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SAI INTERNATIONAL SCHOOL

SESSION 2020-21

CLASS-X

ECONOMICS- Ch-2- SECTORS OF INDIAN ECONOMY

LESSON NOTES

SUB-TOPIC- 2

Comparing the different sectors

COMPARING THE THREE SECTORS (Pg. No. 22 & 23)
I. The next step, therefore, is to see how much goods and services are produced
and how many people work in each sector. In an economy there could be one
or more sectors which are dominant in terms of total production and
employment, while other sectors are relatively small in size.
ii. there is one precaution one has to take. Not every good (or service) that is
produced and sold needs to be counted. It makes sense only to include the
final goods and services.
iii. In contrast to final goods, goods such as wheat and the wheat flour in this
example are intermediate goods. Intermediate goods are used up in
producing final goods and services. The value of final goods already includes
the value of all the intermediate goods that are used in making the final good.
Hence, the value of Rs 60 for the biscuits (final good) already includes the
value of flour (Rs 10). Similarly, the value of all other intermediate goods would
have been included. To count the value of the flour and wheatseparately is
therefore not correct because then we would be counting the value of the
same things a number of times. First as wheat, then as flour and finally as
biscuits.
iv. In the past 100 years, there has been a further shift from secondary to tertiary
sector in developed countries. The service sector has become the most
important in terms of total production. Most of the working people are also
employed in the service sector. This is the general pattern observed in
developed countries.