatisation the country is benefited.	4. By globalisation the whole world is benefited.
5. It helps the country’s economy to grow.	5. It helps the world as a whole to grow.

Question 2.
Liberalisation and Privatisation.
Answer:

Liberalisation	Privatisation
1. Economic reforms which liberalize the economy from government control are called liberalisation.	1. Privatisation refers to including private ownership in publicly owned enterprises.
2. It leads to the opening of the economy to international competition.	2. It leads to the transfer of ownership, management, and control to the private sector.
3. It gives the opportunity for technology improvement which benefits producers and consumers.	3. It encourages monopoly power and may lead to the exploitation of consumers and workers.
4. It ignores the welfare aspect in the whole world.	4. It ignores the welfare aspect within the country.

Question 3.
Agriculture and Industry.
Answer:

Agriculture	Industry
1. Any productive activity which is carried on by using land and another free gift of nature is considered as agriculture.	1. Any productive activity in which processing on manufacturing takes place is called as ‘Industry’.
2. It is our primary sector.	2. It is considered as our secondary sector.
3. It is also known as an unorganised sector.	3. It is also known as an organised sector.
4. Even the unskilled labourers also gain employment opportunity here.	4. Only skilled people will gain employment opportunities here.
5. As a result of NEP, yield per acre could increase (or) productive capacity increased when we started using HYV seeds.	5. As a result of NEP, India could not only export traditional goods but also machinery, chemicals, computers, etc.
6. The negative impact of NEP (globalisation) in this sector leads to poverty, unemployment, indebtedness, etc. among the rural poor.	6. The negative impact of NEP on this sector leads to the concentration of economic and political power in few hands.

Question 4.
Private Sector and Public Sector.
Answer:

Private Sector	Public Sector
1. Private sector is that sector where industries are owned and managed by private individuals or businessmen.	1. Public sector is that sector where industries are owned, managed, and operated by the government.
2. E.g. Most of the small-scale industries and cottage industries are owned by the private sector.	2. E.g. Bharat Petroleum Ltd., Indian railways, etc. are owned by the public sector.
3. Its main aim is to earn profit.	3. Its main aim is to promote social welfare.
4. Quick decisions can be taken and managerial efficiency is high.	4. There is a delay in decision making and efficiency is lower.
5. Exploitation of workers is more and inequality increases.	5. Exploitation of workers is less and inequality reduces.

5. Answer the following:

Question 1.
Explain any two positive effects or achievements of NEP.
Answer:

• Improvement in educational standards: Standards of educational institutions are improving. Our students are getting opportunities to study abroad.
• Diversification of cropping: Due to globalization, the farmers have shifted from practicing traditional cropping to non-traditional cropping patterns.

Question 2.
What is globalization? How does it help to increase foreign capital?
Answer:
Globalization means the interaction of the domestic economy with the rest of the world with regard to foreign investment, trade, production, and financial matters. The government has opened the economy to foreign investments. Foreign capital is allowed in India without any restrictions. This flow of foreign capital encouraged high-priority industries to boost their production.

Question 3.
What are the objectives of NEP 1991?
Answer:

• To make the Indian economy market-oriented by introducing it in the arena of globalization. To bring down the rate of inflation.
• To move towards a higher economic growth rate.
• To build sufficient foreign exchange reserve.
• To achieve economic stabilization.
• To promote international trade by removing restrictions.
• To increase the participation of private players in all sectors of the economy.
• To reduce the reserved numbers of sectors for the government.
• To reduce the gap between import and export (BOP).

Question 4.
What is Privatization?
Answer:
Privatisation means allowing the private sector to set up industries that were previously reserved for the public sector. Privatisation is the process of transferring ownership of Public Sector Units (PSUs) to the private sector. Privatisation led to disinvestment, dereservation, the establishment of BIFR and NRB, etc.

Question 5.
What are the negative effects of NEP 1991 on farmers?
Answer:
Due to a lack of capital, poor farmers were unable to grow exportable crops. They were forced to sell their land or take extreme steps. Thus, they faced the problem of indebtedness and poverty.

Question 6.
Explain any 4 features of Economic Policy, 1991.
Answer:
Features of Economic Policy, 1991:

• Delicensing: The new industrial policy abolished all industrial licensing, except 18 specified industries related to security and strategic concerns and social reasons.
• Abolition of MRTP Act: No prior approval of the MRTP commission is now required for setting up industrial units by the large business houses.
• Encouragement to Small Scale Industries (SSI): The investment limit of the SSI has been increased up to 5 crores which will help to upgrade their machinery.
• Encouraging Foreign Investment: Many industrial units were open to foreign investment under the 1991 policy. The limit was raised to 51% and 100% in some industries and 100% in mining, pollution control equipment, electricity generation projects, ports, etc.

Question 7.
State the measures taken for Liberalisation.
Answer:
Measures were taken for Liberalisation:

• Banks are free to determine the rate of interest. Earlier it was determined by RBI.
• The industries are free to expand and produce. The producers are now free to produce anything on the basis of demand in the market.
• Companies falling under MRTP Act are given a concession. Firms are free to make decisions regarding investment.
• FEMA (Foreign Exchange Management Act) was introduced in place of FERA.
• Domestic and foreign investment is allowed in infrastructure to improve its quality.
• SEBI was formed to secure the interest of the investors.

6. State with reasons whether you agree or disagree with the following statements:

Question 1.
Agriculture and industry are interdependent or complementary.
Answer:
Yes, I do agree with the statement.

• In a country like India, there are many agro-based industries like sugar, textile, oil, etc.
• These industries depend on agriculture for their raw materials.
• Hence, agriculture supports industries.
• Industries also support agriculture in the sense that new methods of agriculture require more use of pump sets, fertilizers, pesticides, agricultural implements, etc.
• All these are produced and supplied by the industrial sector.
• With the help of these inputs, farmers produce more output.
• Hence, the statement agriculture and industry are interdependent is a true statement.

Question 2.
There are no benefits of globalisation.
OR
There is no impact of globalisation on the Indian economy.
Answer:
No, I do not agree with the statement.
Globalisation for any country is important and the benefits are as follows:

• Globalisation helps developing countries to improve overall economic management and make their economies efficient.
• An increase in competition reduces the cost and improves the quality of products.
• More varieties are made available to consumers and at lower prices.
• Countries can get access to foreign investment and keep interest rates low.
• Political stability is established.

Question 3.
The NEP has not achieved anything in India.
Answer:
No, I do not agree with the statement.

• NEP brought a revolution in the IT sector which helps to earn foreign exchange.
• It strengthened the financial sector by raising the competition among the banks.
• The standard of educational institutions is improving.
• It helps to improve the conditions of the BOP.
• It helped to increase the exports of our country.
• It also helped farmers by diversifying their cropping pattern i.e. from traditional products to non-traditional products.

7. Answer in detail:

Question 1.
Explain the measures taken for Privatisation.
Answer:
Privatisation means allowing the private sector to set up industries that were previously reserved for the public sector. Privatisation is the process of transferring ownership of Pubilc Sector Units (PSUs) to the private sector.

Measures were taken for Privatisation:

• Dereservation Policy: The number of industries reserved for the public sector has been gradually reduced to only two and all other industries are deserved i.e. opened up for the private sector.
• Establishment of BIFR: Board of Industrial and Financial Reconstruction (BIFR) has been set up to make the decisions about sick public sector units i.e. whether to close or revive them.
• Creation of NRB: National Revival Board (NRB) has been set up to take care of unemployed workers of the sick units.
• Status of Navratna: On the basis of strategic importance, nine public sector enterprises were selected and given the status of ‘Navratnas’ i.e. they were given the full managerial and financial freedom to make them global giants. Some are ONGC, BHEL, HPCL, SAIL, etc.
• Disinvestment: This was an important step undertaken to reform public sector. The Government started selling PSUs to the private sector, those are running at a loss. e.g. Maruti Udyog Ltd. VSNL, etc.

Question 2.
What is Liberalisation? Explain the measures taken for liberalisation.
Answer:
Liberalisation means ‘economic freedom’ or ‘freedom for economic decisions’. All economic units are free to take decisions for self-interest e.g. consumer, producer, owner of a factor of production, etc.

Measures were taken for Liberalisation:

• The flexibility of Interest rate: Banks are free to determine the rate of interest. Earlier it was determined by RBI.
• Freedom for expansion of industries: The industries are free to expand and produce. The producers are now free to produce anything on the basis of demand in the market.
• Abolition of Monopolies and Restrictive Trade Practices: Companies falling under MRTP Act are given concession. Firms are free to make decisions regarding investment.
• Reforms in FERA: FEMA (Foreign Exchange Management Act) was introduced in place of FERA. It will encourage international trade.
• Investments in infrastructure: Domestic and foreign investment is allowed in infrastructure to improve its quality.
• Encouragement to foreign technology: The use of foreign technologies allowed in high-priority industries resulting in cost cuts.
• SEBI: SEBI was formed to secure the interest of the investors and to regulate the securities market.

Question 3.
Write about major achievements of the NEP of 1991.
Answer:
Major Achievements:

• Revolution in the IT sector: The contribution of the IT sector to national income has considerably increased. The demand for software engineers has increased in the developed countries.
• Improved financial facilities: The financial sector has become more competitive due to the entry of private and foreign banks.
• Improvement in educational standards: Standards of educational institutions are improving and our students are getting more opportunities to study abroad.
• Increase in exports: Due to rising in export, the conditions of our adverse balance of payment is improving.
• Diversification of cropping: Due to globalization, the farmers have shifted from practicing traditional cropping to non-traditional cropping patterns.
• Solves the problem of scarcity: Due to liberal imports, the economy can overcome the scarcity of goods and raw materials.

Question 4.
Critically evaluate the NEP of 1991.
Answer:
Though NEP, 1991 brought many achievements to the economy, it has also brought failures in many areas:
Failures of Economic Policy, 1991:

• Lack of self-sufficiency: Globalisation led to the diversion of production to export-oriented products which were demanded globally. This failed to achieve self-sufficiency in the home country.
• Adverse effect on the domestic market: Imported goods were cheaper and were flooded in the Indian market due to liberal import policy. Thus, domestic markets were adversely affected due to globalisation and liberalisation.
• Affected poor farmers: Poor farmers were not able to produce goods as per the export standards due to a lack of capital. So, the benefits of globalisation and liberalisation reached rich farmers only. This led to the selling of lands by small farmers for their survival.
• Unhealthy competition: Indian companies could not match the competition with multinational companies and as a result, many Indian Companies had to declare themselves as ‘sick units’ or had to close down the industry-leading to unemployment and poverty in the society.
• Neglects welfare aspect: Privatisation led to an increase in prices of products and services, as private firms are profit-oriented and not welfare-oriented. They are more interested in their profits rather than the welfare of society. Thus, the economic policy of 1991 failed to achieve the welfare of the masses.
• Unemployment: Closing down of companies due to unhealthy competition by multinational companies, led to unemployment in the economy. An increase in the unemployment level in the country led to poverty and inequality.

Question 5.
How globalization will help to increase foreign exchange reserves?
Answer:
Globalisation refers to a borderless economy having a free flow of goods and services, capital, labour, technology, etc.
In other words, it means integrating the economy of a country with the world economy.

Globalisation has helped the economy to increase foreign exchange reserve in the following ways:

• Encouragement to Foreign Capital: Due to globalisation, foreign investors were allowed to invest in Indian companies. Thus, foreign capital started flowing into various sectors of the economy. This led to an increase in the earnings of foreign currency.
• Convertibility of Rupee: Due to globalisation and new economic policy, Rupee was made fully convertible ‘ into all current account transactions. This made foreign transactions easy and hence, the foreign currency started flowing into our economy.
• Foreign Collaboration: Due to liberalization and globalisation, any trade was possible throughout the world. Indian companies made foreign collaboration to increase their business. This led to the flow of foreign exchange currency in India. E.g. Maruti-Suzuki, Hero Honda, etc.
• Encouragement to Export: Due to the introduction of the Exim Policy, various incentives were allowed to exporters which made exporters do business on a larger scale. This increased India’s export and foreign exchange currency reserves. Thus to conclude, globalisation has overall encouraged to increase the foreign exchange reserves.

8. Read the following passage and answer the questions given below:

In the Second Five Year Plan (1956), the public sector played a major role by setting up basic and heavy industries for the economic and industrial development of India. In India, most of the Public Sector Units (PSUs) were working inefficiently. So, many PSUs were running in loss. PSUs never have competitive nature. PSUs know that whenever they will go into loss, they will be bailed out by the government. This attitude kills that competitiveness and cost-effective working nature of the unit which is necessary to earn profit.

In 1991, the Government decided to transfer ownership to the private sector which is more efficient in management, allocation of resources, better services to its customers, etc. Also, it helps to develop the local capital market and source of revenue to the government. Videsh Sanchar Nigam Limited (VSNL) was established in 1986 by the Government of India to bring internet to our country. In 2002, the Government of India decided to disinvest its shareholdings. TATA group acquired a 45% stake in VSNL. On 13th February 2008, VSNL was completely acquired by TATA Group and renamed TATA Communications.

At present, TATA Communications connects its customers in global offices at speed of up to 10 Gbits. It delivers voice, video, and data connectivity through subsea cable networks in 200 countries and territories. In 2018, annual income is 5575.96 crores and net profit (after deducting taxes) is 266.63 crores.

Question 1.
In which five-year plan emphasis is given to developing the public sector?
Answer:
In the second five-year plan, emphasis was given to develop the public sector.

Question 2.
Identify the reasons for the poor performance of PSUs.
Answer:
PSUs were working inefficiently, lack of competitive nature, dependence on bailed out by the government, lack in cost-effective working nature, etc. led to poor performance of PSUs.

Question 3.
Find out the economic concepts from this case study.
Answer:
Privatisation and Disinvestment.

Question 4.
Explain the benefits of privatisation.
Answer:
Under privatisation, ownership is transferred from the public sector to the private sector because the private sector is more efficient in resource allocation, management and provides better services to the customers. Privatization can be an important source of revenue to the government and help to develop local capital markets.

Question 5.
Explain the growth of VSNL after privatisation.
Answer:
In 2008, privatisation of VSNL took place. VSNL was completely acquired by the TATA group and renamed TATA Communication. At present TATA Communication is providing internet services globally. Its cable network is in 200 countries and territories. The annual income is 5575.96 crores and the net profit is 266.63 crores in 2018.

Balbharti Maharashtra State Board Class 11 Economics Important Questions Chapter 8 Poverty in India Important Questions and Answers.

Maharashtra State Board 11th Economics Important Questions Chapter 8 Poverty in India

1A. Choose the correct option:

Question 1.
____________ poverty refers to lack of minimum subsistence. [Absolute/Relative/General]
Answer:
Absolute

Question 2.
____________ poverty is a universal phenomenon. [Relative/Absolute/Rural]
Answer:
Relative

Question 3.
Poverty is ____________ phenomenon. [a social/an economical/a political]
Answer:
a social

Question 4.
According to planning commission, an individual in urban area requires ____________ calories per day. [2000/2100/2400]
Answer:
2100

Question 5.
____________ poverty refers to Absence of minimum subsistence. [Relative/Absolute/General]
Answer:
Absolute

Question 6.
____________ poverty cannot be removed completely. [Absolute/Relative/Urban]
Answer:
Relative

Question 7.
An average Indian requires ____________ calories from his/her daily consumption of food. [2250/2550/2200]
Answer:
2250

Question 8.
When a person is unable to consume 2100 calories per day, he/she is considered to be ____________ poor. [urban/ ural/relative]
Answer:
urban

Question 9.
____________ poverty is mostly found among agricultural and landless labourers or marginal farmers. [Urban/Rural/Relative]
Answer:
Rural

Question 10.
Poverty line is an ____________ line. [imaginary/straight/visible]
Answer:
imaginary

Question 11.
According to World Bank, India’s ____________ population lived below poverty line. [21.2%/5%/20%]
Answer:
21.2%

1B. Complete the correlation:

Question 1.
National Health Mission : Health : : Sarva Shiksha Abhiyan : ____________
Answer:
Education

Question 2.
Antyodaya Anna Yojana : Food Security : : Jan Dhan Yojana : ____________
Answer:
Financial inclusion

Question 3.
NUT Aayog : Poverty Line : : Anti Poverty Programme : ____________
Answer:
Garibi Hatao

Question 4.
Pradhan Mantri Awaas Yojana : Housing : : Swachch Bharat Mission : ____________
Answer:
Sanitation

Question 5.
Material dimension : No access to safe drinking water : : ____________ : social discrimination
Answer:
Non-material dimensions

Question 6.
Rural Area : ____________ : : Urban Area : 2100 calories
Answer:
2400 calories

Question 7.
Low agricultural productivity : ____________ : : Slow individual growth : Urban Poverty
Answer:
Rural Poverty

Question 8.
Effects of poverty : ____________ : : Causes of poverty : Inflation
Answer:
Anti social activities.

1C. Suggest the economic terms for the given statement:

Question 1.
An imaginary line that divides the poor and non-poor.
Answer:
Poverty Line

Question 2.
The cycle of low income, low saving, low investment, low production, less employment.
Answer:
The vicious circle of poverty

Question 3.
Poverty where we can find unemployed people, slums, unhygienic conditions, crime, thefts, etc.
Answer:
Urban poverty

Question 4.
Noted Indian economist and recipient of Bharat Ratna.
Answer:
Prof Amartya Sen

Question 5.
Anti-poverty programme during British Period.
Answer:
‘Garibi Hatao’

Question 6.
Deprivation of basic needs to people living in villages.
Answer:
Rural Poverty

Question 7.
The spillover effect of migration among rural poor.
Answer:
Urban Poverty

Question 8.
The situation in which there is a continuous rise in the price of essential commodities.
Answer:
Inflation

1D. Arrange in proper order:

Question 1.
Capital formation, Saving, Income, Investment, Production.
Answer:
Income, Saving, Investment, Capital formation, Production.

Question 2.
Middle income. Low income, Upper Middle income, High income.
Answer:
High income, Upper middle income, Middle income, Low Income.

Question 3.
Saffron Ration Cards, White Ration Cards, Yellow Ration Cards.
Answer:
White Ration Cards, Saffron Ration Cards, Yellow Ration Cards.

1E. Find the odd word out:

Question 1.
Food items – Fish, Salt, Beverages, Durable Goods.
Answer:
Durable Goods

Question 2.
Low poverty ratio – Himachal Pradesh, Jammu and Kashmir, Punjab, Tamil Nadu.
Answer:
Himachal Pradesh

Question 3.
Cause of poverty – Inflation, Population explosion, Unemployment, Industrialization.
Answer:
Industrialization

Question 4.
Effects of poverty – Low national income, Anti social activities, Population explosion, Low standard of living.
Answer:
Population explosion

Question 5.
Non-food items – Durable goods, Footwear, Fuel and Light, Salt and Sugar.
Answer:
Salt and Sugar

Question 6.
Economic effects of poverty – Low national income, Anti socio activities, Law standard of living, Malnutrition and starvation.
Answer:
Anti socio activities

1F. Complete the following statements:

Question 1.
The Employment Guarantee Scheme was launched in the state of ____________
Answer:
Maharashtra in 1972

Question 2.
An individual in the Urban area requires ____________
Answer:
2100 calories per day

Question 3.
Antyodaya Anna Yojana was launched in ____________
Answer:
December 2000

Question 4.
Comparison between standard of living is known as ____________
Answer:
Relative Poverty

Question 5.
Poverty line is an ____________
Answer:
imaginary line

Question 6.
Poverty line is based on ____________
Answer:
household consumption expenditure

Question 7.
Wide inequalities have been observed in the ____________
Answer:
distribution of income

Question 8.
Inflation refers to a continuous rise ____________
Answer:
in the price

Question 9.
‘Vicious Circle of Poverty’ concept is given by ____________
Answer:
Prof. Ragnar Nurkse

Question 10.
Minimum Wages Act was passed in 1948, to ____________
Answer:
provide fair wages

1G. Choose the wrong pair:

Question 1.

Group ‘A’	Group ‘B’
(i) SGSY	Self-employment
(ii) SBM	Sanitation
(iii) JDY	Literacy
(iv) PAY	Housing

Answer:
Wrong pair: JDY – Literacy

Question 2.

Group ‘A’	Group ‘B’
(i) Rural Poverty	2400 Calories
(ii) Urban Poverty	2100 Calories
(iii) Average Calories	4500 Calories
(iv) Absolute Poor	Minimum Subsistence

Answer:
Wrong pair: Average Calories – 4500 Calories

Question 3.

Group ‘A’	Group B’
(i) Absolute Poor	Lack of Nutrition
(ii) Relative Poor	Comparison
(iii) Rural Poor	Marginal Farmer
(iv) Urban Poor	Industrialization

Answer:
Wrong pair: Urban Poor – Industrialization

Question 4.

Group ‘A’	Group ‘B’
(i) Anti Poverty Programme	Garibi Hatao
(ii) Poverty Line	Imaginary Line
(iii) Vicious Circle	Poverty
(iv) Cause of Poverty	Equal Distribution of Income

Answer:
Wrong pair: Cause of Poverty – Equal Distribution of Income

Question 5.

Group ‘A’	Group ‘B’
(i) Absolute Poverty	India
(ii) Relative Poverty	The U.S.A.
(iii) Urban Poverty	More in India
(iv) Rural Poverty	More in the U.S.A.

Answer:
Wrong pair: Rural Poverty – More in the U.S.A

1H. Choose the correct pairs:

Question 1.

Group ‘A’	Group ‘B’
1. Absolute poverty	(a) Unorganised labour
2. Relative poverty	(b) Small farmer
3. Rural poor	(c) Health Insurance
4. Urban poor	(d) The U.S.A.
5. Slums	(e) India
	(f) Unhygienic conditions

Answer:
(1) – e, (2) – d, (3) – b, (4) – a, (5) – f

Question 2.

Group ‘A’	Group ‘B’
1. Village artisans	(a) 2100 calories
2. Poverty line	(b) Universal
3. Urban poverty	(c) Urban poor
4. Rural poverty	(d) Rural poor
5. Relative poverty	(e) 2400 calories
	(f) Imaginary line

Answer:
(1) – d, (2) – f, (3) – a, (4) – e, (5) – b.

Question 3.

Group ‘A’	Group ‘B’
1. Control of population	(a) Comparison between income group
2. Absolute poverty	(b) Garibi Hatao
3. Relative poverty	(c) Poverty line
4. Anti-poverty programme	(d) Population
5. NITI Aayog	(e) Family Planning programme
	(f) Absence of minimum subsistence

Answer:
(1) – e, (2) – f, (3) – a, (4) – b, (5) – c.

2. Assertion and Reasoning questions:

Question 1.
Assertion (A): Urban poverty is more harmful than rural poverty.
Reasoning (R): The poor in the urban areas live in unhygienic conditions which are hazardous to their health,
(i) (A) is true, but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).

Question 2.
Assertion (A): The poverty line differs from country to country.
Reasoning (R): A person described as poor in the USA will not be placed below the poverty line category in India.
(i) (A) is true, but (R) is False.
(ii) (A) is false, but (R) is True.
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).
(iv) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
Answer:
(iii) Both (A) and (R) are true and (R) is the correct explanation of (A).

3. Distinguish between:

Question 1.
Urban Poverty and Rural Poverty.
Answer:

Urban Poverty	Rural Poverty
(i) Poverty found in urban areas is known as Urban poverty.	(i) Poverty found in rural areas is known as Rural poverty.
(ii) A person who is unable to consume more than 2100 calories experiences Urban poverty.	(ii) A person who is unable to consume more than 2400 calories experiences poverty.
(iii) It is mostly found among the village artisans, the landless agricultural labourers, the small and marginal farmers.	(iii) It is mostly found among the rural migrate in the urban area, who lives in slums, lack infrastructure, illiteracy, unemployed people, etc.
(iv) It can be eradicated by agricultural growth and development, anti-poverty programmes like ‘garibi hatao’ etc.	(iv) It can be eradicated by industrialization, affordable housing, etc.

Question 2.
Absolute Poverty and Relative Poverty.
Answer:

Absolute Poverty	Relative Poverty
(i) Absolute poverty is a situation where an individual is not able to consume minimum calories intake.	(i) Relative poverty is a situation where there is a comparison of income or living standard of different income groups.
(ii) Absolute poverty can be eradicated with the help of effective anti-poverty programmes.	(ii) Relative poverty can not be eradicated completely.
(iii) It exists in developing and underdeveloped countries like India, etc.	(iii) It is a universal phenomenon and is found in all countries of the world.
(iv) Absolute poverty indicates the minimum subsistence level of a section of society.	(iv) Relative poverty indicates the existence of income inequalities between different income groups.

4. Answer the following:

Question 1.
What are the economic effects of poverty?
Answer:
Economic effects of poverty:

• Low national income: As a substantial number of people are poor, their income, saving, and investment are inadequate. This results in low capital formation.
• Adverse effect on production: Since the capital for modernization is not available, the farmers continue with the outdated methods. Similarly, the industry does not have funds for modernization.
• Misallocation of resources: To help the poor, the government spends a huge amount on welfare activities. This restricts the allocation of resources for productive activities.
• Low standard of living: Due to low per capita income and low per capita consumption, people are forced to live in slums. This is reflected in the low standard of living.
• Malnutrition and starvation: Poor people can not afford a balanced diet due to low income. They do not get the minimum calories from their diet.

Question 2.
What are the causes of rural poverty?
Answer:
Causes of rural poverty:

• Population explosion: Due to the rapid growth of population and lesser growth in employment, poverty is increasing.
• Slow economic growth: Agricultural and industrial growth is happening at a slower pace, thus contributing to poverty.
• Unemployment: Unemployment is a major cause of poverty because of which poor people are not able to get jobs as well as income.
• Economic inequalities: A larger percentage of national income is in a few rich people’s hands, who exploit poor people, which in turn causes poverty.
• Inflation: Increase in the price of commodities without rising in income put more pressure on poor people.
• Regional imbalance: Some states in India are having lesser economic growth as compared to other states.
• The vicious circle of poverty: Due to low consumption, low saving, low production, low employment, and low income, the vicious circle of poverty has trapped India.

Question 3.
Explain the concepts of poverty.
Answer:
Concepts of Poverty: There are two major concepts of poverty in India, which include absolute poverty and relative poverty.

• Absolute Poverty: Absolute Poverty can be measured in terms of calorie intake on daily basis. As per the standard set by the planning commission, in case a person is not able to take a calorie intake of 2400 calories in a rural area and 2100 calories in an urban area then the person is called absolute poor. It is found in developing and under-developing countries. It can be eradicated with proper planning of the government.
• Relative Poverty: Relative poverty is a universal phenomenon and is found in all countries. It can be measured through comparison of standard of living of different sections of people in terms of different income, wealth, consumption, etc. It cannot be completely eradicated from any country.

Question 4.
Write notes on types of poverty.
Answer:
Types of Poverty:

(i) Rural Poverty: Poverty prevailing in rural areas is called rural poverty. A person who consumes less than 2400 calories per day is said to be a rural poor. This poverty is mostly found among poor farmers, artisans, landless laborers, etc. It can be removed by agricultural growth and anti-poverty programmes.

(ii) Urban Poverty: Poverty prevailing in urban areas is called urban poverty. A person who consumes less than 2100 calories per day is said to be an urban poor. This poverty is more found among people who live in slums with unhygienic conditions or are employed in low-paid jobs. It can be removed by using labor-intensive techniques, growth of employment programs, etc.

(iii) Absolute Poverty: Absolute poverty is a condition in which even the basic needs of a person are not satisfied. A person who is unable to consume 2100 calories per day in urban areas or 2400 per day in rural areas, is said to be absolutely poor. It is found in poor and developing countries of the world like India, Bangladesh, Pakistan, etc.

(iv) Relative Poverty: Relative poverty is based on the comparison of the lower-income groups with the higher-income groups. It is judged on the basis of per capita income and per capita consumption expenditure of people in a country. It is a universal phenomenon and is found in all countries.

5. State with reasons whether you agree or disagree with the following statement:

Question 1.
Absolute poverty can be eradicated.
Answer:
Yes, I agree with the statement.

• Absolute poverty can be eradicated.
• Developed countries have eradicated absolute poverty.
• It is only in developing countries that absolute poverty is seen.
• In these countries problems like overpopulation, slow economic development, illiteracy, agricultural and industrial backwardness, defective land system, unemployment, inequalities when solved, the problem of absolute poverty will also be solved.
• In this manner, the problem of absolute poverty can be eradicated.

Question 2.
Poverty is not responsible for the degradation of the environment.
Answer:
No, I do not agree with the statement.

• Poverty is a part of the society or population which is not able to meet even its basic necessities.
• Poor people do not have sufficient income.
• They don’t possess money for proper food, clothing, shelter, health, and education.
• They live in unhygienic conditions.
• Thus, to satisfy their basic requirement, they cause harm to the quality of the environment.

Question 3.
Controlling population growth can reduce poverty in India.
Answer:
Yes, I agree with the statement.

• Poverty is a social phenomenon.
• Population explosion leads to poverty in India.
• In order to remove poverty, it is necessary to create awareness about the importance of family planning to the people.
• The government needs to formulate appropriate population policies to keep in check for population growth in the country.
• If the population is controlled, there will be enough scope for employment for all in the country.
• Full employment will lead to growth in per capita income, which in turn will lead to an increase in the standard of living of the people.
• Thus, controlling population growth can reduce poverty in India.

6. Answer in detail:

Question 1.
Explain the causes of poverty in India.
Answer:
The causes of poverty are as follows:

• Population explosion: Due to the increase in population, poverty is growing rapidly.
• Slow economic growth: There is slow industrial and agricultural growth due to which the economy is growing slowly.
• Unemployment and underemployment: Unemployment is the major factor of increased poverty.
• Economic inequalities: There are inequalities in the distribution of income, assets, consumption expenditure, which in fact have increased poverty.
• Inaccessibility to infrastructural facility: Due to lack of sufficient income, purchasing power is less. This leads to the inaccessibility of infrastructure such as energy, transport, communication, etc.
• Inflation: Inflation is the major cause of poverty where prices are increased on basic food and commodity.
• Regional imbalance: Economic development of some of the states in India is happening at a lower growth rate thus creating poverty.
• The vicious circle of poverty: Vicious circle of poverty can be explained, where all the factors are interrelated with each other like low national income, low per capita income, low saving, low capital formation, low production, less employment resulting in poverty.
• Other factors: Gender discrimination, corruption, natural disasters, caste, religion are some of the other factors which lead to poverty.

Balbharti Maharashtra State Board Class 11 Economics Important Questions Chapter 7 Unemployment in India Important Questions and Answers.

Maharashtra State Board 11th Economics Important Questions Chapter 7 Unemployment in India

1A. Choose the correct option:

Question 1.
Disguisedly unemployed labour has ___________ marginal productivity.
(a) zero
(b) one
(c) minimum
(d) maximum
Answer:
(a) zero

Question 2.
Introduction of computer causes ___________ unemployment.
(a) technological
(b) structural
(c) frictional
Answer:
(a) technological

Question 3.
Defective education system causes ___________ unemployment.
(a) educated
(b) technological
(c) frictional
(d) rural
Answer:
(a) educated

Question 4.
Unemployment during the off season is called ___________ unemployment.
(a) urban
(b) seasonal
(c) disguised
(d) involuntary
Answer:
(b) seasonal

Question 5.
Unemployment during recession is called ___________ unemployment.
(a) cyclical
(b) frictional
(c) structural
(d) voluntary
Answer:
(a) cyclical

Question 6.
Unemployment due to power cut is called ___________ unemployment.
(a) frictional
(b) cyclical
(c) seasonal
Answer:
(a) frictional

Question 7.
Educated unemployment is ___________ unemployment.
(a) open
(b) hidden
(c) cyclical
Answer:
(a) open

Question 8.
Employment Guarantee scheme was first introduced in ___________
(a) Maharashtra
(b) Karnataka
(c) Kerala
(d) Orissa
Answer:
(a) Maharashtra

Question 9.
Employment Guarantee Scheme was started in the year ___________
(a) 1972
(b) 1969
(c) 1970
Answer:
(a) 1972

Question 10.
Post graduate working as a peon is called ___________
(a) underemployment
(b) unemployment
(c) structural unemployment
Answer:
(a) underemployment

1B. Complete the correlation:

Question 1.
Disguised Unemployment : Rural Unemployment : : Frictional Unemployment : ___________
Answer:
Urban unemployment

Question 2.
Offseason : Seasonal Unemployment : : Excessive pressure on land : ___________
Answer:
Disguised unemployment

Question 3.
Involuntary Unemployment : People are willing to work : : ___________ : Person capacity to work is under utilised
Answer:
Underemployment

Question 4.
Technological Unemployment : Introduction of robotic technology : : ___________ : Breakdown of Machinery
Answer:
Frictional unemployment

Question 5.
Horse carts had been replaced by auto rickshaws : Structural unemployment : : Period of depression : ___________
Answer:
Cyclical unemployment

Question 6.
Employment Guarantee Scheme : 28th March 1972 : : Swarnjayanti Gram Swarozgar Yojana : ___________
Answer:
April 1999

Question 7.
Training about 2 lakh rural youth every year : Training rural youth for self-employment : : Wage Employment Scheme : ___________
Answer:
Jawahar Rozgar Yojana

Question 8.
MGNREGS : at least 100 days of guaranteed wage employment : : TRYSEM : ___________
Answer:
Training about 2 lakh rural youth every year.

1C. Suggest the economic terms for the given statements:

Question 1.
A situation where people are willing to work but unable to get a job.
Answer:
Unemployment

Question 2.
A person working less than fourteen hours per week.
Answer:
Unemployed

Question 3.
A person working 15-28 hours a week.
Answer:
Underemployed

Question 4.
A person working 8 hours per day.
Answer:
Employed

Question 5.
Type of self unemployment.
Answer:
Voluntary unemployment

Question 6.
The situation in which all available resources are used inefficiently manner.
Answer:
Full employment

Question 7.
Unemployment is found in villages.
Answer:
Rural unemployment

Question 8.
Unemployed during the slack season.
Answer:
Seasonal unemployment

Question 9.
Unemployment was found among graduates and postgraduates.
Answer:
Educated unemployment

Question 10.
Unemployment is created due to breakdown of machinery, power failure, etc.
Answer:
Frictional unemployment

1D. Find the odd word out:

Question 1.
Concept of unemployment – Involuntary unemployment, Voluntary unemployment, Underemployment, Frictional unemployment.
Answer:
Frictional unemployment

Question 2.
State with a low rate of unemployment – Goa, Punjab, Gujarat, Bihar.
Answer:
Gujarat

Question 3.
Economic effects of Unemployment – Social tension and unrest, Loss of human dignity, Waste of human resources, Helplessness.
Answer:
Waste of human resources.

1E. Complete the following statements:

Question 1.
Structural unemployment arise due to ___________
Answer:
a drastic change in the economic structure of a country

Question 2.
Unemployment due to cyclical fluctuations in level of business activity is called as ___________
Answer:
Cyclical unemployment

Question 3.
Scheme introduced to provide productive employment to rural population is ___________
Answer:
Employment Guarantee Scheme

Question 4.
Excessive pressure on land leads to ___________
Answer:
disguised unemployment

Question 5.
Unemployment found in towns and cities are called as ___________
Answer:
urban unemployment

Question 6.
Technological unemployment arises because of ___________
Answer:
changes in technology

Question 7.
Frictional unemployment is caused due to breakdown of ___________
Answer:
machinery, power failure, strikes, etc.

Question 8.
Hypothetical situation where all available resources are used efficiently is termed as ___________
Answer:
Full employment

Question 9.
A person is considered unemployed if he works for ___________
Answer:
less than 14 hours per week

Question 10.
Disguised Unemployment is also known as ___________
Answer:
invisible unemployment

1F. Choose the wrong pair:

Question 1.

Types of Unemployment	Reasons
1. Seasonal unemployment	(a) Due to slack season
2. Disguised unemployment	(b) Due to more people working than actual
3. Educated unemployment	(c) Due to imbalance between job opportunities and the number of educated youth
4. Industrial unemployment	(d) Due to fast industrial growth

Answer:
Wrong Pair : (4) Industrial unemployment – Due to fast industrial growth.

Question 2.

Schemes	Aims/Objectives
1. Employment Guarantee Scheme	(a) to provide productive employment to the rural population.
2. Swarna Jayanti Shahari Rozgar Yojana	(b) to provide gainful employment to rural unemployed and underemployed.
3. TRYSEM	(c) to train 2 lakh rural youth every year.
4. Startup India Initiative	(d) to impart strength and inspiration to the talented young generation.

Answer:
Wrong Pair: (2) Swarna Jayanti Shahari Rozgar Yojana – to provide gainful employment to rural unemployed and underemployed.

1G. Choose the correct pair:

Question 1.

Group – ‘A’	Group – ‘B’
1. Seasonal unemployment	(a) Computers
2. Disguised unemployment	(b) Breakdown of machinery
3. Structural unemployment	(c) Zero marginal productivity
4. Frictional unemployment	(d) Depression
5. Cyclical unemployment	(e) Slack season
6. Technological unemployment	(f) Infrastructural changes
7. EGS	(g) Maharashtra

Answer:
Correct Pair: (1) – (e), (2) – (c), (3) – (f), (4) – (b), (5) – (d), (6) – (a), (7) – (g).

2. Distinguish Between:

Question 1.
Unemployment and Underemployment.
Answer:

Unemployment	Underemployment
(i) It refers to a situation in which people are willing to work at the prevailing wage rate but do not get jobs.	(i) It is a situation in which employed people are contributing to production, less than their capacity.
(ii) It is a situation when the supply of labour force is more than its demand.	(ii) It is a situation where workers work below his ability as he is unable to find a suitable job.
(iii) Unemployed are those who do not have any work.	(iii) Underemployed work for less than 28 hours a week or CA working as a clerk.
(iv) In this situation, there is wastage of working capacity and a complete waste of manpower.	(iv) In this situation there is underutilization of working capacity.

Question 2.
Disguised Unemployment and Seasonal Unemployment.
Answer:

Disguised Unemployment	Seasonal Unemployment
(i) It is a situation where people appear to work but do not contribute anything to production.	(i) It is a situation in which people remain unemployed during the off-season.
(ii) It is found throughout the year.	(ii) It is found only in some months of the year.
(iii) It is usually found in the agricultural sector due to too much pressure of population on land.	(iii) It is found in the agricultural sector as well as in agro-based industries like sugar mills, rice mills, etc.
(iv) Marginal productivity of a worker is zero.	(iv) Marginal productivity of a worker is not zero.
(v) It is classified on the basis of productivity.	(v) It is classified on the basis of seasons.
(vi) It can be reduced by way of production control, rural industrialization, labour mobility, etc.	(vi) It can be reduced by providing better irrigational facilities, encouraging cottage industries, creating alternative job opportunities, etc.

Question 3.
Frictional Unemployment and Structural Unemployment.
Answer:

Frictional Unemployment	Structural Unemployment
(i) It takes place when due to the frictions in the industry, some workers are removed from jobs.	(i) It takes place due to the structural changes in the economic organizations.
(ii) It is the result of a shortage of raw materials, strikes, power failure, etc.	(ii) It is the result of a change in the production process, shifting the industry from one region to another, technological changes, etc.
(iii) It is temporary unemployment.	(iii) It may be long-term unemployment.
(iv) It is seen in all countries.	(iv) It is normally seen in underdeveloped countries.
(v) It can be removed by improvement in the supply of inputs, good labor-employer relations, etc.	(v) It can be removed by way of long-term planning, creation of alternative jobs, etc.

Question 4.
Technological Unemployment and Cyclical Unemployment.
Answer:

Technological Unemployment	Cyclical Unemployment
(i) It refers to unemployment due to the introduction of new techniques of production.	(i) It refers to unemployment due to a lack of effective demand for goods and services in the market.
(ii) It may be temporary or long-term in nature.	(ii) It is temporary in nature.
(iii) It is caused due to the introduction of new labour-saving techniques, lack of proper training, etc.	(iii) It is caused by fluctuations in business and trade cycles, a fall in effective demand, etc.
(iv) It is found more in developing countries.	(iv) It is found more in the developed countries.
(v) It can be removed by making alternative job arrangements, providing technical training, encouraging self-employment, etc.	(v) It can be removed by encouraging consumption, export activities, etc.

Question 5.
Rural Unemployment and Urban Unemployment.
Answer:

Rural Unemployment	Urban Unemployment
(i) Unemployment prevailing in the village is called rural unemployment.	(i) Unemployment prevailing in the cities and towns is called urban unemployment.
(ii) It is of two types: seasonal unemployment disguised unemployment.	(ii) It is also of two types: industrial unemployment educated unemployment.
(iii) Causes of rural unemployment are more pressure on land, rising population, seasonal nature of agriculture, etc.	(iii) Causes of urban unemployment are slow economic growth, lopsided development, immobility of labour, the spread of education, etc.
(iv) This problem is not so intense in India.	(iv) This problem is more intense in India.

Question 6.
Voluntary Unemployment and Involuntary Unemployment.
Answer:

Voluntary Unemployment	Involuntary Unemployment
(i) Voluntary unemployment arises when people are fit to work but not willing to work.	(i) Involuntary unemployment arises when people who are able and willing to work at the existing wage rate, do not find employment.
(ii) The idle rich belong to this category.	(ii) It is generally found among educated and skilled workers.
(iii) It is not considered a serious problem.	(iii) It gives rise to serious economic and social problems.
(iv) The Government cannot solve the problem of voluntarily unemployed people.	(iv) The Government can solve the problem of such people.

3. Answer the following:

Question 1.
Explain the concepts of unemployment.
Answer:
Unemployment is a situation in which a person between the age group of 15 to 59 years, who is willing and able to work at the prevailing wage but not getting any job. Hence it is a situation of scarcity of jobs, where the supply of labour is more than its demand.
Concepts of Unemployment:

• Involuntary unemployment: It refers to a situation when people are able and willing to work but there is no work for them due to excess of labour force in relation to demand labour it is also known as visible or open unemployment. Such unemployment is found in both rural and urban areas.
• Voluntary unemployment: This is not really unemployment, it is “idleness”. It is a type of unemployment where a person is fit to work but not willing to work. E.g. Rich people not willing to work or beggars who are not ready to work or educated people waiting for white-collared jobs.
• Underemployment: It is a situation where a person’s capacity to work is not fully utilized with respect to time, energy, or education. E.g: a CA working as a clerk, or a person who is ready to work full time gets a part-time job.
• Full employment: It is a situation where all the available resources in an economy are used to their optimum level.

Question 2.
What are the types of Rural unemployment?
Answer:
The unemployment situation found in village and rural areas is called rural unemployment. The main two types of rural unemployment are:
(i) Seasonal unemployment: In India, agriculture depends on the monsoon, therefore only one crop can be grown during a year. The rural agricultural labourers work mostly for 4 to 5 months during rains and rest of the year they are idle. Hence unemployment during the off-season is known as seasonal unemployment. Seasonal unemployment is also found in tourism, marriage bands, sugar factories, ice factory, fisheries, etc.

(ii) Disguised unemployment: It is also known as invisible unemployment. It is a situation where more people are working when less is required. E.g. on a piece of land when 6 workers work, the output produced is 20 quintals. If 2 workers are removed, then also the output produced is 20 quintals. This means 2 workers are not adding anything to the production. Hence these surplus workers are said to be disguisedly unemployed or in economic terms, the marginal productivity of these disguisedly unemployed labours is zero.

Question 3.
What are the types of Urban unemployment?
Answer:
Unemployment found in towns and cities is known as urban unemployment.
The two types of urban unemployment are:
(i) Educated unemployment: With the spread of education, the number of educated persons has increased. But when these educated persons do not find jobs, there is said to be educated unemployment. This type of unemployment is found among matriculates, undergraduates, graduates, and postgraduates. The casual approach to education; imbalance between job opportunities and the number of educated youth, Preference for white-collar jobs, lack of employable skills, lack of awareness about available educational opportunities are the main reasons for unemployment among educated youth in India.

(ii) Industrial unemployment: It refers to unemployment in the industrial sector. The unemployed workers may be skilled or unskilled. This is generally in a form of open unemployment. Slow industrial growth, the rapid growth of population, lack of training facilities, low adaptability to modern technology, inconvenient location of industries, low mobility of labour, etc. are the main reason for industrial unemployment. Industrial unemployment can be further classified into-

• Technological unemployment
• Frictional unemployment
• Cyclical unemployment
• Structural unemployment.

Question 4.
State any 4 Causes of Unemployment.
Answer:
Causes of Unemployment:

• The slow rate of economic development: Slow rate of economic development has resulted in the inability of the economy to give employment to the additional labour force. Therefore, unemployment is increasing.
• Excessive use of machinery: Industries are undergoing modernization and using more machines and less labour. This reduces employment opportunities. Also, in the agricultural sector, producers are increasingly substituting capital for labour.
• Migration of rural population: Agriculture being seasonal, in the off-season, there are no alternative jobs available. So they migrate to urban areas and the number of unemployed increases in urban areas.
• Expectation towards employment: Educated people have high expectations about the salary and they want ‘white-collar jobs which are not enough. They prefer to remain unemployed rather than accepting a lower salary. This also causes unemployment.

Question 5.
State the economic effects of unemployment.
Answer:
Economic effects of unemployment:

• Waste of human resources: Human resources are wasted due to unemployment in the country. These resources could have been used in the production activity of the economy.
• Difficult to implement welfare schemes: Due to corruption and malpractices, it is difficult to implement various welfare schemes introduced by the government from time to time.
• Poverty and Income inequality: Lack of employment leads to poverty and income inequality in the economy.
• Growth of informal sector: Due to unemployment, poverty increases in the economy which will attract the growth of informal sectors like smuggling, drug peddling, black marketing, etc.
• High dependency ratio: When unemployment increases in an economy, it will lead to an increase in dependency ratio.
• The unemployed group will become the burden on the employed group.

Question 6.
State the Social Effects of Unemployment.
Answer:
Social effects of unemployment:

• Social tensions: Due to unemployment, social tensions and unrest in the economy go on increasing.
• Loss of human dignity: Unemployment especially among the educated, creates an inferiority complex and leads to low dignity and self-esteem.
• Helplessness: Sometimes unemployed youth become so helpless that they try to run away from reality and some may commit suicide. Therefore, unemployment is socially undesirable.

Question 7.
State any 4 specific measures taken by the Government to generate employment in the country.
Answer:
Specific measures to generate employment are as follows:

• Jawahar Rozgar Yojana (JRY): It was announced by the Government on 1st April 1989 to general employment in 120 backward districts specifically rural areas of India. This program was later on renamed as Jawahar Gram Samrudhi Yojana (JGSY).
• Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS): This scheme aims at providing at least 100 days of guaranteed wage employment in a year to at least one member of every rural household.
• Deen Dayal Upadhyaya Grameen Kaushalya Yojana, 2014: It is a placement linked skill training programme run under the Ministry of Rural Development.
  • The main aim of this scheme is to reduce poverty and provide gainful and sustainable employment.
  • This scheme focused on rural youth from poor families under the age group of 15 – 35 years.
• Startup India Initiative: It was introduced to impart more strength and inspiration to the talented young generation of India to do something new for India and humanity.

4. State with reasons whether you agree or disagree with the following statements:

Question 1.
Problems of unemployment in India and America are the same.
OR
Problems of unemployment in developed and developing countries are the same.
Answer:
No, I do not agree with the statement.

• Problems of unemployment in India and America are not the same.
• India is a developing country whereas America is a developed one.
• India being an agricultural economy, in rural areas there is a problem of disguised and seasonal unemployment and in urban areas, there is underemployment, frictional, structural, and educated unemployment.
• All this is because of overpopulation.
• But America is a technically advanced country and being thinly populated, the problem of unemployment is not so very serious.
• More often cyclical unemployment is found there which is because of a lack of effective demand.
• Hence, the statement that the problems of unemployment in India and America are the same is not correct.

Question 2.
The high growth of the population is the only cause of rural unemployment.
Answer:
No, I do not agree with the statement.

• The high growth of the population is one of the causes of rural unemployment.
• Other causes are:
  • Seasonal nature of agriculture.
  • Lack of mobility.
  • Declining of handicrafts.
  • Under the development of villages.
  • Joint family system.
  • Law of inheritance.
  • Illiteracy among the people.

Hence, the high growth of the population is not the only cause of rural unemployment.

Question 3.
Disguised unemployment is a part of urban unemployment.
Answer:
No, I do not agree with the statement.

• Disguised unemployment is a special feature of rural areas.
• It exists when more workers are employed in a sector than what is actually required.
• They seem to be working but their contribution to the work is zero.
• This is found more in rural areas because of the high growth of the population and the lack of alternative job opportunities.
• In urban areas, we find educated unemployment or there may be frictional, structural, cyclical, or technological unemployment.
• Hence, disguised unemployment is a part of rural unemployment.

Question 4.
Educated unemployment is due to a defective education system.
Answer:
Yes, I agree with the statement.

• The Indian education system is defective.
• It stresses more on general education rather than job-oriented education.
• Educated people do not fit in any type of job unless they do some professional courses.
• Hence, a defective education system is one of the main causes of unemployment among educated people.

Question 5.
Frictional unemployment is temporary in nature.
Answer:
Yes, I agree with the statement.

• Frictional unemployment arises when there are problems like a breakdown of machinery, shortage of raw materials, power failure, etc. and some workers are removed from their jobs.
• All these are temporary problems and can be solved in a short period.
• Such problems do not cause a serious problem.
• Hence, it is right to say that frictional employment is temporary in nature.

Question 6.
Underemployment is found both in rural and urban areas.
Answer:
Yes, I agree with the statement.

• Underemployment arises when employed persons contribute less than their capacity.
• In rural areas, on the farms, labourers work for 2-3 hours a day and since alternative jobs are not available, they remain idle for the rest of the day.
• In urban areas, because of the shortage of employment, when qualified persons do not get jobs as per their qualifications, they accept either low-paid or part-time jobs.
• Hence, in both rural and urban areas underemployment is found, although it is more in rural areas.

5. Observe the following charts and answer the questions given below:

Question 1.

Question i.
Workers were sitting idle in a factory due to power failure for 3 hours.
Answer:
Frictional unemployment.

Question ii.
Ram had no work, due to the end of the Kharif crop season.
Answer:
Seasonal unemployment.

Question iii.
Due to the introduction of taxis and auto-rickshaws, Bhimaji’s horse-cart was not demanded by travellers.
Answer:
Structural unemployment.

Question 2.

Question i.
If Prakash is ready to work at the prevailing wage rate in the market, but he is unable to find the work, then what type of unemployment is it? Write the reason.
Answer:
Involuntary Unemployment.
It is due to the excess labour force with respect to demand for labour.

Question ii.
Vishal is an educated youth XYZ company is offering him a job, but he doesn’t want to work. What kind of unemployment is it? Write the reason.
Answer:
Voluntary Unemployment.
It is a kind of self unemployment. Here, the person is fit and eligible to work, but wants to remain unemployed.

Question iii.
Ajay has passed his degree college by first class and he is working as a factory assembly like a worker. Write the reason.
Answer:
Underemployment.
Mr. Ajay could have worked much better as per his qualification, but due to the non-availability of job opportunities, he is working as a factory assembly.

Question iv.
Write the meaning of full employment.
Answer:
Full employment is a situation in which all the available resources of the country are being used at their optimum and in the most efficient manner.