The question asks for the term that describes an increase in capital stock, also known as gross capital formation, within a macroeconomic framework. We need to identify the economic concept that directly corresponds to this definition.
C) Investment — In macroeconomics, investment is defined as the addition to the capital stock of an economy. This includes the purchase of new capital goods like machinery, equipment, buildings, and changes in inventories. Gross capital formation is a key component of GDP and represents the total investment in an economy.
The question asks to identify the key difference between Foreign Direct Investment (FDI) and Foreign Institutional Investor (FII). We need to understand the nature, objectives, and impact of each type of investment.
Correct Option: B) FII helps in increasing capital availability in general, while FDI only targets specific sectors.
The question asks to identify which of the given options constitute Foreign Direct Investment (FDI) in India. We need to understand the definition and characteristics of FDI versus other types of foreign investment, particularly portfolio investment.
Correct Option: D) 1, 2 and 3 only
The question asks about the investment models India has followed in the past. To answer this, we need to understand the concepts of top-down and bottom-up investment approaches and how they relate to India's economic planning history.
Correct Option: C) Both a and b. India's economic planning and investment strategies have historically incorporated elements of both top-down (centralized planning, Five-Year Plans, government-led initiatives) and bottom-up (market-driven investments, private sector growth, local initiatives, post-liberalization era) approaches. The balance between these two has shifted over time, but both have been present.
The question refers to economic reforms and their impact on investment. Post-reforms, many economies, including India, have seen a shift in the economic landscape, with certain sectors playing a more dominant role in driving growth and investment. The blank needs to be filled with the sector that typically gains a larger role after such reforms, leading to increased investment through profit reinvestment.
B) Private sector — Post-reforms, governments typically reduce their direct involvement in economic activities, opening up new avenues for the private sector. This leads to increased competition, innovation, and efficiency. The private sector, driven by profit motives, identifies new opportunities, invests in them, and reinvests its profits (plough back) to expand operations, thereby increasing overall investment in the economy. This aligns perfectly with the description provided in the question.
The question asks for the definition of venture capital. To answer this, one needs to understand the core characteristics of venture capital funding, particularly its target recipients and the stage of business it typically supports.
Correct Option: B) A long-term start-up capital provided to new entrepreneurs