This a MCQ (Multiple Choice Question) based practice test of Chapter 2- National Income Accounting of Economics of Class XII (12) for the quick revision/preparation of School Board examinationsQ Explain the meaning of non-market activitiesa)Involuntaryb)Non marketablec)Economicd)ProductionCorrect answer is option 'B'. Can you explain this answer?

Question

Answer

Non market Activities -

1) Non market activities are those activities primarily undertaken for the purpose of self-consumption. These activities don't give profit as they are for self consumption.

2) The output of the non market activities is neither for sale in the market nor for earning profit. These activities can be for consumption and processing of primary products for one's own use.

3) Example : A farmer cultivates primarily for himself and his family and not for earning profit.

Answer

Non market activities are those activities primarily undertaken for the purpose of self-consumption. These activities don't give profit as they are for self consumption. The output of the non market activities is neither for sale in the market nor for earning profit.

Answer

It means stock

Answer

Meaning of Non-market Activities

Non-market activities refer to economic activities that are not exchanged in the market and do not have a monetary value attached to them. These activities are usually performed within households or communities and are not included in the calculation of the national income.

Explanation of the Correct Answer: Option 'B'

Non Marketable
Non-market activities are considered non-marketable because they are not bought or sold in the market. These activities are typically performed for personal consumption or welfare purposes and do not involve any exchange of goods or services for money.

Examples of Non-market Activities
- Household Work: Activities such as cooking, cleaning, caregiving, and child-rearing are non-market activities as they are performed within households for personal consumption and are not exchanged in the market.
- Volunteer Work: When individuals offer their services without any monetary compensation, such as volunteering at a charity or community organization, it is considered a non-market activity.
- Subsistence Agriculture: In rural areas, where individuals engage in farming primarily for self-consumption rather than for commercial purposes, the agricultural activities are considered non-market activities.
- DIY (Do-it-yourself) Projects: When individuals undertake projects at home, such as repairing appliances or renovating their house, it is considered a non-market activity as it is done for personal consumption and not for exchange in the market.

Exclusion from National Income Calculation
Non-market activities are not included in the calculation of the national income because they do not involve any monetary transactions. National income accounting focuses on capturing economic activities that contribute to the production of goods and services that are exchanged in the market.

Significance
Although non-market activities are not included in the calculation of national income, they play a vital role in the overall well-being of individuals and society. These activities contribute to the social and personal welfare and are essential for the functioning of households and communities. However, their exclusion from national income accounting does not diminish their importance.

In conclusion, the correct answer 'B' - Non-marketable - explains the meaning of non-market activities as economic activities that are not exchanged in the market and do not have a monetary value attached to them. These activities are typically performed within households or communities and are not included in the calculation of national income.

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