Q. Which of the following activities constitute real sector in the economy?
1. Farmers harvesting their crops
2. Textile mills converting raw cotton into fabrics
3. A commercial bank lending money to a trading company
4. A corporate body issuing Rupee Denominated Bonds overseas.
Select the correct answer using the code given below:
Exp) Option a is the correct answer.
There are three sectors of any domestic economy:
- General government sector
- Real sector
- Financial sector
Options 1 and 2 are correct: The real sector of the economy consists of enterprises (non-financial corporations), households and non-profit institutions serving households. Non-financial organizations comprise all resident units involved in production of market goods and non-financial services. Market goods and services are those goods and services that are sold at market prices (economically significant prices).
Options 3 and 4 are incorrect: The financial sector consists of corporations principally engaged in financial intermediation or in auxiliary financial activities that contribute to financial intermediation.
Source) https://www.cba.am/Storage/EN/publications/statistics/monetary_stat_manual/sectors.pdf
