CLASS XII - ECONOMICS MULTIPLE CHOICE QUESTIONS

CLASS XII - ECONOMICS

MULTIPLE CHOICE QUESTIONS

 1. Economics was originally developed as a science of __________

     (a) State craft. (b) business management (c) wealth of management. (d) resource management.

2. _________ of resources is necessary for development of economy.

  (a) Utilization     (b) Growth     (c) Wastage    (d) Non -utilization.

3. Which of the following is not example of micro economics studies?

        (a) Study of consumer equilibrium  (b) Study of price determination of a commodity 

       (c) study of an unemployment in an economy.  (d) All of above

4. Which of the following is not the component of micro economic study ........

        (a) Theory of consumer behavior  (b) Theory related to equilibrium level of output.

       (c) Theory of producer behavior (d) None of the above.

5. Which of the following is not micro economic variables ?

      (a) Consumer's demand   (b) Aggregate demand (c) Firm's output

      (d) Market price of a commodity.

6. Which of the following is not macro economic variables : -

     (a) Aggregate demand (b) General price level in the economy (c) Firm's output .

7. A PPC curve is concave to the point of origin because of ------

      (a) Increasing opportunity cost. (b) Law of demand.

       (c) Unit elastic (d) Law of supply.

8. If there in unemployment in the economy, we would be producing __________the PPC

 (a) below   (b) above (c) on   (d) None of the above.

9. If the PPC is concave, MPC is ............

 (a) Increasing (b) Equal (c) Decreasing (d) None of the above.

10. If MPC is constant, PPC would be ___

(a)Convex  (b) Concave (c) straight line (d) horizontal line.

11. PPC is sloping is  sloping __________because more production of one good is associated with less of the others.

(a) Upward downward (b) Straight (d) Uneven.

12. Factors which leads to shift of PPC __________

    (a) Increase in resources (b) Decrease in resources

     (c) Change in technology. (d) All of the above.

13. Rightward shift of PPC indicate _______

    (a) Improve in technology (b) Quantum of resources increase (c) Both A & b (d) None of the above.

14. A point below PPC indicate _________

       (a) Full employment and efficient use of resources. (b) Under utilization and insufficient  of resources  (c) Growth of resources (d) None of the above.

15. A point above PPC indicate -----

         (a) Full employment and efficient use of resources

         (b) Growth of resources (c) Under utilization of resources (d) None of the above.

16. Which of the following is not the assumption of PPC ___

    (a) Increasing MPC,

     (b) Decreasing MPC (c) Constant MPC

 (D) All of the above.

17.  Which of the following is not the assumption of PPC ?

 (a) Available resources are fully utilize (b) There is change in the technology (c)Available resources are fully and efficiently utilized  (d) There is no change in technology.   

18. A point on PPC indicate ----------

      (a) Full employment and efficient use of resources

      (b) Under utilization of resources (c) Growth of resources (d) None of the above.

                                                CONSUMER'S EQUILIBRIUM

19. Which statement is false -

    (a)  So long as MU positive , TU is increases.  (b) TU is zero when MU is zero.

    (c) TU starts decreasing when Mu is negative.

20. The extent to which a consumers expects a commodity to satisfy his wants for the same is known as ________ of that commodity for him.

20. Total utility is maximum when MU is _____

(a) Equilibrium   (b) Minimum   (c) Maximum (d) Equal.

21. locus of different combination of two goods which a consumers   can afford  by spending his whole income is known as : -

(a) Total utility (b) Budget (c) Budget line (d) Budget set. 

22.Total utility falls when marginal utility is : -

(a) positive (b) Negative (c) Equals (d) Zero.

INDIFFERENCE CURVE

23. Which is not the characteristics of monotonic indifference curve?

        (a) IC are negatively sloped. (b) IC intersect each other.

        (c) IC are convex to origin. (d) a higher IC offered higher level of satisfaction.

24. Shape of IC is convex due to _____________ MRT.

      (a) (a) Increasing (b) Equal (c) Diminishing (d) Maximum.

25. According to IC approach, a consumer attains equilibrium at a point where budget line is ___________to indifference curve.

(a) Tangent  (b) Straight (c) Diminishing  (d) Maximum

26. Shape of IC Curve is ________

   (a) Downward sloping and convex to the origin    (b) Upward sloping and convex to the origin.

     (c) Down wards sloping and concave to the origin    (d) Upward sloping and concave to origin

27. An IC Curve is downward sloping because if quantity of one commodity is __ the quantity of the other is to be _______in order to maintain the same satisfaction level.

(a) Reduce ,increase

(b) Increase , reduce.

(c) Increase , increase

(d) Reduce, Reduce.

29. Properties of independence are: -

(a) Negatively sloped (b) Convex to the point of origin (c) touches neither nor Y axis

(d) All of the above.

                              

ANNUAL PAPER CLASS XII ECONOMICS

                                                                          ECONOMICS
                                                                           अर्थशास्त्र
                                                                            CLASS XII 
समय : 3 घंटे                                                                                                          अधिकतम अंक 100

SYLLABUS CLASS XII ECONOMICS - 2014-15

Part A                                            PERIODS            MARKS.

1 Introduction                                          11                      6

2 Consumer's Equilibrium and Demand      34                    16

3 Producer Behaviour and Supply              34                   16

4 Forms of Market and Price Determination 

under perfectcompetition with simple 

applications                                                 31                12                  

                                                      

                                                                110                      50

Part B Introductory Macroeconomics

5 National Income and Related Aggregates       32                    15

6 Money and Banking 18 8

7 Determination of Income and Employment      27                 12

8 Government Budget and the Economy 1          7                    8

9 Balance of Payments                                     16                   7

                                                                     110                  50

Part A: Introductory Microeconomics

Unit 1: Introduction                                   11 Periods

Meaning of microeconomics and macroeconomics

What is an economy? Central problems of an economy: what, how and for whom to produce; concepts of

production possibility frontier and opportunity cost.

Unit 2: Consumer's Equilibrium and Demand 34 Periods

Consumer's equilibrium - meaning of utility, marginal utility, law of diminishing marginal utility, conditions

of consumer's equilibrium using marginal utility analysis.

Indifference curve analysis of consumer's equilibrium-the consumer's budget (budget set and budget line),

preferences of the consumer (indifference curve, indifference map) and conditions of consumer's equilibrium.

Demand, market demand, determinants of demand, demand schedule, demand curve, movement along and

shifts in the demand curve; price elasticity of demand - factors affecting price elasticity of demand;

measurement of price elasticity of demand - (a) percentage-change method and (b) geometric method (linear

demand curve); relationship between price elasticity of demand and total expenditure.

Unit 3: Producer Behaviour and Supply            34 Periods

Production function: Total Product, Average Product and Marginal Product.

Returns to a Factor.

238

Cost and Revenue: Short run costs - total cost, total fixed cost, total variable cost; Average fixed cost, average

variable cost and marginal cost-meaning and their relationship.

Revenue - total, average and marginal revenue.

Producer's equilibrium-meaning and its conditions in terms of marginal revenue-marginal cost.

Supply, market supply, determinants of supply, supply schedule, supply curve, movements along and shifts in

supply curve, price elasticity of supply; measurement of price elasticity of supply - (a) percentage-change

method and (b) geometric method.

Unit 4: Forms of Market and Price Determination under Perfect Competition with simple applications.     31 Periods

Perfect competition - Features; Determination of market equilibrium and effects of shifts in demand and

supply.

Other Market Forms - monopoly, monopolistic competition, oligopoly - their meaning and features.

Simple Applications of Demand and Supply: Price ceiling, price floor.

Part B: Introductory Macroeconomics

Unit 5: National Income and Related Aggregates     32 Periods

Some basic concepts: consumption goods, capital goods, final goods, intermediate goods; stocks and flows;

gross investment and depreciation.

Circular flow of income; Methods of calculating National Income - Value Added or Product method,

Expenditure method, Income method.

Aggregates related to National Income:

Gross National Product (GNP), Net National Product (NNP), Gross and Net Domestic Product (GDP and

NDP) - at market price, at factor cost; National Disposable Income (gross and net), Private Income, Personal

Income and Personal Disposable Income; Real and Nominal GDP.

GDP and Welfare

Unit 6: Money and Banking                            18 Periods

Money - its meaning and functions.

Supply of money - Currency held by the public and net demand deposits held by commercial banks.

Money creation by the commercial banking system.

Central bank and its functions (example of the Reserve Bank of India): Bank of issue, Govt. Bank, Banker's

Bank, Controller of Credit through Bank Rate, CRR, SLR, Repo Rate and Reverse Repo Rate, Open Market

Operations, Margin requirement.

Unit 7: Determination of Income and Employment  27 Periods

Aggregate demand and its components.

Propensity to consume and propensity to save (average and marginal).

Short-run equilibrium output; investment multiplier and its mechanism.

Meaning of full employment and involuntary unemployment.

239

Problems of excess demand and deficient demand; measures to correct them - change in government

spending, availability of credit.

Unit 8: Government Budget and the Economy           17 Periods                                                    

Government budget - meaning, objectives and components.

Classification of receipts - revenue receipts and capital receipts; classification of expenditure - revenue

expenditure and capital expenditure.

Measures of government deficit - revenue deficit, fiscal deficit, primary deficit their meaning.

Unit 9: Balance of Payments                                16 Periods

Balance of payments account - meaning and components; balance of payments deficit-meaning.

Foreign exchange rate - meaning of fixed and flexible rates and managed floating.

Determination of exchange rate in a free market.

Prescribed Books:

1. Statistics for Economics, Class XI, NCERT

2. Indian Economic Development, Class XI, NCERT

3. Introductory Micro Economics, Class XII, NCERT

4. Macro Economics, Class XII, NCERT

5. Supplementary Reading Material in Economics, Class XII, CBSE

NEW NORM FOR PAPER SETTING -2014 -15.

Suggested Question Paper Design

Economics (Code No. 030)

Class XII (2014-15)

March 2015 Examination

Marks: 100                                                                                                                      Duration: 3 hrs.

S. No.	Typology of Questions	Very Short Answer MCQ 1 Mark Short	Answer II 3 Marks	Short Answer I 4 Marks	Long Answer 6 Marks	Marks	%
1	Remembering- (Knowledge based Simple recall questions, to know specific facts, terms, concepts, principles, or theories; identify, define, or recite, information)	2	1	2	2	25	25
2	Understanding- (Comprehension –to be familiar with meaning and to understand conceptually, interpret, compare, contrast, explain, paraphrase, or interpret information)	3	2	1	2	25	25
3	Application (Use abstract information in concrete situation, to apply knowledge to new situations; Use given content to interpret a situation, provide an example, or solve a problem)	-	2	2	1	20	20
4	High Order Thinking Skills (Analysis & Synthesis- Classify, compare, contrast, or differentiate between different pieces of information, Organize and/or integrate unique pieces of information from a variety of sources)	2	2	-	2	20	20
5	. Evaluation and Multi-Disciplinary- (Appraise, judge, and/or justify the value or worth of a decision or outcome, or to predict outcomes based on values)	1	1	-	1	10	10
	TOTAL	8X1= 8	8X3=24	5X4=20	8X6= 48	100(29)	100

1st Pre - Board Question paper -2013 -14

KENDRIYA VIDYALAYA SANGATHAN, SIRSA REGION

FIRST PRE – BOARD EXAM.2013 – 14

CLASS - XII ECONOMICS.

Q1. What is meant by’ economizing of resources’?

Q2. What happened to the MU when total utility is maximum ?

Q3. Whay is demand for water is inelastic?

Q.4. Define fixed cost.

Q5. In which market form average revenue and Marginal revenue of a firm are always equal.

Q.6. What does a production possibility curve show? When will it shift to the right?

Q.7. Demand for electricity has increase, however supply cannot be increased due to lack of resources. Explain how in two ways demand for electricity can be decreased.

Q.8. Define budget line. How the budget line change if the consumers income decreases to

         Rs. 20 from Rs.40 but the prices remains unchanged.

Q.9.  Explain the relationship between SVC and MC with the help of curve.

Q10.Distinguish between monopoly and monopolistic forms of market.

Ans.

                                                         OR

Complete the following table: -

OUTPUT	PRICE TAKER	T R	MR
1 2 3 4	10 - - -	- 14 - 12	- - 1 -

Q11. How the nature of the commodity and No. of affect the elasticity of demand explain

          with example.

                                                                                  OR

   A consumer buys 80 units of a good. At a price of Rs. 5 per unit. Suppose, the price elasticity of demand is (-) 2. At what price will be buy 64 units.

Q.12. Explain the effect of the following on the supply of a commodity.

 (a) Fall in the price of factor input.

(b)  Increase in taxes.

Q13. The TR & TC value a of a firm are given in the following schedule. Calculate MR and MC and determined the level of output. Give reason for your answer.

Ans.

Q.14. What is meant by return to a factor? State the law of increasing returns to a factor. Give 

         to a factor?

Q.15. What are the condition of consumer’s equilibrium under the indifference curve

        Analysis ? Explain the help of a diagram.

          

Q.16. Explain the effect of equilibrium price and equilibrium quantity in the following cases (Use diagram)

(a) Demand curve shift to the left.

(b) Supply increases when demand is perfectly inelastic.

( c) Increase in supply more than increase in supply.

                                                        PART – B

Q.17.  What is full bodied money?

Ans.

Q.18. If Planned saving are greater than planned investment, what will effect on inventories?

Ans.

Q.19. If the value of MPC is 0.8. Calculate the value of multiplier.

Q.20. Define CRR.

Q21. What is the likely effect currency depreciation and devolution on Foreign trade?

Q.22. How you will treat  the following while calculating National Income. Give reason: -

      (i)  Production for self consumption.

(ii) Expenditure of construction of a house.

(iii) Salary received by an Indian resident working in US embassy in New Delhi.

Q.23. From the following data calculate Net Value Added at Factor cost.

Sr. No.	Particulars	Rs.
1 2 3 4 5 6 7	Purchase of intermediate goods. Sales Import of raw materials Depreciation Net indirect taxes Change in stock Export	500 750 50 60 100 -30 20

24. Distinguish between Final goods & Intermediate goods with examples.

                                           OR

   Distinguish between Factor income and Transfer income.

25. Explain two sources of each of demand and supply of foreign exchange.

26.State the component of current account of balance of payments.

27. Explain the meaning and implication of revenue deficit.

                               OR

        Complete the following table: -

Income	Saving (Rs.)	MPC	APC
0	-20
50	-10
100	0
150	30
200	60

28. Categories the following Government receipt into Revenue & Capital receipts. Give reasons for your answer.

(a) receipts from sale of share of  a public sector under taking.

(b) Income tax received by govt.

© Grants from foreign government.

(d) Recovery of loans.

29. Define government budget . State any three objectives of government budget.

30. Explain the process of money creation by commercial banks giving a numerical example

                                       OR

    In an economy the consumption function C = 500 + 0.8Y, where C is consumption expenditure and Y is income , I = 800

(i)                 Equilibrium level of income.

(ii)               Consumption expenditure at equilibrium level.

Q31. Explain the problem of excess demand in an economy with the help of diagram. Explain the role of bank rate in correcting it.

Q.32. From the following data calculate GNP at MP by Income method and expenditures method: Income method and expenditure method: -

Sr. No.	Particulars	Rs.
1 2 3 4 5 6 7 8 9 10 11 12	Compensation of employees Profits Mixed Income of self employed Rent Interest Private final consumption expenditure Net domestic capital formation Consumption of fixed capital Net Export Govt. final consumption expenditure Net indirect taxes Net factor income from abroad.	400 250 300 80 70 700 120 100 (-) 10 350 60 (-) 10

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