National Income Accounting Class 12-Short Notes and hand outs

Class 12 - Macro Economics Hand Outs for Students on  National income accounting Compiled by Mr. Pankaj Bhanwani #9899971997 @Pankaj Bhanwani Board Covered - CBSE , ICSE Basic Definition National income is the (money) value of all the final goods and services produced by a country in a year. Gross domestic product (GDP): GDP is the money value of all final goods and services produced in the domestic territory of a country in an accounting year Before moving further must watch the video Domestic territory includes the following: 1) Territory lying within the political frontiers, including territorial waters of the country 2) Ships and aircraft operated by the residents of the country between two or more countries, fishing vessels, oil and natural gas rigs, and floating platforms operated by the residents of the country in the international waters or engaged in extraction in areas in which the country has exclusive rights of exploitation 3) Embassies, consulates and military establishments of the country located abroad. GDP at constant and current prices 1) GDP can be estimated at current as well as constant prices. If the GDP is estimated on the basis of the prevailing prices it is called GDP at current prices. In 1995-96, India's GDP at current prices was Rs. 8,57,570 crores - that is, measured on the basis of the prices prevailing in 1995-96. 2) If GDP is measured on the basis of some fixed prices - that is, prevailing at a point of time or in some base year - it is known as GDP at constant prices or real GDP. Th us, in 1995-96, the GDP was Rs. 2,36,738 crores at 1980-81 prices - that is, measured on the basis of the prices prevailing in 1980-81 Relationships of various aggregates A GNP at market price - depreciation = NNP at market price. A GNP at market price - net income from abroad = GDP at market price. A GNP at market price - net indirect taxes = GNP at factor cost. A NNP at market price - net income from abroad = NDP at market price. A NNP at market price - net indirect taxes = NNP at factor cost. A GDP at market price - net indirect taxes = GDP at factor cost. A GNP at factor cost - depreciation = NNP at factor cost. A NDP at market price - net indirect taxes = NDP at factor cost. Circular flow of income The circular flow of production, income and expenditure represents three related phases - production, distribution and disposal. These phases enable one to view national income in three ways - as a flow of goods and services, as a flow of incomes or as a flow of expenditure on goods and services. Corresponding to these phases, there are three methods of measuring national income. They are: value-added method (alternatively known as the product method); income method; and expenditure method. Precautions of all the methods of national income The following items need be included carefully: i) production of fixed assets by government, enterprises and households; ii) production for self-consumption; and iii) imputed rent of owner-occupied houses The following should not be included: i) sale of second-hand machines (because they were counted as a part of production in the year in which they were produced). (Brokerage and commission earned by the dealers of second-hand goods are a part of production and, hence, included while calculating the total value-added Income method: Factors of production pool their services for carrying out production activities. These factors of production are paid for their services in the form of factor incomes. Labor gets wages, land gets rent, capital gets interest and entrepreneur gets profits. Whatever is produced by a producing unit is distributed among the factors of production for their services and the aggregate of factor incomes of all the factors of production of all the producing units form the subject matter of calculation of national income by the income method. Transfer incomes are excluded from national income. Therefore, wages of labourers will be included, pensions of retired workers will be excluded from national income . Labour income includes, compensations in kind. Concept of mixed income of self employee It is difficult to separate labour income from capital income because in many instances people provide both labour and capital services as is the case with self-employed people such as lawyers, engineers, traders, proprietors, and so on. In sectors such as agriculture, trade, transport, and so on, of underdeveloped countries (including India), it is difficult to differentiate between the labour and capital elements of the people's incomes. For overcoming this difficulty, a new category of income, namely , mixed income, is introduced for incomes which are difficult to separate. Transfer incomes should not get included in the national income . Illegal incomes, windfall gains, death duties, gift tax and sale proceeds of second-hand goods are not included for calculating national income. Total expenditure in an economy consists of expenditure on financial assets, on goods produced in preceding periods, on raw materials, intermediate goods and services, and on final goods and services produced in the current period. Expenditure on financial assets which are produced and owned within the country is excluded, but expenditure on financial assets of foreign countries is included in national expenditure. But only the net expenditure, that is, the difference between expenditure on foreign financial assets by residents and expenditure on the country's financial assets by non-residents or foreigners is incorporated. The difference is known as net foreign investment. Expenditure on raw materials and intermediate goods and services are excluded, as otherwise, there would be double counting of some of the items.  Government expenditure on pensions, scholarships, unemployment allowance, and so on, should be excluded because these are transfer payments. Only expenditure on final goods and services produced in the period for which the national income is to be measured and net foreign investment are included in the expenditure method. These three methods should ideally lead to the same figure of national income and, therefore, national income of a country can be measured by these methods separately to get different views of the economy. Each method provides a check on the accuracy of the other.

Demand Worksheet for class 11 and class 12

Pankaj Bhanwani
#9899971997
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Topic Demand for class 11 and class 12

Activity 1

Watching of the video - It is the video of a child in which when the price falls children start demanding more products

Activity 2 Word Puzzle

The children can search the words and then try to learn the meaning of the words and their defination

Activity 3 - A short test

Chapter Demand Test

Class Test                                                                                             Date of test

Maximum Marks =10

Q1 Expansion in demand leads to an upward movement on the same demand curve-True or False (2)

Q2 Cross demand is positive in case of substitute goods –T/F (2)

Q3 Distinguish between decrease in demand and decrease in quantity demanded (2)

Q4 Explain the derivation of market demand with the help of a numerical example(2)

Q5 A good is an inferior good for one and at the same time normal for another consumer Do you agree ? Explain using example? (2)

General Knowledge Questions for practice August 2018

G.K Questions for August 2018

Pankaj Bhanwani #9899971997

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Questions to check

Ø  Union Minister for agriculture and farmer welfare Radha Mohan Singh launched the Meghalaya Milk Mission in _________________

Ø  What was India’s rank in WEF energy transition Index 2018 ___________________

Ø  The biggest solar power plant of Uttar Pardesh has set up in which district ______________

Ø  Which of the following state governments has launched Kanya Van Sambrudhi Yojana recently ____________

Ø  Who is the newly elected president of Nepal _________________

Ø  Which state topped the ease of doing business ranking in the recently released business reform action plan ___________________

Ø  President Ram Nath Govind has inaugurated the World Hindi Secretariat in which country ____________________

Ø  Which country is hosting the the 10^Th edition of the BRICS summit 2018 _____________________

Ø  The 18^th UNICEF children festival 2018 has been inaugurated by West Bengal governor KN Tripathi in ______________________

Ø  The citizen centric online portal “ Innovate India Platform “ has been jointly launched by NITI Aayog Atal innovation mission and __________________

Ø  Who is the author of the book “ The Dhoni Touch : Unravelling The Enigma That is Mahender Singh Dhoni” _________________     

Ø  As per the the Swach Survekshan -2018 results , name the city that has emerged as the cleaniest city in India __________________________

Ø  Which country took the seat vacated by United States at the UN Human rights council ________________________

Ø  Which country hosted the 6^th edition of World Cities Summit 2018 __________________

Ø  Who has won the 2018 Formulae One French Grand Prix tournament  2018 _______________________________

Ø  Who has become the first woman fighter to fly fighter aircraft solo ___________________________

_

Ø  UIDAI has announced that children under five years of age AADHAR BAL What is the specified colour of this card ___________

Ø  Government earmarks Rs ________________ crores to commemorate 150 years of birth of mahatma ghandhi

Answers

Ø  Union Minister for agriculture and farmer welfare Radha Mohan Singh launched the Meghalaya Milk Mission in ___Shillong______________

Ø  What was India’s rank in WEF energy transition Index 2018 _____ 78^th

Ø

Ø  The biggest solar power plant of Uttar Pardesh has set up in which district _ Mirzapur

Ø  Which of the following state governments has launched Kanya Van Sambrudhi Yojana recently  Marashtra

Ø  Who is the newly elected president of Nepal  Bidya Devi Bhandari

Ø  Which state topped the ease of doing business ranking in the recently released business reform action plan Andhra Pradesh

Ø  President Ram Nath Govind has inaugurated the World Hindi Secretariat in which country

Mauritius

Ø  Which country is hosting the the 10^Th edition of the BRICS summit 2018

South Africa

Ø  The 18^th UNICEF children festival 2018 has been inaugurated by West Bengal governor KN Tripathi in  Kolkata

Ø  The citizen centric online portal “ Innovate India Platform “ has been jointly launched by NITI Aayog Atal innovation mission and  My Gov

Ø  Who is the author of the book “ The Dhoni Touch : Unravelling The Enigma That is Mahender Singh Dhoni” Bharat Sundaresan

Ø  As per the the Swach Survekshan -2018 results , name the city that has emerged as the cleaniest city in India Indore

Ø  Which country took the seat vacated by United States at the UN Human rights council

Ireland_

Ø  Which country hosted the 6^th edition of World Cities Summit 2018 Singapore

Ø  Who has won the 2018 Formulae One French Grand Prix tournament  2018 _______________________________Lewis Hammilton

Ø  Who has become the first woman fighter to fly fighter aircraft solo ___________________________Avani  Chaturvedi

Ø  UIDAI has announced that children under five years of age AADHAR BAL What is the specified colour of this card _Blue

Ø  Government earmarks Rs 150 crores to commemorate 150 years of birth of mahatma ghandhi

Demand and Supply Criss Cross Puzzle

Class 11 and Class 12

@Pankaj Bhanwani +919899971997

Topic Demand and Supply –Criss Cross

Lesson Development and Introduction

Movement along a demand curve

The amount of quantity demanded by the consumer changes with the rise and fall in the price of the commodity if other determinants of demand remain constant. This alternation in demand, when shown in the graph, is known as movement along a demand curve.

Movement along a demand curve can also be understood as the variation in quantity demanded of the commodity with the change in its price, ceteris paribus.

There can be two types of movement in a demand curve – extension and contraction.

Extension in a demand curve is caused when the demand for a commodity rises due to fall in price. And, contraction in demand curve is caused when the demand for a commodity falls due to rise in price

Shift in demand curve

The amount of commodity demanded by the consumers may change due to the effect of non-price factors as well. Non-price factors which influence demand for the commodity may be consumers’ income, the price of related goods, advertisement, climate and weather, the expectation of rise or fall in price in future, etc.

When the amount of commodity demanded changed due to non-price factors, there is no extension or contraction in the curve but the formation of the entirely new demand curve. As a result, demand curve shifts from its original position.

For an example, the demand for cold drinks in the market may increase substantially even at same price due to hot weather.

Movement along a supply curve

The amount of commodity supplied changes with rise and fall of the price while other determinants of supply remain constant. This change, when shown in the graph, is known as movement along a supply curve.

in simple words, movement along a supply curve represents the variation in quantity supplied of the commodity with a change in its price and other factors remaining unchanged.

The movement in supply curve can be of two types – extension and contraction. Extension in a supply curve is caused when there is an increase in the price or quantity supplied of the commodity while contraction is caused due to a decrease in the price or quantity supplied of the commodity

 

Shift in supply curve

The amount of commodity that the producers or suppliers are willing to offer at the marketplace can change even in cases when factors other than the price of the commodity change. Such non-price factors can be the cost of factors of production, tax rate, state of technology, natural factors, etc.

When the quantity of the commodity supplied changes due to change in non-price factors, the supply curve does not extend or contract but shifts entirely. For an instance, the introduction of improved technology in industries helps in reducing the cost of production and induces production of more units of a commodity at the same price. As a result, the quantity of commodity supplied increases but the price of the commodity remains as it is.

Activity to understand -Demand – Supply Expansion /Contraction , Increase/Decrease  Application

Initial Point	New Point	Demand	Supply
X	A	Increase – As you move from D1 to D2	Expansion-No change in supply curve only upward movemnt
X	B
X	I
X	F
X	E
X	D
X	G
A	B
A	I

Quiz on 2018 Asian Games

Quiz on Asian games -2018

Q1 Where is the asian games 2018 going to be held

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Q2 When was the first asian games held

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Q3 It is the ________ (number) edition of the asian games

Q4 How many sports and events are taking place in this asian games

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Q5 The opening and closing ceremonies of the _____th Asian Games will be held at the ________________________________ Stadium in ____________.

Q6 The  three new mascots  are ____________—a greater bird-of-paradise, Atung—a ____________ deer, and _____________—a Javan rhinoceros, representing the Eastern, ______________ and Western regions of Indonesia.

Q7 Name three sports which are not a part of the asian games this year 2018

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Q8 What is the full form of INASGOC

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Q9 What is the music album release for 2018 Asian games

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Q10 The Athletes’ Village will be in _________ Jakarta and the __________ Village in South Jakarta.

Q11 Where will be the 2022 Asian games will be held

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The above is the mascot for the current asian games 2018

Fill  the following mascots of the year

Year	Mascots
1982
2010
1998

Q12 Only seven countries have participated in all editions of the Asian Games. India is one of them. The rest six are

1
2
3
4
5
6

Identify the person and why he is in news for the asian games 2018

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For Answers please follow the link

Answers to the Quiz

Quiz made by Pankaj Bhanwani

Date 18/08/2018

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