Laxmi

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 2 Consumption Analysis Notes

→ “Consumption is the sole end and object of economic activity” – J M Keynes.

→ Consumption is the beginning of economic science.

→ Wants are unlimited: Human wants are countless, in number and various in kinds.

→ Wants become habits: Wants become habits; for example, when a man starts reading newspaper in the morning, it becomes a habit. Same is the case with drinking tea or chewing pans.

→ Wants are Satiable: Though we cannot satisfy all our wants, at the same time we can satisfy particular wants at a given time.

→ Wants are Alternative: There are alternative ways to satisfy a particular want eg. Idly, dosa or chappathi.

→ Wants are Competitive: All our wants are not equally important. So, there is competition among wants. Hence, we have to choose more urgent wants than less urgent wants.

→ Wants are Complementary: Sometimes, satisfaction of a particular want requires the use of more than one commodity. Example: Car and Petrol, Ink and Pen.

→ Wants are Recurring: Some wants occur again and again. For example, if we feel hungry, we take food and satisfy our want. But after sometime, we again feel hungry and want food.

→ H H Gossen, an Austrian Economist was the first to formulate this law in Economics in 1854. Therefore, Jevons called this law as “Gossen’s First Law of Consumption”. But credit goes to Marshall, because he perfected this law on the basis of Cardinal Analysis. This law is based on the characteristics of human wants, i.e., wants are satible.

→ Definition: Marshall states the law as, “the additional benefit which a person derives from a given increase of his stock of a thing, diminishes with every increase in the stock that he already has”.

→ Consumer’s Surplus: The concept of consumer surplus was originally introduced by classical economists and later modified by Jevons and Jule Dupuit, the French Engineer Economist in 1844.

→ “Demand in economics means desire backed up by enough money to pay for the good demanded” -Stonier And Hague

→ Definitions: The Law of Demand says as “the quantity demanded increases with a fall in price and diminishes with a rise in price” – Marshall
“The Law of Demand states that people will buy more at lower price and buy less at higher prices, other things remaining the same”. – Samuelson

→ Levels or Degrees of Price Elasticity of Demand: The Price Elasticity of Demand is commonly known as the elasticity of demand, which refers to the degree of responsiveness of demand to the change in the price of the commodity.

→ The theory of indifference curve was given by J R Hicks and RJD Allen, ‘A reconsideration of the theory of value,’ Economics in 1934.

→ Marginal Rate of substitution: According to Leftwich “The Marginal rate of substitution of.x for y (MRS_xy ) is defined as the maximum amount of y the consumer is willing to give up for getting an additional unit of x and still remaining on the same indifference curve”.

→ Conclusion: An understanding of consumer behaviour is an important part of comprehending the allocation resources by individuals.

→ Consumption: The use of goods and services for satisfying one’s wants.

→ Demand: Demand is desire backed by sufficient purchasing power and willingness to spend on it.

→ Needs: It is defined as goods or services that are required. This would include the needs for food, clothing, shelter and health care.

→ Utility: Utility is the capacity of a commodity to satisfy human wants.

→ Marginal Utility: Marginal utility is the utility derived from the last or Marginal unit of consumption.

→ Elasticity of Demand: The Elasticity of Demand refers to the rate of change in demand due to a given change in price.

→ Consumer’s Surplus : The difference between the potential price and actual price.

→ Indifference Curves: ICs means all those combinations of any two goods which give equal satisfaction to the consumer.

→ Indifference Map: A set of indifference curves upper ICs denoting higher and lower ICs lesser level of satisfaction.

→ Price line or Budget lines: The line joining various combination of the two goods which the consumer can buy at given prices and income.

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 1 Introduction To Micro-Economics Notes

→ Economics is everywhere and understanding economics can help you make better decisions and lead a happier life. – Tyler Cowen.

→ The term or word ‘Economics’ comes from the Ancient Greek oikonomikos (oikos means “households”; and, nomos means “management”, “custom” or “law”).

→ Adam Smith (1723-1790), in his book “An Inquiry into Nature and Causes of Wealth of Nations” (1776) defines “Economics as the science of wealth”.

→ The publication of Adam Smith’s “The Wealth of Nations” in 1776, has been described as “the effective birth of economics as a separate discipline”.

→ The scope of the subject of Economics refers to on the subject-matter of Economics.

→ Economics focuses on the behaviour and interactions among economic agents, individuals and groups belonging to an economic system.

→ Economics studies the ways in which people use the available resources to satisfy their multiplicity of wants.

→ Art is the practical application of knowledge for achieving particular goals.

→ ‘Utility’ means ‘usefulness’. In Economics, utility is the want-satisfying power of a commodity or a service.

→ Prof. Stigler states that “equilibrium is a position from which there is no net tendency to move”.

→ According to Engel’s Law “The proportion of total expenditure incurred on food items declines as total expenditure [which is proxy for income] goes on increasing.”

→ Alfred Marshall has rightly remarked: “Inductive and Deductive methods are both needed for scientific thought, as the right and left foot are both needed for walking”.

→ Micro economics is the study of the economic actions of individual units say households, firms or industries.

→ Macro economics is the obverse of micro economics. It is concerned with the economy as a whole. It is the study of aggregates such as national output, inflation, unemployment and taxes.

→ The terms ‘micro economics’ and ‘macro economics’ were first used in economics by Norwegian economist Ragner Frisch in 1933.

→ The problem of choice between relatively scarce commodities due to limited productive resources with the society can be illustrated with the help of a geometric device, is known as production possibility curve.

→ Scarcity: The gap between what people want and what people can get

→ Production: Creation of utility

→ Distribution: Share of the national income reaching the four factors of production

→ Services: Services, like goods, are economic entities; and are inseparable from their owners and are intangible, perishable in nature

→ Value: Power of a commodity to command other commodities in an exchange

→ Price: Value of a commodity expressed in terms of money

→ Income: The amount of monetary or other returns, either earned or unearned, accruing over a period of time

→ Deductive Method: Deduction is a process in logic facilitating or arriving at an inference, moving from general to particular

→ Inductive Method: Induction is a process in logic facilitative or arriving at an inference, moving from particular to general

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 8 Indian Economy Before and After Independence Notes

→ Freedom is never dear at any price. It is the breath of life. What would a man not pay for living? -Tyler Cowen

→ Indian’s sea route trade to Europe started only after the arrival of Vasco da Gama in Calicut, India on May 20, 1498.

→ The period of Industrial capital was from 1813 to 1858.

→ India is the Asia’s third largest economy.

→ Economic development of a country particularly depends on the process of industrialisation.

→ The term Green Revolution refers to the technological breakthrough in of agricultural practices.

→ The major achievement of the new strategy was to boost the production of major cereals viz., wheat and rice.

→ The Government of India had implemented ‘Second Green revolution’ to achieve higher agricultural growth.

→ The term “Large scale industries” refers to those industries which require huge infrastructure, man-power and have a influx of capital assets.

→ Jute industry is an important industry for a country like India, because not only it earns
foreign exchange but also provides substantial employment opportunities in agriculture and industrial sectors.

→ Sugar industry is the second largest industry among agriculture-based industries in India.

→ India is the third largest producer of nitrogenous fertilisers in the world.

→ The first mechanised paper mill was set up in 1812 at Serampur in West Bengal.

→ India is the second-largest (first being China) country in the world in producing natural silk.

→ First successful Oil well was dug in India in 1889 at Digboi, Assam.

→ Small scale industries play an important role for the development of Indian economy in many ways.

→ Public sector bank is a bank in which the government holds a major portion of the shares.

→ The main objective of nationalization was to attain social welfare.

→ Economic planning is the process in which the limited natural resources are used skillfully so as to achieve the desired goals.

→ The Planning Commission has been replaced by the NITI Aayog on 1st January, 2015.

→ HDI was developed by the Pakistani Economist Mahbub ul Haq and the Indian Economist Amartya Kumar Sen in 1990 and was published by the United Nations Development Programme (UNDP).

→ Zamindari: The owner of the land who pays the land revenue to the Government.

→ Mahalwari: The collective body usually the villagers which serve as a unit of management.

→ Ryotwari: The ownership rights of use and control of land were held by the tiller himself.

→ Green Revolution: The renovation of agricultural practices through modem technology.

→ Public Sector Banks: A bank in which the government holds a major portion of the shares.

→ Private Sector Banks: Most of the equity is owned by private bodies, corporations, institutions and individuals rather than government.

→ Nationalisation: The process of transforming private assets ownership into government ownership.

→ Human Development Index: It is a composite statistic of life expectancy, education and per capita income indicators.

→ Physical Quality of Life Index: It is a measure to calculate the quality of life (well being of a country).

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 9 Development Experiences in India Notes

→ At the time of Independence in 1947, India was a typically backward economy.

→ Liberalization refers to removal of relaxation of governmental restrictions in all stages of industry.

→ Privatization means transfer of ownership and management of enterprises from public sector to private sector.

→ Globalization refers to the integration of the domestic (Indian) economy with the rest of the world.

→ Disinvestment means selling of government securities of Public Sector Undertakings (PSUs) to other PSUs or private sectors or banks.

→ India was at 3rd position after China and Japan among Asian countries. India shared 8.50% of total Asia’s GDP (nominal) in 2016.

→ Agriculture in India is highly prone to risks like droughts and floods.

→ A Kisan Credit Card (KCC) is a credit delivery mechanism that is aimed at enabling farmers to have quick and timely access to affordable credit.

→ Agricultural Produce Market Committee (APMC) is a statutory body constituted by state government in order to trade in agricultural or horticultural or livestock products.

→ The Government of India, Ministry of Commerce and Industry announced New Foreign Trade Policy on 1st April 2015 for the period of 2015-2020.

→ The new EXIM policy has been formulated focusing on increasing in exports scenario, boosting production and supporting the concepts like make in India and Digital India.

→ Goods and Services Tax (GST) is defined as the tax levied when a consumer buys a good or service.

→ The Goods and Service Tax Act was passed in the Parliament on 29th March 2017.

→ Monetary reforms aimed at doing away with interest rate distortions and rationalizing the structure of lending rates.

→ There is no doubt that the Indian economy recorded ample achievements in some sectors after new economic policy.

→ Liberalization: Liberalization refers to the relaxation of the government restriction usually in the area of social and economic policies.
It refers to the participation of private entities in businesses and services and transfer of ownership from public sector to private sector as well.

→ Privatization: Globalization stands for the consolidation of the various economies of the world. The action of a government selling or liquidating public asset.

→ Globalization: Globalization stands for the consolidation of the various economies of the world.

→ Disinvestment: The action of a government selling or liquidating public asset.

→ Industrial delicenscing: Abolishing government control by removing the earlier restriction and licenses.

→ Foreign Direct Investment: An investment in a business by an investor from another country.

→ Foreign Private Investment: It comprises Foreign Direct Investment and Foreign Portfolio Investment.

→ Cold storage: A storage of agricultural commodities in a cold place for preservation.

→ SEZ: It is an area in which business and trade laws are different from rest of the country mainly aiming at increasing trade, investment and job creation.

→ SLR: Statutory Liquidity Ratio refers to the amount that the commercial banks require to maintain in the form of cash or gold or government approved securities before providing credit to the customers.

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 10 Rural Economy Notes

→ ‘Rural Development is a strategy designed to improve the economic and social life of a specific group of people – rural poor’.

→ Rural development is very urgent in the context of the overall growth and development of Indian economy.

→ Rural areas are facing number of problems relating to, 1. People, 2. Agriculture, 3. Infrastructure, 4. Economy, 5. Society and Culture, 6. Leadership and 7. Administration.

→ Poverty alleviation schemes and programmes have been implemented, modified, consolidated, expanded and improved over time.

→ Rural unemployment in India are categorised into three classes:
(i) Open Unemployment (ii) Concealed Unemployment or Under employment and (iii) Seasonal Unemployment.

→ The rural industries can be broadly classified into (i) cottage industries, (ii) village industries, (iii) small industries, (iv) tiny industries and (v) agro-based industries.

→ Rural indebtedness refers to the situation of the rural people unable to repay the loan accumulated over a period.

→ The RRBs confine their lending’s only to the weaker sections and their lending rates are at par with the prevailing rate of cooperative societies.

→ Self Help Groups are informal voluntary association of poor people, from the similar socio-economic background.

→ Health is an important component for ensuring better quality of life.

→ Indian rural people are suffering with various epidemics such as small pox, cholera, malaria, typhoid, dengue, chicken guniya, etc.

→ The rural marketing is still defective as farmers lack bargaining power, long chain of middlemen, lack of organisation, insufficient storage facilities, poor transport facilities, absence of grading, inadequate information and poor marketing arrangements.

→ Rural Electrification refers to providing electrical power to rural areas. The main aims of rural electrification are to provide electricity to agricultural operations and to enhance agricultural productivity, to increase cropped area, to promote rural industries and to lighting the villages.

→ Village Industries: Village industries are traditional in nature and depend on local raw-material. They cater to the needs of local population. Examples of village industries are gur and khandsari, cane and bamboo basket, shoe making, pottery and leather tanning.

→ Small Scale Industries (SSIs): Most small scale industries are located near urban centres. They produce goods for local as well as foreign markets. Examples of such small scale industries are manufacture of sports goods, soaps, electric fans, foot wear, sewing machines and handloom weaving.

→ Agro-based Industries: These industries are based on the processing of agricultural produce. Agro-based industries may be organised on a cottage-scale, small-scale and large-scale. Examples are textile, sugar, paper, vegetable oil, tea and coffee industries.

→ Micro Units Development and Refinance Agency Bank (MUDRA Bank): It is a public sector financial institution which provides loans at low rates to microfinance institutions and non-banking financial institutions which then provide credit to Micro, Small and Medium Enterprises (MSMEs). It was launched on 8th April 2015.

→ National Rural Health Mission: The National Rural Health Mission (NRHM) was launched on 12th April 2005, to provide accessible, affordable and quality health care to the rural population,especially the vulnerable groups.

→ Rural Economics: Application of Economic Principles in rural areas

→ Population Density: Number of persons living per sq.km or per sq. mile.

→ Unemployment: Situation of people with willingness and ability to work but not getting employed.

→ Open Unemployment: Unemployed persons are identified as they remain without work.

→ Seasonal Unemployment: Employment occurs only in a particular season and workers remain unemployed in the remaining period of a year. Situation where people employed in excess over and above the requirements.

→ Under employment: Condition where the basic needs of the people like food, clothing and shelter are not being met.

→ Poverty Dualism: Co-existence of two extremely different features.

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 11 Tamil Nadu Economy Notes

→ “If the nature of the work is properly appreciated and applied, it will stand in the same relation to the higher faculties as food is to the physical body” – J C Kumarappa.

→ Growth of SGDP in Tamil Nadu has been among the fastest in India since 2005.

→ Tamil Nadu stands sixth in population with 7.21 crore against India’s 121 crore as per 2011 census.

→ The average period that a person may expect to live is called life expectancy.

→ Tamil Nadu, with seven agro climatic zones and varied soil types is better suited for the production of fruits, vegetables, spices, plantation crops, flowers and medicinal plants.

→ Chennai is sometimes referred to as the Health Capital of India or the Banking Capital of India, having attracted investments from International Finance Corporations and the World Bank. It is also called as Detroit of Asia.

→ Tamil Nadu is known as the “Yam Bowl” of the country accounting for 41% of India’s cotton yam production.

→ Tamil Nadu ranks third in cement production in India (First Andhra Pradesh, Second Rajasthan).

→ One of the global electrical equipment public sector companies viz BHEL has manufacturing plants at Tiruchirappalli and Ranipet.

→ Sivakasi – A fireworks manufacturing hub Coimbatore is also referred to as “the Pump City” as it supplies two thirds of India’s requirements of motors and pumps.

→ The Kalpakkam Nuclear Power Plant and the Koodankulam Nuclear Power Plant are the major nuclear energy plants for the energy grid.

→ In Tamil Nadu the share of thermal power in total energy sources is very high and the thermal power plants are at Athippattu (North Chennai), Ennore, Mettur, Neyveli and Thoothukudi.

→ In Tamil Nadu, Nationalised banks account for 52% with 5,337 branches, Private Commercial Banks 30% (3,060) branches, State Bank of India and its associates 13% (1,364), Regional Rural Banks 5% (537) branches and the remaining 22 foreign bank branches.

→ Tamil Nadu has 59 Universities, 40 Medical colleges, 517 Engineering colleges, 2,260 Arts and Science colleges, 447 Polytechnics and 20 dental colleges.

→ According to government data, India had a total of 342.65 million internet subscribers at the end of March, 2016.

→ Tamil Nadu has a well-developed rail network as part of Southern Railway, Headquartered at Chennai.

→ Tamil Nadu has three major ports; one each at Chennai, Ennore, and Tuticorin, as well as one intermediate port in Nagapattinam, and 23 minor ports.

→ Tourism in Tamil Nadu is promoted by Tamil Nadu Tourism Development Corporation (TTDC), a Government of Tamil Nadu undertaking.

→ Per capita Income: Income per head (GSDP / Population)

→ GSDP: Money value of all goods and services produced annually in the State

→ Neo natal Mortality: Death of kids soon after delivery

→ Infant Mortality Rate: Death of children before completing one year after birth.

→ Child Mortality Rate: Death of child before the age of file

→ C-D Ratio: Ratio of Bank advances to deposits

→ Bio-diesel: Extraction of oil from plants like jatropha

→ MSMEs: Micro, Small and Medium Enterprises

→ Micro Enterprise: Enterprise with a capital investment, not exceeding 25 lakhs (These may change)

→ Small Enterprise: Unit with investment on plant and machinery above 25 lakhs but below 10 cr. (These may change)

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 11th Economics Notes Chapter 12 Mathematical Methods for Economics Notes

→ Economic analysis is a systematic approach to (a) determine the optimum use of scarce resources and (b)choose available alternatives and select the best alternative to achieve a particular objective.

→ A function is a mathematical relationship in which the values of a dependent variable are determined by the values of one or more independent variables.

→ A statement of relationship between two quantities is called an equation, e.g., Y = 100 – 10X.

→ Slope or Gradient of the line represents the ratio of the changes in vertical and horizontal lines.

→ Demand Function: Q_d = f (P_x) where Q_d stands for Quantity demand of a commodity and P_x
is the price of that commodity.

→ Supply Function: Q_s = f (P_x ) where ‘Q_s ’ stands for Quantity supplied of a commodity and P_x is the price of that commodity.

→ The point of intersection of demand line and supply line is known as equilibrium

→ ‘Matrix’ is a singular while ‘matrices’ is a plural form. Matrix is a rectangular array of numbers systematically arranged in rows and columns within brackets.

→ In a matrix, if the number of rows and columns are equal, it is called a square matrix.

→ For every square matrix, there exists a determinant. This determinant is an arrangement of same elements of the corresponding matrix into rows and columns by enclosing vertical lines.

→ Cramer’s rule provides the solution of a system of linear equations with ‘n’ variables and ‘n’ equations. It helps to arrive at a unique solution of a system of linear equations with as many equations as unknowns, \(x=\frac{\Delta x}{\Delta}, y=\frac{\Delta y}{\Delta}, z=\frac{\Delta z}{\Delta}\)

→ If the determinant Δ = 0, then solution does not exist.

→ The fundamental operation of calculus is differentiation. Derivative is used to express the rate of change in any function.

→ (Any non-zero real number)° = 1

→ Marginal concept is concerned with variations of Y (on the margin of X), that is; it is the variation corresponding in Y to a very small variation in X. (X is the independent variable and Y is the dependent variable)

→ Marginal product of a factor of production refers to addition to total product due to the use of an additional unit of a factor.
MP = d(TP)/dQ = ΔTP/ΔQ

→ Marginal cost is an addition to the total cost caused by producing one more unit of output. In symbols: MC = \(\frac{d(T C)}{d Q}\)or MC = \(\frac{T C}{Q}\) Where, ΔTC represents a change in total cost and ΔQ represents a small change in output or quantity.

→ Marginal Revenue is the revenue earned by selling an additional unit of the product. In other words, Marginal Revenue is an addition made to the total revenue by selling one more unit of the good.
\(M R=\frac{d(T R)}{d Q} \text { or } M R=\frac{\Delta T R}{\Delta Q}\)
Where ΔTR stands for change in the total revenue, and AQ stands for change in output.

→ Elasticity of Demand is the ratio of the proportionate change in quantity demanded to the proportionate change in price. In mathematical terms,
\(\mathrm{e}_{d}=\left(\frac{p}{x}\right)\left(\frac{d x}{d p}\right)\)
In demand function Q = a – bP. So, e = (dQ/dP)(P/Q)

a. J is used to denote the process of integration. In fact, this symbol is an elongated ‘S’ denoting sum.
b. The differential symbol ‘dx’ is written by the side of the function to be integrated.
c. ∫f(x) dx = F(x) + C, C is the integral constant ∫f(x)dx means, integration of f(x) with respect to x.

→ Consumer’s Surplus theory was developed by the Alfred Marshall. The demand function P(x) reveals the relationship between the quantities that the people would buy at given price. It can be expressed as P =f(x). Mathematically, the consumer’s surplus (CS) can be defined
as \(\mathrm{CS}=\left[\int_{0}^{x_{0}} p(x) d x\right]-\mathrm{x}_{0} \mathrm{p}_{0}\)

→ MS Excel 2007 version supports up to 1 million rows and 16 thousand columns per work sheet.

Samacheer Kalvi 11th Economics Notes

Tamilnadu Samacheer Kalvi 12th Economics Notes Chapter 12 Introduction to Statistical Methods and Econometrics Notes

→ First Part deals with meaning of statistics, nature, type and scope.

→ Brief information about the data, data source and its kinds are given in the second part.

→ The third part of this chapter explains correlation V’ which measures the strength and direction of the linear association between two quantitative variables x and y.

→ The fourth section depicts regression.

→ The last part of this chapter introduces Econometrics.

→ Next the organizational structure of Indian statistical system is given in a gist.

Samacheer Kalvi 12th Economics Notes

Tamilnadu Samacheer Kalvi 12th Economics Notes Chapter 3 Theories of Employment and Income Notes

→ The first part of this chapter deals with economic development which gained importance during the 20th Century.

→ The concept of development and growth are used inter-changeably.

→ However, there are mild differences between the two.

→ The pace of economic development depends on several factors which are classified under economic and non-economic factors.

→ Economic development is retarded by several obstacles of which the Vicious Circle of Poverty is the prime one.

→ The second part is concerned with economic planning.

→ The failure of market mechanism brought the birth of planning.

→ Planning started in USSR and spread to countries like India and most of the mixed economies.

→ There are strong arguments in favour of planning and some arguments against planning.

→ There are various types of planning under different economic systems depending upon the extent of Government control.

→ It is totalitarian and highly centralized in socialist countries, democratic and indicative in countries like France.

→ The NITI Aayog is the new planning body replacing Planning Commission in India.

→ Capital accumulation : The process of addition to the existing stock of capital.

→ Centralized Planning : Centralized planning means the power of planning and
decision making are exclusively in the hands of top management.

→ Development : The systematic use of scientific and technical knowledge
to meet specific objectives and requirements.

→ Financial Planning : Techniques of planning in which resources are allocated in terms of money.

→ Growth : Economic growth refers to an increase in real GDP, which means an increase in the value of national output/national expenditure.

→ Human Capital : Education and training that make human beings more productive.

→ Perspective Planning : Long term planning i.e. for a period of 15 or more.

→ Physical Planning : Techniques of planning in which resources are allocated in terms of men, materials and machinery.

→ Planning : It is the process of thinking about the activities required to achieve directed goals.

→ Social Indicators : The basic needs for development such as health, education, sanitation, water, food etc.

→ Underdevelopment : Underdevelopment is low level of development characterized by low real per capita income, widespread poverty, lower level of literacy, low life expectancy, underutilization of resources etc.

→ Vicious Circle of Poverty : Circular relationships that tend to perpetuate the low level of development in Less Developed Countries.

Samacheer Kalvi 12th Economics Notes

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 18 Business Ethics and Corporate Governance Notes

→ ‘Businesses need to go beyond the interests of their companies to the communities they serve.’ – Ratan Tata, Former Chairman of the Tata group. ,

→ ‘A business that is in the making of only money is a poor kind of business.’ – Henry Ford, Founder of Ford Motor Corporation.

→ Ethics is derived from the Greek word ‘ethos.’which means a person’s fundamental orientation towards life.

→ Business ethics may be defined as a set of moral standards to be followed by owners, managers and business people.

→ All business units have realised that ethics is vitally important for the existence and progress of the business as well as the society.

→ Top management has a very important role to guide the entire organization towards ethical behaviour.

→ Code of ethics documents the generally accepted principles of ethical conduct.

→ ‘The proper governance of companies will become as crucial to the world economy as the proper governing of countries.’ Jeames Wolfenson, President of World Bank, 1999

→ “Corporate governance is about promoting fairness, transparency and accountability.” -World Bank

→ “Corporate governance is defined as the system by which companies are directed and controlled.” – Cadbury committee

→ MNC is defined to be an enterprise operating in several countries but managed from one country.

→ India ranks 10^th in the world in factory output.

→ India has become big employment generator especially amongst young graduates.

→ The 2012 Singapore corporate governance code recommends a majority of Independent Directors when the chairman of me Board is not independent.

→ The Council of Institutional Investors (CI1), Corporate Governance Policies state that at least 2/3rd of the directors should be independent.

→ European commission urges member states to have sufficient number of independent non-executive or supervisory directors on Board.

→ The European Commission has proposed legislation that would require non-executive directors to be 40% women by 2020, up from 16.6% in 2013.

→ UK businesses had voluntary targets first set in 2011 i.e. to have 25% women on FTSE100 (The Financial Times Stock Exchange) Boards by 2015.

→ A bill pending in the Brazilian Senate would impose a 40% female quota on the Boards of state owned enterprises by 2022.

→ In the global and highly interconnected world of business and finance where money and corporate operations constantly cross borders, creating trust is something that we need to do together.

Samacheer Kalvi 11th Commerce Notes