ST.LAWRENCE CONVENT,SR. SEC.

SCHOOL

CLASS XII (2021-22)

PREBOARD - ECONOMICS (030)

TIME ALLOWED: 90 minutes MAXIMUM MARKS: 40

General Instructions:-

1. There are a total 60 questions in this paper out of which 50 questions are to be attempted.
2. This paper is divided into three sections:
a. Section A – Contain 24 questions. Attempt any 20 questions.
b. Section B – Contain 24 questions. Attempt any 20 questions.
c. Section C – Contain 12 questions. Attempt any 10 questions.
3. All questions carry equal marks.
4. There is no negative marking.

SECTION A
(20 questions out of 24 questions are to be attempted)

1. Identify which of the following banks does not accept chequeable deposits from public.
(a) SBI (b) Axis (c) LIC (d) ICICI

2. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – The government has strengthen the unified payment interface (UPI) by NPCI, to secure digital
payments as compared to past.
Statement 2 – With this payment, system has been made more accessible due to offline transactions, which
makes it possible to use mobile banking services without internet to promote financial
inclusion and to empower the poor and unbanked in the country.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

3. Mr. Parag Gupta, an economics teacher, was explaining the concept of ‘centralisation of foreign exchange
transaction with RBI helps in stabilizing the external value of currency’.
From the following, choose the correct alternative which specifies the correct function of RBI explained by
him?
(a) Currency authority (b) Custodian of Foreign exchange reserves
(c) Banker to the government (d) Moral suasion

4. Two friends Om and Aryan were discussing the exchange rate market.
‘Under this market, a two days margin is allowed as it takes two days for payments made through cheques
to be cleared’.

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 The above mentioned statement was given by Om, identify the type of exchange rate market was he talking
about?
(a) Spot forward (hybrid) market (b) Forward market
(c) Hedging market (d) Spot Market

5. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Non-tax revenue receipts includes gifts which are generally received during national crisis
such as war, flood etc.
Statement 2 – Gifts are a fixed sources of non-tax revenue of the government.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

6. Under __________ five years plan, human capital assigned a key role in the country’s development strategy.
(a) First (b) Seventh (c) Fourth (d) Sixth

7. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – From 1973-74 to 2011-12, there has been a considerable rise in the number of poor and
their proportion.
Statement 2 – In 1973-74 more than 80% of the poor resided in urban areas, and this situation has not
changed even in 2011-12.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

8. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – With the launch of Make in India initiative in September 2014, FDI policy was further
liberalized.
Statement 2 – The foreign investment (FDI and FII) increased from about US $100 million in 1990-91 to US
$73.5 billion in 2014-15.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

9. Due to Green revolution prices of food grains declined relative to other items of consumption which benefit
to ___________.
(a) The richer section (b) High income groups
(c) Low income groups (d) the government

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10. From the following given sets of statements in Column I and II, choose the correct pair of statements.
Column I Column II
A. Balance of trade i. Includes visible items as well as invisible items
B. Current account ii. Net income generated to the foreign sector
C. Unilateral transfers iii. Requited transfers to and from abroad
D. Foreign Direct Investments iv. Foreign Institutional Investment
Alternatives:
(a) A-i (b) B-ii (c) C-iii (d) D-iv
11. Self help groups has emerged as __________ programme to promote thrift in small proportions by a
minimum contribution from each member.
(a) Major finance (b) Marginal finance
(c) Institutional finance (d) Micro finance
12. The Government of India spent Rs. 4.85 crore on Neeraj Chopra for his training. This will be categorized as
_____________.
(a) revenue nature income (b) capital nature income
(c) revenue nature expenditure (d) capital nature expenditure

13. ___________ is one of the characteristics of people living in poverty.

(a) Political inclusion (b) Affluent lifestyle
(c) High expenditure pattern (d) No gender disparity

14. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Till 1990, there was witnessing disguised unemployment in the agriculture sector because
industrial and service sector were unable to absorb the extra.
Statement 2 – As a result, the new economic policy 1991 has promoted the agricultural sector compared
to industry, trade and service sector.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

15. _________ is one of the correct demographic condition of Indians during the colonial rule.
(a) Adequate health facilities (b) High birth and death rate
(c) Low infant mortality rate (d) High life expectancy

16. The government can achieve its budget objective of ‘reducing regional disparities’ by __________.
(a) Increasing monopolic control
(b) Reducing debt trap
(c) Promoting social welfare
(d) Providing subsidies for setting up industries in backward areas.

17. Balance of Payments does not include economic transactions between __________ and rest of the world,
in a given period of time.
(a) Diplomatic staff of foreign country in India (b) Branches of foreign company in India
(c) Tourists (d) All of these.
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18. The RBI is empowered to __________ in the economy through its monetary policy?
(a) Maintain reserves (b) Regulate the money supply
(c) Issue currency and all coins (d) Supervise all bank

19. Identify which of the following is not an example of capital account transaction.
(a) Payment due as interest on loans
(b) Indian party making investment in equity shares
(c) Acquisition of immovable property in equity shares
(d) Repayment of loans

20. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Monthly per capita expenditure considers social factor that generate and are responsible of
poverty.
Statement 2 – ‘Monthly per capital income expenditure’ method groups all the poor together and does
not differentiate between the poor and other poor.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

21. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – India has a fair international worthiness and credibility which makes it a favourable
outsourcing destination.
Statement 2 – MNCs get various types of lucrative offers from the Indian government like tax holidays, low
tax rates, etc.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

22. ‘During British rule death rate was very high in India’. Identify which of the following may not be the
reason for high death rate.
(a) No clean and safe drinking water (b) Extremely low literacy rate
(c) Poverty and malnutrition (d) Healthy inadequate health facilities.

23. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): Acquisition of INTEL CORPORATION by TATA will be recorded on the debit side of BOP
account.
Reason(R): It leads to outflow of foreign exchange from the domestic country.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explaination of (A).
(b) Both (A) and (R) are true and (R) is not the correct explaination of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

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24. Mr. Ramesh, Director of Om Higher Education Institute, providing higher education in India at reasonable
fees, it has 600 branches across all over India which is great step towards increasing literacy rate of higher
education. It exhibits the right step in the direction of human capital formation.
Spot which of the following does not directly contributes to the process of human capital formation by
Mr. Ramesh:
(a) The fullest possible development of human capabilities
(b) Ability to think and pursue dreams in life
(c) Induces equity in land distribution
(d) Overcome of social prejudices

SECTION B
(20 questions out of 24 questions are to be attempted)

25. Suppose in an economy, the initial deposits of Rs. 2,000 crores lead to the creation of total deposits worth
Rs. 10,000 crores.
Under the given situation the value of reserve requirements would be ____________.
(a) 0.5 (b) 0.21 (c) 0.20 (d) 1/0.2

26. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): The ‘Land reform’ measures and Green revolution were the greatest achievements of the
Indian government in enhancing the agricultural production and productivity.
Reason(R): The proportion of GDP between 1950-90 contributed by agriculture declined significantly.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explanation of (A).
(b) Both (A) and (R) are true and (R) is not the correct explanation of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

27. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): Human development considers education and health as a means to increase labour
productivity.
Reason(R): According to human development perspective, every individual has a right to be literate and
lead a healthy life.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explanation of (A).
(b) Both (A) and (R) are true and (R) is not the correct explanation of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

28. From the set of statements given in Column I and Column II, choose the correct pair of statement:
Column I Column II
(Name of the Scheme) (Objective of Poverty Alleviation Program)
A. National Food for Work Programme i. Aims at creating self employment opportunities
for rural people
B. Pradhan Mantri Garib Kalyan Yojana ii. Provide free health facilities to poorest to fight
covid battle

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 C. Pradhan Mantri Jan-dhan Yojana iii. Aims to expand affordable access to financial
services such as bank a/c remittances, credit
insurance and pension
D. Indira Awaas Yojana (rural housing) iv. Housing program operated with the aim of
providing facilitating houses to homeless poor
during the covid crisis.
Alternatives:
(a) A-i (b) B-ii (c) C-iii (d) D-iv

29.

 The term post-pandemic refers to the period since the onset of the pandemic in January 2020.
 The chart shows the estimated number of people in each income tier in 2020 before and after the
Covid 19 induced global recession.

Figure showing estimated number of poor in each income tier, before and after Covid-19.
On the basis of the given bar diagram, the number of poor in India is estimated to have _________ and
low income people is estimated to have _________due to Covid-19 induced recession.
(a) increased, increased (b) increased, decreased
(c) decreased, increased (d) decreased, decreased

30. Educational levels in India, 1991

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 On the basis of the above mentioned information answer the following question:
The Indian education pyramid is steep indicating __________ reaching higher education.
(a) Comparatively high (b) Almost all
(c) Relatively more (d) Lesser and Lesser number of people

31. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): The idea behind abolition of intermediaries was that ownership of land would give
incentives to the actual tillers to make improvements.
Reason(R): Land reforms were successful in Kerala and West Bengal because government of these
states were committed to the policy of land reforms.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explanation of (A).
(b) Both (A) and (R) are true and (R) is not the correct explanation of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

32. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – NABARD facilitates rural prosperity by refinancing and promoting institutional
development.
Statement 2 – NABARD is intended to create income generating assets in agriculture and allied activities.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

33. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Money creation by commercial bank raises the national income.
Statement 2 – Higher the value of LRR, higher the value of money multiplier and more the money is
created by the banking system resulting in the subsequent rise in the national income.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

34. Arrange the following event in the correct chronological order:

i. Opening of Suez canal
ii. First Official Census
iii. Introduction of railway in India
iv. Foundation of British empire (Battle of Plassey)
Alternatives:
(a) iv, ii, i, iii (b) I, iv, iii, ii (c) ii, iii, iv, i (d) iv, iii, I, ii

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35. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): Unfavourable balance of trade can be met out of favourable balance of payments.
Reason(R): Autonomous transactions are compensating capital transactions which are meant to correct
disequilibrium in all item of balance of payments.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explanation of (A).
(b) Both (A) and (R) are true and (R) is not the correct explanation of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

36. Demand deposits of commercial banks include only ____________ and ___________ excluded.
i. Saving account deposits ii. Net demand deposits
iii. Inter-bank deposits iv. Cash reserves with banks
Alternatives:
(a) i and ii (b) ii and iii (c) i and iii (d) i and iv

37. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): After the economic reforms of 1991, the growth rate of agriculture sector decelerated to 3%
p.a. during 1991-2012.
Reason(R): The new economic policy has neglected the agricultural sector as compared to industry,
trade and service sector.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explaination of (A).
(b) Both (A) and (R) are true and (R) is not the correct explaination of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.
38. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): Consumers and business park much of their funds in demand deposits in order to pay for
their ongoing, daily expenses.
Reason(R): Demand deposits are advantageous due to their liquidity ease of access.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explaination of (A).
(b) Both (A) and (R) are true and (R) is not the correct explaination of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

39. Choose the correct alternatives relating to the adverse living standards of Indian during British rule to be
filled in given blank B and D.

Population Explosion

Low, unstable, inadequate yield

D
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 (a) High illiteracy, indebtness
(b) Fragmentation of landholding, indebtness and poverty
(c) Low economic development, Fragmentation of landholding
(d) High subsidies, distress among farmers

40. Suppose that the Balance of Trade (BOT) of a nation, exhibits a deficit of Rs. 50,000 crores. The import of
visible items are five time of the exports of visible items to the rest of the world.
The value of exports would be Rs. _________ crores.
(a) 20,000 (b) 10,000 (c) 12,500 (d) 20,300

41. Identify the incorrect statement from the following:

(a) Colonial government enforced discriminatory tariff policy, which allowed free export of raw materials
from India and free import of final goods of British industry to India.
(b) Indian agricultural sector did not suffer due to partition.
(c) During British rule, India inherited the features of both feudal and capitalist system in the Indian
economy.
(d) At the time of independence, Indian economy was a ‘depleted economy’ and ‘amputed economy’.

42. Match the situations given in Column I with their respective implications given in Column II:
Column I Column II
A. Massive illiteracy i. Serious inefficiency
B. Physical capital ii. Create private benefit
C. Health expenditure iii. Productive labour force
D. Human developmentive iv. Human welfare is the main objective

Alternatives:
(a) A-ii, B-iii, C-iv, D-i (b) A-iii, B-iv, C-i, D-ii
(c) A-i, B-ii, C-iii, D-iv (d) A-ii, B-iv, C-i, D-iii

43. When there is a depreciation of foreign currency, the supply of foreign currency in domestic economy will:
(a)Increase (b) Not change (c) Either increase or decrease (d) Decrease

44. If an economy is to control recession, which of the following can be appropriate?

(a) Reducing Repo Rate (b) Reducing CRR
(c) Both (a) and (b) (d) None of (a) and (b)

45. Most of the studies disclosed that India’s growth of aggregate real output during the first half of the
twentieth century was less than
(a) 0.5% (b) 5% (c) 2% (d) 1.5%

46. Arguments against subsidies:

(a) A huge burden on the government’s finances
(b) It does not benefit the target group
(c) Fertiliser subsidy also benefits the fertilizer industry
(d) All of the above

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47. By March end 2003, more than __________ SHGs had reportedly been credit linked.
(a) one lakh (b) two lakhs (c) five lakhs (d) seven lakhs

48. _____________ essentially focuses on action for the development of areas that are lagging behind in the
overall development of the village economy.
(a) Economic growth (b) Economic development
(c) Rural development (d) All of these

SECTION C
(10 questions out of 12 questions are to be attempted)
Q.No. 49-54 are to be answered on the basis of the following data:

49. The value of recovery of loans has __________ crores between 2017-18 (Actuals) and 2018-19 (Budgeted
estimate).
(a) Fallen by Rs. 4343 (b) Risen by Rs. 3434
(c) Fallen by Rs. 3434 (d) Risen by Rs. 4343

50. The percentage change in the Non-Tax Revenue, between 2017-18 (Actual) and 2018-19 (Budgetary
Estimate), taking the 2017-18 as base, would be ___________.
(a) 27.89% (b) 271.5% (c) 24.64% (d) 27.15%

51. Identify which of the following is not an example of non-tax revenue:

(a) Fees (b) Customs (c) Escheat (d) Special tax

52. Identify the correct formula of total borrowings:

(a) Revenue deficit + (Capital expenditure – Non-dept creating receipts)
(b) Primary deficit – Interest payments
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 (c) Total expenditure – Total receipts including borrowings
(d) Total expenditure – Revenue Receipt

53. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Fiscal deficit of 2017-18 is more than 2018-19’s annual fiscal deficit.
Statement 2 – Revenue deficit of 2017-18 tends to be higher than 2018-19’s annual revenue deficit.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

54. The value of Primary deficit for the year 2017-18, would be Rs. ________ crores.
(a) 62112 (b) 626112.4 (c) 48481 (d) 609219

Q. No. 55-60 are to be answered on the basis of the following data:

The economic liberalization process in 1991 was triggered by an economic crisis (when government finances
were strained, BOP crisis) that confronted our nation then, but it was not limited to crisis management. The
edifice of India’s economic reforms was build on the desire to prosper, the belief in our capabilities, and the
confidence to relinquish control of the economy by the government. The measures included devaluating the
rupee, a new industrial policy which sharply reduced bureaucratic control, raising FDI limits in a number of
sectors, cutting red tape and paving the way for privatization of state-owned entities, to ensure ameliorate
performance of PSUs. The thrust of the NEP has been towards creating a more competitive environment by
encouraging foreign investment too through trade and investment policy reforms in the economy as a means
to improve the productivity and efficiency of the system. This was to be achieved by removing the barriers to
entry and the restrictions on the growth of firms.
Liberalisation
Liberalisation refers to the slackening of government regulations. The economic liberalization in India denotes
the continuing financial reforms which began since July 24, 1991.
Privatisation and Globalisation
Privatisation refers to the participation of private entities in businesses and services and transfer of ownership
from the public sector (or government) to the private sector as well.
Globalisation stands for the consolidation of the various economies of the world.
55. Liberalisation involves _________ and greater autonomy of private investment.
(a) Greater control of government (b) Regulating reform
(c) Deregulation and reduction of government control (d) Licensing reforms
56. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Liberalisation was introduced to induce more competition into the economy.
Statement 2 – Under Liberalisation multinational corporation were also engaged to invest and expand in
India.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false

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57. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): The new economic reforms include cutting red tapism paving the way for privatization of
state owned entities.
Reason(R): Privatisation will improve financial discipline and facilitates modernisation will improve the
performance of PSUs.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explaination of (A).
(b) Both (A) and (R) are true and (R) is not the correct explaination of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

58. In the light of the given text and common knowledge, identify the incorrect statement:
(a) Under industrial sector reforms public sector’s role was substantially reduced and MRTP act was
introduced.
(b) Liberalisation involves transcending economic, social and geographical boundaries.
(c) The main aim of policy was to create a more competitive environment in the economy and remove the
barriers to entry and growth of firms.
(d) Rupee was devalued against foreign currencies to increase the inflow of foreign exchange.

59. Read the following statements carefully and choose the correct alternative from the following:
Statement 1 – Reduction in bureaucratic control will provide ease in privatization.
Statement 2 – The practical reason for privatization is that the government finances are strained and it
looks to augment its resources by government assets.
Alternatives:
(a) Both the statements are true.
(b) Both the statements are false.
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false

60. Read the following statements and choose the correct one from the given alternatives:
Assertion (A): The NEP involves drastic steps such as deindustrialization, changes to foreign exchange rate,
PSU privatization, delicensing and so on.
Reason(R): LPG were introduced to create conducive climate for public sector to usher growth.
Alternatives:
(a) Both (A) and (R) are true and (R) is the correct explaination of (A).
(b) Both (A) and (R) are true and (R) is not the correct explaination of (A).
(c) (A) is true but (R) is false.
(d) (A) is false but (R) is true.

--------X--------

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