Students can download Class 8 Economics Chapter 1 Introduction to Economics Important Questions, KSEEB Class 8 Social Science Important Questions and Answers helps you to revise the complete Karnataka State Board Syllabus and to clear all their doubts, score well in final exams.
Karnataka State Syllabus Class 8 Social Science Economics Important Questions Chapter 1 Introduction to Economics
What are goods?
Goods are physical and tangible materials like food, clothes, books, etc., that satisfy human wants.
What are services?
Services are transactions in which no physical goods are transferred from the seller to the buyer. Examples: Transport, education, banking, electricity, etc.
Give the meaning of the term ‘consumer’.
An individual who buys products or services for personal use and not for manufacture or resale is called a consumer.
Give the meaning of the term ‘producer’.
The manufacturer of a product is called producer. OR People engaged in the production of goods are called producers.
What do you mean by ‘distributor’?
A distributor is a person who makes goods and services available through traders and shopkeepers to consumers who need them.
Price is the value of goods and services expressed in terms of money.
What do you mean by ‘prioritising’?
Wants are unlimited but the resources to satisfy them are limited. Hence the most important or pressing wants have to be satisfied first and the less urgent ones can be satisfied later. This classification of wants as more important or less important is called prioritising.
What is scarcity?
Scarcity refers to the basic economic problem, the gap between limited – that is, scarce – resources and unlimited wants.
What is Economics?
Economics is the social science that examines how people choose to use the limited or scarce resources to satisfy their unlimited wants.
Give some definitions of Economics.
According to Adam Smith, “Economics is the study of wealth”. Alfred Marshall defines Economics as “the study of people in the ordinary business of life”. According to Lionel Robbins, “Economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses”.
Paul Samuelson defines, “Economics is the study of how societies use scarce resources to produce valuable commodities and distribute them for consumption among various people”.
How is die word ‘Economics’ derived?
The word ‘Economics’ comes from two Greek words ‘Oikos’ and ‘nomos’. ‘Oikos’ means ‘household’ and ‘Nomos’ means ‘management’. Thus, the term ‘Economics’ refers to the art of household management that involves using the available means to satisfy the basic needs of the family as well as to prosper.
Who is considered as the ‘Father of Economics’?
Adam Smith is considered as the ‘Father of Economics’.
What is the importance of the study of Economics?
Why do we need to study Economics?
The study of Economics is very important for the individual as well as the society. Economics helps to
- Recognise the scarcity of resources against the unlimited wants.
- Prioritise the use of resources and identify the more important and the less important wants.
- Economise on the use of resources and look for more efficient ways of using the resources.
- Engage in economic activity to support the family as well as the country.
- Contribute to government’s revenue and assist it in the discharge of its developmental and welfare programmes.
- Understand socio-economic problems of the country like poverty, unemployment, inflation, etc., and try to find solutions for them.
- Suggest better policies and better ways of implementing policies for bringing about desired growth and development of the country.
What is an economic activity?
The various activities that we perform for satisfaction of our wants as also to earn money and wealth are called economic activities.
What is the basis of ail economic activities?
Wants are the basis of all economic activities.
List the different economic activities.
How are economic activities classified?
Economic activities can be classified into four groups. They are – production activities, consumption activities, exchange activities and distribution activities.
What are production activities? Give examples.
Explain the meaning of production activities.
Production activities are those that produce goods and services. Examples: Agriculture, animal husbandry, fishing, mining, different kinds of industries, transport, communication, etc.
What is meant by consumption activities?
Goods and services are produced for consumption. Man satisfies his wants by buying and utilizing goods and services. All these activities are known as consumption activities.
What is meant by exchange activities?
Producers produce goods for consumers. The marketing system supplies the goods produced to the consumers. The marketing system involves activities like collection of goods, transportation, selling and buying.
The income that is earned through production of goods has to be distributed to the various factors of production (land, labour, capital and organisation) that have enabled production. This process involves activities undertaken to determine the price of the factors of production. Steps have to be taken to ensure that the income earned is distributed among all factors in a just manner.
Name the two branches of Economics.
The two branches of Economics are Micro Economics and Macro Economics.
When you buy a pen, which branch of Economics analyses your decision?
Buying a pen being the activity of an individual, it comes under the purview of micro economics.
What is micro economics?
Micro economics is a branch of Economics that studies decision-making by the smallest components of the society, namely, individuals, households and business firms regarding the use of resources.
What is macro economics?
Macroeconomics is a branch of Economics that studies how the aggregate or whole economy works. A variety of economy-wide phenomena such as inflation, price levels, rate of growth, national income, gross domestic product (GDP) and changes in unemployment, etc., are studied in macro economics.
Differentiate between micro economics and macro economics.
Microeconomics is the branch of economics that studies the behaviour of an individual consumer, households and business firms. Macroeconomics, on the other hand, is the study of the national economy as a whole. Microeconomics focuses on issues that affect individuals and firms.
This could mean studying the supply and demand for a specific product, the production that an individual or business is capable of, or the effects of regulations on a business. Macroeconomics focuses on issues that affect the economy as a whole.
Some of the most common focuses of macroeconomics include inflation, price levels, rate of growth, national income, gross domestic product (GDP), changes in unemployment, etc.
What are the basic economic problems?
The basic economic problems common to all economies are:
1. What to produce:
An individual or society has to decide what goods are to be produced. It is a question of choice whether to produce more food or weapons, agricultural goods or industrial goods, consumer goods or capital goods, and so on. The type and quantity of various goods produced depends on the availability of resources On the one hand and requirements of the people on the other.
2. How to produce:
There are different ways to produce given goods. Different combinations of inputs and resources can be used to produce a given amount of good or service. Also, a choice has to be made about the technology to be used for production – whether labour-intensive technology should be used or capital-intensive technology. This is essential to minimise the cost of production and for efficient use of available resources.
3. For whom to produce:
A society cannot satisfy each and every human want. Therefore, it has to decide on who gets what share of the total output of goods and services produced. In other words, the society decides on the distribution of the goods and services among the members of the society.
What major economic decisions are taken by the government?
The major economic decisions taken by the government are:
- What goods are to be produced
- how they are to be produced, that is, the technology to be used
- for whom they are to be produced, that is distribution of the goods.
Multiple Choice Questions
All human activities are undertaken for earning money and spending money are considered as __________ activities.
According to Adam Smith, Economics is the study of
The basis of every economic activity is
Land, labour, capital and organisation are called
(A) economic activities
(B) primary activities
(C) exchange intermediaries
(D) factors of production.
(D) factors of production.
Classification of wants as more important and less important is called as
Fill In The Blanks
- The word ‘Economics’ is derived from two Greek words Oikos and Nomos.
- The basic economic problem of every individual is scarcity and choice.
- The activities that generate income are economic activities.
- Micro Economics is the study of small units.
- Macro Economics is the study of large units.
- The physical and tangible things that we use in our daily life are called goods
- Wants are the basis for all economic activities.