Board Paper of Class 12-Commerce 2010 Economics (SET 1) - Solutions

Q.1 (A) Fill in the blanks with appropriate alternatives given in the brackets. [5 marks]

1. If the price of the inferior goods falls, the demand for them will ________.

(increase/decrease/remain constant/become zero)

2. Demand elasticity can be measured from demand curve by ___________ method.

(Total outlay/Percentage/Geometric/Mathematical)

3. ________economics can study the problem of inflation in the country.

(Micro/Macro/Static/Dynamic)

4. Marginal consumption function is always ________.

(zero/one/more than one/less than one)

5. To increase credit creation Central Bank __________ the debentures.

(purchases/sells/borrows/stocks).

Q.1 (B) State Whether the following statements are TRUE or FALSE: [5 marks]

1. Demand will not increase by coming of new customers.

2. Demand elasticity concept is useful for labour unions.

3. Due to the use of modern production technique supply will decrease.

4. There is no price discrimination in the monopolistic competition.

5. Due to Government expenditure demand increases.

Q.1 (C) Choose the correct answer :                                                    [5 marks]

1. In the period of scarcity of a particular commodity _________.

(a) price becomes less

(b) demand becomes less

(c) price and demand increases

(d) price and demand decreases

2. Demand elasticity of habitual goods is _________.

(a) more elastic

(b) less elastic

(c) zero elastic

(d) unitary elastic

3. In the long term supply becomes _________.

(a) active

(b) inactive

(c) zero

(d) negative

4. When income increases consumption and saving will _________.

(a) increase

(b) decrease

(c) be constant

(d) be equal

5. Currency rate of India to other currency means _________.

(a) interest rate

(b) exchange rate

(c) tax rate

(d) profit rate

Q.1 (D) Match the following Group ‘A’ with Group ‘B’ :                                        [5 marks]

Q.2 (A) Define or Explain the concepts (Any Four) :                                       [8 marks]

1. Micro economics

2. Perfectly elastic demand

3. Entrepreneur

4. National income

5. Real investment

6. Current deposit

7. Lender of the last resort

8. Budget

Q.2 (B) State whether the following statements are True or False with reasons (Any Four): [8 marks]

1. Utility of the same commodity for two persons is different.

2. Demand for medicine is inelastic.

3. No monopolistic competition is found in real life.

4. After the world depression importance of macro economics study increased.

5. Ten years period is considered for measuring National Income.

6. Income earned from foreign investment is considered for aggregate demand.

7. Interest rate is more for fixed deposits.

8. Due to clearing house of the Central Bank cash money is saved.

Q.3 (A) Distinguish between Any Four of the following :                                        [8 marks]

1. Marginal utility and Total utility.

2. Joint demand and Composite demand.

3. Percentage method and Total outlay method.

4. Man-made factors and Natural factors.

5. Illegal income and Transfer income.

6. Average propensity to consume and Marginal propensity to consume.

7. Bank rate and Interest rate.

8. Direct tax and Indirect tax.

1. Assumptions of micro economics are unrealistic.

2. It is more appropriate to tax the rich in excess than the poor.

3. Due to speedy transport supply increases.

4. A monopolist can control the supply of goods.

5. Macro economics is comprehensive in nature.

6. In a rich country marginal propensity to consume is less.

7. Invention of money is the most important invention of human economic history.

8. For the period of inflation surplus budget is prepared.

Q.4 (A) Write answers in ‘one’ or ‘two’ paras each (Any TWO) :                        [8 marks]

1. Explain the features of capital.

2. Explain the concept of saving function.

3. Explain the secondary functions of money.

4. Explain the types of Government budget.

Q.4 (B) Write explanatory notes (Any Two)  :                                  [8 marks]

1. Features of Micro economics

2. Difficulties in the estimation of the National income.

3. Government expenditure.

4. Qualitative credit control methods of the Central Bank.

Q.5 Answer with reasons whether you agree or disagree with the following statements (Any Two):  [16 marks]

1. The supply curve slopes downward from left to right.

2. Perfect competition means monopolistic competition.

3. The commercial banks perform many useful works for the people.

Q.6 Answer in detail. (Any Two) :                                        [16 marks]

1. Explain the types of Price Elasticity of demand.

2. Explain the law of Diminishing Marginal Utility with its assumptions.

3. State the features of Macro economics.