Economics(Paper-4) - Shivaji University

) Subsistence Sector: agriculture sector
c) Take-off stage: the stage ofpeak level development
d) Spread effect: effect which helps development of an economy.
e) Backwash effect: effect which affected economic development.
f) Indivisibility: unseparateness
2.5 Questions
2.5.1 Objective Type Questions:
A. Give Answer in one Sentence
1. In which book Lewis developed his unlimited supply of labour theory?
2. Which sector have unlimited supply of labour?
3. What is subsistence sector?
4. What is capitalists sector?
5. Which are the five stages of Rostow’s theory of development?
6. Which effect is favourable for development of economy?
7. Give two assumptions of Lewis theory.
8. In which book Rostow developed his theory?
9. According to Lewis what is dual economy?
10. When Rostow published his stages of economic development?
Answers :
1. Lewis developed his theory in “Economic Developed with Unlimited Supplies
of Labour”
2. The subsistence sector have unlimited supply of labour.
3. The part of the economy which used reproducible capital.
4. The subsistence sector is that part of the economy which is not using
reproducible capital.
5. a)The Traditional Stage, b)The Pre-Conditions for Take-off, c)Take-off Stage,
d) Drive to Maturity and e) High Mass-Consumption these are the stages of
economic development.
6. Spread effect is favourable for development of an economy.
7. Dual economy and unlimited supply of labour are the assumptions of Lewis
theory.
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