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Class 11 - Economics

Sample Paper - 07 (2023-24)

Maximum Marks: 80

Time Allowed: : 3 hours

General Instructions:

1. This question paper contains two sections:

Section A – Micro Economics

Section B – Statistics
2. This paper contains 20 Multiple Choice Questions type questions of 1 mark each.
3. This paper contains 4 Short Answer Questions type questions of 3 marks each to be answered in 60 to 80 words.
4. This paper contains 6 Short Answer Questions type questions of 4 marks each to be answered in 80 to 100 words.
5. This paper contains 4 Long Answer Questions type questions of 6 marks each to be answered in 100 to 150 words.

Section A
1. Assertion (A): A new science has evolved nowadays which is called Econometrics.

Reason (R): There is a vital relationship between economics, mathematics, and statistics due to the importance of
mathematics and statistics in economics.
a) Both A and R are true and R is the correct explanation of A.
b) Both A and R are true but R is not the correct explanation of A.
c) A is true but R is false.
d) A is false but R is true.
2. _________ reflects on the price change experienced by families of people.
a) weighted average price
b) none
c) consumer price index
d) whole sale price index
3. The highest strength of association is reflected by which of the following correlation coefficient? 
a) 0.1
b) -0.95
c) 0.85
d) +1.0
4. Calculate index numbers from the following data by simple aggregate method taking prices of 2000 as base.
Commodity A  B C D

Price per unit (in Rupees) 2000 80 50 90 30

  2001 95 60 100 45
a) 120
b) 150
c) 130
d) 140
5. Reference year for Index number is:
a) Current Year

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b) Base year
c) Previous Year
d) First Year
6. Fisher's index number is based on 
a) The Geometric Mean Laspeyre's and Paasche's index numbers.
b) None of these.
c) The Median of Laspeyre's and Paasche's index numbers.
d) The Arithmetic mean of Laspeyre's and Paasche's index numbers.
7. The study of mankind in the ordinary business of life
a) Economy
b) Environment
c) Economics
d) Econometric
8. A table should be:
a) All of these
b) Attractive
c) Comparable
d) As per Objective
9. The best average for constructing an index numbers is:
a) Arithmetic mean
b) Geometric mean
c) Harmonic mean
d) None of these
10. Calculate Pearson's correlation coefficient from the following data:
X 10 12 8 15 20 25 40

Y 15 10 6 25 16 12 8
a) -0.18
b) -0.14
c) 0.12
d) +0.25
11. What methods are used for constructing Consumer Price Index number?
12. If the median of 5, 9, 11, 3, 4, X and 8 is 6, then find the value of X.

OR

Find the mean of first 8 odd numbers.

13. How will you differentiate between variable and attributes?

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14. Differentiate between diagrammatic and tabular presentation of data. 

OR

Represent the following data by an appropriate bar diagram.

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Index Numbers of Agricultural Production

(base 1991-92 = 100 and figures to the nearest of unit value)

Foodgrains
Year
Rice Wheat Pulses
1999-2000 149 157 141

2000-01 162 170 131

2001-02 165 187 139
2002-03 155 176 121

2003-04 164 197 140

2004-05 166 189 127
2005-06 173 201 145
15. Distinguish between Primary data and secondary data. 
16. Describe how to tell whether a set of data points shows a positive correlation, a negative correlation, or approximately no
correlation. 
17. The following series relates to the daily income of workers employed in a firm. Compute
i. highest income of lowest 50% workers.
ii. minimum income earned by top 25% workers.
iii. maximum income earned by lowest 25% workers.
Daily Income (in ₹) Number of Workers
10-14 5
15-19 10
20-24 15

25-29 20
30-34 10
35-39 5

OR

The mean of the given distribution is Rs.425. Find the missing frequency.
Wages (Rs.) Number of Workers

100-200 12
200-300 8

300-400 20

400-500 32
500-600 x

600-700 8

700-800 5
Section B

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18. Due to the increase in GST the supply of Air conditioners decrease from 20 units to 10 units at the same price, this
situation leads to:
a) Extension in supply
b) Contraction in supply
c) Decrease in supply
d) Increase in supply
19. _____ is an act of abstinence from consumption
a) Distribution
b) Saving
c) Production
d) Investment
20. Excess capacity is a prominent feature of equilibrium under?
a) Perfect competition
b) gopoly
c) Monopoly
d) Monopolistic competition
21. In which market AR is equal to MR?
a) Monopoly
b) Perfect competition
c) Monopolistic competition
d) Oligopoly
22. Which cost curve is parallel to x-axis:
a) TFC
b) TC
c) AFC
d) TVC
23. Assertion (A): Demand increases with an increase in population and decreases with a decrease in population.

Reason (R): With the increase in population size the number of buyers of the product tends to decrease.
a) Both A and R are true and R is the correct explanation of A.
b) Both A and R are true but R is not the correct explanation of A.
c) A is true but R is false.
d) A is false but R is true.
24. If the market demand curve for a commodity is horizontal to x-axis then the market structure must be:
a) Perfect competition
b) The market structure cannot be determined from the information given.
c) Oligopoly
d) Monopoly
25. The Average revenue become negative when
a) TR stops rising at increasing rate
b) Never
c) TR is constant and maximum
d) TR starts rising
26. Average fixed cost (AFC) is indicated by:
a) a rectangular hyperbola
b) a straight line parallel to X-axis
c) a U-shaped curve

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d) a straight line parallel to Y-axis

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27. In perfect competition, which of the following curves generally lies below the demand curve and slopes downward?
a) Marginal revenue
b) Marginal cost
c) Average cost
d) Average revenue
28. Explain how scarcity and choice go together.

OR

State the central problem 'for whom to produce'.

29. Explain why an equilibrium price of a commodity is determined at that level of output at which its demand equals its
supply.
30. State the factors of leftward shift of demand curve. Explain any one.
31. Imagine yourself a producer (in a perfectly competitive market structure), focusing on profit maximisation. Will you
prefer striking an equilibrium in a state of increasing returns?

OR

Explain why will a producer not be in equilibrium if the conditions of equilibrium are not met.
32. Explain the concept of Budget line equation with the help of numerical examples.
33. Find out the missing values from the following table:
Variable Factors 0 1 2 3 4 5 6 7

TP (in units) - - - - 25 - - -

AP (in units) - 5 - - - - - -
MP (in units) - - 8 4 - 5 0 -4
34. Answer the following questions
1. The price elasticity of demand of X is (-) 1.25. Its price falls from Rs 10 to Rs 8 per unit. Calculate the percentage
change in its demand.
2. Consider the demand for a good. At price ₹ 4, the demand for the good is 25 units. Suppose price of the good
increases to ₹ 5, and as a result, the demand for the good falls to 20 units. Calculate the price elasticity.

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Class 11 - Economics

Sample Paper - 07 (2023-24)

Solution

Section A
1. (a) Both A and R are true and R is the correct explanation of A.

Explanation: New science has evolved nowadays which is called Econometrics as there is a vital relationship between
economics, mathematics, and statistics due to the importance of mathematics and statistics in economics.
2. (c) consumer price index

Explanation: Consumer index number (CPI) or cost of living index numbers are helpful in studying the change in
consumer expenditure .Here, family is basically a consumer unit. 
3. (d) +1.0

Explanation: The range of correlation coefficient ranges from +1 to -1.  +1 being the highest strength of association.  If
r = +1, that is the maximum and it is said to be a perfectly positive correlation.
4. (a) 120

Explanation: 95+60+100+45/80+50+90*100=12
5. (b) Base year

Explanation: The base year refers to the year in which an index number series begins to be calculated. This will
invariably have a starting value of 100.
6. (a) The Geometric Mean Laspeyre's and Paasche's index numbers.

Explanation: Fisher has combined the techniques of Laspeyres and Paasche's Method. He used both base year as well
as  Current Year quantities (q0, q1) as weight. Prof. Irving Fisher has given a number of formulae for constructing index
numbers and of these, he calls one as the ‘ideal’ index. Fisher’s Ideal Index is the geometric mean of the Laspeyres and
Paasche indices.

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7. (c) Economics

Explanation: The phrase 'business of life ' implies all the three aspects of economics: production, distribution, and
consumption. This definition was given by Alfred Marshall.
8. (a) All of these

Explanation: All of these are included in the characteristics of a table.

9. (b) Geometric mean

Explanation: Geometric mean is the best average for constructing an index numbers.
10. (a) -0.18

Explanation:
X Y dX dY dX
2
dY
2
dXdY

10 15 -5 -10 25 100 50

12 10 -3 -15 9 225 45
8 6 -7 -19 49 361 133
15 (A) 25 (A) 0 0 0 0 0

20 16 5 -9 25 81 -45

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25 12 10 -13 100 169 -130
40 8 25 -17 625 289 -425
  ∑ 25 -83 833 1225 -372
N ∑ XY −∑ X ∑ Y
r = 

2 2 2 2
√N ∑ X −(∑ X ) √N ∑ Y −(∑ Y )

7(−372)−(25)(−83)
  =   = -0.18
2 2
√7(833)−(25) √7(1225)−(−83)

11. There are two methods of constructing Consumer Price Index number:
i. Family Budget Method This method computes CPI on the basis of family budget, using the given formula.

Consumer Price Index = 

ΣI W

ΣW

ii. Aggregative Method This is the most popular method for constructing Consumer Price Index number, and is
computed with the help of the following formula.

Σp1 q0
Consumer Price Index =  Σp0 q0
× 100

12. The given series is an individual series. So we will arrange the given data in ascending order

3, 4, 5, X, 8, 9, 11

The number of terms is 7.

7+1
∴M edian =  Size of  [
2
] th item

⇒ Median= Size of 4th item.

6 is given as median.

∵ 6 = Size of fourth item

So, the fourth item should be 6. 

So we arrange the given series in ascending order and put 6 in the fourth place.

3, 4, 5, 6, 8, 9, 11. 

Now 4th item is X and it is given that Median is 6.

⇒ X=Median = 6

OR

The first 8 odd numbers are 1, 3, 5, 7, 9, 11, 13 and 15.

¯¯¯¯
Mean( X ) = ΣX/n

where ΣX is the sum of observations and n is the total no. of observations.

¯¯¯¯ 1+3+5+7+9+11+13+15
∴ X = = 64/8 = 8
8

13. The differences between variables and attributes are:

Basis of
Variables Attributes
distinction
Variables are the characteristics which can be
Attributes are the characteristics which are qualitative
Definition measured and expressed in quantitative or
in nature and cannot be measured in numerical terms.
numerical terms.
Example For example- height, weight etc. For example- intelligence, honesty.
Attributes cannot be measured in numerical terms, we
Measurement Variables can be measured in numeric terms. can only find out whether an attribute is present or not
in a given population. 
It can be classified into two categories:(i)
It can be classified as :(i) simple classification or ii)
Classification Individual series

manifold classification.
ii) Frequency distribution series.

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Marketing In marketing, variables represent a buyer's In marketing, attributes represent manufacturers or
perspective perspective. For example- customers of sellers perspective. For example - to determine
different age groups require different products the features of the product to please the customer.
Tables are meant for statistician for the purpose of further
Diagrams and Graphs are meant for a layman.
14. analysis.
Diagrams give only an approximate idea. Table contain figures. Exact value can be read
Diagrams can be more easily compared, and can be Comparison and interpretations of tables can only be done by
interpreted by a layman. statisticians and it is a difficult task.
Diagrams and graphs cannot present much
Tables can present more information.
information.
Diagrams are more attractive and have a visual
Tables are dry for a layman (may be attractive to a statistician.)
appeal.

OR

Since we have to compare three variables in this question, therefore it is represented through a multiple bar diagram.

The bar diagram showing index number of agricultural production is given below. We represent Year in the X-axis and
index number in the Y-axis. 1991-92 is taken as the base year.

15. Difference between primary and secondary data:     

Primary data Secondary data
1. Primary data are those data which are collected from 1. Secondary data are those data which are collected from
the primary sources.  the secondary sources.
2.  Primary data are known as basic data. 2. Secondary data are known as subsidiary data.
3. The collection of secondary data is comparatively less
3. The collection of primary data is more expensive.
expensive.
4. It takes more time to collect the data. 4. It takes less time to collect the data.
5. Primary data are more accurate.  5. Secondary data are less accurate than the primary data.
6. Primary data are known as firsthand data.     6. Secondary data are known as second hand data.
7. Primary data are not readily available. 7. Subsidiary data are readily available.
8. It is not required to take much care at the time of
7. Subsidiary data are not readily available.
collecting data.  
16. a. A perfect positive correlation is given the value of 1.

b. A perfect negative correlation is given the value of -1.

c. If there is absolutely no correlation present the value given is 0.

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The closer the number is to 1 or -1, the stronger the correlation, or the stronger the relationship between the
variables.
The closer the number is to 0, the weaker the correlation. So something that seems to kind of correlate in a
positive direction might have a value of 0.67, whereas something with an extremely weak negative correlation
might have the value -0.21.

Examples :
An example of a situation where you might find a perfect positive correlation would be when every time that "x"
number of people go, "y" amount of money is spent on tickets without variation.
An example of a situation where you might find a perfect negative correlation would be if with every increase in
X, same amount of y decreases.
On the other hand, a situation where you might find a strong but not perfect positive correlation would be if you
examined the number of hours students spent studying for an exam versus the grade received. This won't be a
perfect correlation because two people could spend the same amount of time studying and get different grades.
But in general the rule will hold true that as the amount of time studying increases so does the grade received.

17. Daily Income Exclusive Group Number of Workers (f) Cumulative Frequency (cf)

10-14 9.5-14.5 5 5
15-19 14.5-19.5 10 15
20-24 19.5-24.5 15 30

25-29 24.5-29.5 20 50
30-34 29.5-34.5 10 60
35-39 34.5-39.5 5 65

    n = Σf = 65  
Calculation of Quartiles
(i)
The second quartile is the 50th percentile or the Median

To find the highest income of the lowest 50% of workers, we calculate second quartile i.e., median (M)

n 65
m =  Size of  ( )  th item  = ( )  th item  = 32.5th item
2 2

32.5th items lie in class 24.5-29.5

n
−cf
32.5−30

2 2.5
M = l1 + × c = 24.5 + × 5 = 24.5 + × 5 = 24.5 + 0.6
f 20 20

⇒  M=25.1
(ii)

The third quartile corresponds to the value that lies halfway between the median and the highest value in the
distribution. It, therefore, marks the region which encloses the 75% of the initial data or 25% of the end data

To find the minimum income earned by the top 25% of workers, we calculate upper quartile (Q3).
n 3×65
Q3 =  Size of 3 ( )  th item  = ( )  th item  = 48.75th item
4 4

48.75th item lies in class interval 24.5-29.5

3
n−cf
48.75−30
∴ Q3 = l1 +
4

f
× c = 24.5 +
20
× 5 = 24.5 +
18.75×5

20
= 24.5 + 4.7

⇒  Q3=29.2

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(iii)
The first quartile corresponds to the value that lies halfway between the median and the lowest value in the
distribution.Hence, it marks the region which encloses 25% of the initial data.
To find the maximum income earned by the lowest 25% workers, we calculate lower quartile (Q1)

Q1 =  Size of  (
n

4
)  th item  = (
65

4
)  th item  = 16.25th item

16.25th item lies in class interval 19.5-24.5

n
−cf
16.25−15

4 1.25×5
Q1 = l1 + × c = 19.5 + × 5 = 19.5 + = 19.5 + 0.42
f 15 15

⇒  Q1=19.92

OR

Wages (Rs.) Number of Workers Mid-Value (m) fm

100-200 12 150 1800

200-300 8 250 2000
300-400 20 350 7000

400-500 32 450 14400

500-600 x 550 550x
600-700 8 650 5200

700-800 5 750 3750

  Σf = 85 + x   Σ fm = 34150 + 550x

Now,

Rs.425 [Given]

¯¯¯¯
X =

Σf = 85 + x

Σ fm = 34150 + 550x

Σfm
We know that, X

¯¯¯¯
=
Σf

34150+550x
⇒ 425 =
85+x

⇒ 425(85 + x) = 34150 + 550x

⇒ 36125 + 425x = 34150 + 550x

⇒ 36125 − 34150 = 550x − 425x

⇒ 1975 = 125x

1975
∴ x = = 15.8 ∼ 16
125

Therefore, the missing frequency of the given data is 16

Section B
18. (c) Decrease in supply

Explanation: When the price is constant and supply decreases due to other factors like GST, it is said to be a decrease in
supply.
19. (b) Saving

Explanation: When we save ,we actually sacrifice consumption which results in savings. 
20. (d) Monopolistic competition

Explanation: In monopolistic competition , the actual output supplied is always less than the potential output.  A
producer under monopolistic competition will not move towards the potential or ideal output as that will increase his MC

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and MC will become more than MR leading to losses.

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21. (b) Perfect competition

Explanation: Perfect competition is a form of market in which Price is constant and AR is equal to MR.
22. (a) TFC

Explanation: Total fixed cost is that cost which remains fixed with a change in output. Its curve is a straight line parallel
to the x-axis.
23. (c) A is true but R is false.

Explanation: Demand increases with an increase in population and decreases with a decrease in population because
with an increase in population size the number of buyers of the product tends to increase.
24. (a) Perfect competition

Explanation: Under perfect competition, the price remains constant due to which its demand curve is a straight line
parallel to the x-axis.
25. (b) Never

Explanation: AR can never become negative as TR is always positive. 

26. (a) a rectangular hyperbola

Explanation: AFC is a rectangular hyperbola. It shows that AFC decreases as output increases and AFC× Q at any level
of output is the same. Because AFC× Q= TFC which is constant at all levels of output.
27. (a) Marginal revenue

Explanation: In perfect competition, marginal revenue curves generally lies below the demand curve and slopes
downward.
28. Scarcity refers to the basic economic problem, the gap between limited – that is, scarce – resources and theoretically
limitless wants. Resources are not only scarce but also have alternative uses i.e., land can be used for producing wheat or
for constructing warehouses or factories. Hence, it leads to a problem of choice. However, if resources were not scarce
one could have anything, anytime and then there would have been no problem of choice.

OR

For whom to produce means that who will buy the goods and services produced. Clearly those who have income will be
able to buy. So, the problem amounts to how the national income is distributed in an economy.
29. The equilibrium price of a commodity can only be determined at that level of output at which demand of a commodity
equals its supply. If at a given price, supply is greater than demand, it will show excess supply and if demand is greater
than supply, it will show excess demand. Due to excess supply price will fall and due to excess demand price will rise.
Hence, the price will be stable only at the equilibrium level where demand and supply both are equal. This can be shown
with the help of the following diagram.

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From the above diagram we have equilibrium price equal to P because at this point there is neither excess supply nor
excess demand.
30. i. When the income of the consumer falls.
ii. When the price of a substitute good decreases.
iii. When the price of complementary good increases.
iv. When taste and preference of the consumer shifts against the commodity.
v. When the availability of the commodity is expected to rise in the near future.
When the income of consumer decrease the purchasing power of consumer decreases and demand curve shifts to
leftward.
31. Striking an equilibrium in a state of increasing returns to a factor (when MP is rising or MC is falling) is absolutely ruled
out. Because it is a situation when every additional unit of output adds more and more to total profits. This is so because
MR is constant (under perfect competition) MC is falling (owing to increasing returns), so that the difference between
MR and MC tends to rise. It is only when the difference (MR - MC) starts shrinking and is finally eliminated, that the
profits are maximised. This happens only in a state of diminishing returns when MP is falling or MC is rising.  It would
be an irrational decision for a producer to strike his equilibrium in a situation of falling MC. It is only when MC is rising
that a producer should strike his equilibrium. 

OR

.A producer attains equilibrium when following two conditions are met:

i. Marginal Cost (MC) = Marginal Revenue (MR)
ii. marginal cost must be rising after the point of equality.

Yes, it is necessary that equilibrium is attained where marginal cost = marginal Revenue, however, it is not sufficient
condition, as both the conditions must be fulfilled as shown in the diagram below.

 We can see that Marginal Revenue is equal to Marginal Cost at point E1 and at point E. However, point E1 is not the
equilibrium point, as Marginal Cost is falling after point E1, which shows that as producer increases output, profit
level also increases.

The producer will continue to Increase his production up to point E, where marginal Cost is equal to marginal
Revenue again and marginal cost > Marginal Revenue thereafter. Hence, point E is equilibrium point where the profit
of the firm is maximised.
32. Budget Line equation: The Budget Line, also called as Budget Constraint shows all the combinations of two
commodities that a consumer can afford at given market prices and within the particular income level. Budget Line
shows all the different combinations of two goods that a consumer can buy at his given money income and price of two
commodities.

price of two commodities.

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Example: Suppose a consumer wants to consume two goods (X1 and X2). The prices of two goods are Rs. 4 and Rs. 5
respectively. The consumer's income is Rs. 20. Then the equation of budget line will be:
i. P1X1+ P2X2= M i.e., 4X1+ 5X2= 20.
ii. X1= = 5 units.
M 20
=
P1 4

iii. X2= = 4 units.

M 20
=
P2 5

ΔX2 −P1
iv. Slope of budget line =
4
= =
ΔX1 P2 5

33. The missing values as per the given table in the question can be found as follows:
Variable Factors
TP (in units)
AP (in units)
MP (in units)

(VF) TP =ΣM P AP = TP÷ VF MPn = TPn - TPn-1

0 0 0 0

1 5 5 5

2 13 6.50 8
3 17 5.67 4

4 25 6.25 8

5 30 6 5
6 30 5 0

7 26 3.71 -4
34. Answer the following questions
Percentage change in quantity demanded
1. Elasticity of Demand (Ed) =  Percentage change in price 

 Change in price 
Percentage change in Price =  Old price 
× 100

10−8
=
10
× 100 = 20%

∴ Ed = -1.25

% Change in quantity demanded 

=

20

∴  % Change in Quantity Demanded

= (−)1.25 × 20 = 25%

Therefore, Demand will increase by 25 percent

2. Price elasticity of demand is an economic measure of the change in the quantity demanded or purchased of a product
in relation to its price change. 

Price Elasticity of Demand = % Change in Quantity Demanded / % Change in Price.

P0 = 4, q0 = 25

P1 = 5, q1 = 20

△ p = 1, △q = -5

△q P0
ed = - ( △p
×
q0
)

5 4
×
1 25

= 0.8

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