Haryana State Board HBSE 10th Class Social Science Important Questions Economic Chapter 4 Globalisation and the Indian Economy Important Questions and Answers.
Haryana Board 10th Class Social Science Important Questions Economic Chapter 4 Globalisation and the Indian Economy
Multiple Choice Questions
Money and Credit Class 10 Important Questions Question 1.
Which of the following is not a feature of a Multinational Company?
(a) It owns or controls production in more than one nation
(b) It sets up factories where it is close to the markets
(c) It organises production in complex ways
(d) It employs labour only from its own country.
Answer:
(d) It employs labour only from its own country.
Chapter 3 Money and Credit HBSE 10th Class Question 2.
Investment made by Multinational Companies is called :
(a) Foreign Investment
(b) Investment
(c) Trade barriers
(d) None of these.
Answer:
(a) Foreign Investment
Money and Credit Important Questions HBSE 10th Class Question 3.
When did Ford Motors come to India?
(a) 1900
(b) 1922
(c) 1990
(d) 1995.
Answer:
(d) 1995.
Question 4.
In which year, the Indian government decided to remove barriers on foreign trade and foreign investment?
(a) 1995
(b) 1990
(c) 2003
(d) 1991.
Answer:
(d) 1991.
Question 5.
What is the main feature of new economic policy?
(a) Privatisation
(b) Globalisation
(c) Liberalisation
(d) All of these.
Answer:
(d) All of these.
Question 6.
Name the organisation which lays emphasis on liberalisation of foreign frade and foreign investment in India.
(a) W.T.O.
(b) UNDP
(c) UNESCO
(d) UNICEF
Answer:
(a) W.T.O.
Question 7.
Globalisation does not involve which one of the following ?
(a) Movement of people between countries for jobs, education etc.
(b) Rapid integration between countries
(c) Increased taxes on imports
(d) More goods and services moving between countries.
Answer:
(c) Increased taxes on imports
Question 8.
What are SEZs ?
(a) Special Economic Zones
(b) Special oort Zones
(c) Special Excise Zones
(d) None of these.
Answer:
(a) Special Economic Zones
Question 9.
Which of these is an Indian MNC ?
(a) Infosys
(b) Ranbaxy
(c) Tata Motors
(d) All of these.
Answer:
(d) All of these.
Question 10.
Foreign trade gives more number of choices for –
(a) Buyers
(b) Producers
(c) Sellers
(d) None of these.
Answer:
(a) Buyers
Fill in the blanks
1. …………. is the integration between countries through foreign trade and foreign investment by multinational companies.
2. ………….. is a trade between different countries of the world.
3. Removing barriers or restrictions set earlier by the government on foreign trade is known as ……………
4. ……………. is the initiative of developed countries to liberalise international trade.
5. Governments of respective countries can play a major role in achieving ……………
6. WTO deals with regulation of trade between participating …………
7. Government establishes ………….. to attract MNCs for investment.
8. …………. has played on important role in globalisation.
Answer:
1. Globalisation
2. Foreigh trade
3. Liberalisation
4. World Trade Organisation
5. Fair globalisation
6. Countries
7. SEZ
8. Information Technology.
Very Short Answer Type Questions
Question 1.
What do you meant by globalisation?
Answer:
Globalisation is the process of interconnection between countries of the world.
Question 2.
Mention any three factors responsible for Globalisation.
Answer:
(i) Growth of Multinational Companies.
(ii) Growth of Technology.
(iii) Development of telecommunication and means of transportation.
Question 3.
Why do MNCs set-up their offices and factories in those regions where they get cheap labour and other resources?
Answer:
To minimise cost of production and maximise profit earnings, MNCs set-up their offices and factories in regions where they get cheap labour and other resources.
Question 4.
How foreign investment is differentiated from investment?
Answer:
The money that is used to set up industries, buy assets, merge with companies based in foreign land is called foreign investment, while investment is simply the buying of assets, land, building, etc.
Question 5.
Define the term ‘liberalisation’.
Answer:
Removing barriers of restriction set earlier by the government is known as liberalisation.
Question 6.
Analyse the contribution of communication technology in globalisation.
Answer:
Communication technology has provided us with fast means of communication through which information can be sent, received or processed at a very rapid pace. This has linked the world and facilitated globalisation.
Question 7.
Who are playing a major role in the globalisation process?
Answer:
Multinational Companies are playing a major role in the globalisation process.
Question 8.
Why is tax on imports called a trade barrier?
Answer:
It is called a barrier because it sets up various restrictions on trade.
Question 9.
For what purpose do governments use trade barriers?
Answer:
Government can use trade barriers to increase or decrease foreign trade and to decide what kinds of goods, and how much of each, should come into the country.
Question 10.
What is meant by trade barrier? Give one example?
Answer:
Trade barriers are restrictions imposed on import and export of goods. An example is import duty.
Question 11.
When was World Trade Organisation established?
Answer:
World Trade Organisation was established on 1 January, 1995.
Question 12.
Where is the head office of WTO?
Answer:
The head office of WTO is in Geneva, Switzerland.
Question 13.
Write full form of the following:
(i) MNC
(ii) WTO
Answer:
(i) MNC-Multinational Corporation.
(ii) WTO-World Trade Organisation.
Question 14.
For which companies has globalisation created new opportunities?
Answer:
Globalisation has created new opportunities, for companies providing services, particularly those involving IT.
Question 15.
What are SEZs?
Answer:
SEZs mean Special Economic Zones. They are created to attract foreign investment.
Question 16.
Which steps have been taken to attract foreign investment in India? Name any two.
Answer:
(i) Special Economic Zones are being set up.
(ii) Flexibility in the labour laws.
Question 17.
Name any two large Indian Companies that emerged as multinational companies.
Answer:
(i) Tata Motors
(ii) Infosys.
Question 18.
Why is fair globalisation necessary?
Answer:
Fair globalisation would create opportunities for all, and also ensure that the benefits of globalisation are shared better.
Short Answer Type Questions-I
Question 1.
What do you mean by Multinational Corporation ? Write the main characteristics of MNCs. .
OR
Where do MNCs set up their production units?
Answer:
Meaning of Multinational Corporation (MNC):
A company that owns or controls production in more than one nation.
Characteristics of MNCs:
This is done, so that the cost of production is low and the MNCs can earn greater profits.
MNCs set up their production units:
- Where there is skilled and unskilled labour available at low costs.
- Where the availability of other factors of production is assured.
- Where it is close to the market.
- Where government policies are as per the interests of MNCs.
Question 2.
MNCs set up production jointly with some of the local companies. Is it beneficial for local companies?
Answer:
MNCs set up production jointly with some of the local companies. The benefit to the local company of such joint production is two-fold:
(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.
Question 4.
What is the most common route for MNC investments?
Answer:
Sometimes, MNCs set up production jointly with some of the local companies in the host countries, but the most common route for MNC investments is to buy up local companies and then to expand production. MNCs with huge wealth can quite easily do so. In fact, many of the top MNCs have wealth, exceeding the entire budgets of the developing country governments.
Question 5.
Why are MNCs spreading across the borders? Give two reasons.
Answer:
Multinational Corporation: Large companies, which operate in many countries of the world, are called multinational companies/corporations. These companies are spreading across the borders because of the following reasons:
(i) These multinational companies are set up for better profits. They spread across the borders to get more and more profits.
(ii) They spread acorss the border to get cheap skilled and unskilled labour and other resources. This is done with a view that in such areas, the cost of production would be low and their chances of profit would be greater.
Question 6.
What are Special Economic Zones? Why have they been set up?
Answer:
Special Economic Zones (SEZs) are those industrial areas, which have been specially established to attract foreign companies to invest in India. These have world-class facilities, like- electricity, water, roads, storage, transport, recreational and educational facilities. Moreover, in such special economic zones, those companies who set up their production units, are provided relaxation in taxes, for an initial period of five years.
Short Answer Type Questions-II
Question 1.
Give a brief description of the role of multinational corporations in Indian economy.
Answer:
The role of multinational corporations in Indian economy can be described as given below :
1. There has been a great increment in foreign direct investment in India, because of the multinational corporations.
2. Due to the establishment of several factories in India, the country has undergone rapid industrial development.
3. Multinational corporations used modern techniques in production, therefore new technologies are coming in the country.
4. Multinational corporations are establishing units in India, in which, people are getting employment.
5. Things of good qualities are being made available to consumers by multinational corporations, consequently there are many choices of goods before consumers.
Question 2.
What is foreign trade? What are its prominent effects of it?
Answer:
Foreign Trade: The process of buying and selling goods and services between two or more than two countries is known as foreign trade.
Effects of Foreign Trade:
The prominent effects of foreign trade are as follows:
1. Foreign trade creates an opportunity for the producers to reach beyond the domestic markets, i.e. markets of their own countries.
2. Producers can sell their products, not only in markets located within the country, but also can compete in markets located in other countries of the world.
3. Import of goods produced in another country is one way of expanding the choice of goods, beyond what is domestically produced.
4. Prices of similar goods in the two markets tend to become equal.
5. The producers of two distant countries can compete with each other.
Question 3.
What is World Trade Organisation? Is this organisation working properly?
Answer:
World Trade Organisation (WTO) is an organisation, whose aim is to liberalise international trade. WTO establishes rules regarding international trade and observes that these rules are obeyed. It was established on 1st January 1995. Though WTO is supposed to allow free trade for all, in practice, 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.
Question 4.
Which factors have enabled globalisation in India?
Answer:
The factors which have enabled globalisation in India are as follows :
(i) Transportation Technology: One of the major factors, that has stimulated the globalisation process, is the improvement in transportation technology. There are aircraft that cover the distance, in a short time, between one country to another. Moreover, the cost of air transport has been reduced.
(ii) Information Technology: It has played an important role in spreading out the production of services. For instance, a news magazine, published for London readers, is being designed and printed in Delhi.
(iii) Information and Communication Technology: Information and Communication technology has got a boost, due to the invention of computers and the internet etc.
Question 5.
Barriers on foreign trade and foreign investment were removed to a large extent in India since 1991; Justify the statement.
Answer:
In 1991, the Government of India liberalised its policy and felt that Indian producers must compete with producers around the world. The government had an opinion that trade competition would improve the performance of the local producers within the country since they will be forced to improve their quality. Another reason was the economic crises in India in 1990-91 and support of WTO and IMF which led the government to remove trade barriers. Thus, Indian Government removed barriers to a large extent on foreign trade and foreign investment.
Question 6.
How have our markets been transformed in recent years. Explain with current examples, or Assess any three advantages of globalisation.
Answer:
After the advent of globalisation, many changes have occurred in the Indian markets. The various transformation in the Indian market in recent years are:
- There is the availability of a wide range of goods and services.
- Products are of better quality.
- Good quality products are available at low costs.
- We can easily avail the latest products with advanced technology, e.g. digital cameras, mobile phones, etc.
These products are affordable as well as accessible.
Question 7.
How does government attract foreign investment? Explain different ways.
Answer:
Government attracts foreign investment in the followings ways:
- Special Economic Zones have been set up to have world-class facilities such as cheap electricity, roads, transport, storage, etc.
- The companies setting their units in SEZs are exempted from paying tax for initial period of five years which increases their profit.
- Labour laws are made flexible in SEZs. This has attracted foreign investment.
Question 8.
Explain the functions and importance of World Trade Organisation.
Answer:
Following are the functions and importance of World Trade Organisation—
- World Trade Organisation (WTO) deals with regulation of trade between participating countries.
- It provides a forum for negotiation and for settling disputes.
- It is an organisation that intends to supervise and liberalise.
- It oversees the implementation, administration and operations of the covered agreements.
Question 9.
Why had the Indian Government put barriers to foreign trade and foreign investments after independence? Analyse the reason.
Answer:
Indian Government put barriers to foreign trade after independence because of the following reasons-
- To protect the domestic producers within the country from foreign competition in the form of imports.
- To encourage more production of goods so that more industries can be started.
- During 1950s and 1960s, Indian industries were just coming up, they were not prepared to face challenges from foreign countries.
Question 10.
” Fair globalisation would create opportunities for all and also ensure that benefits of globalisation are shared better.” Support the statement.
OR
How can the government of India play a major role to make globalisation more fair? Explain with examples.
Answer:
The statement points to the fact that the government can work for the cause of fair globalisation through the following ways-
- By framing policies that protect the interests of not only the rich and powerful but also the weaker sections of society.
- By supporting small producers so they can compete with large manufacturers.
- By ensuring that labour laws are properly implemented and workers get their rights.
- By using trade and investment barriers and negotiating for fairer rules at the WTO.
Question 11.
How are local companies benefitted by collaborating with multinational com¬panies? Explain with examples. (CBSE 20131
Answer:
The following examples show that local companies benefitted by collaborating with multinational companies.
- Local companies get additional investments, to buy new machines for faster production.
- Local companies get the latest technology for production.
- By more production, local companies earn greater profits.
Question 12.
How can government play a major role in making globalisation fair?
OR
How can the government of India play in major role to make globalisation more fair? Explain with examples. (CBSE 2019;
Answer:
Government can play a major role in making fair globalisation in the following ways :
- Government policies must protect the interests, not only of the rich and the powerful, but also of other people in the country.
- Government can ensure that labour laws are properly implemented.
- Government can ensure whether the workers get their rights or not.
- Government can support small producers to improve their performance, till the time they become strong enough to compete.
- Government can use trade and investment barriers, if necessary.
- Government can negotiate at the WTO for fairer rules.
- Government can align with other developing countries with similar interests, to fight against the domination of developed countries in the WTO.
Long Answer Type Questions
Question 1.
Explain in what ways has competition affected workers, Indian exporters and foreign MNCs in the garment industry.
Answer:
Competition has affected workers, Indian exporters and foreign MNCs in the following ways :
Workers:
- Their jobs are no longer secure. They now work on a temporary basis.
- They have to put in very long working hours.
- Wages are low.
Indian exporters:
- They get orders from MNCs at cheaper rates.
- They try hard to cut their costs.
- They employ workers only on a temporary basis.
Foreign MNCs:
- They are able to find cheaper raw materials and other inputs in order to maximise their profits.
- Competition among garment exporters has allowed these MNCs to make large profits.
Question 2.
How has foreign trade been integrating markets of different countries? Explain with examples.
Answer:
Since historic times, foreign trade has been the main channel connecting countries, e.g. silk route connects India and South Asia to markets both in the East and West. Foreign trade creates an opportunity for producers to reach beyond the domestic markets, i.e. markets of their own countries. Choice of goods in the markets rises. Prices of similar goods in the two markets tend to become equal. Producers in the two countries closely compete against each other, even though they are separated by thousands of miles.
With many MNCs in the market, the consumer has a wide range of products coming from different nations to choose from. Hence, it interlinks various markets across the countries. For example, Volkswagen, German automobile company, is the biggest German automaker in the world. It came to India in 2007 and had recorded sales of 32,627 vehicles in the year 2010.
Question 3.
“Globalisation has been advantageous to consumers as well as to producers.” Support the statement with suitable examples.
Answer:
Globalisation has benefitted the producers and the consumers in the following ways:
(i) Globalisation has led to a rapid increase in industrial competition. As result, producers are competing over each other to provide better and cheaper services to the consumers. This has also resulted in a reduction in the prices.
(ii) With the initiation of globalisation, producers now have relatively free access to international markets. Also, they can now avail more easily of the credit facilities forwarded in terms of capital and technology. This is illustrated by the example of the electronics goods and garments industry.
(iii) Consumers have more choice of goods and services as compared to earlier times specially in modern digital technological equipment like cell phones, cameras etc.
Question 4.
What are the various ways in which MNCs set up or control production in other countries.
OR
Explain by giving examples that MNCs are spreading their production in different ways.
Answer:
The way in which MNCs control or spread their production are:
By Buying Local Companies: Large MNCs buy companies that are operating locally. By doing this, they get a good customer base and the local company gets latest technology. For example, Cargill Foods (MNC) merged with Parakh Foods (local).
By Joint Ventures:
MNCs set-up production units jointly with any company that may be operating in a country. By doing this, MNCs not only increase their production but also get a vast market. For example, Ford Motors set up automobile plant in collaboration with Mahindra and Mahindra. By placing orders with small producers : MNCs place orders for their products with small producers in developing countries where the resources are cheap. Then the MNCs sell those products under their own brand. Ex. garments, foodwear, jeans, footballs, etc.