Page 125 - Understanding Economics for Class 10

Due to this massive money that they receive, the US farmers can sell the farm products at
abnormally low prices. The surplus farm products are sold in other country markets at low
prices, adversely affecting farmers in these countries.

13. Why did Ford Motors Company want to develop Ford India as a component supplying base
Goyal Brothers Prakashan
for its other plants across the globe? Explain.
Ans. The reasons behind it are given below-
(i) Wages and salaries are much lower in India in comparison to developed countries. raw
materials and power are also cheaper in India.
(ii) There are many companies which manufacture various auto-parts. For example, Sundaram
Fasteners. These companies supply various parts at low rates.
(iii) India and China together provide a huge market for various companies. Making a
production base in India means easy access to these two markets.
14. Globalisation and greater competition among producers has been advantageous to consumers.”
Explain
Ans. Globalisation has given birth to competition among producers which has been a great
advantage for the consumers
(i) There is greater choice before these consumers.
(ii) Competition has improved the quality of goods.
(iii) Bargain can be possible due to competition among producers. As a result, consumers
can buy several products at lower prices.
(iv) People today enjoy much higher standards of living than was possible earlier.

VI. Long Answer type Questions
1. Assess how globalisation has touched the lives of larger society.
Ans. Globalisation has touched the lives of larger society. Its benefits are not uniform. Well off
buyers and large companies have gained whereas workers and small producers have suffered
(i) Globalisation has benefited well-off consumers and also producers with skill, education
and wealth, many small producers and workers have suffered as a result of the rising
competition.
(ii) There is greater choice before well-off consumers who now enjoy improved quality and
lower prices for several products. As a result, these people today, enjoy much higher
standards of living than was possible earlier.
(iii) MNCs have increased their investments in India over the past 20 years, which means
investing in India has been beneficial for them. MNCs have been interested in industries
such as cell phones, automobiles, electronics, soft drinks or services such as banking in
urban areas. These products have a large number of well-off buyers. In these industries
and services, new jobs have been created. The supply of raw materials, etc. by the local
companies to these industries have flourished.
(iv) Many Indian companies have turned into MNCs. Tata Motors, Infosys, ranbaxy, Asian
Paints, etc. are some Indian companies which are spreading their operations worldwide.
(v) Several of the top Indian companies have been able to benefit from the rising competition
due to globalisation. They have invested in newer technology and production methods
and raised their production standards. Some have gained from successful collaborations
with foreign companies.
(vi) But small producers and workers have faced tough times in the process of globalisation.
They have been hit hard due to competition. Several of the manufacturing units have
been shut down rendering many workers jobless. Uncertain employment and insecurity
among workers have made their lives quite different. Thus, we can say that the impact
of globalisation has not been uniform.

Economics Class X E-111