Differentiate between primary and secondary data. State two situa…

Question

Differentiate between primary and secondary data. State two situations for each where one is more suitable than other.

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Answer

Primary data are those which are collected for a specific purpose directly from the field of enquiry, and thus original in nature. The procedure adopted for collection of data may either be complete enumeration or sampling.(i.e. sample survey). Primary data provides a statistician with detailed information. Such data are published by the authorities themselves as Government, Civil bodies, Trade Associations etc. Individuals such as Economists, and institutions like Banks and other allied bodies can collect primary data for a specific purpose, by engaging trained investigators. The collection of primary data is a laborious and time consuming process. It is also expensive. Secondary data are such numerical information which has been already collected by some agency for a specific purpose and are subsequently compiled from that source for application in a different connection. For example the Census figures published will be primary data, whereas the same data reproduced in another publication will come under the category of secondary data. The chief sources of secondary data are: Publications of State Governments, of Foreign governments, and international bodies like ILO, UNO, UNESCO, WHO, etc.
In short, when time and funds are less and accuracy is not so important then secondary method in better, otherwise Primary method in better.

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1. On the basis of the data given above when demand changes from 10 units to 8 units, that situation will be called
(a) increase in demand
(b) decrease in demand
(c) extension of demand
(d) contraction of demand
2. On the basis of your answer of the above question, what will be the shape of new demand curve?
(a) Demand curve shifts to the left
(b) Demand curve shifts to the right
(c) There is downward movement along the demand curve
(d) There is upward movement along the demand curve
3. On the basis of the data given above when demand changes from 10 units to 12 units, that situation will be called __________ .
(a) increase in demand
(b) decrease in demand
(c) extension of demand
(d) contraction of demand
4. On the basis of your answer of the above question, what will be the shape of new demand curve?
(a) Demand curve shifts to the left
(b) Demand curve shifts to the right
(c) There is downward movement along the demand curve
(d) There is upward movement along the demand curve
5. Read the following statements carefully and choose the correct alternative among those given below:
Statement 1 : Shift in demand curve shows extension or contraction of demand.
Statement 2 : Movement along the demand curve is indicated by upward or downward movement along the same demand curve.
(a) Both the statements are true
(b) Both the statements are false
(c) Statement 1 is true and Statement 2 is false
(d) Statement 2 is true and Statement 1 is false
6. On the basis of the data given above when demand changes from 10 units to 8 units, we assume that ______________ .
(a) own price of the commodity is constant
(b) other determinants of demand (other than own price of the commodity) are constant
(c) other determinants of demand (including own price of the commodity) are constant
(d) none of these