Page 109 - VIRANSH COACHING CLASSES

• Disparities in income : It refers to a significant data from the past and present and analysis of
disparity or inequality in the distribution trends.
of income between individuals, groups, • General price level : It is an index that
populations, social classes or countries. measures the change in price of goods in an

• Division of labour : It means separation of a economy over time and hence the purchasing
work process into a number of tasks, with each power of the currency of the country.
task performed by a separate person or group of • Illegal incomes : Income derived from illegal
persons. activities such as bookie/betting operations,
• Double counting : It occurs when the costs theft, embezzlement and from other illegal
of intermediate goods used by a business to resources.
produce a finished good are included in the • Imputed value : Imputed value is an assumed
computation of a nation's gross domestic value given to an item when the actual value is
product. not known or available.
• Economic efficiency : Economic efficiency • Impact of tax : Effect of a tax on production or
is achieved when all goods and factors of consumption of a product.
production in an economy are distributed or • Incidence of tax: The incidence of a tax
allocated to their most valuable uses and waste refers to the extent to which an individual
is eliminated or minimized. or organisation suffers from the imposition of
• Economic model : It is a simplified a tax.
representation of economic reality showing the • Income tax returns : A tax return is
inter-relationships between selected economic documentation filed with a taxing authority that
variables. reports income, expenses and other relevant
• Economic variable : It refers to any financial information.
measurement that helps to determine how • Indivisible goods : A good is indivisible when
an economy functions. Population, poverty, the utility one derives from it depends on the
unemployment, inflation etc. are examples of number of users or individuals using it. This
economic variables. concept is used in public finance.
• Economic welfare : It is the overall level • Intermediate goods : An intermediate good is
of financial satisfaction and prosperity a good or service purchased by a manufacturer
experienced by participants in an economic to be used as an input in another product.
system. • Laissez-faire : It is a policy of minimum
• Effective demand : In Keynesian governmental interference in the economic
macroeconomic theory, effective demand is the affairs of individuals and society.
point of equilibrium where aggregate demand = • Leasing Companies : They provide finance for
aggregate supply. acquiring plant and machinery especially for
• Engineering goods : Engineering goods small and medium sized enterprises.
include metal products, industrial machinery • Liquidity Adjustment facility (LAF) : It is a
and equipment, auto and its components and monetary policy tool used by RBI which allows
transport equipments. commercial banks to borrow money through

• Financial proposal : A financial proposal is a repurchase agreements. It consists of Repo and
written report that provides details of the future Reverse Repo operations.
of a business by addressing its monetary needs • Marginalism : Marginalism is concerned with
and budget. how much extra use is gained from incremental
• Forecasting : It is a planning tool that helps increases in the number of goods created, sold,
management in its attempts to cope with the etc. and how these measures relate to consumer
uncertainty of the future, relying mainly on choice and demand.
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