Class 11 SAMPLE PAPER 02

Section01 Economics
1. Price theory studies which of the following problem?
(a) What goods to produce and how much to produce
(b) How to produce
(c) For whom to produce
(d) All of the above
Ans. a
Explanation: What goods to produce and how much to produce.

2. What do you mean by higher Indifference curve?

(a) Price of goods have reduced
(b) Consumer has more income
(c) Higher utility level
(d) All of the above
Ans. c
Explanation: Higher Indifference curves represent higher levels
of satisfaction: Higher indifference curve represents large
bundle of goods, which means more utility because of
monotonic preference.

3. What will be equilibrium price when increase in demand

is more than increase in supply?
(a) Remain the same
(b) Rise
(c) Fall
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(d) None of the above
Ans. b
Explanation:

4. Movement along the supply curve is also called:

(a) Increase in supply
(b) Contraction in supply
(c) Change in quantity supplied
(d) Change in supply
Ans. c
Explanation: Movement along supply curve can be defined as
graphical representation of change in supply for a commodity
brought by change in its own price other things remaining
constant. If price changes supply too changes. The change in
supply is graphically shown by movement form a point to
another point of same supply curve.

5. Statistical calculation in classified data is based

on__________
(a) The upper class limit
(b) The actual values of observation
(c) The lower class limit
(d) The class midpoint

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Ans. d

6. What do you mean by Range?

(a) Difference between the largest and the smallest observations
(b) Difference between the smallest and the largest observations
(c) Average of the largest and the smallest observations
(d) Ratio of the largest to the smallest observation
Ans. c
Explanation: The range of a set of data is the difference
between the largest and smallest values.

7. What can be understand by data represented through

arithmetic line graph?
(a) Long term trend
(b) Cyclicity in data
(c) Seasonality in data
(d) All the above
Ans. a
Explanation: Data represented through arithmetic line graph
help in long term trend.

8. Inflation is calculated by using___________

(a) Consumer price index
(b) Wholesale price index
(c) Producers’ price index
(d) Manufacture’s price index
Ans. b
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9. Choose from the following three measures which can
measure any type of relationship:
(a) Karl Pearson’s coefficient of correlation
(b) Spearman’s rank correlation
(c) Scatter diagram
(d) None of these
Ans c

10. What is the algebraic sum of deviation of a set of n values

from A.M.?
(a) n
(b) 0
(c)1
(d) None of the above
Ans. b

11. Obtain the mean of the following series by step-deviation

method:
Marks 10–25 25–40 40–55 55–70 70–85 85–100
Frequency 6 20 44 26 3 1
(a) 48.00 (b) 47.95
(c) 27.29 (d) 68.65
Ans. (b)
Explanation: Refer to the following table:

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Class Frequenc Cumulative Midvalue m  41.5 d fd 

y (f) frequency (m)

(cf)
10–25 6 6 17.5 –30 –2 –12
25–40 20 26 32.5 –15 –1 –20
40–55 44 70 47.5 0 0 0
55–70 26 96 62.5 +15 +1 +26
70–85 3 99 77.5 +30 +2 +6
85–100 1 100 92.5 +45 +3 +3
Total  f  100  cf  397  fd   3

By step deviation method:

 fd 
X  A i
N
3
 47.5   15
100
 47.5  0.45
 47.95

12. Find the mean deviation about the mean for the
following data:
17, 20, 12, 13, 15, 16, 12, 18, 15, 19, 12, 11
(a) 3.25
(b) 4.25
(c) 2.25
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(d) 4.98
Ans. c
Explanation:
Given data: 17,20,12,13,15,16,12,18,15,19,12,11
Mean of the given data is
17  20  12  13  15  16  12  18  15  19  12  11
12
180
x̅ = = 15
12
The respective absolute values of the deviations from mean i.e.
x i  x are 2,5,3,2,0,1,3,3,0,4,3,4
Thus, the required mean deviation about the mean is
∑12
i= 1 xi  x
(x̅) =
12
2+5+3+2+0+1+3+3+0+4+3+4
=
12
30
= = 2.5
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13. Which one of the following statement is classified with

reference to geographical locations?
(a) Quantitative Classification
(b) Qualitative Classification
(c) Chronological Classification
(d) Spatial Classification
Ans. (d)

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Explanation: Spatial Classification is classified with reference
to geographical locations. For example, countries, states, cities,
districts, etc.

14. Statistical average has significance due to following

sequence.
1. To present huge mass of data in a summarized form.
2. To facilitate comparison of different sets of data
3. To help decision-making
Select the cored ans. Using the codes given below.
Codes
(a) 1,2,3 (b) 2,3,1
(c) 2,1,3 (d) 3,2,1
Ans. (a)

15. Which among the given statement is false?

(a) According to Boddington, “Statistics is the science of
estimates and probabilities”.
(b) According to Bowley, “Statistics is not a science, it is a
scientific method.”
(c) According to Tippett, “Statistics is not a science, it is a
scientific method”.
(d) According to Seligman, “Statistics may be regarded as a
body of methods for making wise decisions in the face of in
certainly”.
Ans. (d)
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Section02 business studies

16. Which is not a type of general insurance

a) Marine Insurance
b) Fidelity Insurance
c) Fire Insurance
d) Life Insurance
Ans. d
Explanation: General insurance is typically defined as any
insurance that is not determined to be life insurance.

17. In which of the following country ADRs are issued?

(a) India
(b) China
(c) USA
(d) Canada
Ans. c
Explanation: The depository receipts issued by a company in
the USA are known as American Depository Receipts (ADRs)

18. Two broad categories of business activities are:

(a) Industry and commerce
(b) trade and industry
(c) Trade and commerce
(d) none of these
Ans. a
Explanation: Industry and commerce are are two broad
categories of business activities.

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19. What is Disinvestments of PSE s?
(a) Investing in new areas
(b) Closing down operations
(c) Sale of equity shares to private sector/public
(d) Buying shares PSE’s
Ans. c
Explanation: Disinvestment refers to the sale of equity shares
to the private sector and the public. The purpose of
disinvestment is to raise funds and encourage wider participation
of general public and workers in the ownership of these
enterprises.

20. Under which type of industry do oil refinery and sugar

mills are classified?
(a) Primary industry
(b) Secondary industry
(C ) Tertiary industry
(d) None of the above
Ans. b
Explanation: oil refinery and sugar mills are classified in
secondary industry.

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21. __________ is the Head of the Joint Hindu family
business.
(a) Proprietor
(b) Director
(c) Karta
(d) Manager
Ans. c
Explanation: The loint Hindu family business is controlled by
me head of the family who is the oldest member and is called
Karta.

22. Choose which of the following is not a function of

insurance?
(a) Assist in capital formation
(b) Risk sharing
(c) Lending of funds
(d) None of these
Ans. c
Explanation: The functions of insurance include providing
certainty, security, risk sharing and assistance in capital
formation.
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23. Which of the following unit is not considered as an
application of e-business?
(a) Research and Development (b) Online trading
(c) Online procurement (d) Online bidding
Ans. a
Explanation:
Research and Development is an outsourcing activity which is
not covered under the e-business.

24. Carbon monoxide emitted by automobiles directly comes

under_______________
(a) Water pollution
(b) Air pollution
(c) Land pollution
(d) Noise pollution
Ans. b
Explanation: Air pollution is the result of a combination of
factors which lowers the air quality especially the carbon
monoxide emitted by automobiles.

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25. Minimum how many members forms a public company?
(a) 5
(b) 21
(c) 12
(d) 7
Ans. d
Explanation: To form a public company, at least seven
members must sign the memorandum of association.

26. Who wrote the famous Book “An Enquiry into the
Nature and Causes of Wealth of Nations”?
(a) Alfred Marshall (b) David Ricardo
(c) Adam Smith (d) Prof. Amartya Sen
Ans. (c)
Explanation: The famous book “An Enquiry into the Nature
and Causes of Wealth of Nations” is written by the Father of
Economics, Adam Smith in 1776. He focusses his studies on
wealth and money.

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27. Which of the following statement (s) it is/ are true about
Indian managers?

(a) Many Indian top management are relatively authoritarian in

their relationship with lower management and with labour.
(b) Prevelance of low degree of control.
(c) Management have faith in capacity off workers for taking
initiative.
(d) None of the above.

Ans. (a)

28. Which of the following statement (s) is/are correct?

(a) Management cannot generate a favourable working
environment.
(b) An ideal management takes the right decisions on all
matters at the right time.
(c) Management activities need not to be result oriented.
(d) None of the above.
Ans (b)

29. Principle of management which implies that there should

be ‘One Head and One Plan’ for a group of activities having
the same objective is
(a) Unity of direction
(b) Authority and responsibility
(c) Unity of command
(d) None of the above
Ans. (a)
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30. Good manager should process many of the qualities of an
effective?
(a) Candidate (b) employee
(c) Superior (d) leader
Ans. (d)

31. “Leadership is the set of interpersonal behaviour designed to

influence employees to corporate in the achievement of
objectives” who said this?
(a) Glueck (b) George Terry
(c) Keith Davis (d) EB Flippo
Ans. (a)

Section03 Accountancy

32. Cost of capital from all the sources of funds is called.

(a) Specific cost
(b) Composite cost
(c) Implicit cost
(d) Simple average cost
Ans. (a)

33. Transaction costs include

(a) Brokerage (b) Commission
(c) Printing (d) All of these
Ans. (a)

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34. Interest rate risk is a type of
(a) Credit risk (b) Market risk
(c) Operational risk (d) All of the above
Ans. (b)

35. After tax cost of debt capital is calculated by

(a) (1 – tax rate) x CB (before tax)
(b) CB (before tax) (1 – tax rate)
(c) (1 – tax rate x CB (before tax)
(d) None of the above
Ans. (c)

36. Return on investment is generally computed as the ratio of

(a) Net profit to sales
(b) Cost of sales to capital employed
(c) Net profit to capital turnover
(d) Operating net profit to shareholders fund
Ans. (c)
Explanation: Return on investment (RoI) is generally computed
as the ratio of net profit to capital turnover.

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37. Everything a firm owns, it also owns out to somebody.
This co-incidence is explained by the ___________ concept.
(a) Consistency (b) conservatism
(c) Business entity concept (d) dual aspect
Ans. (d)

38. For which type of pricing, cost plus pricing is considered

appropriate tool?
I. Product tailoring II. Public pricing
III. Refusal pricing IV. Monopoly pricing
Codes:
(a) II, III and IV only (b) I, II and III only
(c) I and II only (d) III and IV only
Ans. (b)
Explanation: Cost plus pricing is considered appropriate tool
for product tailoring, public pricing and refusal pricing.

39. Which one of the following is considered as the pre-

acquisition profit in subsidiary company?
(a) Minority interest (b) Revenue profit
(c) Goodwill (d) Capital profit
Ans. (d)
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Explanation: Capital profit is considered as the pre-acquisition
profit in subsidiary company.

40. Long-term loans are for a period of

(a) One year (b) Five years
(c) More than five years (d) None of these
Ans. (c)

41. In finance, working capital means the same thing as

(a) Total assets (b) Fixed assets
(c) Current assets (d) None of these
Ans. (c)

42. Government grants are generally offered to businesses

in
(a) Prosperous areas
(b) Cold areas
(c) Economically deprived areas
(d) Areas with high employment
Ans. (c)

43. Which is the source of mid-term finance?

(a) Micro credit
(b) Specialised financial institution
(c) Collect advances from purchasers
(d) Discounting the bills receivable

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Ans. (b)

44. …………….. varies inversely with profitability.

(a) Liquidity (b) Risk
(c) Return (d) Loss
Ans. (b)

45. Equipment costing Rs 3,000 with accumulated

depreciation of Rs.2, 125 is exchanged for another asset
with a fair value of Rs 625. The exchange has commercial
substance. How much is the gain or loss on this transaction?

a. A gain of Rs250 should be recognized.

b. A loss of Rs250 should be recognized.
c. A loss of Rs 500 should be recognized.
d. No gain or loss should be recognized.
Ans b)
Explanation: The consideration given (Rs3,000 - Rs2,125) =
Rs875) is Rs250 greater than the value of the asset received
(Rs625), necessitating the recording of a loss.)

46. Deep Gold Mining Company recognizes Rs 4 of depletion

for each ton of ore mined. This year, 300,000 tons of ore
were mined but only 180,000 were sold. The amount of
depletion which should be deducted from revenue this year
is:

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a. Rs 0
b. Rs 480,000
c. Rs 720,000
d. Rs1,200,000
Ans c)
Explanation: The depletion which should be deducted from
revenue equals the 180,000 units sold times the Rs4 per ton
depletion rate. The depletion on the other 120,000 units
(300,000 - 180,000) is reported as inventory (120,000 X Rs4 =
Rs480, 000).)

Achiever Section
47. Systematic sampling is used for which of the following?
1. Quota sampling
2. Non-probability sampling
3. Probability sampling
Codes
(a) Both 1 and 2
(b) Both 2 and 3
(c) Only 2
(d) Only 3
Ans. (d)

48. Cracker Ltd. Forfeited 800 shares of Rs. 10 each, issued

at 30% premium (to be paid at the time of allotment) for
non-payment of a first call of Rs. 2 per share. The second

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and final call of Rs. 2 has not yet been called. Out of these,
200 shares were re-issued as paid up for Rs. 8 per share
(a) Rs.1200
(b) Rs.1100
(c) Rs.1000
(d) Rs.1300
Ans a)
Explanation: As profit on 800 shares = Rs. 4800
Therefore, profit on 200 shares = Rs. 4800/800×200
= Rs. 1200
Since, there is no loss on re-issue, the full amount of Rs. 1200
will be transferred to Capital reserve.

49. If NPV is positive, then IRR will be equal to

(a) Negative (b) K < R
(c) K = R (d) Positive
Ans. (b)
Explanation: If NPV is positive, then IRR will be equal to K
which is less than R.

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50. Match the List-I with those in List-II as follows and
suggest the correct code as answer.
List-I List-II
(Stock Exchanges) (Years of
Establishment)
(a) National stock exchange (NSE) (i) 1875
(b) MCX stock exchange (MCX-SX) (ii) 1992
(c) Bombay stock exchange (BSE) (iii) 2000
(d) Interconnected stock exchange of India (ISEI) (iv) 2008
Codes:
(a) (b) (c) (d)
(a) (ii) (iv) (i) (iii)
(b) (iii) (ii) (iv) (i)
(c) (i) (iii) (ii) (iv)
(d) (ii) (iii) (iv) (i)
Ans. (a)
Explanation:
(a) National stock exchange (NSE) (ii)
1992
(b) MCX stock exchange (MCX-SX) (iv) 2008
(c) Bombay stock exchange (BSE) (i) 1875
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(d) Interconnected stock exchange of India (ISEI) (iii)
2000

51. An asset was purchased for Rs 10000 on which

depreciation was provided @ 5% on S.L.M. method, the
W.D.V. of asset at the end of two years is
(a) Rs. 7500
(b) Rs. 8000
(c) Rs. 9000
(d) Rs.9500
Ans c)
Explanation:
WDV of the asset = 10000 – [10,000 x 5% x 2] = 9000

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