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To Answer Economic Questions; Indian Eonomic System

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1 ) Name and briefly describe one of the three major functions of an economic policy ( function of state intervention in the economy )

2) Select one country case study and characterize briefly it's economic system . Include what type of system it is, what type of fiscal policy it pursues,  what type of central and monetary policy it had,  basic type of taxation and unique elements to that country.

3) How can you define socio- economic system?

4) Characterize briefly the concept of Kondratieff waves ?

5) What are the potential benefits of a ' shock therapy' approach towards economic transition? 

6) Definition of welfare state .

7) Which type of economic system is my least preferred one and why ?


To Answer Economic Questions: Indian Eonomic System

1. Economic policy

Economic policy refers to the actions that governments play in the economy. Governments’ economic policies depend on the desired outcome of the economic tools used. Generally, the economic policies include the role of the government in regulating the money supply, like government spending, interest rates, taxation, and subsidies. The government interventions are aimed at maximizing social welfare. Taxation is one of the most economical policy tools used by the government. Taxation influence the amount of money circulating in the economy. When the money supply in the economy is high, the government increases taxes so that the cost of borrowing money is high; this will mean that investors will find the cost of investment high, and the money supply in the economy will be reduced.

2. Indian Economic system

India has an economic system considered as a mixed economy, which is a combination of a free-market economy and government intervention. In India today, the economy as private and the public sectors co-exist, and as well the government leverages international trade. It has both elements of capitalism and socialism. India has a mixed economy had borrowed a lot from the united states’ fiscal policy instruments. Government spending and taxes are the common tools used by the Indian government. India has a structured tax system, and the importance of taxes is defined by two attributes - progressive and proportional. It is progressive in that the tax is levied at increasing rates to increase brackets of income and revenue. The Central Bank of India has a reserve requirement that influences the money supply in the economy and the level of interest rates. Progressive and proportional taxation means that the percentage of an income of an individual or household pays increases as income increases. Those people with higher income pay more taxes and also have a higher rate of taxes.

3. Socio-economic system

The socio-economic system is the way social and economic factors within an economy influence one another in households and in the communities. Some of these socio-economic factors include the level of education and the social setting of the community, like heritage.

4. The concept of Kondratieff waves

The concept of the Kondratieff Wave was coined by Nikolai Kondratieff,...


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