Give an outline of the value added method of measurement of Gross Domestic Product. Explain how the problem of ‘double counting’ is taken care of in this method.

Explain why illegal activities are excluded from gross domestic product.

What is Say’s Law of market? What are its implications for an economy?

Explain why and how, according to the classical economists, the economy always operates at full employment level.

Explain why income tax is considered as an automatic stabiliser.

For a three sector economy the following are given:

What are the functions of money? Explain how paper money or fiat money performs all these functions.