Introduction to Economics | SSC CGL Tier 2 - Study Material, Online Tests, Previous Year PDF Download

Understanding Economic Indicators

• Gross Domestic Product (GDP):

  • Definition: Total market value of all finished goods and services produced in a country in a given year.

• Industrial Production:

  • Definition: Reports on changes in the production of factories, mines, and utilities.
  • Significance: Indicates potential price increases, supply shortages, and overall economic slack or tightening.

• Employment Data:

  • Significance: Sharp increases suggest economic growth, while significant decreases may indicate potential contractions.

• Consumer Price Index (CPI):

  • Definition: Measures retail price changes and consumer costs, serving as a benchmark for inflation.
  • Importance: Releases can impact volatility in equity, fixed income, and forex markets.

Exploring Economic Systems: A Historical Overview

Primitivism:

• Individuals produce necessities at the household or tribal level.
• Activities include building dwellings, growing crops, and hunting game.

Feudalism:

• Lords hold land and lease it to peasants for production.
• Peasants receive safety and security from the lord in return.

Capitalism:

• Emerged with the industrial revolution.
• Business owners organize resources to produce goods for market consumption.
• Prices determined by supply and demand in markets.

Socialism:

• Form of a cooperative production economy.
• Limited or hybrid private ownership of means of production.
• Prices, profits, and losses not sole determinants in production decisions.

Communism:

• Economic activity centralized through state-sponsored central planners.
• Common ownership of production and distribution.

List of terms one should be familiar with to understand the concepts going further