UPSC CAPF

* John Maynard Keynes introduced and popularized this concept in his work, particularly “The General Theory of Employment, Interest and Money” (1936).
* The Paradox of Thrift suggests that if, during a recession, individuals and households collectively decide to save more money, it can lead to a decrease in aggregate demand, a reduction in economic growth, and paradoxically, a potential decrease in overall saving for the economy as a whole, because incomes fall. While individual saving is prudent, mass saving can be detrimental to the macroeconomy during a downturn.
* Adam Smith is known as the father of classical economics and focused on concepts like the invisible hand, free markets, and division of labour.
* Alfred Marshall was a leading figure in neoclassical economics, contributing significantly to microeconomic theory like supply and demand, marginal utility, etc.
* Paul A. Samuelson was a prominent 20th-century economist who helped synthesize classical, neoclassical, and Keynesian economics. While he discussed the Paradox of Thrift, the concept is primarily attributed to Keynes.

* Being “on its production possibility frontier” means the economy is operating at full efficiency, with no unemployed or underutilized resources.
* Option A is true because, when an economy is on the PPF, resources are fully employed. To increase the production of one commodity, resources must be shifted away from the production of the other commodity, leading to a decrease in its output. This sacrifice is known as the opportunity cost.
* Option B is false. The PPF itself represents the limit or constraint on production given the current resources and technology. An economy on the PPF is producing the maximum possible.
* Option C is false. This statement describes moving from a point *inside* the PPF (inefficient production) to a point *on* the PPF (efficient production). An economy already on the PPF cannot increase production of one commodity without decreasing the production of another, assuming technology and resources remain constant.
* Option D is false. The PPF is typically downward sloping because to produce more of one good, you must produce less of the other (trade-off). It is usually concave (bowed outwards) or straight, but never upward sloping. An upward sloping curve would imply you could produce more of both goods simultaneously, which is impossible when resources are fully and efficiently utilized.

* Option A) Fares charged by Airlines in India: Airline fares are generally determined by market dynamics, although they can be subject to regulatory oversight regarding maximum and minimum limits or fare bands in certain situations (like during emergencies or for specific routes). However, they are not a standard, universal example of a price ceiling like an MRP.
* Option B) Price printed on biscuit packets: This typically refers to the Maximum Retail Price (MRP). MRP is a type of price ceiling set by the manufacturer, indicating the maximum price that can be charged to the consumer. It serves as a legal upper limit.
* Option C) Minimum support price for cane growers: Minimum Support Price (MSP) is an example of a price floor, which is a minimum price set by the government, usually above the equilibrium price, to protect producers (farmers in this case).
* Option D) Minimum wages fixed by state Governments: Minimum wage is another example of a price floor, applied to the price of labour.

Therefore, the price printed on biscuit packets (MRP) is the clearest example of a price ceiling among the given options.