Indian Economy Questions

A large underground economy results in an Overstated GDP. The underground economy is also called as Black market. It refers to illegal economic activity. Transactions in the underground economy are illegal either because the good or service being traded is illegal or because an otherwise licit transaction does not comply with government reporting requirements.

In national income accounting, government purchases by Local, State and Federal governments.

A perfectly inelastic demand curve is perfectly vertical either up or down in any way.

Mixed economy is the most common economic system in the world.

Any type of insurance, be it home, auto, life, health, etc. are based on a principle of division of risk.

Division of Risk :: This is based on how much risk the insurer estimates the insured's coverage to be. The riskier the opportunity (bad health, area the home is in) the higher the premium costs.

Economic growth is measured by the percentage of gross domestic product. GDP refers to the total value of goods and services produced in the country.