Board Paper of Class 12-Commerce 2018 Economics (SET 1) - Solutions
(i) All questions in both sections are compulsory.
(ii) Marks for questions are indicated against each question.
(iii) Question No.1-4 and 13-16 are very short answer questions carrying 1 mark each. They are required to be answered in one sentence each.
(iv) Question No.5-6 and 17-18 are short answer questions carrying 3 marks each. Answers to them should not normally exceed 60 words each.
(v) Question No.7-9 and 19-21 are also short answer questions carrying 4 marks each. Answers to them should not normally exceed 70 words each.
(vi) Question No.10-12 and 22-24 are long answer questions carrying 6 marks each. Answers to them should not normally 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
State one example of positive economics. VIEW SOLUTION
- Question 2
Define fixed cost. VIEW SOLUTION
- Question 3
When the Average Product (AP) is maximum, the Marginal Product (MP) is : (Choose the correct alternative)
(a) Equal to AP
(b) Less than AP
(c) More than AP
(d) Can be any one of the above VIEW SOLUTION
- Question 4
When the total fixed cost of producing 100 units is Rs 30 and the average variable cost Rs 3, total cost is : (Choose the correct alternative)
(a) Rs 3
(b) Rs 30
(c) Rs 270
(d) Rs 330 VIEW SOLUTION
- Question 5
Explain the central problem of "for whom to produce".
Explain the central problem of "choice of technique". VIEW SOLUTION
- Question 6
What is meant by inelastic demand? Compare it with perfectly inelastic demand. VIEW SOLUTION
- Question 7
Given the price of a good, how will a consumer decide as to how much quantity to buy of that good? Explain.
What is indifference Curve? State three properties of Indifference curves.VIEW SOLUTION
- Question 8
When the price of a commodity changes from Rs 4 per unit to Rs 5 per unit, its market supply rises from 100 units to 120 units. Calculate the price elasticity of supply. Is supply elastic? Give reason. VIEW SOLUTION
- Question 9
What is meant by price ceiling? Explain its implications. VIEW SOLUTION
- Question 10
Explain the conditions of consumer's equilibrium using Indifference Curve Analysis. VIEW SOLUTION
- Question 11
Explain the conditions of producer's equilibrium in terms of marginal revenue and marginal cost. VIEW SOLUTION
- Question 12
State three characteristics of monopolistic competition. Which of the characteristics separates it from perfect competition and why?
Explain the implications of the following :
(a) Freedom of entry and exit of firms under perfect competition
(b) Non-price competition under oligopoly VIEW SOLUTION
- Question 13
Which of the following affects national income? (Choose the correct alternative)
(a) Goods and Services tax
(b) Corporation tax
(d) None of the above VIEW SOLUTION
- Question 14
Define money supply. VIEW SOLUTION
- Question 15
The central bank can increase availability of credit by : (Choose the correct alternative)
(a) Raising repo rate
(b) Raising reverse repo rate
(c) Buying government securities
(d) Selling government securities VIEW SOLUTION
- Question 16
Why does consumption curve not start from the origin? VIEW SOLUTION
- Question 17
Which among the following are final goods and which are intermediate goods? Give reasons.
(a) Milk purchased by a teal stall
(b) Bus purchased by a school
(c) Juice purchased by a student from the school canteen
Give nominal income, how can we find real income? Explain. VIEW SOLUTION
- Question 18
Define multiplier. What is the relation between marginal propensity to consume and multiplier? Calculate the marginal propensity to consume if the value of multiplier is 4. VIEW SOLUTION
- Question 19
Explain the role of the Reserve Bank of India as the "lender of last resort". VIEW SOLUTION
- Question 20
What is meant by inflationary gap? State three measures to reduce this gap.
What is meant by aggregate demand? State its components.VIEW SOLUTION
- Question 21
The value of marginal propensity to consume is 0.6 and initial income in the economy is Rs 100 crores. Prepare a schedule showing Income, Consumption and Saving. Also show the equilibrium level of income by assuming autonomous investment of Rs 80 crores. VIEW SOLUTION
- Question 22
Explain the meaning of the following"
(a) Revenue deficit
(b) Fiscal deficit
(c) Primary deficit
Explain the following objectives of government budget:
(a) Allocation of resources
(b) Reducing income inequalities VIEW SOLUTION
- Question 23
(a) Explain the impact of rise in exchange rate on national income.
(b) Explain the concept of 'deficit' in balance of payments. VIEW SOLUTION
- Question 24
Calculate (a) Net National Product at market price, and (b) Gross Domestic Product at factor cost :
(Rs in crores) (i) Rent and interest 6,000 (ii) Wages and salaries 1,800 (iii) Undistributed profit 400 (iv) Net indirect taxes 100 (v) Subsidies 20 (vi) Corporation tax 120 (vii) Net factor income to abroad 70 (viii) Dividends 80 (ix) Consumption of fixed capital 50 (x) Social security contribution by employers 200 (xi) Mixed income 1,000