Subject

Economics

Class

CBSE Class 12

Pre Boards

Practice to excel and get familiar with the paper pattern and the type of questions. Check you answers with answer keys provided.

Sample Papers

Download the PDF Sample Papers Free for off line practice and view the Solutions online.
Advertisement

 Multiple Choice QuestionsShort Answer Type

21.

Distinguish between final goods and intermediate goods. Give an example of each.

3394 Views

Advertisement

22.

Explain the store of value function of money.
Or
State the meaning and components of money supply.


People keep their wealth in the form of money because money is the most liquid form of wealth. Savings in the form of money is maintained for purchasing commodities in the future. In this case, the values of commodities are being stored. Hence, money acts as a store of value.  Wealth is stored in terms of goods as there was no money in existence. . For example, wheat and rice do not possess durability i.e. their quality deteriorates with passage of time. Storage of good requires time and efforts. Hence, it is not practically possible to store people’s purchasing power.

justification for store value of money:

i)money is the most and widely accepted as a common medium of exchange
ii)there is no loss in the value of money over time
iii)money can be stored conveneintly and does not involve any cost
iv) money abolished barter system and all the problems related to it.

or, 

Money supply means the total stock of money in circulation, in form of coins and currency notes, among the people at a particular point of time in an economy.

 There are various types of money supply and these are labeled as M0, M1, M2 and M3, according to the type and size of the account in which the instrument is kept.

M1 = Currency with the public + demand deposits with the commercial banks + deposits kept by commercial banks with the Reserve Bank.
or M1 = C + DD + OD
Demand deposits are not for any specific period of time. They can be withdrawn as and when required. Demand deposits are chequeable deposits.

2. M2 = M1 + Savings deposits with Post office Savings banks.
Saving deposit includes the features of both demand and term deposits.

3. M3 = M2 + Term deposits in Commercial banks. Term deposits are always for a specific period of time. They cannot withdraw
money as when required. They are not chequeable deposits as we cannot sign a cheque against these deposits.

4. M4 = M3 + Savings with the Post office other than in the form of National Saving Certificate.

427 Views

Advertisement
23.

Explain the basis of classifying taxes into direct and indirect tax. Give examples

682 Views

24.

Explain ‘banker to the government’ function of the central bank.
Or
Explain the role of reverse repo rate in controlling money supply.

334 Views

Advertisement
25.

Explain how government budget can be used to influence distribution of income ?

628 Views

26.

An economy is in equilibrium. From the following data about an economy calculate autonomous consumption.
(i) Income = 5000
(ii) Marginal propensity to save = 0.2
(iii) Investment expenditure = 800

741 Views

27.

Why does the demand for foreign currency fall and supply rises when its price rises ? Explain.

814 Views

 Multiple Choice QuestionsLong Answer Type

28.

Explain ‘non-monetary exchanges’ as a limitation of using gross domestic product as an index of welfare of a country.
Or
How will you treat the following while estimating domestic product of a country ? Give reasons for your answer :
(a) Profits earned by branches of country’s bank in other countries
(b) Gifts given by an employer to his employees on independence day
(c) Purchase of goods by foreign tourists

892 Views

Advertisement
29.

Calculate (a) net domestic product at factor cost and (b) gross national disposable income :

s. no.   in RS
1 Private final consumption expenditure 8000
2 Government final consumption expenditure 1000
3 exports 70
4 imports 120
5 Consumption of fixed capital 60
6 Gross domestic fixed capital formation 500
7 change in stock 100
8 Factor income to abroad 40
9 Factor income from abroad 90 
10 indirect taxes 700
11 subsidies 50
12 Net current transfers to abroad (-)30
612 Views

30.

Assuming that increase in investment is Rs. 1000 crore and marginal propensity to consume is 0.9, explain the working of multiplier.

1025 Views

Advertisement