One of the factors impeding capital formation in a developing economy like India is the size of the ...........

Economic Affairs Growth and Indicators

One of the factors impeding capital formation in a developing economy like India is the size of the market. This implies

low level of demand

low level of supply

inadequate banking facilities

narrow base of taxation

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Explanation:

2nd option is correct. One of the factors impeding capital formation in a developing economy like India is the size of the market.This implies low level of supply.
Capital formation is a term used to describe the net capital accumulation during an accounting period for a particular country, and the term refers to additions of capital stock, such as equipment, tools, transportation assets and electricity.