(a) There is a difference between the supply of labour and that of other goods. An individual’s supply of labour may increase at first with the increase in wage rate i.e., the price of labour. In that case, the worker prefers income to leisure. However, man is not a machine. So with further increase in the wage rate (per hour), the worker may prefer leisure to income. Thus, the individual labour supply curve may be backward bending in nature. However, in case of other goods, the quantity supplied increases with an increase in product price. In that case, supply curve will be upward rising.
(b) The bank which is given the responsibility of supervising the activities of all other banks in the economy, as well as the entire monetary system of the country, is called the central bank of the country. The Reserve Bank of India is the central bank in India. In England the Bank of England is the central bank.
(c) By providing government subsidy to seller, supply increases because seller will be able to produce commodities at a cheaper price thus the supply curve will shift rightward.
(d) The differences between an entrepreneur and the organiser or capitalist are:
1. A organiser provides loan to firm so he is only a creditor whereas the entrepreneur’s job is to set up the business.
2. An entrepreneur bears loss of gain of the business while the organiser has no link with the profit and loss.
(e) Two important factors which affect the market element for a commodity are as follows:
1. Pattern of income distribution: If income distribution moves in favour of the poor people, then market demand for the mass consumption items will increase.
2. Total number of consumers: If the total number of consumers of any commodity rises, it would lead to an increase in the market demand for that commodity
