Financial Abbreviations and Acronyms in India

Abbreviation	Definition
AD	Authorized Dealer
ADB	Asian Development Bank
ADR	American Depository Receipt
AFS	Annual Financial Statement
AGM	Annual General Meeting
AIRCSC	All India Rural Credit Survey Committee
ARIMA	Auto-Regressive Integrated Moving Average
AFS	Available For Sale
ASSOCHAM	Associated Chambers of Commerce and Industry of India
ATM	Asynchronous Transfer Mode
ATM	Automated Teller Machine
BIS	Bank for International Settlements
BOI	Bank of India
BoP	Balance of Payments
BSCS	DESACS RBI Basel Committee on Banking Supervision
BSE	Bombay Stock Exchange
BSR	Basic Statistical Returns
CAD	Capital Account Deficit
CAG	Controller and Auditor General of India
CBS	Consolidated Banking Statistics
CC	Cash Credit
CD	Certificate of Deposit
CD Ratio	Credit Deposit Ratio
CDBS	Committee of Direction on Banking Statistics
CF	Company Finance
CFRA	Combined Finance and Revenue Accounts
CGRA	Currency and Gold Revaluation Account
CII	Confederation of Indian Industries
CO	Capital Outlay
CP	Commercial Paper
CPI	Consumer Price Index
CPI-IW	Consumer Price Index for Industrial Workers
CR	Capital Receipts
CRAR	Capital to Risk Weighted Asset Ratio
CRR	Cash Reserve Ratio
CSIR	Council of Scientific and Industrial Research
CSO	Central Statistical Organisation
CVC	Central Vigilance Commission
DAP	Development Action Plan
DBOD	Department of Banking Operations and Development
DCA	Department of Companies Affairs
DCB	Demand Collection and Balance
DCCB	District Central Cooperative Bank
DCM	Department of Currency Management
DD	Demand DraftDDSData Dissemination Standards
DEIO	Department of External Investments and Operations
DESACS	Department of Statistical Analysis & Computer Services
DGBA	Department of Government and Bank Accounts
DGCI&S	Directorate General of Commercial Intelligence and Statistics
DI	Direct Investment
DICGC	Deposit Insurance and Credit Guarantee Corporation of India
DID	Discharge of Internal Debt
DMA	Departmentalized Ministries Account
DRI	Differntial Rate of Interest Scheme
DSBB	Dissemination Standards Bulletin Board
DVP	Delivery versus Payment
ECB	External Commercial Borrowing
ECB	European Central Bank
ECGC	Export Credit and Guarantee Corporation
ECS	Electronic Clearing Scheme
EDMU	External Debt Management Unit
EEA	Exchange Equalization Account
EEC	European Economic Community
EEFC	Exchange Earners Foreign Currency
EFR	Exchange Fluctuation Reserve
EPF	Employees Provident Fund
ETF	Exchange Traded Fund
EUR	Euro
EXIM Bank	Export Import Bank of India
FC	Finance Commision
FCCB	Foreign Currency Convertible Bond
FCNR(B)	Foreign Currency Currency Non-Repatriable(Banks)
FCNRA	Foreign Currency Currency Non-Repatriable Account
FDI	Foreign Direct Investment
FEMA	Foreign Exchange Management Act
FI	Financial Institution
FICCI	Federation of Indian Chambers of Commerce and Industry
FII	Foreign Institutional Investor
FIMMDA	Fixed Income Money Market and Derivatives Association of India
FISIM	Financial Intermediation Services Indirectly Measured
FPI	Flow Of Funds
FRA	Foreign Portfolio Investment
FRBM	Forward Rate Agreement
FRN	Fiscal Responsibility and Budget
FWG	First Working Group on Money
FX	Foreign Exchange
GDP	Gross Domestic Product
GDR	Global Depository Receipt
GFD	Gross Fiscal Deficit
GFS	Government Finance Statistics
GIC	General Insurance Corporation
GLS	Generalized Least Squares
GNIE	Government Not Included Elsewhere
GoI	Government of India
GPD	Gross Primary Deficit
G-Sec	Government Securities
HDFC	Housing Development Finance Corporation
HFT	Held For Trading
HICP	Harmonised Index of Consumer Prices
HO	Head Office
HUDCO	Housing & Urban Development Corporation
IBRD	International Bank Reconstruction and Development
IBS	International Banking Statistics
ICAR	Indian Council of Agricultural Research
ICICI	Industrial Credit and Investment Corporation of India
ICMR	Indian Council of Medical Research
IDB	India Development Bonds
IDBI	Industrial Development Bank of India
IDD	Industrial Development Department
IDFC	Infrastructure Development Finance Corporation
IFAD	International Fund for Agricultural Development
IFC	International Finance Corporation
IFC(W)	International Finance Corporation (Washington)
IFCI	Industrial Finance Corporation of India
IFR	Investment Fluctuation Reserve
IFS	International Financial Statistics
IFSC	Indian Financial System Code
IGLS	Iterative Generalized Least Squares
IIBI	Industrial Investment Bank of India
IIP	Index of Industrial Production
IIP/InIP	International Investment Position
IMD	India Millennium Deposits
IMF	International Monetary Fund
IN	India
INR	Indian Rupee
IOTT	Input-Output Transaction Table
IP	Interest Payment
IPO	Initial Public Offer
IRB I	Industrial Reconstruction Bank of India
IRDA	Insurance Regulatory Developement Authority
ISDA	International Swaps and Derivative Association
ISIC	International Standard Industrial Classification
ISO	International Standards Organization
ITRS	International Transaction Reporting System
IWGEDS	International Working Group on External Debt Statistics
KVIC	Khadi & Village Industries Corporation
LAF	Liquidity Adjustment Facility
LAMPS	Large-sized Adivasi Multipurpose Societies
LAS	Loan & Advances by States
LBD	Land Development Bank
LBS	Locational Banking Statistics
LERMS	Liberalised Exchange Rate Management System
LIC	Life Insurance Corporation of India
LT	Long Term
LTO	Long Term Operation
M1	Narrow Money
M3	Broad Money
MA	Moving Average
MCA	Ministry of Company Affairs
MF	Mutual Fund
MIGA	Multilateral Investment Guarantee Agency
MIS	Management Information System
MMSE	Minimum Mean Squared Errors
MoF	Ministry of Finance
MOF	Master Office File
MRM	Monitoring and Review Mechanism
MRP	Maximum Retail Price
MSS	Market Stabilisation Scheme
MT	Mail Transfer
MTM	Mark-To-Market
NABARD	National Bank for Agriculture and Rural Development
NAC(LTO)	National Agricultural Credit (Long Term Operatiion)
NAIO	Non Administratively Independent Office
NAS	National Account Statistics
NASSCOM	National Association of Software and Services Companies
NBC	Non-Banking Companies
NBFC	Non Banking Financial Companies
NEC	Not Elsewhere Classified
NEER	Nominal Effective Exchange Rate
NFA	Non-Foreign Exchange Assets
NFD	Net Fiscal Deficit
NGO	Non-Governmental Organization
NHB	National Housing Bank
NIC	National Industrial Classification
NIF	Note Issuance Facility
NNML	Net Non-Monetary Liabilities
NPA	Non-Performing Assets
NPD	Net Primary Deficit
NPRB	Net Primary Revenue Balance
NPV	Net Present Value
NRE	Non-Resident External
NRG	Non-Resident Government
NRI	Non-Resident Indian
NSC	National Statistical Commission
NSE	National Stock Exchange
NSSF	National Small Savings Fund
OD	Over Draft
ODA	Official Development Assistance
OECD	Organisation for Economic Cooperation and Development
OECO	Organisaton for Economic Co-operation
OFI	Other Financial Institutions
OLTAS	OnLine Tax Accounting System
OMO	Open Market Operations
OSCB	Other Indian Scheduled Commercial Bank
PACF	Partial Auto-Correlation Function
PACS	Primary Agriculture Credit Societies
PCARDB	Primary Cooperative Agriculture and Rural Development Bank
PD	Primary Deficit
PDAI	Primary Dealers Association of India
PDO	Public Debt Office
PDO-NDS	Public Debt Office-cum-Negotiated Dealing System
PDs	Primary Dealers
PES	Public Enterprises Survey
PF	Provident Fund
PIO	Persons of Indian Origin
PNB	Punjab National bank
PO	Principal Office
PRB	Primary Revenue Balance
PSE	Public Sector Enterprises
PUC	Paid Up Capital
QRR	Quick Review Report
RBI	Reserve Bank of India
RD	Revenue Deficit
RDBMS	Relational Database Management System
RE	Revenue Expenditure
REC	Rural Electrification Corporation
REER	Real Effective Exchange Rate
RFC	Residents Foreign Currency
RIB	Resurgent India Bonds
RIDF	Rural Infrastructure Development Fund
RLA	Recoveries of Loans & Advances
RLC	Repayment of Loans to Centre
RMB	Renminbi (Chinese)
RNBC	Residuary Non-Banking Companies
RO	Regional Office
RoCs	Registrars of Companies
RPA	Rupee Payment Area
RPCD	Rural Planning and Credit Department of RBI
RR	Revenue Receipts
RRB	Regional Rural Bank
RTP	Reserve Tranche Position
RUF	Revolving Underwriting Facility
RWA	Risk Weighted Asset
SAM	Social Accounting Matrix
SAS	Statistical Analysis System
SBI	State Bank of India
SCARDB	State Cooperative Agriculture and Rural Development Bank
SCB	State Cooperative Bank
SCB	Scheduled Commercial Bank
SCS	Size Class Strata
SDDS	Special Data Dissemination Standards
SDR	Special Drawing Right
SEBI	Securities and Exchange Board of India
SEBs	State Electricity Boards
SFC	State Financial Corporation
SGL	Subsidiary General Ledger
SGSY	Swarnajayanthi Gram Swarrojgar Yojana
SHGs	Self-Help Groups
SIDBI	Small Industries Development Bank of India
SIDC	State Industrial Development Corporation
SI-SPA	Systems Improvement Scheme under Special Project Agriculture
SJSRY	Swarna Jayanti Shahari Rojgar Yojana
SLR	Statutory Liquidity Ratio
SLRS	Scheme for Liberation & Rehabilitation of Scavangers
SMG	Standing Monitoring Group
SNA	System of National Accounts
SRWTO	Small road & Water Transport Operators
SSI	Small-Scale Industries
SSSBEs	Small Scale Service & Business Enterprises
SWG	Second Working Group on Money Supply
TBs	Treasury Bills
TC	Temporary Change
TDSAT	Telecom Disputes Settlement Appellate Tribunal
TRAI	Telecom Regulatory Authority of India
TT	Telegraphic Transfer
UBB	Uniform Balance Book
UBD	Urban Banks Department
UCB	Urban Cooperative Bank
UCN	Uniform Code Number
ULIP	Unit Linked Insurance Policy
US	United States
USD	US Dollars
USE	United Stock Exchange
UTI	Unit Trust of India
VC	Venture Capital
WPI	Wholesale Price Index
WSS	Weekly Statistical Supplement
YTM	Yield to Maturity
ZO	Zonal Office

IBPS GENERAL AWARENESS PRACTICE MCQs

1. What is financial inclusion ?
(1) To provide a permanent employment to the unemployed
(2) To provide a 100 days job to all those who are in need of a job
(3) To provide banking services to all those living in remote areas
(4) To ensure that all financial transactions amounting Rs. 5,000/- and above are done through banks.
(5) To provide finances for all.

2. Recently the term 3G was very much in news and even a conference on it was organized in India. What is the letter 'G' denotes in 3G ?
(1) Grade
(2) Group
(3) Global
(4) Guild
(5) Generation

 3. Some major banks and financial institutions in various Western countries were to wind up their business and/ or declare themselves in financial problems during last few years. This trend is technically known as _
(1) Devaluation
(2) Deformation
(4) Political backdrop
(5) Globalisation

 4. Which of the following International sports events was organized in Delhi in October 2010 in which several countries participated ?
(1) Asian Games
(2) World Cup Cricket Tournament
(3) Asian Hockey Tournament
(4) Commonwealth Games
(5) None of these

 5. Exporters in India get insurance cover and risk cover from which of the following organizations?
(1) SIOBI
(2) NABARD
(3) ECGC
(4) RBI
(5) None of these

6. Which of the following places in India does not have a Stock Exchange ?
(1) Kolkata
(2) Ahmedabad
(3) Mumbai
(4) Delhi
(5) Udaipur


7. Hillary Clinton who was in India recently is the U.S. Secretary of--
(1) Commerce
(2) State
(3) Treasury
(4) Defence
(5) None of these

8. If Indian Banking industry had demonstrated its resilience to external shocks in 2008-09, the credit goes to --
(A) Policies of the RBI & the Govt. of India
(C) Foreign aid/investments to Indian companies
(1) Only (A)
(2) Only (B)
(3) Only (C)

9. Tembhli village which was in news is in ---
(1) Bihar
(2) Rajasthan
(3) Orissa
(4) West Bengal
(5) Maharashtra


10. Rohan Bopanna who represented Indian in an international event is a----
(1) Billiards Player
(2) Golf Player
(3) Chess Player
(4) Table Tennis Player
(5) Lawn Tennis Player

11. AlBA Women's World Boxing Championship was organized in September 2010 in ---
(I) Rome
(2) New Delhi
(3) London
(4) Vienna
(5) Barbados

12. Mr. A. K. Antony a Union Minister in the Indian Cabinet recently signed an agreement with South Korea. This means the agreement is for the Cooperation in the field of--
(1) Agriculture
(2) Rural Development
(3) Defence
(4) Steel & Iron
(5) None of these

 13. Sir Mota Singh who was Knighte by the Queen Elizabeth II earlier this year is---
(1) First Sikh Judge in UK
(2) first Sikh Minister in UK
(3) First Indian to become Vice Chancellor in Cambridge
(4) First Indian to become Governor of a State in USA
(5) None of these

14. 'Ayodhya' which was in news recently is a place in---
(1) Madhya Pradesh
(2) Bihar
(3) Rajasthan
(4) Jharkhand
(5) Uttar Pradesh

15. Which of the following is the name of a private sector Bank in India?
(1) IDBI Bank
(2) Axis Bank
(3) Corporation Bank
(4) UCO Bank
(5) All are Private Banks

16. The Govt. of India does no! provide any direct financial assistance to which of the following schemes?
(1) Mahatma Gandhi National Rural Employment Guarantee scheme
(2) Rural Health Mission
(3) Indira Aawas Yojana
(4) Jeevan Sathi Yojana
(5) Rajiv Gandhi Grameen Vidyutikaran Yojana

17. What does the letter'S' denotes in 'AFSPA' ar abbreviation we very often see in newspapers?
(1) Slow
(2) Special
(3) State
(4) Solid
(5) Sovereign

18. Which of the following terms is used in banking and finance?
(1) Abiotic
(2) Demand Deposit
(3) Fat scales
(4) A diabetic
(5) Cathode

19. Which of the following is a food crop?
(1) Maize
(2) Cotton
(3) Palm
(4) Jute
(5) Jatropha

20. Vedanta Alumina is a company operating in the area of ----
(1) Shipping
(2) Mining
(3) Cement
(4) Textiles
(5) Banking

21. Names of which of the following rates/ratios cannot be seen in financial newspapers?
(1) Bank Rate
(2) Repo Rate
(3) Cash Reserve Ratio
(4) Pulse Rate
(5) Statutory Liquidity Ratio

22. An individual visiting UAE will have to make his/her payments in which of the following currencies?
(1) Dirham
(2) Taka
(3) Baht
(4) Peso
(5) Dinar

23. Who, amongst the following is NOT a famous writer?
(1) Sania Mirza
(2) V. S. Naipaul
(3) Chetan Bhagat
(4) Khushwant Singh
(5) Namita Gokhale

24. 'Peepli Live' is a film directed by ---
(I) Anusha Rizvi
(2) Aamir Khan
(3) Kiran Rao
(4) David Dhawan
(5) None of these

25. Which of the following is the Chemical name of the salt we use in our kitchen?
(1) Calcium Carbonate
(2) Calcium Chloride
(3) Sodium Carbonate
(4) Sodium Chloride
(5) Ammonium Sulphate

26. The judges of the Supreme Court of India now retire at the age of---
(1) 58 years
(2) 60 years
(3) 62 years
(4) 65 years
(5) 68 years

27. Operation New Dawn is the beginning of stability in---
(1) Afghanistan
(2) Iran
(3) Sudan
(4) Sri Lanka
(5) Iraq

28. Which of the following books' is written by Kiran Desai ?
(1) A house for Mr. Biswas
(2) 3 Mistakes of My Life
(3) A Tale of Two Sisters
(4) The Inheritance of Loss
(5) Tale of Two Cities

29. Jimena Na";'arrete who was crowned Miss Universe 2010 is from ---
(I) Mexico
(2) Venezuela
(3) Brazil
(4) New Zealand
(5) Italy

30. India has an agreement with USA for producing energy in the form of---
(1) Hydraulic
(2) Thermal
(3) Nuclear
(4) Solar
(5) All of these forms

 31 Which of the following is an economic term?
(1) Plaintiff
(2) Bunker Blaster
(3) Deflation
(4) Lampoon
(5) Zero Hour

32. Which of the following awards is given to sports persons in India?
(1) Shantiswarup Bhatnagar Awards
(2) Arjuna Award
(3) Kalidas Samman
(4) Saraswati Samman
(5) None of these

33. Which of the following is the trophy/cup associated with the game of cricket?
(1) Derby
(2) Merdeka Cup
(3) Santosh Trophy
(4) Duleep Trophy
(5) Durand Cup

34. Who amongst the following can take benefit of the Social Security Fund established by the
Govt. ofIndia for unorganized workers? .
(1) Primary school teacher
(2) Employee of Sugar Factory
(3) Textile Mazdoor
(4) Rickshaw Puller
(5) Clerk in a factory

35. Shushil Kumar who won a Gold Medal at an international event is a famous---
(1) Wrestling champion
(2) Golf player
(3) Table Tennis Player
(4) Weight lifter
(5) None of these

36. In case a major war breaks out between two nations, which of the following organizations/agencies will be seen in the battle field, in addition to the armies of the fighting parties?
(1) WTO
(2) Red Cross
(3) CARE
(4) OPEC
(5) All of these

37. Which of the following is the abbreviated name associated with food security?
(1) ASHA
(2) PDS
(3) WTO
(4) OPEC
(5) NPA

38. Which of the following is a good and rich source of vitamin 'C' ?
(1) Milk
(2) Radish
(3) Mango
(4) Lemon Juice
(5) Banana

39. Who amongst the following Indian Prime Ministers was honoured Posthumously by the Govt.
of Bangladesh for his/her contributions to the independence of the nation?
(1) Rajiv Gandhi
(2) Jawaharlal Nehru
(3) Indira Gandhi
(4) Lal Bahadur Shastri
(5) None of these

40. Who amongst the following was never a Governor of the RBI?
(1) Bimal Jalan
(2) Y. V. Reddy
(3) Arup Roy Choudhury
(4) C. Rangarajan
(5) D. Subbarao

Answers:

(1) 3 (2) 5 (3) 3 (4) 10 (5) 5 (6) 5 (7) 4 (8) 1 (9) 5 (10) 5 (11) 5 (12) 3 (13) 1 (14) 5 (15) 2
(16) 1 (17) 2 (18) 2 (19) 4 (20) 2 (21) 4 (22) 1 (23) 1 (24) 1 (25) 4 (26) 4 (27) 1 (28) 4 (29) 1
(30) (31) 3 (32) 2 (33) 4 (34) 4 (35) 5 (36) 2 (37) 2 (38) 4 (39) 3 (40) 3

Andhra Bank Clerk Exam., 2011

English Language

(Exam Held on 15-5-2011)

Directions-(Q. 1-15) Read the following passage carefully and answer the questions given below it. Certain words are printed in bold to help you to locate them while answering some of the questions.

In the city of Manmathapura, there lived a young man named Veeravara. He was brave and intelligent. He longed for adventure and when he was eighteen years old, he took up a job on a ship so that he could travel and see other countries. He traveled to many places on the ship and had many adventures. One day, a storm hit the sea, the ship tossed about and everyone was thrown overboard, including Veeravara. He managed to clutch on to a piece of wood and save his life. As he was floating in the sea, he lost consciousness. When at last he woke up, he found himself lying on the sandy shore of an unknown island, under the piercing rays of the sun.

Glad to be alive, he got up. He was on a large island, and some miles inland he could see a city. Veeravara started walking in that direction. When he reached the city, to his surprise, he was greeted by a great crowd that cheered him. He did not know what was happening. An elephant was brought forward and he was made to sit on his back. A sad looking man was also sitting there silently. The elephant marched towards a palatial building. Veeravara asked the old man, "Why do the people welcome a stranger like me in this grand fashion ? What are they celebrating, and where are they taking me ?"

The old man now looked sadder. "This is an unusual island," he explained. "The people here are very intelligent but they have some funny rules. They are prosperous but they don't have a king. They feel that if they choose a king from within themselves, he will be partial. So they wait for an unknown person to come to this island. When someone like you, a shipwrecked traveller, gets washed to the shore, they make him their king. They are taking us to the palace. You are our new king now ," "What happens to the previous king ? And who are you ?" Veeravara asked. "I was the king till you came along. The old king is given a day to teach the new one the ropes. Then he is sent off to the next deserted island, where he has to look after himself. That's the rule." Saying this, the old man pointed to an island. Veeravara could see it was covered with dense forest. Now he realised why the old man was sad.

Veeravara was crowned king with great pomp. He quickly learnt his new job and became a good and fair king. But deep inside, a little part of him remained unhappy. When would the next shipwrecked person show up and he be sent off to the other island to live till the end of his days with wild animals and other retired kings ?

As he thought about this, he came up with an idea. As long as he was the king, he had absolute power. He ordered his men to go to the island and clear a part of the forest. Then he ordered roads and houses to be built. Soon there were roads, shops and pretty little houses on the island. People would go to the forest and see the wild animals; they gathered honey and fruits from the trees there, and in a few years, the island was no longer deserted but a cheerful little town.

Now Veeravara was not worried at all. When the next king appeared, he would not have to fend for himself in the forest. Instead, he would live in a little cottage and grow vegetables. Years passed and he got older. The people loved him and were sad whenever they thought he would no longer be their king. Then one day Veeravara called his people and said, "It is good when you make a person from outside the island a king. He is fresh and unbiased. But this may not always be a good idea. What if the next person who comes here is a crook ? You will make him king without knowing anything about him. Instead, let's have a system where the cleverest people of this island are chosen and rule the place together. Then no one person will have absolute power, and if one of them turns out dishonest, you can always remove him from the council." The islanders liked the idea, and in a few days, chose their new rulers. Veeravara handed over the kingdom to them and retired happily to his cottage, where he stayed till the end of his days.

1. Why did Veeravara take up a job on the ship ?
(A) He enjoyed the sea
(B) It was the only job available
(C) He wanted to visit an island
(D) Jobs on the ship paid well and Veeravara needed the money
(E) Life on the ship was filled with adventure
Ans : (E)

2. How did Veeravara land on an unknown island ?
(I) He swam across to the nearest island after the shipwreck.
(2) The ship lost its way and docked on the island.
(3) He was unconscious while he floated across to the island.
(A) Only (1)
(B) Only (2)
(C) Only (3)
(D) Only (1) and (2)
(E) None of these
Ans : (C)

3. Why did the crowd cheer when they saw Veeravara approaching them ?
(A) They were happy he was saved
(B) They were expecting his visit
(C) They were going to make him their king
(D) They were happy Veeravara accepted their invitation to visit their island
(E) They wanted their present king to retire as soon as possible
Ans : (C)


4. Why was the old man who was accompanying Veeravara sad ?
(1) He was going to be sent off to a deserted island.
(2) He had no sons who were adventurous like Veeravara.
(3) He had no heir who could take over the kingdom after him.
(A) Only (1)
(B) Only (2)
(C) Only (3)
(D) Only (1) and (3)
(E) All (1), (2) and (3)
Ans : (A)

5. What was the rule put forth by the people of the island ?
(A) Every stranger would get a warm welcome
(B) No one was allowed to clear the forest area
(C) The retired king would be sent off to a deserted island to look after himself
(D) The island would be ruled by a council of rulers
(E) The king had absolute power and could do as he wished
Ans : (D)

6. Which of the following statements about Veeravara is false in the context of the passage ?
(A) He was responsible for bringing about a change in the island
(B) He cleared the dense forest and built roads and cottages for his people
(C) He wanted to have a comfortable retirement
(D) He introduced the concept of a council
(E) He was envious of the previous king
Ans : (E)

7. Why did the villagers wait for an unknown person to arrive to their island in order to make him their king ?
(A) They wanted their king to be someone who was not from among them
(B) They did not have any young boys who were capable of carrying out the duties of a king
(C) The people of the village were not educated
(D) They found it easier to disrespect unknown people
(E) Nobody in the island was willing to take up the responsibility of governance
Ans : (A)

8. Although Veeravara was a successful king, there was an element of unhappiness because–
(A) He knew that he would not be able to stay on the island as he would have to return home one day
(B) He always felt that he was a foreigner on the island
(C) He felt responsible for the dethronement of the previous king
(D) He was not sure when he would be sent off to the deserted island
(E) He lost his companions after the shipwreck
Ans : (D)

9. What advise did Veeravara give to the people of his kingdom ?
(A) To choose a king fro within the island
(B) To send all the retired kings to the farthest deserted island
(C) To have a system where a council of rulers could rule the island
(D) To place complete trust in their king
(E) None of these
Ans : (A)

Directions-(Q. 10-12) Choose the word which is most nearly the SAME in meaning as the word printed in bold as used in the passage.

10. Piercing
(A) Intense
(B) Loud
(C) Vibrant
(D) Violent
(E) Full
Ans : (A)

11. Deserted
(A) Secured
(B) Inhabited
(C) Isolated
(D) Protected
(E) Safe
Ans : (C)

12. Dense
(A) Dark
(B) Thick
(C) Tall
(D) Natural
(E) Lively
Ans : (B)

Directions-(Q. 13-15) Choose the word which is most OPPOSITE in meaning of the word printed in bold as used in the passage.

13. Fair
(A) Unjust
(B) Unlucky
(C) Honest
(D) Sensible
(E) Dark
Ans : (A)

14. Remove
(A) Indulge
(B) Adjust
(C) Derive
(D) Include
(E) Eliminate
Ans : (D)

15. Partial
(A) Complete
(B) Unbiased
(C) Favourable
(D) Unfamiliar
(E) Prejudiced
Ans : (B)

Directions-(Q. 16-25) Read each sentence to find out whether there is any grammatical error in it. The error, if any, will be in one part of the sentence. The letter of that part is the answer. If there is no error, the answer is (E) i.e. 'No Error'. (Ignore the errors of punctuation, if any).

16. I cannot able to teach you (A) / how to learn the guitar (B) / if you do not (C) / show any interest in music. (D) No Error (E)
Ans : (A)

17. The researcher could not (A) / speak the local language (B) / of the state and so, (C) / found it difficult to study on the people. (D) No Error (E)
Ans : (D)

18. Since it was (A) / a very cold and windy day (B) / I asked my friend (C) / to off the fan. (D) No Error (E)
Ans : (D)

19. Not only do (A) / the nurses want a pay increase, (B) / but they want reduce (C) / working hours as well. (D) No Error (E)
Ans : (C)

20. You cannnot expect the students (A) / to blame on the teacher (B) / for getting low marks (C) / in the examination. (D) No Error (E)
Ans : (B)

21. I live very (A) / close by to the train station, (B) / so travelling to work (C) / is very convenient for me. (D) No Error (E)
Ans : (B)

22. There is appearing (A) / to be a shortage (B) / of skilled staff (C) / in the organisation. (D) No Error (E)
Ans : (A)

23. The patient lodged (A) / a complaint against (B) / the doctor for / its negligence. (D) No Error (E)
Ans : (D)

24. My colleague informed (A) / to her boss that (B) / she needed more time (C) / to complete the assignment. (D) No Error (E)
Ans : (B)

25. At first, (A) / I would like to (B) / thank you all (C) / for inviting me here today. (D) No Error (E)
Ans : (A)

Directions-(Q. 26-30) Pick out the most effective word from the given words to fill in the blanks to make the sentence meaningfully complete in the context of the sentence.

26. In her first book, the author ………….her experiences as a child.
(A) describes
(B) talks
(C) feels
(D) understands
(E) claims
Ans : (A)

27. Mr. Nair has been awake ………….6 O'clock.
(A) until
(B) since
(C) by
(D) at
(E) before
Ans : (B)

28. Frequent news of terrorist activity in the area has ………….most tourists away.
(A) caused
(B) worried
(C) frightened
(D) moved
(E) scare
Ans : (C)

29. On a Saturday, neither the bank ………….the post office is open.
(A) nor
(B) and
(C) also
(D) neither
(E) or
Ans : (A)

30. My youngest child, ………….is only three years old, has started going to kindergarten.
(A) that
(B) whom
(C) just
(D) which
(E) who
Ans : (E)

Directions-(Q. 31-35) In each question below, four words printed in bold type are given. These are lettered (A), (B), (C) and (D). One of these words printed in bold may either be wrongly spelt or inappropriate in the context of the sentence. Find out the word that is inappropriate or wrongly spelt, if any. The letter of that word is your answer. If all the words printed in bold are correctly spelt and appropriate in the context of the sentence then mark (E) i.e. ' All Correct' as your answer .

31. The actress' Participation (A) in the play (B) came as a surprise (C) to all her fans. (D) All Correct (E)
Ans : (A)

32. Children (A) have a natural (B) curiosity (C) about the world around (D) them. All Correct (E)
Ans : (E)

33. The poet's writings (A) reflect on the little abcences (B) and distractions (C) of mankind. (D) All Correct (E)
Ans : (B)

34. After more (A) than a day's journey (B) we finally arrived (C) at our destination. (D) All Correct (E)
Ans : (E)

35. My friends chose (A) to stay home rather (B) than play with colours, (C) during the festivhal (D) of Holi. All Correct (E)
Ans : (D)

Directions-(Q. 36-40) Rearrange the following seven sentences / group of sentences (1), (2), (3), (4), (5), (6) and (7) in the proper sequence to form a meaningful paragraph; then answer the questions given below them–

(1) One day a zamindar decided to test his capacity and invited him to lunch.
(2) Just then a servant was passing by with a plate of mango slices, Gopal took the plate from the servant and ate all the slices.
(3) "The mango being the king of fruits, all the food in my stomach made way for it."
(4) Gopal had a large appetite and was known to eat enormous quantities of food especially when invited to feasts.
(5) "Very simple", said Gopal. "What happens when you walk into a crowded room ? Every-body steps aside to let a royal person like you pass. Something similar happened here."
(6) Gopal ate to his hearts content and declared that there was no more place left for even a grain of rice.
(7) "You said you did not have place for even a single grain of rice yet you devoured almost three mangoes. How do you explain that ?" asked the zamindar.

36. Which of the following should be the FIRST sentence after the rearrangement ?
(A) 1
(B) 2
(C) 6
(D) 4
(E) 7
Ans : (A)

37. Which of the following should be the SECOND sentence after the rearrangement ?
(A) 4
(B) 6
(C) 1
(D) 2
(E) 7
Ans : (C)

38. Which of the following should be the THIRD sentence after the rearrangement ?
(A) 5
(B) 2
(C) 7
(D) 3
(E) 6
Ans : (E)

39. Which of the following should be the FIFTH sentence after the rearrangement ?
(A) 3
(B) 5
(C) 2
(D) 1
(E) 7
Ans : (E)

40. Which of the following should be the SEVENTH (LAST) sentence after the rearrangement?
(A) 3
(B) 5
(C) 6
(D) 2
(E) 7
Ans : (A)

Directions-(Q. 41-50) In the following passage, there are blanks, each of which has been numbered. These numbers are printed below the passage and against each, five words are suggested, one of which fits the blank appropriately. Find out the appropriate word in each case.

A farmer was ...(41)... home from his fields one evening when suddenly two women ...(42)... in front of him. "1 am the goddess of poverty ," said one of them. " And I .am the goddess of wealth," said the other. "What do you want from me ?" (43)... the man, his voice faint ...(44)... fear.

"Tell us who ...(45)... the two of us is more beautiful," said the goddess of wealth, giving him an enchanting smile. The man ...(46)... he was in a dangerous position. If he favoured one, it would displease the other. But he was a clever man and ...(47)... fast he said to the goddess of wealth: "When you are ...(48)... a house, you are certainly more beautiful. "Then turning quickly to the other deity said: "But there is ...(49)... one to compare you with, when you are leaving a house. In circumstances like these, it is you who are more beautiful." The deities beamed with joy and disappeared, and the fanner heaved a ...(50)... of relief and hurried home.

41. (A) returning
(B) exiting
(C) travel
(D) joining
(E) went
Ans : (A)

42. (A) comes
(B) standing
(C) appeared
(D) reaching
(E) seemed
Ans : (C)

43. (A) replied
(B) order
(C) question
(D) asked
(E) request
Ans : (A)

44. (A) by
(B) with
(C) inside
(D) under
(E) within
Ans : (B)

45. (A) of
(B) between
(C) which
(D) inspite
(E) including
Ans : (B)

46. (A) observe
(B) thinks
(C) finds
(D) knew
(E) feel
Ans : (D)

47. (A) pretending
(B) telling
(C) seeing
(D) seeking
(E) thinking
Ans : (E)

48. (A) coming
(B) going
(C) entering
(D) into
(E) looking
Ans : (C)

49. (A) neither
(B) few
(C) many
(D) some
(E) no
Ans : (E)

50. (A) burden
(B) shower
(C) act
(D) posture
(E) sigh
Ans : (E)

Wainganga Krishna Gramin Bank Officers (Scale-I) Exam., 2011

General English 

(Exam Held on 8-5-2011) 

Directions-(Q. 1-10) Read the following passage carefully and answer the questions given below it. Certain words/phrases have been printed in bold to help you locate them while answering some of the questions.

Right of entry to education, an ample teaching-learning environment, a suitable curriculum and an empowered and all-encompassing faculty are four essential prerequisites of an education system that seeks to enable social transformation. While educational reform since the 1980s was strongly focused on the first two elements, the late 1990s brought the role of the curriculum into national focus. The critical link that binds these four critical elements together the activity of the faculty continues to be cast aside, by political ideologies of most hues, contemporary curriculum reform efforts and the professional practices of the faculty.

Far-reaching educational initiatives of both the Left and the Right have recognized the potential power of the .faculty. In multiple experiments, they have used this dormant force to build committed institutions and cadres of faculties dedicated to their particular causes. In many instances this has led to extreme politicization of the college faculty. In others it has led to the education of a generation of students in half –truths underpinned by the personal beliefs, sectarian concerns and folk pedagogy of faculties who have had little access themselves to education and training in related areas.

Over the last decade or so, educational reform has included, apart from access, a focus on developing alternative text materials and the training of faculty to handle these materials, without directly engaging with the issue of curriculum revamp. At the turn of the 20th century, a major national curriculum redesign was initiated following the change of political regime at the centre. The subsequent development of college programme came under wide public scrutiny and debate. Issues of equity, inclusion and exclusion, learner medley religious identity and communalism gained considerable importance in the curriculum debates that followed. For instance scholars argued that, "...the curriculum, while loud on rhetoric, fails to address the quality of education that students of under-privileged and marginalized group's experience". Several other critics described the revised curriculum as a retrogressive step in education that sought to impose the religious agenda in the garb of a national identity.

The subsequent change of national government in 2004, led to the curriculum review in 2005 underlining a new political interest in the role of education in national development, its role in social mobilization and transformation directed specifically at questions of caste and gender asymmetry and minority empowerment. Deeper than these politically driven initiatives, however, the professional need for curriculum review emerges from the long ossification of a national education system that continues to view faculty as "dispensers of information" and students as "passive recipients" of an "education", sought1obe "delivered" in four-walled classrooms with little scope to develop critical thinking and understanding.

1. Prior to 1990 what was NOT the agenda of the educational reforms?
(1) An appropriate curriculum
(2) Well managed admission process
(A) Only (1)
(B) Only (2)
(C) Both (1) and (2)
(D) Either (1) or (2)
(E) None of these
Ans : (A)

2. Which of the following best describes the phrase "passive recipients" as used in the passage ?
(A) The users of the educational system
(B) The political ideology of right and left parties
(C) Well framed curriculum guiding the teaching/learning process
(D) Free access to education system
(E) The faculty
Ans : (A)

3. To facilitate social transformation, which of the following has been identified by the author as one of the factors ?
(A) A committed political ideology'
(B) Support of the well framed curriculum
(C) A strong administration system
(D) Carefully planned education delivery
(E) None of these
Ans : (E)


4. What hampers the critical thinking ability of college going students?
(A) The emphasis on rote memorization and recalling the facts of education based on real experience
(B) Lack of political will to develop these abilities
(C) Absence of focus while designing curriculum framework
(D) Ignoring the active role of faculty and the student
(E) Lack of proper tests of critical thinking ability
Ans : (C)

5. Which of the following best describes the meaning of the word underpinned as used in the passsage ?
(A) advocated
(B) supported
(C) prepared
(D) bolstered
(E) boosted
Ans : (D)

6. Which of the following best describes the word ossification as used in the passage?
(A) hardening
(B) plasticity
(C) imbibition
(D) incorporation
(E) coalescing
Ans : (A)

7. Development of text books generated public debate on many issues except…
(1) making the curriculum students centered.
(2) using teaching community as an agency to bring change.
(A) Only (1)
(B) Only (2)
(C) Both (1) and (2)
(D) Either (1) or (2)
(E) None of these
Ans : (B)

8. How did personal beliefs and folk pedagogy enter into educational system ?
(A) The college acted as an agent of local communities
(B) The faculties were not properly trained
(C) College faculties started acting as passive listeners
(D) The loopholes in the educational system allowed it to happen
(E) It was by design
Ans : (B)

9. Which of the following is the most opposite in meaning to the word medley as used in the passage ?
(A) amalgamate
(B) united
(C) unity
(D) diffuse
(E) focusing
Ans : (D)

10. Revamping of the text material was the main focus in–
(A) early eighties
(B) late nineties
(C) 21st century
(D) evolving curriculum framework
(E) training faculty
Ans : (C)

Directions-(Q. 11-15) In each of the following sentences there are two blank spaces. Below each sentence there are five pairs of words denoted by letters (A), (B), (C), (D) and (E). Find out which pair of words can be filled up in the blanks in the sentence in the same sequence to make the sentence grammatically correct and meaningfully complete.

11. …………….to the popular belief that every astrologer nurtures blind faith in fate, our astrologer believes in………..
(A) Contrary , action
(B) According, thoughts
(C) Bowing, present
(D) Proving, forecasting
(E) Pointing, devotion
Ans : (A)

12. His………….has yielded him the…………….fruit.
(A) fate, undesirable
(B) efforts, unwanted
(C) action, viable
(D) perseverance, desired
(E) emphasis, expected
Ans : (D)

13. Liberalization has removed all the legal………….... and…………....flood-gates to multinational companies.
(A) hurdles, awarded
(B) barriers, opened
(C) obstacles, guarded
(D) manipulation, closed
(E) battles, threw
Ans : (B)

14. His …………....contribution to the Tsunami relief fund was …………....by his staff members.
(A) meagre, admired
(B) spontaneous, nullified
(C) negligible, sanctioned
(D) noteworthy, improved
(E) generous, appreciated
Ans : (E)

15. The …………....on some of the towns has created …………....among the residents of the other part of the country.
(A) attack, ambition
(B) raid, awareness
(C) bombardment, panic
(D) spell, satisfaction
(E) shower, dampness
Ans : (C)

Directions-(Q. 16-20) In each question below a sentence with four words printed in bold type is given. These are lettered as (A), (B), (C) and (D). One of these four words printed in bold may be either wrongly spelt or inappropriate in the context of the sentence. Find out the word which is wrongly spelt or inappropriate if any. The letter of that word is your answer. If all the words printed in bold are correctly spelt and also appropriate in the context of the sentence, mark (E) i.e. ' All correct' as your answer .

16; The file contents (A) a revised (B) estimate (C) of the banking industry's manpower requirements (D) for the next year. All correct (E)
Ans : (E)

17. Your marketing strategy (A) should be devised (B) dependent (C) on the kind of business you own. (D) All correct (E)
Ans : (C)

18. Since our financial resources (A) are limitless (B) we cannot afford (C) this alternative. (D) All correct (E)
Ans : (B)

19. His main reasoning (A) for applying (B) for this promotion is the possibility (C) of an overseas posting. (D) All correct (E)
Ans : (A)

20. To better understand the challenges (A) of starting anew venture (B) he read (C) up extensively. (D) All correct (E)
Ans : (C)

Directions-(Q. 21-30) Which of the phrases (A).. (B), (C) and (D) given below each sentence should replace the phrase printed in bold type to make the sentence grammatically correct ? If the sentence is correct as it is, mark (E) i.e., 'No correction required' as the answer .

21. His behavior with all his employees is so pleasing that everyone come forward for helping him.(A) came towards him for help
(B) comes towards him for help
(C) comes forward to help him
(D) comes forward for help him
(E) No correction required
Ans : (C)

22. The police commissioner burst into rage and ordered immediately suspension of the inspector who had arrested the innocent boy.
(A) order immediately
(B) order immediate
(C) ordered immediate
(D) ordering immediate
(E) No correction required
Ans : (C)

23. She will not attend the meeting until she is asked to.
(A) except
(B) even with
(C) even except
(D) unless
(E) No correction required
Ans : (E)

24. He would be like to have some ice-cream.
(A) would like to
(B) would be liked to
(C) was to be liking to
(D) would being liked to
(E) No correction required
Ans : (A)

25. A master should never impose his servants too much work.(A) his servants with too much work
(B) too much work with his servants
(C) too much work on his -servants
(D) too much work for his servants
(E) No correction required
Ans : (C)

26. Good life, according to many people, is to making more and more money.
(A) is making
(B) is made
(C) are made
(D) are making
(E) No correction required
Ans : (A)

27. Lift the handset only after paid a one rupee coin.
(A) paying a one rupee coin
(B) you pay one rupee coin
(C) pay one rupee-coin
(D) you paid one rupee coin
(E) No correction required
Ans : (A)

28. What matter does most is the quality and not the quantity.
(A) What does matter
(B) What does it matter
(C) That matters
(D) What matters
(E) No correction required
Ans : (B)

29. Not knowing the language and had no friends in the country, he found it impossible to get a job.
(A) has no
(B) with having
(C) with having not
(D) having no
(E) No correction required
Ans : (D)

30. With the introduction of new system, the number of candidates who resort to unfair means is decreasing year after year.
(A) resorting to
(B) to resort to
(C) resorted to
(D) to resorting
(E) No correction required
Ans : (E)

Directions-(Q. 31-40) Read each sentence to find out whether there is any error in it. The error, if any, will be in one part of the sentence. The letter of that part is the answer. If there is no error, the answer is (E). (Ignore errors of punctuation, if any).

31. Our country can contribute (A) / to the mitigation of global warming (B) / by protecting forests (C) / and starting at afforestation programme. (D) No error (E)
Ans : (D)

32. The task for ensuring employment (A) / for the labour force has been (B) / a persistent concern throughout (C) / India's post independence development. (D) No error (E)
Ans : (A)

33. Psychologists have been documenting (A) / the emotional and physical (B) / effect of (C) / negative political advertisements. (D) No error (E)
Ans : (A)

34. India's efforts that are (A) / aimed at controlling (B) / infectious diseases is likely (C) / to show only partial success. (D) No error (E)
Ans : (C)

35. The magazine industry (A) / in India (B) / has been going from (C) / confusing times. (D) No error (E)
Ans : (C)

36. The fast pace of progress on (A) / basic education and literacy (B) / is consistent with an increase (C) / in demand for education. (D) No error (E)
Ans : (A)

37. Technology is (A) / transforming the way (B) / films are screen (C) / in the theatres. (D) No error (E)
Ans : (C)

38. One needs to set goals (A) / at differing stages (B) / of one's career and (C) / monitor achievements and accomplishments. (D) No error (E)
Ans : (B)

39. Non-communicable diseases (A) / often require (B) / long term and expensive interventions which (C) / poor people cannot afford. (D) No error (E)
Ans : (E)

40. A leader is a group member which (A) / exerts profound influence (B) / on the behaviour and attitudes (C) / of other members of the group. (D) No error (E)
Ans : (A)

Directions-(Q. 41-50) In the following passage there are blanks, each of which has been numbered. These numbers are printed below the passage and against each, five words are suggested, one of which fits the blank appropriately. Find out the appropriate word in each case.

The growth story in any developing country cannot be ...(41)... without ...(42)... its impact on the poverty and employment situation. The Planning Commission has ...(43)... that India should strive for 'more inclusive growth' .The number of people living below the poverty line has ...(44)... from 36 per cent in 1993-94 to 22.0 per cent in 2004-05. Again, the issue is to bring more and more people out of poverty by ...(45)... them the productive employment opportunities. The Approach Paper to 11th Five Year Plan suggests that doubling the growth of agricultural GDP to 4 per cent per annum will ...(46)... rural employment conditions, by raising real wages and reducing under employment. However, even if this is attained, an overall growth of 9 per cent will further increase income ...(47)... between agricultural and non-agricultural households, ...(48)... around 10 million workers currently in agriculture find remunerative non-agricultural employment.. This ...(49)... a major challenge not only in terms of generating non-agricultural employment but also in ...(50)... its required location and type.

41. (A) complete
(B) retold
(C) achieved
(D) constructed
(E) narrated
Ans : (A)

42. (A) generating
(B) assessing
(C) realizing
(D) counting
(E) finding
Ans : (B)

43. (A) desired
(B) estimated
(C) focused
(D) verified
(E) stressed
Ans : (C)

44. (A) uplifted
(B) degraded
(C) vanished
(D) decreased
(E) enhanced
Ans : (D)

45. (A) absolving
(B) providing
(C) nurturing
(D) ignoring
(E) refusing
Ans : (B)

46. (A) impact
(B) diversify
(C) lay
(D) aggravate
(E) improve
Ans : (E)

47. (A) opportunity
(B) assessment
(C) disparity
(D) parity
(E) tax
Ans : (C)

48. (A) unless
(B) for
(C) in spite of
(D) despite
(E) by
Ans : (A)

49. (A) addresses
(B) meets
(C) poses
(D) recognizes
(E) solves
Ans : (C)

50. (A) exploring
(B) acquiting
(C) reciprocating
(D) matching
(E) solving
Ans : (D)

BANKING AND FINANCIAL TERMS

Ad valorem tax:(in Latin: to the value added) - a tax based on the value (or assessed value) of property. Ad valorem tax can also be levied on imported items.

Aggregate demand is the sum of all demand in an economy. This can be computed by adding the expenditure on consumer goods and services, investment, and not exports (total exports minus total imports).


Aggregate supply is the total value of the goods and services produced in a country, plus the value of imported goods less the value of exports.

Alternative minimum tax: An IRS mechanism created to ensure that high-income individuals, corporations, trusts, and estates pay at least some minimum amount of tax, regardless of deductions, credits or exemptions. Alternative minimum tax operates by adding certain tax-preference items back into adjusted gross income. While it was once only important for a small number of high-income individuals who made extensive use of tax shelters and deductions, more and more people are being affected by it. The AMT is triggered when there are large numbers of personal exemptions on state and local taxes paid, large numbers of miscellaneous itemized deductions or medical expenses, or by Incentive Stock Option (ISO) plans.

Asset: Anything of monetary value that is owned by a person. Assets include real property, personal property, and enforceable claims against others (including bank accounts, stocks, mutual funds, and so on). 

 

Average propensity to consume is the proportion of income the average family spends on goods and services.

Average propensity to save is the proportion of income the average family saves (does not spend on consumption).

Average total cost is the sum of all the production costs divided by the number of units produced. See also average cost. Asymmetric Information is where one party in a transaction has less information than the other.
Balance of Payment is the summation of imports and exports made between one countries and the other countries that it trades with.

Balance of trade: The difference in value over a period of time between a country's imports and exports.

Barter system: System where there is an exchange of goods without involving money.

Base year: In the construction of an index, the year from which the weights assigned to the different components of the index is drawn. It is conventional to set the value of an index in its base year equal to 100.

Bear: An investor with a pessimistic market outlook; an investor who expects prices to fall and so sells now in order to buy later at a lower price. A Bear Market is one which is trending downwards or losing value.

Bid price: The highest price an investor is willing to pay for a stock.

Bill of exchange: A written, dated, and signed three-party instrument containing an unconditional order by a drawer that directs a drawee to pay a definite sum of money to a payee on demand or at a specified future date. Also known as a draft. It is the most commonly used financial instrument in international trade.

Birth rate: The number of births in a year per 1,000 population.

Bond: A certificate of debt (usually interest-bearing or discounted) that is issued by a government or corporation in order to raise money; the bond issuer is required to pay a fixed sum annually until maturity and then a fixed sum to repay the principal. Bonds guide.


Boom: A state of economic prosperity, as in boom times.

Break even: This is a term used to describe a point at which revenues equal costs (fixed and variable).

Bretton Woods: An international monetary system operating from 1946-1973. The value of the dollar was fixed in terms of gold, and every other country held its currency at a fixed exchange rate against the dollar; when trade deficits occurred, the central bank of the deficit country financed the deficit with its reserves of international currencies. The Bretton Woods system collapsed in 1971 when the US abandoned the gold standard.

Budget: A summary of intended expenditures along with proposals for how to meet them. A budget can provide guidelines for managing future investments and expenses. The budget deficit is the amount by which government spending exceeds government revenues during a specified period of time usually a year.


Bull: An investor with an optimistic market outlook; an investor who expects prices to rise and so buys now for resale later. A Bull Market is one in which prices are rising. c.i.f., abbrev: Cost, Insurance and Freight: Export term in which the price quoted by the exporter includes the costs of ocean transportation to the port of destination and insurance coverage.

Call money: Price paid by an investor for a call option. There is no fixed rate for call money. It depends on the type of stock, its performance prior to the purchase of the call option, and the period of the contract. It is an interest bearing band deposits that can be withdrawn on 24 hours notice.

Capital: Wealth in the form of money or property owned by a person or business and human resources of economic value. Capital is the contribution to productive activity made by investment is physical capital (machinery, factories, tools and equipments) and human capital (eg general education, health). Capital is one of the three main factors of production other two are labour and natural resources.

Capital account; Part of a nation's balance of payments that includes purchases and sales of assets, such as stocks, bonds, and land. A nation has a capital account surplus when receipts from asset sales exceed payments for the country's purchases of foreign assets. The sum of the capital and current accounts is the overall balance of payments.

Capital budget: A plan of proposed capital outlays and the means of financing them for the current fiscal period. It is usually a part of the current budget. If a Capital Program is in operation, it will be the first year thereof. A Capital Program is sometimes referred to as a Capital Budget. Capital Asset Pricing Model: A way to show the prices of securities and other risk-free assets.


Capital gains tax: Tax paid on the gain realized upon the sale of an asset. See capital gains tax for examples of tax regimes in various countries. It is a tax on profits from the sale of capital assets, such as shares. A capital loss can be used to offset a capital gain, reducing any tax you would otherwise have to pay.

Cartel: An organization of producers seeking to limit or eliminate competition among its members, most often by agreeing to restrict output to keep prices higher than would occur under competitive conditions. Cartels are inherently unstable because of the potential for producers to defect from the agreement and capture larger markets by selling at lower prices.

Census: Official gathering of information about the population in a particular area. Government departments use the data collected in planning for the future in such areas as health, education, transport, and housing.


Central bank: Major financial institution responsible for issuing currency, managing foreign reserves, implementing monetary policy, and providing banking services to the government and commercial banks.


Centrally planned economy: A planned economic system in which the production, pricing, and distribution of goods and services are determined by the government rather than market forces. Also referred to as a "non market economy." Former Soviet Union, China, and most other communist nations are examples of centrally planed economy Classical economics: The economics of Adam Smith, David Ricardo, Thomas Malthus, and later followers such as John Stuart Mill. The theory concentrated on the functioning of a market economy, spelling out a rudimentary explanation of consumer and producer behaviour in particular markets and postulating that in the long term the economy would tend to operate at full employment because increases in supply would create corresponding increases in demand.

Closed economy: A closed economy is one in which there are no foreign trade transactions or any other form of economic contacts with the rest of the world.

Collateral security: Additional security a borrower supplies to obtain a loan.

Commercial Policy: encompassing instruments of trade protection employed by countries to foster industrial promotion, export diversification, employment creation, and other desired development-oriented strategies. They include tariffs, quotas, and subsidies.

Comparative advantage: The ability to produce a good at a lower cost, relative to other goods, compared to another country. With perfect competition and undistorted markets, countries tend to export goods in which they have a Comparative Advantage and hence make gains from trading

Compound interest: Interest paid on the original principal and on interest accrued from time it became due.
Consumer Surplus is the difference between the price a consumer pays and what they were prepared to pay.

Conditionality: The requirement imposed by the International Monetary Fund that a borrowing country undertake fiscal, monetary, and international commercial reforms as a condition to receiving a loan for balance of payments difficulties.

Copyright: A legal right (usually of the author or composer or publisher of a work) to exclusive publication production, sale, distribution of some work. What is protected by the copyright is the "expression," not the idea. Notice that taking another's idea is plagiarism, so copyrights are not the equivalent of legal prohibition of plagiarism.

Correlation coefficient: Denoted as "r", a measure of the linear relationship between two variables. The absolute value of "r" provides an indication of the strength of the relationship. The value of "r" varies between positive 1 and negative 1, with -1 or 1 indicating a perfect linear relationship, and r = 0 indicating no relationship. The sign of the correlation coefficient indicates whether the slope of the line is positive or negative when the two variables are plotted in a scatter plot.


Cost benefit analysis: A technique that assesses projects through a comparison between their costs and benefits, including social costs and benefits for an entire region or country. Depending on the project objectives and its the expected outputs, three types of CBA are generally recognised: financial; economic; and social. Generally cost-benefit analyses are comparative, i.e. they are used to compare alternative proposals. Cost-benefit analysis compares the costs and benefits of the situation with and without the project; the costs and benefits are considered over the life of the project.

Countervailing duties: duties (tariffs) that are imposed by a country to counteract subsidies provided to a foreign producer
Current account: Part of a nation's balance of payments which includes the value of all goods and services imported and exported, as well as the payment and receipt of dividends and interest. A nation has a current account surplus if exports exceed imports plus net transfers to foreigners. The sum of the current and capital accounts is the overall balance of payments.

Cross elasticity of demand: The change in the quantity demanded of one product or service impacting the change in demand for another product or service. E.g. percentage change in the quantity demanded of a good divided by the percentage change in the price of another good (a substitute or complement)

Crowding out: The possible tendency for government spending on goods and services to put upward pressure on interest rates, thereby discouraging private investment spending.

Currency appreciation: An increase in the value of one currency relative to another currency. Appreciation occurs when, because of a change in exchange rates; a unit of one currency buys more units of another currency. Opposite is the case with currency depreciation.

Currency board: Form of central bank that issues domestic currency for foreign exchange at fixed rates.

Currency substitution: The use of foreign currency (e.g., U.S. dollars) as a medium of exchange in place of or along with the local currency (e.g., Rupees).

Customs duty: Duty levied on the imports of certain goods. Includes excise equivalents Unlike tariffs customs duties are used mainly as a means to raise revenue for the government rather than protecting domestic producers from foreign competition.

Death rate: numbers of people dying per thousand population.

Deflation: Deflation is a reduction in the level of national income and output, usually accompanied by a fall in the general price level.
What is depreciation/ Developed country is an economically advanced country whose economy is characterized by a large industrial and service sector and high levels of income per head.

Developing country, less developed country, underdeveloped country or third world country: a country characterized by low levels of GDP and per capita income; typically dominated by agriculture and mineral products and majority of the population lives near subsistence levels.
Dumping occurs when goods are exported at a price less than their normal value, generally meaning they are exported for less than they are sold in the domestic market or third country markets, or at less than production cost.

Direct investment: Foreign capital inflow in the form of investment by foreign-based companies into domestic based companies. Portfolio investment is foreign capital inflow by foreign investors into shares and financial securities. It is the ownership and management of production and/or marketing facilities in a foreign country.

Direct tax: A tax that you pay directly, as opposed to indirect taxes, such as tariffs and business taxes. The income tax is a direct tax, as are property taxes. See also Indirect Tax.

Double taxation: Corporate earnings taxed at both the corporate level and again as a stockholder dividend
Economic growth: Quantitative measure of the change in size/volume of economic activity, usually calculated in terms of gross national product (GNP) or gross domestic product(GDP).

Duopoly: A market structure in which two producers of a commodity compete with each other.

Econometrics: The application of statistical and mathematical methods in the field of economics to test and quantify economic theories and the solutions to economic problems.

Economic development: The process of improving the quality of human life through increasing per capita income, reducing poverty, and enhancing individual economic opportunities. It is also sometimes defined to include better education, improved health and nutrition, conservation of natural resources, a cleaner environment, and a richer cultural life.

Economic growth: An increase in the nation's capacity to produce goods and services.

Economic infrastructure: The underlying amount of physical and financial capital embodied in roads, railways, waterways, airways, and other forms of transportation and communication plus water supplies, financial institutions, electricity, and public services such as health and education. The level of infrastructural development in a country is a crucial factor determining the pace and diversity of economic development.

Economic integration: The merging to various degrees of the economies and economic policies of two or more countries in a given region. See also common market, customs union, free-trade area, trade creation, and trade diversion.

Economic policy: A statement of objectives and the methods of achieving these objectives (policy instruments) by government, political party, business concern, etc. Some examples of government economic objectives are maintaining full employment, achieving a high rate of economic growth, reducing income inequalities and regional development inequalities, and maintaining price stability. Policy instruments include fiscal policy, monetary and financial policy, and legislative controls (e.g., price and wage control, rent control).
Economies of Scale.

Elasticity of demand: The degree to which consumer demand for a product or service responds to a change in price, wage or other independent variable. When there is no perceptible response, demand is said to be inelastic.

Excess capacity: Volume or capacity over and above that which is needed to meet peak planned or expected demand.

Excess demand: the situation in which the quantity demanded at a given price exceeds the quantity supplied. Opposite: excess supply

Exchange control: A governmental policy designed to restrict the outflow of domestic currency and prevent a worsened balance of payments position by controlling the amount of foreign exchange that can be obtained or held by domestic citizens. Often results from overvalued exchange rates


Exchange rate: The price of one currency stated in terms of another currency, when exchanged.

Export incentives: Public subsidies, tax rebates, and other kinds of financial and nonfinancial measures designed to promote a greater level of economic activity in export industries.

Exports: The value of all goods and nonfactor services sold to the rest of the world; they include merchandise, freight, insurance, travel, and other nonfactor services. The value of factor services (such as investment receipts and workers' remittances from abroad) is excluded from this measure. See also merchandise exports and imports.

Externalities: A cost or benefit not accounted for in the price of goods or services. Often "externality" refers to the cost of pollution and other environmental impacts.

Fiscal deficit is the gap between the government's total spending and the sum of its revenue receipts and non-debt capital receipts. The fiscal deficit represents the total amount of borrowed funds required by the government to completely meet its expenditure

Fiscal policy is the use of government expenditure and taxation to try to influence the level of economic activity. An expansionary (or reflationary) fiscal policy could mean: cutting levels of direct or indirect tax increasing government expenditure The effect of these policies would be to encourage more spending and boost the economy. A contractionary (or deflationary) fiscal policy could be: increasing taxation - either direct or indirect cutting government expenditure These policies would reduce the level of demand in the economy and help to reduce inflation

Fixed costs: A cost incurred in the general operations of the business that is not directly attributable to the costs of producing goods and services. These "Fixed" or "Indirect" costs of doing business will be incurred whether or not any sales are made during the period, thus the designation "Fixed", as opposed to "Variable".

Fixed exchange rate: The exchange value of a national currency fixed in relation to another (usually the U.S. dollar), not free to fluctuate on the international money market.

Foreign aid The international transfer of public funds in the form of loans or grants either directly from one government to another (bilateral assistance) or indirectly through the vehicle of a multilateral assistance agency like the World Bank. See also tied aid, private foreign investment, and nongovernmental organizations.

Foreign direct investment (FDI): Overseas investments by private multinational corporations.

Foreign exchange reserves: The stock of liquid assets denominated in foreign currencies held by a government's monetary authorities (typically, the finance ministry or central bank). Reserves enable the monetary authorities to intervene in foreign exchange markets to affect the exchange value of their domestic currency in the market. Reserves are invested in low-risk and liquid assets, often in foreign government securities.

Free trade: Free trade in which goods can be imported and exported without any barriers in the forms of tariffs, quotas, or other restrictions. Free trade has often been described as an engine of growth because it encourages countries to specialize in activities in which they have comparative advantages, thereby increasing their respective production efficiencies and hence their total output of goods and services.

Free-trade area A form of economic integration in which there exists free internal trade among member countries but each member is free to levy different external tariffs against non-member nations.

Free-market exchange rate Rate determined solely by international supply and demand for domestic currency expressed in terms of, say, U.S. dollars.

Fringe benefit: A benefit in addition to salary offered to employees such as use of company's car, house, lunch coupons, health care subscriptions etc.

Gains from trade The addition to output and consumption resulting from specialization in production and free trade with other economic units including persons, regions, or countries.

General Agreement on Tariffs and Trade (GATT) An international body set up in 1947 to probe into the ways and means of reducing tariffs on internationally traded goods and services. Between 1947 and 1962, GATT held seven conferences but met with only moderate success. Its major success was achieved in 1967 during the so-called Kennedy Round of talks when tariffs on primary commodities were drastically slashed and then in 1994 with the signing of the Uruguay Round agreement. Replaced in 1995 by World Trade Organization (WTO).

Global warming Theory that world climate is slowly warming as a result of both MDC and LDC industrial and agricultural activities.

Gross domestic product (GDP): Gross Domestic Product: The total of goods and services produced by a nation over a given period, usually 1 year. Gross Domestic Product measures the total output from all the resources located in a country, wherever the owners of the resources live.

Gross national product (GNP) is the value of all final goods and services produced within a nation in a given year, plus income earned by its citizens abroad, minus income earned by foreigners from domestic production. The Fact book, following current practice, uses GDP rather than GNP to measure national production. However, the user must realize that in certain countries net remittances from citizens working abroad may be important to national well being. GNP equals GDP plus net property income from abroad.
Globalisation or Globalization: The process whereby trade is now being conducted on ever widening geographical boundaries. Countries now trade across continents and companies also trade all over the world.


Human capital Productive investments embodied in human persons. These include skills, abilities, ideals, and health resulting from expenditures on education, on-the-job training programs, and medical care.

Imperfect competition: A market situation or structure in which producers have some degree of control over the price of their product. Examples include monopoly and oligopoly. See also perfect competition.

Imperfect market A market where the theoretical assumptions of perfect competition are violated by the existence of, for example, a small number of buyers and sellers, barriers to entry, nonhomogeneity of products, and incomplete information. The three imperfect markets commonly analyzed in economic theory are monopoly, oligopoly, and monopolistic competition.

Import substitution A deliberate effort to replace major consumer imports by promoting the emergence and expansion of domestic industries such as textiles, shoes, and household appliances. Import substitution requires the imposition of protective tariffs and quotas to get the new industry started.

Income inequality The existence of disproportionate distribution of total national income among households whereby the share going to rich persons in a country is far greater than that going to poorer persons (a situation common to most LDCs). This is largely due to differences in the amount of income derived from ownership of property and to a lesser extent the result of differences in earned income. Inequality of personal incomes can be reduced by progressive income taxes and wealth taxes. This is measured by the Gini coefficient.

Index of industrial production: A quantity index that is designed to measure changes in the physical volume or production levels of industrial goods over time.

Inflation is the percentage increase in the prices of goods and services.

Indirect tax: A tax you do not pay directly, but which is passed on to you by an increase in your expenses. For instance, a company might have to pay a fuel tax. The company pays the tax but can increase the cost of its products so consumers are actually paying the tax indirectly by paying more for the merchandise.

Interdependence Interrelationship between economic and noneconomic variables. Also, in international affairs, the situation in which one nation's welfare depends to varying degrees on the decisions and policies of another nation, and vice versa. See also dependence.

International commodity agreement Formal agreement by sellers of a common internationally traded commodity (coffee, sugar) to coordinate supply to maintain price stability.

International Labor Organization (ILO) One of the functional organizations of the United Nations, based in Geneva, Switzerland, whose central task is to look into problems of world labor supply, its training, utilization, domestic and international distribution, etc. Its aim in this endeavor is to increase world output through maximum utilization of available human resources and thus improve levels of living.

International Monetary Fund (IMF) An autonomous international financial institution that originated in the Bretton Woods Conference of 1944. Its main purpose is to regulate the international monetary exchange system, which also stems from that conference but has since been modified. In particular, one of the central tasks of the IMF is to control fluctuations in exchange rates of world currencies in a bid to alleviate severe balance of payments problems.

International poverty line An arbitrary international real income measure, usually expressed in constant dollars (e.g., $270), used as a basis for estimating the proportion of the world's population that exists at bare levels of subsistence.

Land reform A deliberate attempt to reorganize and transform existing agrarian systems with the intention of improving the distribution of agricultural incomes and thus fostering rural development. Among its many forms, land reform may entail provision of secured tenure rights to the individual farmer, transfer of land ownership away from small classes of powerful landowners to tenants who actually till the land, appropriation of land estates for establishing small new settlement farms, or instituting land improvements and irrigation schemes.

Macroeconomic stabilization Policies designed to eliminate macroeconomic instability.

Macroeconomics: The branch of economics that considers the relationships among broad economic aggregates such as national income, total volumes of saving, investment, consumption expenditure, employment, and money supply. It is also concerned with determinants of the magnitudes of these aggregates and their rates of change over time.

Market economy: A free private-enterprise economy governed by consumer sovereignty, a price system, and the forces of supply and demand.

Market failure: A phenomenon that results from the existence of market imperfections (e.g., monopoly power, lack of factor mobility, significant externalities, lack of knowledge) that weaken the functioning of a free-market economy--it fails to realize its theoretical beneficial results. Market failure often provides the justification for government interference with the working of the free market.

Market-friendly approach: World Bank notion that successful development policy requires governments to create an environment in which markets can operate efficiently and to intervene selectively in the economy in areas where the market is inefficient (e.g., social and economic infrastructure, investment coordination, economic "safety net").

Market mechanism: The system whereby prices of stocks & shares, commodities or services freely rise or fall when the buyer's demand for them rises or falls or the seller's supply of them decreases or increases.

Market prices: Prices established by demand and supply in a free-market economy.

Merchandise exports and imports: All international changes in ownership of merchandise passing across the customs borders of the trading countries. Exports are valued f.o.b. (free on board). Imports are valued c.i.f. (cost, insurance, and freight).

Merchandise trade balance: Balance on commodity exports and imports.

Microeconomics: The branch of economics concerned with individual decision units--firms and households--and the way in which their decisions interact to determine relative prices of goods and factors of production and how much of these will be bought and sold. The market is the central concept in microeconomics.

Middle-income countries (MICs): LDCs with per capita income above $785 and below $9,655 in 1997 according to World Bank measures.

Mixed economic systems: Economic systems that are a mixture of both capitalist and socialist economies. Most developing countries have mixed systems. Their essential feature is the coexistence of substantial private and public activity within a single economy.

Monetary policy: The regulation of the money supply and interest rates by a central bank in order to control inflation and stabilize currency. If the economy is heating up, the central bank (such as RBI in India) can withdraw money from the banking system, raise the reserve requirement or raise the discount rate to make it cool down. If growth is slowing, it can reverse the process - increase the money supply, lower the reserve requirement and decrease the discount rate. The monetary policy influences interest rates and money supply.

Money supply: the total stock of money in the economy; currency held by the public plus money in accounts in banks. It consists primarily currency in circulation and deposits in savings and checking accounts. Too much money in relation to the output of goods tends to push interest rates down and push inflation up; too little money tends to push rates up and prices down, causing unemployment and idle plant capacity. The central bank manages the money supply by raising and lowering the reserves banks are required to hold and the discount rate at which they can borrow money from the central bank. The central bank also trades government securities (called repurchase agreements) to take money out of the system or put it in. There are various measures of money supply, including M1, M2, M3 and L; these are referred to as monetary aggregates.

Monopoly: A market situation in which a product that does not have close substitutes is being produced and sold by a single seller. See also monopsony.

Multi-Fiber Arrangement (MFA) A set of nontariff bilateral quotas established by developed countries on imports of cotton, wool, and synthetic textiles and clothing from individual LDCs

Multinational corporation (MNC) An international or transnational corporation with headquarters in one country but branch offices in a wide range of both developed and developing countries. Examples include General Motors, Coca-Cola, Firestone, Philips, Volkswagen, British Petroleum, Exxon, and ITT. Firms become multinational corporations when they perceive advantages to establishing production and other activities in foreign locations. Firms globalize their activities both to supply their home-country market more cheaply and to serve foreign markets more directly. Keeping foreign activities within the corporate structure lets firms avoid the costs inherent in arm's-length dealings with separate entities while utilizing their own firm-specific knowledge such as advanced production techniques.

National debt: Treasury bills, notes, bonds, and other debt obligations that constitute the debt owed by the federal government. It represents the accumulation of each year's budget deficit
Public debt: Borrowing by the Government of India internally as well as externally. The total of the nation's debts: debts of local and state and national governments is an indicator of how much public spending is financed by borrowing instead of taxation

Newly industrializing countries (NICs) A small group of countries at a relatively advanced level of economic development with a substantial and dynamic industrial sector and with close links to the international trade, finance, and investment system (Argentina, Brazil, Greece, Mexico, Portugal, Singapore, South Korea, Spain, and Taiwan).

Nongovernmental organizations (NGOs) Privately owned and operated organizations involved in providing financial and technical assistance to LDCs. See foreign aid.

Nontariff trade barrier: A barrier to free trade that takes a form other than a tariff, such as quotas or sanitary requirements for imported meats and dairy products.


Official development assistance (ODA) Net disbursements of loans or grants made on concessional terms by official agencies of member countries of the Organization for Economic Cooperation and Development (OECD).

Official exchange rate: Rate at which the central bank will buy and sell the domestic currency in terms of a foreign currency such as the U.S. dollar.

An Open economy is an economy that encourages foreign trade and has extensive financial and nonfinancial contacts with the rest of the world in areas such as education, culture, and technology. See also closed economy.
The opportunity cost is the implied cost of not doing something that could have led to higher returns.

Organization for Economic Cooperation and Development (OECD):An organization of 20 countries from the Western world including all of those in Europe and North America. Its major objective is to assist the economic growth of its member nations by promoting cooperation and technical analysis of national and international economic trends.

Overvalued exchange rate An official exchange rate set at a level higher than its real or shadow value--for example, 7 Kenyan shillings per dollar instead of, say, 10 shillings per dollar. Overvalued rates cheapen the real cost of imports while raising the real cost of exports. They often lead to a need for exchange control.

Perfect competition: A market situation characterized by the existence of very many buyers and sellers of homogeneous goods or services with perfect knowledge and free entry so that no single buyer or seller can influence the price of the good or service. 

Performance budget is a budget format that relates the input of resources and the output of services for each organizational unit individually. Sometimes used synonymously with program budget. It is a budget wherein expenditures are based primarily upon measurable performance of activities.

Political economy The attempt to merge economic analysis with practical politics--to view economic activity in its political context. Much of classical economics was political economy, and today political economy is increasingly being recognized as necessary for any realistic examination of development problems.

Portfolio investment Financial investments by private individuals, corporations, pension funds, and mutual funds in stocks, bonds, certificates of deposit, and notes issued by private companies and the public agencies of LDCs. See also private foreign investment.

Poverty gap: The sum of the difference between the poverty line and actual income levels of all people living below that line.

Poverty line: A level of income below, which people are deemed poor. A global poverty line of $1 per person per day was suggested in 1990 (World Bank 1990). This line facilitates comparison of how many poor people there are in different countries. But, it is only a crude estimate because the line does not recognize differences in the buying power of money in different countries, and, more significantly, because it does not recognize other aspects of poverty than the material, or income poverty.

Price: The monetary or real value of a resource, commodity, or service. The role of prices in a market economy is to ration or allocate resources in accordance with supply and demand; relative prices should reflect the relative scarcity of different resources, goods, or services.

Price elasticity of demand: The responsiveness of the quantity of a commodity demanded to a change in its price, expressed as the percentage change in quantity demanded divided by the percentage change in price.


Price elasticity of supply: The responsiveness of the quantity of a commodity supplied to a change in its price, expressed as the percentage change in quantity supplied divided by the percentage change in price.

Quota: A quota is a physical limitation on the quantity of any item that can be imported into a country, such as so many automobiles per year. Also a method for allocating limited school places by noncompetitive means--for example, by income or ethnicity.

Repo rate: This is one of the credit management tools used by the Reserve Bank to regulate liquidity in South Africa (customer spending). The bank borrows money from the Reserve Bank to cover its shortfall. The Reserve Bank only makes a certain amount of money available and this determines the repo rate. If the bank requires more money than what is available, this will increase the repo rate - and vice versa.

Revenue expenditure: This is expenditure on recurring items, including the running of services and financing capital spending that is paid for by borrowing. This is meant for normal running of governments' maintenance expenditures, interest payments, subsidies and transfers etc. It is current expenditure which does not result in the creation of assets. Grants given to State governments or other parties are also treated as revenue expenditure even if some of the grants may be meant for creating assets. Subsidy : Financial assistance (often from the government) to a specific group of producers or consumers.

Revenue receipts: Additions to assets that do not incur an obligation that must be met at some future date and do not represent exchanges of property for money. Assets must be available for expenditures. These include proceeds of taxes and duties levied by the government, interest and dividend on investments made by the government, fees and other receipts for services rendered by the government.

Stabilization policies: A coordinated set of mostly restrictive fiscal and monetary policies aimed at reducing inflation, cutting budget deficits, and improving the balance of payments. See conditionality and International Monetary Fund (IMF).

Subsidy: A payment by the government to producers or distributors in an industry to prevent the decline of that industry (e.g., as a result of continuous unprofitable operations) or an increase in the prices of its products or simply to encourage it to hire more labor (as in the case of a wage subsidy). Examples are export subsidies to encourage the sale of exports; subsidies on some foodstuffs to keep down the cost of living, especially in urban areas; and farm subsidies to encourage expansion of farm production and achieve self-reliance in food production.

Tax avoidance: A legal action designed to reduce or eliminate the taxes that one owes.

Tax base: the total property and resources subject to taxation. See also tariffs.

Tax evasion: An illegal strategy to decrease tax burden by underreporting income, overstating deductions, or using illegal tax shelters.

Terms of trade The ratio of a country's average export price to its average import price; also known as the commodity terms of trade. A country's terms of trade are said to improve when this ratio increases and to worsen when it decreases, that is, when import prices rise at a relatively faster rate than export prices (the experience of most LDCs in recent decades).

Treasury bill: A short-term debt issued by a national government with a maximum maturity of one year. Treasury bills are sold at discount, such that the difference between purchase price and the value at maturity is the amount of interest.

VAT: A form of indirect sales tax paid on products and services at each stage of production or distribution, based on the value added at that stage and included in the cost to the ultimate customer.

World Bank: An international financial institution owned by its 181 member countries and based in Washington, D.C. Its main objective is to provide development funds to the Third World nations in the form of interest-bearing loans and technical assistance. The World Bank operates with borrowed funds.

WTO: The World Trade Organization is a global international organization dealing with the rules of trade between nations. It was set up in 1995 at the conclusion of GATT negotiations for administering multilateral trade negotiations.