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Test Your Knowledge on Indian Economy Quiz

Almost all exams have questions from economics . The Economy of India is the ninth largest in the world by nominal GDP and the fourth largest by purchasing power parity (PPP). The country is a part of the G-20 major economies and the BRICS, in addition to being partners of the ASEAN. India has a per capita GDP (PPP) of $3,586 (IMF, 129th) as per 2010 figures, making it a low-middle income country.

10 Questions on Indian Economy

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Comments ( 14 )

  1. and why has it to be per capita?

  2. If a country’s purchasing power parity is higher thanthe rest of the world, does that mean the person within the country can consume more compared to the rest of the world when it comes to goods and services?

  3. Describe and discuss the relevance of the Fisher Effect and the Purchasing Power Parity theories to a foreign currency dealer in a merchant back in London

  4. It i is asserted that a country’s living standard is better reflected by using purchasing power parity dollars rather than an exchange rate $$. Why so?

  5. Caroline ODonoghue
    March 13, 2012 at 9:32 AM

    We all know that the dollar is becoming surprisingly weak compared to the euro.
    But what is the actual euro-dollar exchange, purchasing power parity?
    (i.e. how much should a US worker earn, in average, to have the same life style of a European worker earning 10,000€ a year?)
    I know that a dollar euro is traded at 1.6$.
    My question is different..

  6. a.one unit of each foreign currency.
    b.foreign currency equal to the U.S. price level divided by the foreign country’s price level.
    c.enough foreign currency to buy as many goods as it does in the United States.
    d.None of the above is implied by purchasing-power parity.

  7. Hello!
    I am writing an essay about how inflation affects the exchange rate of a country. After reading up on the theory of Purchasing-power parity, I am confused as to why high levels of inflation is bad. According to the theory the exchange rate will adjust itself accordingly. However, high levels of inflation is known to decrease the wealth of the citizens in the long run according to my understanding..

    Please help me get some clarity on the topic. Thanks!

  8. What is the worth of dollar when compared to Indian Rupee. The usual practice would be currency exchange rate. However I am looking for the purchasing worth of a dollar in United States and Indian Rupee in United States. This can be also for Euro in Europe and Indian Rupee in Europe. What is 1000 Rupee worth in Europe and United States.

  9. or are they the same thing? thank you 🙂
    oh crap, wrong section. lol i don’t know how that happened, but basically, this is a business-finance or society/culture question. thanks again!

  10. Who knows the purchasing power parity of every state of US and every province of Canada?

  11. so basically purchasing power parity per capita indicates how strong a country’s currency is essentially, right? with that said, the United States standard of living is much higher than say Chad because the United States dollar is much stronger because there a more developed country than chat which is a less-developed country. If this is incorrect, please feel free to educate me?
    purchasing power parity per capita: United States: $47,400 versus Chad: $1,800

  12. What impact does price elasticity have on the purchasing power parity theory?

  13. 1. the ratio of the prices of goods in two countries ought to reflect the exchange rate between the two countries.
    2. everyone in the world should have the opportunity to purchase the same bundle of goods.
    3. countries exhibiting a greater purchasing power are more developed than those with lower purchasing power.
    4. given the same amount of money one can purchase more in a developed country as opposed to developing countries.

  14. What is the idea of comparative advantage? How do exports and imports affect the economy? What is purchasing power parity theory?

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