CBSE Class 12 Economics Solved Question Paper 2011

Short Answer Type

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Define cash reserve ratio.

Cash Reserve Ratio (CRR) is a specified minimum fraction of the total deposits of customers, which commercial banks have to hold as reserves either in cash or as deposits with the central bank

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    Define foreign exchange rate. 

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    State the components of capital account of balance of payments. 

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    Explain the 'allocation of resources' objective of Government budget. 

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    Define money supply.

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    When price of a foreign currency rises, its supply also rises. Explain why. 

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    Explain the relationship between investment multiplier and marginal propensity to consume. 

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    When price of a foreign currency rises, its demand falls. Explain why.

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    Explain how 'distribution of gross domestic product' is a limitation in taking gross domestic product as an index of welfare. 

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    Given that national income is Rs.80 crore and consumption expenditure Rs.64 crore, find out average propensity to save. When income rises to Rs.100 crore and consumption expenditure to Rs.78 crore, what will be the average propensity to consume and the marginal propensity to consume? 

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