Question

State whether the following statements are true or false.

1. Economic development is not so important for a country like India.

2. Economic growth means increase in real national income.

3. Economic development involves only economic growth.

4. Economic development is a smooth and simple process.

Answer 1

1. This statement is false.
Explanation
Economic development refers to an improvement in the overall standard of living and welfare of the people of a nation. In this regard, it implies an improvement in such facilities as education, health, safe drinking water, etc. Economic development is of immense importance for a developing nation such as India. With a move towards economic development India would be able to achieve improvements in national income, standard of living, capital formation, employment opportunities, utilisation of natural and human resources.

2. This statement is true.
Explanation
Economic growth implies a rise in the volume of the production of goods and services in an economy. Thus, economic growth is concerned mainly with the increase in the real national income of a nation while ignoring the distribution aspect of growth.

3. This statement is false.
Explanation
Economic development is a broader concept than economic growth. Besides economic growth (as measured in terms of increase in the national income), it comprises of improvement in various other factors as well such as education, health, equality, etc. that imply an improvement in the overall standard of living and welfare of the nation.

4. This statement is false.
Explanation
Economic development is not a simple and smooth process. Rather, it is the outcome of a planned and deliberate process. Plans are drafted cautiously and accordingly, investments are allocated to the sectors (such as health and education) that act as vital inputs for economic development.