WHY OUR COURSE!

1) 1) Save Videos offline

ECONOMIC 2) 2) Downloadable & printable PDFs
3) 3) Sectional Tests &
TERMS AND Comprehensive Mocks with All
India Ranking System
CONCEPTS – 4) 4) We Check Your English Papers.
English is the most scoring in
PART 3 Phase 2.
5)
WWW.ANUJ 6) *You can watch videos for free on
our Youtube channel.
JINDAL.IN
ECONOMIC TERMS AND
SUCCESSRBI
CONCEPTS – PART 3
@ANUJJIND
WWW.ANUJJINDAL.IN

AL.IN
[email protected]

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Table of Contents
Closed shop: .................................................................................................................... 3
Commodity money:.......................................................................................................... 3
Communitisation: ............................................................................................................ 3
Comparative advantage: ................................................................................................. 6
Consols: ........................................................................................................................... 7
Consortium: ..................................................................................................................... 7
Consumer durables: ......................................................................................................... 8
Consumer non-durables: .................................................................................................. 8
Conspicuous Consumption: .............................................................................................. 8
Contagion: ....................................................................................................................... 9
Contrarian: .....................................................................................................................10
Core investment companies (CICS): .................................................................................10
Correction: .....................................................................................................................11
Creative destruction: ......................................................................................................11
Crony capitalism: ............................................................................................................12
Cross subsidy: .................................................................................................................12
Crowding-out effect: .......................................................................................................12
CSR: ................................................................................................................................13
Debenture: .....................................................................................................................14
Debt/Equity Swap:..........................................................................................................14
Decoupling theory: .........................................................................................................14
Deindustrialisation: ........................................................................................................15
Demerger: ......................................................................................................................16
Direct cost: .....................................................................................................................16
Dirty float: ......................................................................................................................17
Disgorgement: ................................................................................................................17

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
 ECONOMIC TERMS AND CONCEPTS

Closed shop:

The requirement that all employees of a given firm be members of a specified trade union.
It is a method of restricting labour supply and maintaining high wages applied by a
powerful trade union.

A pre-entry closed shop (or simply closed shop) is a form of union security
agreement under which the employer agrees to hire union members only, and employees
must remain members of the union at all times in order to remain employed. This is
different from a post-entry closed shop (US: union shop), which is an agreement requiring
all employees to join the union if they are not already members.

Commodity money:

Products being used as the means of payment as in the traditional barter system. Such
practises take place generally when the confidence in money has fallen down (as for
example in the situations of high inflation and high depreciation).

Communitisation:

A method of privatizing public service delivery without going for the tendering process.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
A major challenge in most developing countries relates to providing basic amenities (such as
education, health, water supply, roads, electricity, etc.) to their citizens, especially the poor
and the rural populations. In the context of South Asia, there are not many success stories
to count on this front. It is in this setting that Communitisation: The Third Way of
Governance offers an alternative approach in governance, one that proposes to improve
public delivery systems at the grassroots. It calls for a ‘paradigm shift’ in the governance
system: a shift to empower, harness, and strengthen the ‘social capital’ of communities at
the grassroots.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
ECONOMIC TERMS AND CONCEPTS – PART 3
COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Comparative advantage:

It is about identifying activities that an individual, a firm or a country can do most efficiently,
being together.
The idea, usually credited to David Ricardo, underpins the case of free trade. It suggests that
countries can gain from trading with each other even if one among them is
more efficient (i.e., it has an absolute advantage) in every kind of economic activity.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Consols:

This is the abbreviated form of consolidated stock.

The government bonds which have no maturity and thus have an indefinite life.
They are issued as perpetual bonds.

Consortium:

An ad hoc grouping of firms, governments, etc.

brought together to undertake a particular project by pooling their resources and skills for
major construction projects, loans, etc.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Consumer durables:

Consumer goods that are consumed over relatively long periods of time rather than
immediately (opposite to the consumer non-durables) such as cars, houses, refrigerators,
etc.

Consumer non-durables:

Consumer goods which yield up all their satisfaction/utility at the time of consumption
(Opposite to the consumer durables), examples are cheese, pickles, jam, etc.

Conspicuous Consumption:

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Consumption for the purpose of showing off ostentatiousness but not for the utility aspect-
for example, the use of diamond-studded sandals, watches, pens, etc.

Contagion:

A situation or an effect of economic problems in one economy spreading to another also

known as the domino effect.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Contrarian:

A person following an investment strategy (specially in share market) just opposite to the
general investors in a given period. For example, when a share is generally being sold by the
investors, a contrarion keeps on buying them- the logic is that due to selling pressure price
will fall below the intrinsic value of the share and there is a prospect of future profit out of
the share.

Core investment companies (CICS):

A NBFC carrying on the business of acquisition of shares and securities which satisfied the
conditions:
These companies a minimum 90% of their assets in the group concerns either in the form of
equity, preference shares or convertibles bonds or loans. Further the component of equity
holdings should not be less than 60% of their assets.
It does not trade in its investments in shares, debt or loans in group companies except
through block sale for the purpose of dilution or disinvestment; and it does not carry on any
other financial activity except investment in bank deposits, money market instruments,
government securities, loans to and investments in group companies.
“systemically important Core Investment Company (CIC-ND-SI)” means a core investment
company having total assets of not less than ₹100 crore either individually or in aggregate
along with other CICs in the Group and which raises or holds public funds.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Correction:

A term usually used in stock market which shows a reversals of share prices in reaction to an
excessive rise or fall of the past.

Creative destruction:

The process by which an innovative entrepreneur takes risks and introduces new
technologies to stimulate economic activity, replacing old technologies is known as 'creative
destruction'. As per Schumpeter, Joseph A. (1883—1950), creative destruction is the key to
economic growth. But due to irregularity in such innovations, business cycle is followed by
both collapse and crisis.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Crony capitalism:

Crony capitalism is an economy in which businesses thrive not as a result of risks they take,
but rather as a return on money amassed through a nexus between a business class and the
political class. This is done using state power to crush genuine competition in handing out
permits, government grants, special tax breaks, or other forms of state intervention[1][2] over
resources where the state exercises monopolist control over public goods, for example,
mining concessions for primary commodities or contracts for public works. Money is then
made not merely by making a profit in the market, but through profiteering by "rent
seeking" using this monopoly or oligopoly. Entrepreneurship and innovative practices, which
seek to reward risk are stifled, since the value-added is little by crony businesses as hardly
anything of significant value is created by them, with transactions taking the form of
"trading".

Cross subsidy:

The process of giving subsidy to one sub-area and fulfilling it through the profits from
the other sub. area.
for example, in India kerosene oil is cross-subsidised against petrol and aviation fuel.

Crowding-out effect:

A concept of public finance which means an increase in the government expenditure which
has an effect of reducing the private sector expenditure.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
CSR:

The concept of corporate social responsibility (CSR) is fast gaining popularity among the
corporate sector of the world. As per the experts, the CSR is qualitatively different from the
traditional concept of passive philanthropy by the corporate houses. Basically, the CSR
acknowledges the debt that the corporates owe to the community within which they
operate. It defines the corporates' partnership with social action groups (i.e., the NGOs) in
providing financial and other resources to support development plans, especially among
disadvantaged communities. There is stress on long-term sustainability of business and
environment and the distribution of well-being.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Debenture:

An instrument for raising long-term loan by companies, having a maturity period bearing an
interest (coupon rate). Theoretically they may be secured or unsecured by assets such as
land and buildings of the issuing company (known as collateral). Debenture holders are
provided with a prior claim on the earnings (by interest) and assets of the company in the
situation of liquidation of the company over the preference and equity
shareholders of the company.

Debt/Equity Swap:
A debt/equity swap is a transaction in which the obligations or debts of a company or
individual are exchanged for something of value, equity. In the case of a publicly traded
company, this generally entails an exchange of bonds for stock. The value of the stocks and
bonds being exchanged is typically determined by the market at the time of the swap.

An equity/debt swap is the opposite of a debt/equity swap. Instead of trading debt for
equity, shareholders swap equity for debt. Essentially, they exchange stocks for bonds.

Decoupling theory:

Decoupling theory holds that Asian economies, especially emerging ones, no longer depend
on the United States economy for growth, leaving them insulated from a severe slowdown
there, even recession looked true for some time as Asian stocks rose while stocks in the US
fell - however, as fears of recession mounted in the US, stocks declined heavily. Looking
this happen in late 2008 the decoupling theory regarding the Asian as well as the EU
economies have now lost ground. But still the emerging economies are able to have higher
growth rates and exports in comparison to the US-that is why the theory is still debated by
the experts.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Deindustrialisation:

Sustained decrease in the share of the secondary sector in the total output (GDP) of an
economy.
This term came into prominence in India to describe the ‘process of destruction of Indian
handicraft industries by competition from the products of British manufacture during the
nineteenth century’.

a decline in the proportion of the working population engaged in secondary industry to total
working population, or a decline in the proportion of population dependent on secondary
industry to total population.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Demerger:

The breaking-up of a company into more separate companies.

A de-merger (or "demerger") allows a large company, such as a conglomerate, to split off its
various brands or business units to invite or prevent an acquisition, to raise capital by selling
off components that are no longer part of the business's core product line, or to create
separate legal entities

Direct cost:

The direct material and labour cost of a product— proportionally varies with the total
output.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
Dirty float:

A term of foreign exchange management when a country manipulates its exchange rate
under the floating currency system to take leverage in its external transactions.

A dirty float is a floating exchange rate where a country's central bank occasionally
intervenes to change the direction or the pace of change of a country's currency value. In
most instances, the central bank in a dirty float system acts as a buffer against an
external economic shock before its effects become disruptive to the domestic economy. A
dirty float is also known as a "managed float."

Disgorgement:

Disgorgement is repayment of ill-gotten gains, that is imposed on wrongdoers by the courts.

Funds that were received through illegal or unethical business transactions are disgorged, or
paid back, with interest to those affected by the action. Disgorgement is a remedial civil
action, rather than a punitive civil action.

ECONOMIC TERMS AND CONCEPTS – PART 3

COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]
ECONOMIC TERMS AND CONCEPTS – PART 3
COURSES OFFERED — RBI GRADE B|SEBI
WWW.ANUJJINDAL.IN
|NABARD GRADE A|UGC NET
[email protected]