Q.Read the case study below and answer the questions that follows:
Ram and Shyam are two friends living in a village named Haripur. Ram owns a small piece of land and cultivates it using traditional seeds, natural manure etc. Over the years his farm production has declined and now it is not sufficient to support his family. In order to overcome his problems he applied for a loan from rural bank but cumbersome documentation formalities forced him to take the loan from the village moneylender who charged a higher rate of interest. As a result of monsoon failure he could not pay the interest amount and was forced by the moneylender to sell a part of his land as payment of his debt. He was left with no option but to work on the landlord’s land who paid him Rs.30 per day despite the minimum wage fixed by the government at Rs.60 per day. On the other hand Shyam bought a juice machine and steel glasses for his juice shop .He used to get fruits, vegetables and salt on the daily basis. For the expansion of his business he obtained a loan from a bank at low rate of interest.
1.Enlist the factors of production used by Ram in the story?
2. What could have Ram done to increase the production of land? Suggest ways.
3. Ram and Shyam used different sources of acquiring Capital. Name them.
4. What difference do you find in the two sources of capital?
Answers
Explanation:
1.Ram owns a small piece of land and cultivates it using traditional seeds, natural manure etc. Over the years his farm production has declined and now it is not sufficient to support his family.
2. In order to overcome his problems he applied for a loan from rural bank but cumbersome documentation formalities forced him to take the loan from the village moneylender who charged a higher rate of interest.As a result of monsoon failure he could not pay the interest amount and was forced by the moneylender to sell a part of his land as payment of his debt. He was left with no option but to work on the landlord’s land who paid him Rs.30 per day despite the minimum wage fixed by the government at Rs.60 per day
3. Ram and Shyam are two friends living in a village named Haripur.
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Answer:
why did shyam borrow from ram