NTA UGC NET/JRF Exam, December 2022 (Commerce) Shift-II

Revenue expenditure of the Central government includes :
(i) Debt relief to Farmers
(ii) Subsidy for Fertilizers
(iii) Grants to States
(iv) Pensions of Employees
(v) Interest Payments etc.

Exchange depreciation rate of one currency in relation to another currency is, approximately, equal to their Inflation rate differential and Interest rate differential.

Following activities are included under investing activities in the Cash Flow Statement :
(i) Cash receipts from disposal of fixed assets (including intangible)
(ii) Cash advance and loans made to third parties (other than advanced and loans made by a financial enterprise)
(iii) Cash receipts from repayment of advances and loans made to third parties (other than advances and loans of a financial enterprise)

• Activity Based Costing (ABC) is a method of assigning overheads and indirect costs – such as salaries and utilities – to products and services.
• The ABC system of cost accounting is based on activities, which are considered any event, unit of work, or task with a specific goal.
• Cost drivers used in Activity Based Costing are as follows :
(i) Transaction  (ii) Intensity  (iii)Duration

Increasing returns to scale arise because as the scale of operation increases it causes :
(i) More division of labour and specialisation.
(ii) Productive utilisation of machinery.
(iii) Lower procurement and logistic costs.
(iv) More economies in advertising.

Consumer rationality implies the following assumptions :
(i) Non-satiaty of needs
(ii) Transitivity of preferences
(iii) Selfish economic motive
(iv) Possession of information

Undue Influence : Undue influence occurs when an individual is able to persuade another decision due to a relationship between the two parties. Often, one of the parties is in a position of power over the other due to elevated status, higher education, or emotional ties. The more powerful individual uses this advantage to coerce the other individual into making decisions that might not be in their long-term best interests.
Doctor and Patient relationships raise presumptions of Undue Influence in given options in this Question.

The Internal Rate of Return (IRR) method offer the following advantages :
(i) It recognises the time value of money.
(ii) It is consistent with shareholders profit-maximization objective also.
(iii) It considers all cash flows occurring over the entire life of the project.
(iv) It generally gives the same acceptance rule as the NPV method.

Following are the off-balance sheet source(s) of finance :
• Securitisation
• Factoring
• Forfeiting
• Operational lease

Portfolio : Beta is the measure of an entire portfolio's sensitivity to market changes.
Following Factors Influence Portfolio beta –
(a) Portfolio size
(b) Investment longevity
(c) Trading volume
(d) Return interval (weekly vs. monthly)