RED ROSE SCHOOL LAMBAKHEDA BHOPAL

FIRST TERM EXAMINATION , 2019

CLASS XII
SUBJECT : ECONOMICS
Max. Time :- 3 Hours Max. Marks :- 80

GENERAL INSTRUCTIONS:-
1. All the questions are compulsory. However, there is internal choice in some
questions.
2. Marks for questions are indicated against each.
3. Question No. 1-10 and 18-27 are very short answer questions carry 1 mark each. They
are required to be answered in one sentence.
4. Question No. 11-12 and 28-29 are short answer questions carry 3 mark each. They are
required to be answered in 60 words.
5. Question No. 13-15 and 30-32 are short answer questions carry 4 mark each. They are
required to be answered in 70 words.
6. Question No. 16-17 and 33-34 are Long answer questions carry 6 mark each. They are
required to be answered in 120 words.
7. Answers should be brief and to the point and the above word limit be adhered as far
as possible.
8. Graph work should be done in saperate graphs. Use appropriate scale.

SECTION A
( INDIAN ECONOMIC DEVELOPMENT )

1) The annual growth rate of per capita real GDP of India during last 50 years
before independence was __________.
2) The objective of Equity can be achieved by:- ( Choose the correct
Alternative )
a) Increasing Poverty
b) Reducing Income inequalities
c) Reducing education ratio
d) Reducing the Age – sex composition
3) Inward foreign direct investment is useful because:-
a) Brings in foreign exchange
b) Brings in Modern Technology
c) Brings in management expertise
d) All of the above
4) The achievement of Industrial and Trade Policy was :-
a) Contribution to India's GDP increased from 11.8% to 24.6%
 b) Contribution to India’s Net production increasing by 10%
c) Decline of small scale sector due to Trade Policy
d) Increase in Production of wheat per year by 20 tonnes per hectare
5) Industrial Policy before 1991 was essentially a :-
a) Pro-Private sector policy
b) Anti-Public sector policy
c) Pro-Public sector policy
d) Anti-Private sector policy
6) What are Monopolistic Tendencies in reference to the industrial Policy (1950-
1990) ?
OR
Why are tariffs imposed on imports?
7) Explain on-the – job training as a source of human capital.
8) State the effect of Tax reforms on corporation Tax.
9) State any one problem in Human capital formation in india?
10)What is the aim of “National Social Assistance Programme" , initiated by the
central government?
11)“Education is considered an important input for the development of a nation.
Comment.
OR
“There is a downward trend in inequality world-wide with a rise in the
average education levels.” Comment.
12)Discuss economic reforms in india in the light of social justice and welfare.
OR
“India has certain advantages which make it a favourable outsourcing
destination.” Do you think Outsourcing is good for India? Why are developed
countries opposing it?
13)Explain some of the India's most crucial economic challenges on the eve of
Independence.
14)Explain any two poverty alleviation programmes which aims at providing self
employment programmes and providing basic amenities.
15)While Subsidies encourage farmers to use new technology, they are a huge
burden on government finances. Discuss the usefulness of subsidies in the
light of this fact.
OR
Why and How was private sector regulated under the IPR 1956?
16)What factors contribute to Human capital formation?
OR
Differentiate between rural and urban poverty on the basis of :-
a) Assets
b) Nutrition
c) Social welfare
d) Meaning
e) Trends and shifts in poverty
17)What is Green Revolution? Why it was implemented and hoe did it benefit the
farmers? Is there a need of Second Green Revolution. Explain.

SECTION – B
( MACROECONOMICS )

18)Demand Deposits include :-

a) Savings account deposits and fixed deposits
b) Savings account deposits and current account deposits
c) Current account deposits and fixed deposits
d) All types of deposits
19)The Value of Nominal GDP of an economy was Rs.2500 crore in a particular
year. The value of GNP of that country during the same year, evaluated at the
prices of the same base year was Rs.3000 crores. Calculate the value of GNP
deflator of the year in percentage terms.
20)The ratio of total deposits that a commercial bank has to keep it with Reserve
bank of india is called:-
a) Statutory Liquidity Ratio
b) Deposit Ratio
c) Cash Reserve Ratio
21)In order to encourage investments in the economy, the central bank may
________ ( Choose the correct alternative)
a) Reduce Cash Reserve Ratio
b) Increase Cash Reserve Ratio
c) Sells Government securities in Open Market
d) Increase Bank Rate
22)Compensation given to victims of Sri Lankan Riots is a good social security
measure but still it is not included in the estimation of national income. Give
reasons. Name a value highlighted in the above case.
23)Social welfare is the sum total of:-
a) Economic welfare and GDP
b) Non economic welfare and transfer income
c) Economic and Non economic Welfare
d) None
24)Weaker sections of the economy needs loans to perceive Self Employment.
The sections feel shy of approaching banks for the same. Which of the
methods of credit control the central bank can adopt to persuade commercial
banks to treat the weaker sections on priority basis. Explain.
25)Investment which is independent to the level of Income is called:-
a) Autonomous Investment
b) Fixed Investment
c) Induced Investment
d) Inventory Investment
OR
 Source of Money Supply in an economy is:-
a. Central Bank
b. Commercial Banks
c. Both (a) and (b)
d. Government
26)When Real National Income increases , the production possibilities curve
shifts rightwards. True or False. Give reasons.
27)Government of India recently launched “Jan Dhan Yojana” aimed at every
household in the country to have at least one bank account. Explain how
deposits made and the plan are going to affect the national income of the
country.
28)“Higher Gross domestic Product means greater per capita availability of goods
of the economy". Do you agree with the given statement? Give valid reason in
support of your answer.
OR
A School conducts the following transactions during the year.
a) Buys furniture worth rupees 5 lakhs
b) Receives tution fees worth Rs. 50 lakhs
c) Pays Rs.10 Lakhs as salary to staff
d) Constructs a new room for 3 Lakhs
e) Distributes gifts of Rs.1 lakh to employees
Explain the effect of each of the above transactions on national income
and by which method.
29)Discuss the adjustment Mechanism in the following situations:-
a) Aggregate Demand is lesser than Aggregate Supply
b) Ex-Ante Savings are greater than Ex – Ante Investments.
OR
What is the difference between Voluntary Unemployment and
involuntary Unemployment? State the significance of this distinction
and relate it with Aggregate Demand.
30)Explain the process of credit creation by commercial banks. How it is likely to
affect the national income?
31)Describe the “Banker's bank and Supervisor" function of Central Bank.
32)From the following data , find out Net value added at factor cost.
I. Total Sales 75000
II. Purchase of Raw Material 30000
III. Indirect Tax 7500
IV. Consumption of fixed capital 2500
33)Explain the equilibrium level of income with the help of the two alternative
approaches. Use Diagram
OR
What is Aggregate Demand? What is the Significance of 45° line aggregate
supply curve in Keynesian Economics.
34. Calculate National Income at Market price by Value added , Income and
expenditure method.

ITEMS Rs. ( in Crores )

Net Exports 0
Depreciation 50
Mixed Income of Self 345
Employed
Closing stock (a) Primary 15
sector
(b) Secondary Sector 10

Private Final Consumption 630

Expenditure
Net Domestic Fixed 130
capital Formation
Government final 85
Consumption Expenditure
Operating Surplus 130
Opening Stock (a) 5
Primary sector
(b) Secondary sector 5
Net factor income to 0
abroad
Net Indirect Taxes 95
Sale of goods and 2395
services by all sectors
Intermediate consumption 1500
by all sectors
Compensation of 290
Employees