Class 10 Economics Chapter 4 – Globalisation and the Indian Economy

Overview of the chapter

Interlinking Production Across Countries

The money that is spent on buying assets such as land,
building, machines and other equipment is called investment.
An investment made by MNCs is called a foreign investment.
MNCs are exerting a strong influence on production at these
distant locations. As a result, production in these widely
dispersed locations is getting interlinked.

There are a variety of ways, as mentioned below, in which MNCs are

spreading their production and interacting with local producers in various
countries across the globe.
 By setting up partnerships with local companies
 By using the local companies for supplies
 By closely competing with local companies or buying them
up

MNCs set up production jointly with local companies, which benefits local
companies in the following ways:
 First, MNCs can provide money for additional investments,
like buying new machines for faster production.
 Second, MNCs might bring with them the latest technology
for production.

Foreign Trade and Integration of Markets

Foreign trade creates an opportunity for the producers to reach
beyond the domestic markets. Producers can sell their products
not only in markets located within the country but can also
compete in markets located in other countries of the world.
Similarly, buyers have the options to choose among various
goods beyond domestically produced goods. Thus, foreign trade
results in connecting the markets or integration of markets in
different countries.
What Is Globalisation?
 Globalisation is the process of rapid integration or
interconnection of countries. MNCs are playing a major
role in the globalisation process.
 More and more goods and services, investments and
technology are moving between countries.
 There is one more way in which the countries can be
connected. This is through the movement of people
between countries.

Factors That Have Enabled Globalisation

Technology
Rapid improvement in technology has been one major factor
that has stimulated the globalisation process. This has made
possible much faster delivery of goods across long distances at
lower costs. The developments in information and
communication technology have made information instantly
accessible.

Liberalisation of Foreign Trade and Foreign Investment Policy

 Trade barriers are some restrictions that have been set up
by governments. The government can use trade barriers
to increase or decrease (regulate) foreign trade and to
decide what kinds of goods and how much of each should
come into the country. Tax on imports is an example of a
trade barrier.
 Removing barriers or restrictions set by the government
on trade is known as liberalisation. When the government
imposes fewer restrictions than before, it is said to be
more liberal.

Impact of Globalisation on India

 Globalisation has impacted the lives of people in India in
the following manner:
  It has provided greater choices to consumers who now
enjoy improved quality and lower prices on several
products.
 It has resulted in higher standards of living.
 Globalisation has also created new opportunities for
companies providing services, particularly in the IT sector.

NCERT QUESTIONS

question 1: What do you understand by globalisation? Explain

in your own words.
Answer:
1. Globalization is a process of interaction and integration
among the people, companies, and governments of
different nations, a process driven by international trade
and investment and aided by information technology.
2. Under globalization the countries that hitherto closed to
trade and foreign investment open up their economies and
go global. The result is increasing interconnectedness and
integration of the economies of the world.
3. Under globalization more and more goods and services,
investments and technology are moving between
countries.
4. In addition to goods, services, investments, and
technology, there is a movement of people who move
from one country to another in search of better income,
better jobs or better education.

Question 2: What was the reason for putting barriers to

foreign trade and foreign investment by the Indian
government? Why did it wish to remove these barriers?

Answer:(1) The government had put restrictions on the import

of goods to protect domestic producers from foreign
competition because industries were coming up in the 1950s
and 1960s, and competition from imports at that stage would
not have allowed these industries to come up. Thus, the
government allowed imports of only essential items such as
machinery, fertilizers, and petroleum. These restrictions helped
to attain technological capability within the country.
(2) Starting around 1991, the government wished to
remove the barriers due to reasons as mentioned below
:
 India had attained technological capability.
 The government decided that the time had come for
Indian producers to compete with producers around the
globe.
 It felt that competition would improve the performance of
producers within the country since they would have to
improve their quality.
 There would be an unrestricted exchange of capital,
technology, and experience between India and other
countries of the world.
Thus, barriers to foreign trade and foreign investment were
removed. Now goods could be imported and exported easily.
The government reduced taxes on imported goods, and encour-
aged investors from abroad to invest in India.

Question 3: How would flexibility in labour laws help

companies?
Answer:Flexibility in labour laws will help companies in being
competitive and progressive. By easing up on labour laws,
company heads can negotiate wages and terminate
employment, depending on market conditions. This will lead to
an increase in the company’s competitiveness.

Question 4: What are the various ways in which MNCs set up,
or control, production in other countries?
Answer:
MNCs set up, or control, production in other countries in
the following ways :
1. MNCs set up production on the basis of the following
factors :
 Closeness of the place to the markets.
 Availability of skilled and unskilled labour at low
costs.
 Availability of other factors of production e., raw
material, etc.
 Government’s favourable policies.
 2. After assuring above conditions, MNCs set up factories and
offices for production. They buy assets such as land,
buildings, machines and other equipment.
3. At times MNCs set up production jointly with local
companies because the local company has knowledge of
the local business conditions. Moreover the domestic
company has an established framework of business. MNCs
provide money and latest technology for production.
4. MNCs buy up local companies to expand production. MNCs
with huge wealth can quite easily do so.
5. Some MNCs start as an independent entity right from the
beginning.
6. While some of the MNCs produce entirely for the local
market, many others produce for the exports markets.
7. MNCs in developed countries place orders for production
with small producers of developing countries for various
products such as garments, footwear. These products are
supplied to the MNCs which sell them under their own
brand names to the customers. The MNCs decide their
price, quality, delivery, and labour conditions for these
distant producers.
Thus we see that there are a variety of ways in which MNCs are
spreading their production and interacting with local producers
in various countries across the globe. As a result, production in
these widely dispersed locations is getting interlinked.

Question 5: Why do developed countries want developing

countries to liberalise their trade and investment? What do you
think should the developing countries demand in return?
Answer:
Developed countries want developing countries to liberalise
their trade and investment because then the MNCs belonging
to the developed countries can set up factories in less-
expensive developing nations, and thereby increase profits,
with lower manufacturing costs and the same sale price. In my
opinion, the developing countries should demand, in return, for
some manner of protection of domestic producers against
competition from imports. Also, charges should be levied on
MNCs looking to set base in developing nations.

Question 6: “The impact of globalisation has not been

uniform.” Explain this statement.
Answer:
The impact of globalisation has not been uniform as
explained below :
(1) Positive impact :
1. Globalization has resulted in more choices for the
consumers who now get better quality and at lower prices
several products.
2. This has improved the standard of living of people,
particularly living in urban areas.
3. MNCs have increased their investments in developing
countries like India in industries such as cell-phones,
automobiles, electronics, soft drinks, etc. As a result of it
new jobs have been created in developing countries.
4. Some local companies that supply raw materials to MNCs
have also benefited.
5. Some local companies in countries like India have been
able to invest in newer technology and production
methods. They are successful in raising their production
standards.
6. Globalisation has enabled some large companies such as
Tata Motors, Infosys to emerge as multi-national
companies.
7. Companies providing services particularly in the field of
information and communication technologies have also
benefited by globalisation. Similar is the case in services
like data entry, accounting, administrative tasks and
engineering.
(2) Negative impact: The impact of globalisation has
been harmful too as mentioned below :
1. Creation of special economic zones has disrupted the lives
of people who are displaced such as tribals. Sometimes to
produce more electricity dams are constructed and their
land is submerged and the people are left without any job.
2. Flexibility in labour laws: Flexibility in labour laws is
allowed by the government to attract foreign investment.
This has resulted in worsening the condition of workers
because they are appointed on a temporary basis to avoid
payment of provident fund and other facilities. No
overtime is paid for extra hours of work. The workers are
paid low wages.
3. Effect on small producers: Globalisation has hit the
small producers because they are unable to compete with
 MNCs or the big producers or manufacturers. Several units
have been shut down rendering many workers jobless. In
India, small industries which employ about 20 million
workers have been hit adversely.
4. From above description, it is clear that the impact of
globalisation has not been uniform. It has positive as well
as a negative impact.

Question 7: How has liberalisation of trade and investment

policies helped the globalisation process?
Answer: Liberalisation of trade and investment policies has
helped the globalisation process by making foreign trade and
investment easier. Earlier, several developing countries had
placed barriers and restrictions on imports and investments
from abroad to protect domestic production. However, to
improve the quality of domestic goods, these countries have
removed the barriers. Thus, liberalisation has led to a further
spread of globalisation because now businesses are allowed to
make their own decisions on imports and exports. This has led
to a deeper integration of national economies into one
conglomerate whole.

Question 8: How does foreign trade lead to the integration of

markets across countries? Explain with an example other than
those given here.
Answer:
1. Foreign trade leads to the integration of markets across
countries because it creates an opportunity for the
producers to reach beyond the domestic markets i.e.,
markets of their own countries. Producers can sell their
products in the markets of their own country as well as in
other countries all over the world. They can also compete
in markets located in other countries of the world.
2. The buyers too have a choice between the goods
produced in different parts of the world. It enables the
consumer to buy according to his requirement.
3. The competition among the producers bring them closer
to each other.
4. Sometimes the producers of other countries set up joint
ventures as AIG have set up joint venture in insurance
sector and are selling their products in India.
Thus in general, with the opening of trade, goods travel
 from one market to another. Prices of similar goods in two
markets tend to become equal. And producers in the two
countries now closely compete against each other even
though they are separated by thousands of miles. Foreign
trade, thus, results in connecting the markets or
integration of markets in different countries.

Question 9: Globalisation will continue in the future. Can you

imagine what the world would be like twenty years from now?
Give reasons for your answer.
Answer: Globalisation will continue in the future. Twenty years
from now, the world will be more globally connected and
integrated into one international economy, if this process
continues on a fair and equitable basis. Trade and capital flows
will increase alongside the mobility of labour. This will occur
because liberalisation will get augmented and MNCs will
converge with other companies producing the same goods.

Question 10: Supposing you find two people arguing: One is

saying globalisation has hurt our country’s development. The
other is telling, globalisation is helping India develop. How
would you respond to these organisations?
Answer:Both the arguments have some truth as
mentioned below :
Globalisation has helped India develop as mentioned
below :
 Many MNCs are making an investment in India in different
sectors like insurance banking and food processing.
 These investments have benefited people in a, number of
ways which has resulted in the development of the
country.
 Now people have choices. They can buy anything of their
choice costly or cheap.
 People are getting jobs with a handsome salary.
 The living standard of people has increased.
 Many projects are going on with the help of foreign
investment. Different states are making efforts to attract
foreign companies to make an investment in their states
and are successful in their mission.
The globalisation, however, has hurt the country’s
development as mentioned below :
  For a large number of small producers globalisation has
posed many challenges. Batteries, capacitors, plastics
toys, tires, dairy products and vegetable oil industries
have been hit badly due to competition.
 Many small units have been shut down rendering many
workers jobless.
 As the small industries in India employ the largest number
of workers (20 million) in the country, next only to
agriculture, it has hurt the development.
Thus, both arguments have some truth in them. However,
if steps are taken to have a fair globalization, then the
adverse effects may be minimised and may not hurt the
country’s development.

EXTRA NOTES

1. What is Globalisation?
Answer: Globalisation is the process of rapid integration or
interconnection between countries.

2. How are Indian markets transformed with

Globalisation?
Answer: The latest models of digital cameras, mobile phones
and televisions made by the leading manufacturers of the world
are within everyone’s reach. We would not have found such a
wide variety of goods in Indian markets even two decades back.
In a matter of years, our markets have been transformed.

3. What is an MNC?
Answer: A multinational company is a company that owns or
controls production in more than one nation.

4. How are MNCs able to gain greater profits?

Answer: MNCs set up offices and factories for production in
regions where they can get cheap labour and other resources.
This is done so that the cost of production is low and the MNCs
can earn greater profits.

5. Which regions are favourable for MNCs to set up

production?
Answer: MNCs set up production where it is close to the
markets, where there is skilled and unskilled labour available at
low costs and where the availability of other factors of
production is assured.

6. What do you understand by the term ‘Investment’?

Answer: The money that is spent to buy assets such as land,
buildings, machines and other equipment is called ‘Investment’
which would later fetch them profits.

7. What is the most common route for MNC’s

investment?
Answer: The most common route for MNC’s investment is to
buy up local companies and then expand the production. MNCs
with huge wealth can do so quite easily.

8. How were Parakh foods purchased by an American

MNC?
Answer: Cargill Foods, a very large American MNC, has taken
over a smaller Indian company Parakh Foods. Parakh foods had
five oil refineries, whose control has now shifted to Cargill, who
is now the largest producer of edible oils.

9. Give examples of industries where production is

carried out by a large number of small producers around
the world.
Answer: Garments, footwear and sports items are examples of
industries where production is carried out by a large number of
small producers around the world.

10. How are MNCs interacting with local companies in

spreading their production?
Answer: There are variety of ways—By setting up partnerships
with local companies, by using the local companies for supplies
and by closely competing with the local companies or buying
them up.
15. Explain the role of MNCs in globalisation.
Answer: MNCs are playing a major role in the globalisation
process. More and more goods and services, investment and
technology are moving between countries.
6. What is the contribution of improvement in transport
technology to stimulate the era of globalisation?
Answer: For the past fifty years, there have been several
improvements in transportation technology. This has made
much faster delivery of goods across long distances possible at
lower costs.
17. What is the contribution of information and
communication technology in the era of globalisation?
Answer: In recent times, technology in the areas of
telecommunication, computers, internet has been changing
rapidly. Telecommunication facilities like telegraph, telephone,
mobile, fax, etc., help to communicate in remote areas also.
19. What is a ‘trade barrier’?
Answer: Tax on imports by the Government is called ‘trade
barrier’. It is called a barrier because some restrictions have
been set up.
20. Why do Governments use trade barriers?
Answer: Governments can use trade barriers to increase or
decrease (regulate) foreign trade and to decide what kinds of
goods and how much of each should come into the country.

21. Why did Indian Government after Independence put

barriers to foreign trade and foreign investment?
Answer: This was considered necessary to protect the
producers within the country from foreign competition.
Industries were just coming up and competition from imports at
that stage would not have allowed these industries to come up.

22. After independence, which items were allowed to be

imported?
Answer: After independence, imports of only essential items
such as machinery, fertilisers, petroleum, etc., were allowed to
be imported.

23. What does the term ‘liberalisation’ mean?

Answer: Removing barriers or restrictions set by the
government is known as ‘liberalisation’.

24. How does liberalisation policy help in trade?

Answer: With liberalisation of trade, businesses are allowed to
make decisions freely about what they wish to import or export.
The government imposes much less restrictions than before
and is, therefore, said to be more liberal.
25. What is WTO?
Answer: It is World Trade Organisation which monitors the
liberalisation of trade at international level.
26. What was the main aim of formation of World Trade
Organization?
Answer: The main aim of formation of WTO is to liberalise
international trade.

27. What role does WTO play to liberalise trade?

Answer: WTO was started at the initiative of the developed
countries. WTO establishes rules regarding international trade,
and sees whether rules are obeyed or not.

28. What is tariff? Why is it imposed on goods?

Answer: Tariff is a tax imposed on imported goods and
services. Tariffs are used to restrict trade, as they increase the
price of imported goods and services, making them more
expensive to consumers.

29. How has globalisation benefited well-of buyers?

Answer: There is greater choice before these consumers who
now enjoy improved quality and lower prices for several
products. As a result, these people today, enjoy much higher
standards of living than was possible earlier.

30. In which specific industries are MNCs interested?

Answer: MNCs have been interested in industries such as cell
phones, automobiles, electronics, soft drinks, fast food or
services such as banking in urban areas.

31. What are the advantages of products and services

produced by MNCs?
Answer: These products have a large number of well off
buyers. In these industries and new services, new jobs have
been created. Also, local companies supplying raw material to
these industries have prospered.

32. What are SEZs?

Answer: SEZ is a special economic zone of a country that is
subject to unique economic regulations that differ from other
areas in the same country. These regulations tend to be
conducive to foreign direct investment. Conducting business in
an SEZ typically implies that the company will receive tax
incentives and the opportunity to pay lower tariffs.

35. How have top Indian Companies been benefitted in

competition from MNCs?
Answer: They have invested in newer technology and
production methods and raised their production standards.
Some have gained from successful collaborations with foreign
companies.
36. In which products, small manufacturers were hit
hard?
Answer: Batteries, capacitors, plastics, toys, tyres, dairy
products and vegetable oil are some examples of industries
where the small manufacturers have been hit hard due to
competition.

37. How can you say that workers’ jobs in MNCs are not
secured?
Answer: Globalisation and the pressure of competition have
substantially changed the lives of workers. Faced with growing
competition, most employers these days prefer to employ
workers ‘flexibly’. This means that workers’ jobs are no longer
secure.

38. How can government ensure fair globalisation in

India?
Answer: The government can play a major role in making this
possible. The government can ensure that labour laws are
properly implemented and the workers get their rights. If
necessary, government can use trade and investment barriers.

39. Which is the most common route for investment by

MNCs in countries around the world?
Answer: To buy up local companies and then to expand
production.

40. Differentiate between investment and foreign

investment.
Answer: Difference between investment and foreign
investment: The money that is spend to buy assets (land,
building, machines and other equipment) is called investment,
while the investment made by the MNCs is called foreign
investment.

41. Why do MNCs set up their offices and factories in

those regions where they get cheap labour and other
resources?
Answer: MNCs set up their office and factories in those regions
where they get cheap labour and other resource because of –
(i) Low cost of production.
(ii) They can earn greater profits.
42. Due to which reason the latest models of different
items are available within our reach?
Answer: Due to globalization, the latest models of digital
camera, mobile phone, TV, etc are available with us.

Short Answer Type Questions

1. Under what conditions do MNCs set up production
units?
OR
Examine any three conditions which should be taken
care of by multinational companies to set up their
production units.
OR
Describe any five factors that promote the Multinational
Corporations (MNCs) to setup their production units in a
particular place.
Answer: MNCs set up production units on the basis of:
(i) Proximity to the markets;
(ii) Availability of skilled and unskilled labour at low cost;
(iii) Availability of other factors of production is assured; and
(iv) Government policies that look after their interests.
(v) Developed infrastructure
(vi) Safety measures. (Any five)

2. What are the basic functions of foreign trade?

Answer:
 Foreign trade creates an opportunity for the produces to
reach beyond the domestic markets.
 Producers can sell their produce not only in markets
located within the country but can also compete in
markets located in other countries of the world.
  For the buyers, import of goods produced in another
country is one way of expanding the choice of goods
beyond what is domestically produced.

3. What do you mean by liberalisation of foreign trade?
Answer: (i) Removing barriers or restrictions set by the
government is known as liberalisation.
(ii) With the liberalisation of trade, businesses are allowed to
make decisions freely about what they wish to import or export.
(iii) The government imposes lesser restrictions than before
and is therefore, said to be more liberal.

4. What is the role of WTO in international trade?

Answer: (i) WTO’s aim is to liberalise international trade.
(ii) It establishes rules regarding international trade and sees
that these rules are obeyed.
(iii) 164 countries of the world are its members currently.
(iv) It is seen that the developed countries have unfairly
retained trade barriers. On the other hand, WTO rules have
forced developing countries to remove trade barriers.

5. What changes do you find with the arrival of MNCs in

the markets?
Answer:
 As consumers in today’s world, some of us have wider
choice of goods and services before us.
 The latest models of digital cameras, mobile phones and
televisions made by the leading manufacturers of the
world are within our reach.
 Every season, new models of automobiles can be seen on
the Indian roads.
7. What are MNCs?
Answer: (i) An MNC is a company that owns or controls
production in more than one nation.
(ii) These companies set up offices and factories for production
in regions where they can get cheap labour and other
resources.
(iii) This is done to ensure that the cost of production remains
low and MNCs can earn greater profits.

8. What is investment? How is foreign investment

different from it?
Answer: The money that is spent to buy assets such as land,
building, machines and other equipment is called investment.
Investment made by MNCs is called foreign investment. Every
investment is made with the hope that the assets will earn
profits for these companies.
9. What are the benefits of MNCs’ production to the
local companies?
OR
Which two benefits local companies get when they set
up production in association with MNCs?
OR
How are ‘local companies’ benefited by collaborating
with ‘multinational companies’? Evaluate any three
benefits. [CBSE Delhi 2017]
Answer: (i) MNCs can provide money for additional
investments, like buying new machines for faster production.
(ii) MNCs might bring with them the latest technology for
production.
(iii) MNCs also buy some local companies to expand
production, since they have wealth exceeding the entire
budgets of some of the developing countries.

10. How are MNCs spreading their production across the

globe?
Answer: There are variety of ways in which the MNCs are
spreading their production across the globe such as:
(i) Setting up partnerships with the local companies;
(ii) Using the local companies for supplies; and
(iii) Closely competing with the local companies or buying
them.
As a result, production in these widely dispersed locations is
getting interlinked.

11. Why are trade barriers imposed on the foreign trade

and investment in a country? Explain with the help of
two illustrations. [CBSE Sample Paper 2017]
Answer: Trade barriers are used by the governments –
(i) To increase, decrease or regulate foreign trade.
(ii) To decide what kinds of goods and how much of each,
should come into the country.
(iii) To protect the producers within the country from foreign
competition.
12. What is the role of MNCs in the globalisation
process?
Answer: (i) MNCs are playing a major role in the globalisation
process.
(ii) More and more goods and services, investments and
technology are moving between countries.
(iii) Most regions of the world are in closer contact with each
other than a few decades back.

13. Besides the movement of goods, what are the ways

in which countries can be linked?
Answer: (i) Besides the movement of goods, services,
investment and technology, there is one more way in which the
countries can be connected.
(ii) It is done through the movement of people between
countries.
(iii) People usually move from one country to another in search
of better income, better jobs or better education.

14. How is foreign trade interlinking markets of different

countries? Explain with example. [CBSE (F) 2017]
Answer: Foreign trade has interlinked markets of different
countries.
(i) Foreign trade has been the main channel connecting
countries.
(ii) Foreign trade creates an opportunity for the producers to
reach beyond the domestic markets.
(iii) Producers can sell their produce in local and foreign
market.
(iv) It is one way of expanding the choice of goods.
(v) Choice of goods in the markets rises.
(vi) Prices of similar goods in the two markets tend to become
equal.
(vii) Close competition with each other.

15. What is the impact of globalisation on the

consumers of India?
Answer: (i) Globalisation and greater competition among
producers—both local and foreign have been of advantage to
consumers, particularly the well-off sections in the urban areas.
(ii) There is a greater choice before these consumers who now
enjoy improved quality and lower prices for several products.
(iii) As a result, these people today enjoy much higher
standards of living than was possible earlier.

17. Explain by giving examples that Multinational

Corporations (MNCs) are spreading their productions in
different ways. [CBSE (AI) 2016]
Answer: Multinational Corporations are spreading their
productions in different ways:
(i) By setting up partnership with local companies.
(ii) By placing orders with local companies. For example,
Garments, Footwear, Sports items, etc.
(iii) By closely competing with the local companies.
(iv) By buying local companies- For example, Cargill buying
Parakh foods in India.

18. How are companies providing services benefitted by

globalisation?
Answer: (i) Globalisation has also created new opportunities
for companies providing services, particularly those involving IT.
(ii) There are Indian companies which are producing magazines
for the London-based companies and call centres are also
existing due to globalisation only.
(iii) Besides, a host of services such as data entry, accounting,
administrative tasks, engineering are now being done cheaply
in developing countries such as India and are exported to the
developed countries.

(b) Prices of foreign products especially the Chinese items like

toys are cheap and have a great variety to attract customers.
(c) Swadeshi and Boycott movements were relevant and
worked because of the movement for Independence of our
country. Today, the circumstances are different. Technology has
made its mark. Foreign goods increase the revenue for the
native countries. Moreover, free trade and marketing needs to
be accepted for country’s economic growth.
21. Classify industries on the basis of capital
investment. How are they different from one another?
Explain with examples. [CBSE (Delhi) 2016]
Answer: Classification of the industries on the basis of capital
investment:
(i) Small Scale industry
(ii) Large Scale industry
Difference:
(i) If the investment is more than one crore on any industry is
considered as a large scale industry, for example, Iron and
Steel Industry/Cement Industry.
(ii) While the investment is less than one crore on an industry
is considered as a small scale industry, for example, Plastic
industry, Toy industry.

22. ‘Barriers on foreign trade and foreign investment

were removed to a large extent in India since 1991.’
Justify the statement. [CBSE (Delhi) 2016]
Answer: Removal of barriers on foreign trade and foreign
investment:
(i) Barriers on foreign trade and foreign investment were
partially removed.
(ii) Goods could be imported and exported easily.
(iii) Foreign companies could set up factories and offices here.
(iv) Opportunities for Indian producers to compete with
producers around the globe.
23. “A wide ranging choice of goods are available in the
Indian markets.” Support the statement with examples
in context of globalisation. [CBSE (Delhi) 2016]
OR
“In a matter of years, Indian markets have been
transformed with wide ranging choice of goods.”
Support the statement with examples. [CBSE (Comptt.)
2017]
Answer: We have a wide variety of goods and services before
us in the market.
(i) The latest models of the digital cameras, mobile phones and
televisions made by leading manufacturers of the world are
available in the market.
(ii) Every season, new models of automobiles can be seen on
Indian roads.
(iii) Today Indians are buying cars produced by nearly all the
top companies in the world.
(iv) A similar explosion of brands can be seen for many other
goods.
24. “Cheap and affordable credit is crucial for the
country’s development.” Assess the statement. [CBSE
(Delhi) 2016]
Answer: Cheap and affordable credit is crucial:
(i) Many people want to start an enterprise by borrowing may
not do because of high cost of borrowing.
(ii) Banks and cooperative societies need to lend more.
(iii) This would lead to higher income and many people could
then borrow at cheap rates for a variety of needs.
(iv) They could grow crops, do business or set up small scale
industries.

25. “Globalisation and greater competition among

producers has been of advantage to consumers.” Justify
the statement with examples. [CBSE (Delhi) 2016]
OR
Describe any five advantages to consumers due to
globalisation and greater competition among producers.
[CBSE (F) 2017]
Answer: Globalisation and greater competition among
producers, both local and foreign producers have been of
advantage to consumers.
(i) There is a greater choice before consumers along with
competitive price.
(ii) They enjoy improved quality and lower prices for several
products.
(iii) They enjoy much higher standards of living that was
possible earlier.
(iv) Strengthening of Consumer Rights like – Right to
Information, Right to Choose, Right to be Heard, and Right to
Seek Redressal has been given to consumers.
(v) Legal rights of consumers have become more effective.