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Tamilnadu Samacheer Kalvi 10th Social Science Economics Solutions Chapter 2 Globalization and Trade

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Globalization and Trade Textual Exercise

I. Choose the correct answer.

Globalisation Will Result In Class 10 Question 1.
Who is the head of the World Trade Organization (WTO).
(a) Ministerial conference
(b) Director General
(c) Deputy Director General
(d) None of these
Answer:
(b) Director General

Globalisation Class 10 Notes Question 2.
How many countries were membership in WTO at present?
(a) 159
(b) 164
(c) 148
(d) 128
Answer:
(b) 164

Economics Class 10 Globalisation Question 3.
Colonial advent in India.
(a) Portuguese, Dutch, English, Danish, French
(b) Dutch, English, Danish , French
(c) Portuguese , Danish, Dutch, French, English
(d) Danish, Portuguese, French, English, Dutch
Answer:
(c) Portuguese , Danish, Dutch, French, English

Question 4.
Who first came to India for trading purpose?
(a) Roman Empire
(b) Portuguese
(c) Dutch
(d) Danish
Answer:
(b) Portuguese

Question 5.
When did Portuguese colonize India?
(a) 1600 AD
(b) 1602 AD
(c) 1498 AD
(d) 1616 AD
Answer:
(b) 1602 AD

Question 6.
GATT’s first round held in:
(a) Tokyo
(b) Uruguay
(c) Torquay
(d) Geneva
Answer:
(d) Geneva

Question 7.
India signed the Dunkel proposal in ………………
(a) 1984
(b) 1976
(c)1950
(d) 1994
Answer:
(d) 1994

Question 8.
Who granted the English “golden Fireman” in 1632?
(a) Jahangir
(b) Sultan of Golconda
(c) Akbar
(d) Aurangzeb
Answer:
(b) Sultan of Golconda

Question 9.
Foreign Investment policy (FIP) announced in ………..
(a) June 1991
(b) July 1991
(c) July-Aug 1991
(d) Aug 1991
Answer:
(c) July-Aug 1991

Question 10.
Indian government was introduced ……………… in 1991.
(a) Globalization
(b) World Trade Organisation
(c) New Economic Policy
(d) none
Answer:
(c) New Economic Policy

II. Fill in the Blanks.

1. The Dutch captured Pondicherry in ……………..
2. A better economy introduce rapid development of the ………………
3. The East India Company built fortified factory in Madras which known as ……………
4. WTO agreement came into force from ………………
5. The term globalization invented by ……………
6. French East India company established second factory at …………………..
Answers :
1. 1693
2. Capital market
3. Frot St. George
4. January 1, 1995
5. Prof. Theodore Levitt
6. Pulicut

III. Choose the Correct Statement.

1. (i) The East Indian Company specially to participate in the East Indian Spice Trade and later added cotton, silk, Indigo.
(ii) Merchants of the Dutch East India Company first established at Calicut.
(iii) Nanadesis were a guild of traders at the time of Hoysala Empire
(a) i is correct
(b) ii and iii are correct
(c) i and iii are correct
(d) i, ii and iii are correct
Answers:
(a) i is correct

IV. Match the Following

Globalisation Will Result In Class 10 Social Science Economics Solutions Chapter 2 Samacheer Kalvi
Answers:
1. (c)
2. (d)
3. (a)
4. (e)
5. (b)

V Give Short Answers.

Question 1.
What is Globalization?
Answer:
Globalization is the process of integrating various economies of the world with the home country without any types of barriers to operating on an International scale.

Question 2.
Write the types of globalization.
Answer:
There are three types of globalization – (i) Archaic globalization (ii) Proto globalization and (iii) Modem globalization.

Question 3.
Write short note on Multinational Corporation.
Answer:
Multi-national Corporation is a corporate organisation which owns (or) control the production of goods (or) services in any other country other than its home country. It is otherwise called as Trans-National Corporation (or) Multi-National Enterprise.

Question 4.
Short note: The Dutch in South India.
Answer:
The Dutch undertook several voyages from 1596 and formed the Dutch East India Company in 1602. In 1605, Admiral Van der Hagen established Dutch factory at Masulipatnam and ‘ PAiapoli, Devanampatinam. In 1610, upon negotiating with the king of Chandragiri, found another factor}’ at Pulicut. Pulicut was the headquarters of the Dutch in India.

Question 5.
What are the reforms made to adopt Globalization?
Answer:

  1. Abolition of Industrial licensing, Reduction in the number of industries reserved for public sector.
  2. Fixation of a realistic exchange rate of rupee to exchange exports of Indian goods.
  3. Foreign private sector by making rupee convertible on trade.
  4. Foreign exchange regulations were suitably amended.
  5. The Statutory Liquidity Ratio (SLR) was reduced to increase lending by RBI.

Question 6.
What is Fair trade ?
Answer:
Fair trade is an industrial arrangement designed to help producers in developing countries achieve better trading conditions. Fair trade is about better prices, decent working conditions and fair terms of trade for farmers and workers.

Question 7.
Write any five principles of fair trade practices?
Answer:

  1. Raising and stabilising the incomes of small scale farmers, farm workers and artisans .
  2. Equal distribution of economic gains, opportunities and risks associated with the production and sale of these goods.
  3. Increasing the organisational and commercial capacities of producer groups.
  4. Promoting labour rights and right of the workers to organise trade unions.
  5. Promoting safe and sustainable farming methods and working conditions.

Question 8.
What is the main objective of WTO?
Answer:
The main objective of WTO is to set and enforce rules for international trade and to provide a forum for negotiating and monitoring further trade liberalisations.

Question 9.
Write short note on TRIPs and TRIMs.
Answer:
TRIPs means Trade Related aspects of Intellectual Property Rights. Under TRIPs, patent shall be available for any invention (whether product or process) in all fields of industrial technologies.

TRIMs means Trade Related Investment Measures. It refers to certain , restrictions imposed by a Government in respect of foreign investment in the country in order to give adequate provisions for the home industries.

Question 10.
Write the positive impact of Globalization.
Answer:
Positive impacts of globalization:

  • A better economy introduces rapid development of the capital market.
  • Standard of living has increased.
  • It has generated employment opportunities.
  • It increases GDP of a country.
  • It helps to increase in free flow of goods and also to increase Foreign Direct Investment.

VI. Brief Answer.

Question 1.
Write briefly the history of globalization.
Answer:
The historical background of globalization can be discussed in three steps –
(i) Archaic Globalization – It is an early form of globalization. It existed during the Hellenistic Age. It established a trade link between the Roman Empire, Parthian Empire and the Han Dynasty. The commercial links between these powers inspired the development of the Silk Road. The Islamic Golden Age was also an important early stage of globalization.

(ii) Proto Globalization – It was characterised by the rise of maritime European empires in the 16th and 17th centuries. In the 17th century, globalization became private business phenomenon like British East India Company founded in 1600, described as the first multinational company.

(iii) Modern Globalization – The 19th and 20th centuries witnessed the advent of modern globalization. Global trade and capital investment increased. Several multinational firms came into being.

Question 2.
Briefly explain the evolution of MNC and its advantages and disadvantages.
Answer:
Multinational Corporation is a corporate organisation which owns (or) controls the production of goods and services in another country other than its home country.

Evolution of MNC:

  1. MNCs first started their activities in 1920’s by controlling the raw materials of the host countries in the industrial sector. Later in the manufacturing and the service sector after 1950’s.
  2. Of the MNCs at present, four are major one’s USA, UK, France, Germany, of which USA is the largest MNC.
  3. With the gain of enormous power in host countries, huge resources with themselves, they are able to invest in research and development at a greater level.
  4. This helped them to manufacture new products and discover new’ processes and exploit Technological developments.

Advantages:

  1. Production of quality goods at lower cost, without cost of transportation.
  2. Reducing prices and increasing the purchasing power of the Consumer’s world wide.
  3. Advantages of tax variation.
  4. Induce job opportunities in the local economy.

Disadvantages:

  1. May develop a monopoly for certain products.
  2. May have damage/harm effect on the environment.
  3. May also lead to the downfall of smaller/ local business.
  4. MNC may neglect ethical standards and laws. Their motive is always improving business with enormous capital.

Question 3.
Explain the trade and traders in south India.
Answer:
(i) Southern Indian trade guilds were formed by merchants in order to organise and expand their trading activities. Trade guilds became channels through which Indian culture was exported to other lands.
(ii) South Indian trade was dominated by the Cholas and it replaced the Pallavas.
(iii) In the year 1053 AD (CE) the Kalinga Traders brought red coloured stone for trade and also cotton textile to Southeast Asia.
(iv) Several trade guilds operated in medieval Southern India such as the Gatrigas, Nakaras, Ayyavole, Gavaras etc. The Nakaras and Gavaras met only in the temple premises.
(v) Several European traders also arrived in South India such as the Portuguese, Dutch, Danes, French and the British. These traders established their companies / factories and strengthened their root in the Indian soil.

Question 4.
Write about the World Trade Organisation.
Answer:

  1. World Trade Organisation was formed in April 1994 based on cbe signing of the final Act of the Uruguay Round by the member nations of GATT (General Agreement on Tariffs and Trade).
  2. The headquarters of the WTO is in Geneva, Switzerland.
  3. The main objectives of WTO is to ensure rules for international trade and to provide a forum for negotiating and monitoring further trade liberalization.
  4. To resolve trade disputes and to ensure that developing countries, secure a better share of growth in World Trade.
  5. To ensure full employment and broad increase in effective demand and transperancy of decision making process.
  6. World Trade Organisation gives five types of subsides like cash subsidies, tax concessions, loan guarantees, stock purchases, procurement subsidies, thereby reducing the cost of doing business.
  7. At present, there are 164 member countries in WTO .
  8. The structure of WTO consists of a Director General, four Deputy Director General and other 600 official staff from around 80 member countries.

Question 5.
Write the challenges of Globalization.
Answer:
The following are the challenges of globalization.

  1. To ensure that the benefits of globalization extent to all countries. That will certainly not happen automatically.
  2. To deal with the fear that globalization leads to stability, which is particularly marked in the developing world.
  3. To address the very real fear in the industrial world that increased global competition will lead memorably to a race to the bottom in wages, labour rights, employment practices, and the environment.
  4. Globalization and all of the complicated problems related to it must not be used as excuses to avoid searching for new ways to cooperate in the over all interest of countries and people.
  5. People have started consuming more junk foods. This has badly affected their health.

Globalization and Trade Additional Questions

I. Choose the correct answer.

Question 1.
Who started establishing trading posts from Africa to Asia and Brazil in the 16th century?
(a) The Dutch
(b) The Portuguese
(c) The French
(d) The British
Answer:
(b) The Portuguese

Question 2.
The New Economic policy was introduced in the year …………………
(a) 1986
(b) 1947
(c) 1956
(d) 1991
Answer:
(d) 1991

Question 3.
Which among the following is the largest exporting country?
(a) USA
(b) UK
(c) France
(d) Germany
Answer:
(a) USA

Question 4.
The term ………………… Globalization signifies a process of internationalisation and …………………
(a) Privatisation
(b) Liberalisation
(c) Globalization
(d) None
Answer:
(c) Globalization

Question 5.
How many countries participated in the seventh round of GATT?
(a) 23
(b) 99
(c) 102
(d) 117
Answer:
(b) 99

Question 6.
The History of Globalization can be studied under ………………… stages.
(a) one
(b) two
(c) three
(d) four
Answer:
(c) three

Question 7.
……………. creates an opportunity for the producers to reach beyond the domestic markets.
(a) Technology
(b) Globalization
(c) Trade barriers
Answer:
(b) Globalization

Question 8.
Modern Globalization is the ………………… stage of Globalization.
(a) one
(b) two
(c) three
(d) four
Answer:
(c) three

Question 9.
The most important factor that has stimulated globalization is ……………
(a) population explosion
(b) urbanization
(c) rapid improvement in technology
Answer:
(c) rapid improvement in technology

Question 10.
An early form of Globalization is called ………………… Globalization.
(a) Archaic
(b) Modem
(c) Proto
(d) Millenium
Answer:
(a) Archaic

II. Fill in the Blanks.

1. The signing of the Final Act of the Uruguay Round by member nations of GATT in April 1994 paved the way for setting up of the ………….
2. The Foreign Exchange Regulation Act, 1974 referred directly to the operations of ………….. in India.
3. In 1605, Admiral van der Hagen established ……………..
4. In 1701 …………….. was the headquarters of the French
5. TRIM refers to Trade Related ……………… Measure.
6. In the middle of the 20th century, production was mainly or largely organised ………………..
7. A company that owns or controls production in more than one nation is known as ……………
8. Investment made by multinational corporations is called ……………….
9. The process of rapid integration or interconnection between countries is known as …………….
10. Removing barriers or restrictions set by the Governments of different countries is known as …………..
Answers:
1. WTO
2. MNCs
3. Dutch
4. Pondicherry
5. Investment
6. nationally
7. Multinational Corporation
8. Foreign Investment
9. Globalization
10. Liberalization

III. Match the Following.

Globalisation Class 10 Notes Samacheer Kalvi Social Science Economics Solutions Chapter 2
Answer:
1. (e)
2. (c)
3. (a)
4. (b)
5. (d)

Economics Class 10 Globalisation And Trade Solutions Chapter 2 Samacheer Kalvi
Answer:
1. (b)
2. (e)
3. (d)
4. (c)
5. (a)

IV. Answer in brief.

Question 1.
What is the advantage of Fair Trade Mark?
Answer:
The Fair Trade Mark was launched in 2002 and Fair Trade Mark has become the most widely, recognized social and development label in the world. Fair Trade companies a credible way to ensure that their trade has a positive impact.

Question 2.
What caused economic crisis in India in the early 1990s?
Answer:
In India the period after 1980-81 was marked by several balance of payment difficulties mainly due to hike in oil price and Gulf war in 1990-91 and hostilities in West Asia. India lost credit in the international market. This caused economic crisis.

Question 3.
What do you understand by G7 countries? List them.
Answer:
G7 countries refers to the developed countries of the world. G7 countries are Unites States, United Kingdom, Germany, France, Canada, Italy and Japan.

Question 4.
Mention any three negative impact of globalization.
Answer:
(i) Globalization has caused environmental damage. Increased production means increased utilisation of natural resources. Besides, increased trade results to increased transport, which was fossil fuels. As a result, pollution has increased, leading to climate change.

(ii) Globalization has led to increased market competition, hence leading to fluctuation in prices.
(iii) Due to globalization, most global economy jobs are insecure and temporary.

Question 5.
What do you understand by the terms FEMA and FERA.
Answer:
FERA refers to the Foreign Exchange Regulation Act. This act was passed in India in 1974 which directly permits. The operations of MNCs in India.

FEMA refers to the Foreign Exchange Management Act of 1999. Under FEMA, the emphasis on management rather than regulation.

Question 6.
What is the term ‘investment’ means?
Answer:
Money spent on buying land, building and machines, etc.

Question 7.
Whom does fair trade support? Why?
Answer:
Fair Trade is for farmers and workers. They support the development of thriving farming and worker communities that have more control over their futures and protecting the environment in which they live and work.

Question 8.
What is the aim of World Trade Organisation (WTO)?
Answer:
Its aim is to liberalize international trade.

Question 9.
How many countries are currently the members of the WTO?
Answer:
164 countries

Question 10.
What was the main channel connecting countries in the past?
Answer:
Foreign trade was the main channel connecting countries in the past.

Question 11.
What is an MNC?
Answer:
An MNC (Multi-National Corporation) is a company that owns and controls production in more than one nation.

Question 12.
Why are MNC’s attracted to India?
Answer:
India has high skilled engineers who can understand the technical aspects of production. It also has educated English speaking youth, who can provide customer care services.

Question 13.
What is the most common route for MNC investments?
Answer:
The most common route for MNC investments is to buy up local companies and then to expand production.

Question 14.
How does liberalization of trade benefit businesses?
Answer:
With liberalization of trade, businesses are allowed to make decisions freely about what they wish to import or export.

Question 15.
Why is fair globalization essential?
Answer:
Fair globalization would create opportunities for all and also ensure that the benefits of globalization are shared better.

Question 16.
Differentiate between investment and foreign investment.
Answer:
The money that is spent to buy assets such as land, buildings, machineries and other equipments is called investment, and the investment made by MNC’s is called foreign investment.

Question 17.
Why are MNC’s setting their customer care centres in India?
Answer:
MNC’s are setting up their customer care centres in India due to the availability of cheap and skilled labour and good English speaking people.

Question 18.
Differentiate between foreign trade and foreign investment.
Answer:

S.No. Foreign Trade Foreign investment
(i) It implies the exchange of goods and services across nations. It means the investment made by the MNC’s.
(ii) It connects markets in different countries. It is invested to earn profit.

Question 19.
Describe any three ways in which countries can be linked through globalization.
Answer:

  1. By movements of goods.
  2. By movement of services.
  3. By movement of investments.
  4. By movement of technology.
  5. By the movement of people between countries.

V. Answer in detail.

Question 1.
What is Globalization? What are its negative impacts on countries?
Answer:
Globalization is the integration of the domestic economy with the world economy.

Its negative impacts are:

  1. When there is too much flow of capital among the countries, it may lead to unfair and immoral distribution of income.
  2. There is possibility of losing the independency of the domestic policies, thereby losing national Integrity.
  3. Building up infrastructure facilities led to resource extraction. This increase negative ecological and social costs.
  4. In order to earn foreign exchange, rapid increase in exploitation of natural resources.
  5. Much relaxation of environmental standards and regulation.

Question 2.
What is SEZ? Explain.
Answer:
In recent years, Central and State Governments in India are taking special steps to attract foreign companies to invest in India. So Special Industrial Zones are being set up. They are also called as Special Economic Zones. They have world class facilities like electricity, water, transport, recreational and educational facilities. Companies that set up production units in SEZs do not have to pay taxes for an initial period of five years.

Recently, the Government of India has set up Special Economic Zones in Southern States especially in Tamil nadu, Karnataka, Andhra and Kerala with a view to boost exports. Nanguneris SEZ, Ennore SEZ, Coimbatore SEZ are some of the SEZ’s in Tamil Nadu.

Question 3.
What were the reforms made in India to adopt Globalization?
Answer:

  1. Abolition of Industrial licensing , except for a few industries.
  2. Number of Industries reserved for public sector are reduced.
  3. The exchange rate of rupee is fixed very much realistically to exchange export of Indian goods.
  4. Rupee was made convertible on trade, on current account enabling foreign private sector to invest easily.
  5. Reduction of Import duties.
  6. Suitable amendment of foreign exchange regulations.
  7. The (SLR) Statutory Liquidity Ratio was redi’ced to increase lending by RBI.

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