Subject –Economics

Class-XII

Time Allowed : 3 Hrs                            Max Marks 100

General Instructions:

1)    All questions are compulsory.

2)    Questions 1 and 13 are very short answer questions .Their each part is of one mark.Answer to each of these parts should be written in one sentence.

3)    Questions 2 to 5 and 14 to 17 are short answer type  questions of 3 marks each.Answer to each of these parts should not exceed 60 words.

4)    Questions 6 to 9 and 18 to 21 are also short answer type  questions of 4 marks each. Answer to each of these parts should not exceed 70 words.

5)    Questions 10 to 12 and 22 to 24 are long answer type  questions of 6 marks each. Answer to each of these parts should not exceed 100 words.

6)    Attempt all parts of questions at one place.

SECTION –A [INTRODUCTORY MICRO ECONOMIC THEORY]

Q1 Answer the following questions :                                                      1* 4  =4

a)    State the condition of consumer’s equilibrium.

b)    What is derived demand?

c)    If two demand curves intersect,which one has higher price elasticity.

d)    Name two commodities which are relatively labour intensive in production.

Q2 How does an increase in income affect the demand curve for a) a normal good, b) an inferior good ?  3

Q3 Distinguish between fixed and variable costs.Give one example of each..                                              3

Q4 Briefly explain three factors that can shift a supply curve.                                                                      3

Q5 Price of a commodity goes up by 15% as a result of which its supply increases from 25 to 30 units.Calculate elasticity of supply.                                                                                                                 3

Q6 Due to improvement in technology, the marginal costs of production of television have gone down.How will it effect the supply curve of television. Briefly explain in the above context                                         4

Q7 Explain why MR=MC is the profit maximizing principle of a firm in general.                                      4

Q8 The output and total cost data of a firm are given below ,workout the following costs TFC,TVC,AFC,AVC,AC and MC at various levels of output.

4

Q9 There are three products X,Y and Z sold under different market forms .The price elasticity of demand of a firm’s product in market Z is infinity.In market X it is less than infinity.In market Y it is less than the price elasticity in market X .Identify the three market forms.Give reasons.                                                           4

Q10 Draw a downward sloping straight line demand curve touching both the axis.Mark the elasticity at different points on the demand curve.Also briefly explain any four factors affecting elasticity of demand. 6

Q11  Explain the law of variable proportions .Use diagram.                                                                          6

Q12 “Equilibrium price may or may not change with shifts in demand and supply curves.” Discuss           6

SECTION –B [INTRODUCTORY MACRO ECONOMIC THEORY]

Q13 Answer the following questions :                                                                                             1* 4  =4

a)    Define tranfer payment.

b)    Define bank rate.

c)    What do you mean by Consumption of fixed capital?

d)    What is meant intermidiate goods?

Q14 Distinguish between Real flow and Money flow?                                             3

Q15  Explain any three functions of a central bank.                                                                                      3

Q16  Define multiplier .State its relation with MPS.?                                                                              3

Q17 Discuss the primary function of money ?                                                                                               3

Q18 Explain  the components of Gross domestic capital formation.

Or

Discuss the value added method of measuring national income with the help of an example .              4

Q19 Consider a two sector economy with the following specifications:

C=50 + 0.80 Y  ,     I= Rs 50 crores

Find a) the equilibrium level of income b) the level of consumption c) the level of saving at           equilibrium.                                                                                                                                                      4

Q20 Distinguish between revenue receipts and capital receipts in a government budget .Give two example of each?                                                                                                                              4

Q21 What are the items to be included  in the current account of balance of payments ?                         4

Q22 When  will the situation of excess demand and deficit demand arise in an economy ? Explain fiscal measures for correcting these  situations                                                      6

Q23 Explain with the help of  a diagram how equlibrium level of income is determined by AD and AS approach .

6

Q24 From the following information calculate

1) NNP FC   2) Net National Disposable Income 3) Gross National Disposable Income                                        (Rs in crores)

1) GNP MP                                                              1000

2) Net Indirect taxes                           100

3) Net current transfers received from rest of the world      (-)20

4) Subsidies                                   25

5) Consumption of fixed capital                     50

6) Net factor income paid to rest of the world                (-)10                                                                  6

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• English - 1998
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