Board Paper of Class 12-Commerce 2010 Economics (SET 1) - Solutions
(i) All questions in both the sections are compulsory.
(ii) Marks for questions are indicated against each.
(iii) Questions Nos. 1-5 and 17-21 are very short-answer questions carrying 1 mark each. They are required to be answered in one sentence each
(iv) Questions Nos. 6-10 and 22-26 are short-answer questions carrying 3 marks each. Answers to them should normally not exceed 60 words each.
(v) Questions Nos. 11-13 and 27-29 are also short-answer questions carrying 4 marks each. Answers to them should normally not exceed 70 words each.
(vi) Questions Nos. 14-16 and 30-32 are long-answer questions carrying 6 marks each. Answers to them should normally not exceed 100 words each.
(vii) Answers should be brief and to the point and the above word limits should be adhered to as far as possible.
- Question 1
Define an indifference curve.VIEW SOLUTION
- Question 2
Name the characteristic which makes monopolistic competition different from perfect competition.VIEW SOLUTION
- Question 3
Why is demand for water inelastic?VIEW SOLUTION
- Question 4
State one feature of oligopoly.VIEW SOLUTION
- Question 5
In which market form demand curve of a firm is perfectly elastic?VIEW SOLUTION
- Question 6
Distinguish between ‘increase in demand’ and ‘increase in quantity demanded’ of a commodity.VIEW SOLUTION
- Question 7
Explain the law of diminishing marginal utility with the help of a utility schedule.
Goods X and Y are substitutes. Explain the effect of fall in price of Y on demand for X.VIEW SOLUTION
- Question 8
At a price of Rs 5 per unit of commodity A, total revenue is Rs 800. When its price rises by 20 per cent, total revenue increase by Rs 400. Calculate its price elasticity of supply.VIEW SOLUTION
- Question 9
Explain the implications of freedom of entry and exit of firms under perfect competition.VIEW SOLUTION
- Question 10
Given below is the cost schedule of a firm. Its average fixed cost is Rs. 20 when it produces 3 units.
Average variable cost (Rs)
Calculate its marginal cost and average total cost at each given level of output.VIEW SOLUTION
- Question 11
Explain the problem of ‘what to produce’.
Explain any two main features of a centrally planned economy.VIEW SOLUTION
- Question 12
When the price of a commodity falls by Rs. 2 per unit, its quantity demanded increases by 10 units. Its price elasticity of demand is (−) 1. Calculate its quantity demanded at the price before change which was Rs 10 per unit.VIEW SOLUTION
- Question 13
Explain the effect of increase in income of buyers of a ‘normal’ commodity on its equilibrium price.VIEW SOLUTION
- Question 14
Using indifference curves approach, explain the conditions of consumer’s equilibrium.VIEW SOLUTION
- Question 15
State whether the following statements are true or false. Give reasons for your answer.
(a) When total revenue is constant average revenue will also be constant.
(b) Average variable cost can fall even when marginal cost is rising.
(c) When marginal product falls, average product will also fall.VIEW SOLUTION
- Question 16
Explain the law of variable proportions with the help of total product and marginal product curves.
Explain producer’s equilibrium with the help of a marginal cost and marginal revenue schedule.VIEW SOLUTION
- Question 17
State the components of money supply.VIEW SOLUTION
- Question 18
Give the meaning of ex-ante savings.VIEW SOLUTION
- Question 19
How is primary deficit calculated?VIEW SOLUTION
- Question 20
Give the meaning of deflationary gap.VIEW SOLUTION
- Question 21
State two sources of supply of foreign exchange.VIEW SOLUTION
- Question 22
Explain how distribution of gross domestic product is its limitation as a measure of economic welfare.
Explain the basis of classifying goods into intermediate and final goods. Give suitable examples.VIEW SOLUTION
- Question 23
Explain the ‘lender of last resort ‘function of the Central Bank.VIEW SOLUTION
- Question 24
How can Government budget be helpful in altering distribution of income in an economy? Explain.VIEW SOLUTION
- Question 25
Explain the meaning of deficit in balance of payments.VIEW SOLUTION
- Question 26
Distinguish between devaluation and depreciation of domestic currency.VIEW SOLUTION
- Question 27
Explain the process of money creation by Commercial Banks.
How do changes in bank rate affect money creation by Commercial Banks? Explain.VIEW SOLUTION
- Question 28
State whether the following statements are true or false. Give reasons for your answer:
(a) When marginal propensity to consume is greater than marginal propensity to save, the value of investment multiplier will be greater than 5.
(b) The value of marginal propensity to save can never be negative.VIEW SOLUTION
- Question 29
(a) Capital receipts and revenue receipts.
(b) Direct tax and indirect tax.VIEW SOLUTION
- Question 30
How will you treat the following while estimating national income India?
(a) Dividend received by an Indian from his investment in shares of a foreign company.
(b) Money received by a family in India from relatives working abroad.
(c) Interest received on loans given to a friend for purchasing a car.VIEW SOLUTION
- Question 31
From the following data, calculate (a) Gross Domestic Product at Factor Cost and (b) Factor Income To Abroad:
(Rs. in 000 crore)
Compensation of employees
Gross national product at market price
Gross domestic capital formation
Net fixed capital formation
Change in stock
Factor income from abroad
Net indirect taxes
Calculate Net National Product at Factor Cost and Gross National Disposable Income from the following:
(Rs in crore)
Saving of non-departmental enterprises
Income from property and entrepreneurship accruing to the government administrative departments
National debt interest
Retained earnings of private corporate sector
Current transfer payments by government
Consumption of fixed capital
Net current transfers from rest of the world
Personal disposable income
- Question 32
In an economy 75 per cent of the increase in income is spent on consumption. Investment is increased by Rs 1,000 crore. Calculate:
(a) Total increase in income
(b) Total increase in consumption expenditure.VIEW SOLUTION