Read the following statements carefully:
Statement 1: Economic territory and political frontier of a nation are one and the same thing.
Statement 2: American Embassy in India is a part of the economic territory of India.
In the light of the given statements, choose the correct alternative from the following:
Statement 1: This is false because the economic territory of a country includes not only its political frontier but also excludes foreign diplomatic zones within its borders.
Statement 2: This is false because the American Embassy in India is considered part of the economic territory of the United States, not India.
For a hypothetical economy, assume the government increased an infrastructural investment by ₹ 30,000 crore. 80% of additional income is consumed in the economy. Estimate the increase in income and the corresponding increase in consumption expenditure in the economy.
“An increase in the credit creation capacity of commercial banks has a direct impact on the money supply in an economy.”
Discuss the given statement.