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Economics for 2014

People having Economics as optional are requested to share their views,strategy,tips here so to help each other and create a better platform to interact so to enhance our preparation.
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Comments

  • Is there any test series for Economics optional ?????
  • edited June 2014
    There was a question in GS3 mains "What is meaning of the term tax expenditure? Taking housing sector as an example, discuss how it influences the budgetary policies of the government?"

    In this I was not able to understand of which housing sector question was about.Is it housing sector means household sector (one of four sectors viz. production, consumption, household and rest of the world) or simply infrastructure/construction sector

    I saw many model answer like in chronicle giving fake answer even to basic of question i.e. tax expenditure.
  • edited June 2014
    Tax expenditure is the revenue govt loses by allowing its taxable subjects to spend it on certain tax exempt categories. For example, section 80C lists some investments such as HRA, interest on education loan, investments in ELSS which are exempt from income tax.

    It influences the budgetary policy in 2 ways. One, it reduces the revenue of govt, lowering its ability to spend. Two, it directs savings in specific areas reducing the funding needs too.

    Eg. Housing sector has buyers who need loans to buy houses. Govt can either tax people and use this money to give interest benefits to these buyers, or give this money to housing construction companies by way of cheaper construction loans, or allowing tax exemption for interest paid on housing loans. When the tax expenditure method is used a section of saving is directed towards the related sector. By implication, the funding needs of the sector come down and pressure on budgetary expenditure from that sector reduces.
  • @ women (a.k.a GS QUEEN) Thanks for such a nice reply and explaination .
    My basic question is not tax expenditure that is about Sec10 & Chapter VI-A of IT Act. My question is what term housing here mean it is household sector or housing construction. Because in both condition answer will be different.
    It is basic public finance question and I think they mean "Household Sector"
  • edited June 2014
    Household is a very broad term to be called as one particular sector.
    They mean the Construction Industry / Housing loans.
  • Household is a very broad term to be called as one particular sector.
    They mean the Construction Industry / Housing loans.
    Thanks @rajkumar484 how is your optional preparation going on .Is there any test series for same

  • No yaar, i am working(resigned now and in notice period for 2 months) and can't go for coaching.
    Not enrolled for any test series / not going to do it.

    For economics paper 1 , i am in the same stage as where i was last year. I was hoping to cover half of it before prelims but seeing my prelims/GS mains marks now, i am dropping that plan. Gonna concentrate on GS papers.

  • No yaar, i am working(resigned now and in notice period for 2 months) and can't go for coaching.
    Not enrolled for any test series / not going to do it.

    For economics paper 1 , i am in the same stage as where i was last year. I was hoping to cover half of it before prelims but seeing my prelims/GS mains marks now, i am dropping that plan. Gonna concentrate on GS papers.

    Dear I too not doing any coaching and even not in past either for GS or optional. I was too working got 2-3 month leave as I am joining Bank Of Baroda on 15 sept (Frictional unemployment)

    Please share your score card ...
  • @Ging7 pls share ur answers
  • @Ging7 pls share ur answers
    I dont think I will be able to reconstruct my answers well enough. I have applied for RTI. If I get the papers, I will definitely scan and upload.
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