Agriculture and industry

Traps in Agriculture and industry

• Agriculture economics errors
  Problems: small holdings, poor storage, price fluctuations, inadequate credit. Remedies: marketing boards, commodity price stabilisation, extension services, credit schemes.
• Confuses monetary and fiscal policy tools
  Monetary (central bank): interest/policy rate, open market operations, reserve requirements. Fiscal (government): taxation and public spending, budget deficit/surplus.
• Reverses the direction of the effect
  Trace the chain step by step (e.g. buying securities → banks gain cash → money supply rises) and check the sign at every link.
• Over-generalises a rule
  Economic laws hold 'other things being equal' and within limits. Be suspicious of options with always/never/all.
• Chooses a true but irrelevant statement
  Re-read the question's key term and test each option against it, not against whether it is true in general.
• Development planning misconceptions
  Growth = increase in real GDP. Development = growth plus improved welfare (health, education, reduced poverty). Rolling plans are revised annually; perspective plans are long-term.