CBSE Past Year Paper - 2019 (Set- 1) | Economics Class 12 - Commerce PDF Download

 Page 1


  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    1 
CBSE 
 Class XII Economics 
Board Paper 2019 All India (Set 1) 
 
Time allowed: 3 hrs Maximum Marks: 80 
 
General Instructions: 
(i) All questions in both the sections are compulsory. 
(ii) Marks for questions are indicated against each question. 
(iii) Question Nos. 1 – 4 and 13 – 16 are very short-answer questions carrying 1 mark 
each. They are required to be answered in one sentence each. 
(iv) Question Nos. 5 – 6 and 17 – 18 are short-answer questions carrying 3 marks each. 
Answers to them should normally not exceed 60 words each. 
(v) Question Nos. 7 – 9 and 19 – 21 are also short-answer questions carrying 4 marks 
each. Answers to them should normally not exceed 70 words each. 
(vi) Question Nos. 10 – 12 and 22 – 24 are long-answer questions carrying 6 marks each. 
Answers to them should normally not exceed 100 words each. 
(vii) Answers should be brief and to the point and the above word limits should be 
adhered to as far as possible. 
 
 
SECTION A 
 
1. The Total Revenue earned by selling 20 units is ` 700. Marginal Revenue earned by 
selling 21
st
 unit is ` 70. The value of Total Revenue earned by selling total 21 units will 
be ____________. (Choose the correct alternative) 1 
(a) ` 721   (b) ` 630 
(c) ` 770   (d) ` 720 
 
2. In the given figure X1Y1 and X2Y2 are Production Possibility Curves in two different 
periods T1 and T2 respectively for Good X and Good Y. A1 and A2 represent actual 
outputs and P1 and P2 represent potential outputs respectively in the two time periods.   
 1 
 
Page 2


  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    1 
CBSE 
 Class XII Economics 
Board Paper 2019 All India (Set 1) 
 
Time allowed: 3 hrs Maximum Marks: 80 
 
General Instructions: 
(i) All questions in both the sections are compulsory. 
(ii) Marks for questions are indicated against each question. 
(iii) Question Nos. 1 – 4 and 13 – 16 are very short-answer questions carrying 1 mark 
each. They are required to be answered in one sentence each. 
(iv) Question Nos. 5 – 6 and 17 – 18 are short-answer questions carrying 3 marks each. 
Answers to them should normally not exceed 60 words each. 
(v) Question Nos. 7 – 9 and 19 – 21 are also short-answer questions carrying 4 marks 
each. Answers to them should normally not exceed 70 words each. 
(vi) Question Nos. 10 – 12 and 22 – 24 are long-answer questions carrying 6 marks each. 
Answers to them should normally not exceed 100 words each. 
(vii) Answers should be brief and to the point and the above word limits should be 
adhered to as far as possible. 
 
 
SECTION A 
 
1. The Total Revenue earned by selling 20 units is ` 700. Marginal Revenue earned by 
selling 21
st
 unit is ` 70. The value of Total Revenue earned by selling total 21 units will 
be ____________. (Choose the correct alternative) 1 
(a) ` 721   (b) ` 630 
(c) ` 770   (d) ` 720 
 
2. In the given figure X1Y1 and X2Y2 are Production Possibility Curves in two different 
periods T1 and T2 respectively for Good X and Good Y. A1 and A2 represent actual 
outputs and P1 and P2 represent potential outputs respectively in the two time periods.   
 1 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    2 
The change in actual output of Goods X and Y over the two periods would be 
represented by movement from _________. (Fill up the blank) 
(a) A2 to P2    (b) A1 to P2 
(c) P1 to A2    (d) A1 to A2 
OR 
The Marginal Rate of Transformation (MRT) is constant. The Production Possibility 
Curve, so formed, would be __________________ to the origin. (Fill up the blank) 1 
 
3. Under imperfect competition, Average Revenue (AR) remains _________ Marginal 
Revenue (MR). (Fill up the blank) 1 
OR 
‘‘For a firm to be in equilibrium, Marginal Revenue (MR) and Marginal Cost (MC) must 
be _________ and beyond that level of output Marginal Cost must be _________.’’  
(Fill up the blank) 1 
 
4. If the supply curve is a straight line parallel to the vertical axis (Y-axis), supply of the 
good is called as _________. (Fill up the blank) 1 
(a) Unitary Elastic Supply 
(b) Perfectly Elastic Supply 
(c) Perfectly Inelastic Supply 
(d) Perfectly Elastic Demand 
 
5. Distinguish between positive economics and normative economics, with suitable 
examples. 3 
 
6. Explain the law of diminishing marginal utility, with the help of a hypothetical 
schedule. 3 
OR 
Elaborate the law of demand, with the help of a hypothetical schedule. 3 
 
7. The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 7: 
 
The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain. 4 
 
 
 
 
Page 3


  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    1 
CBSE 
 Class XII Economics 
Board Paper 2019 All India (Set 1) 
 
Time allowed: 3 hrs Maximum Marks: 80 
 
General Instructions: 
(i) All questions in both the sections are compulsory. 
(ii) Marks for questions are indicated against each question. 
(iii) Question Nos. 1 – 4 and 13 – 16 are very short-answer questions carrying 1 mark 
each. They are required to be answered in one sentence each. 
(iv) Question Nos. 5 – 6 and 17 – 18 are short-answer questions carrying 3 marks each. 
Answers to them should normally not exceed 60 words each. 
(v) Question Nos. 7 – 9 and 19 – 21 are also short-answer questions carrying 4 marks 
each. Answers to them should normally not exceed 70 words each. 
(vi) Question Nos. 10 – 12 and 22 – 24 are long-answer questions carrying 6 marks each. 
Answers to them should normally not exceed 100 words each. 
(vii) Answers should be brief and to the point and the above word limits should be 
adhered to as far as possible. 
 
 
SECTION A 
 
1. The Total Revenue earned by selling 20 units is ` 700. Marginal Revenue earned by 
selling 21
st
 unit is ` 70. The value of Total Revenue earned by selling total 21 units will 
be ____________. (Choose the correct alternative) 1 
(a) ` 721   (b) ` 630 
(c) ` 770   (d) ` 720 
 
2. In the given figure X1Y1 and X2Y2 are Production Possibility Curves in two different 
periods T1 and T2 respectively for Good X and Good Y. A1 and A2 represent actual 
outputs and P1 and P2 represent potential outputs respectively in the two time periods.   
 1 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    2 
The change in actual output of Goods X and Y over the two periods would be 
represented by movement from _________. (Fill up the blank) 
(a) A2 to P2    (b) A1 to P2 
(c) P1 to A2    (d) A1 to A2 
OR 
The Marginal Rate of Transformation (MRT) is constant. The Production Possibility 
Curve, so formed, would be __________________ to the origin. (Fill up the blank) 1 
 
3. Under imperfect competition, Average Revenue (AR) remains _________ Marginal 
Revenue (MR). (Fill up the blank) 1 
OR 
‘‘For a firm to be in equilibrium, Marginal Revenue (MR) and Marginal Cost (MC) must 
be _________ and beyond that level of output Marginal Cost must be _________.’’  
(Fill up the blank) 1 
 
4. If the supply curve is a straight line parallel to the vertical axis (Y-axis), supply of the 
good is called as _________. (Fill up the blank) 1 
(a) Unitary Elastic Supply 
(b) Perfectly Elastic Supply 
(c) Perfectly Inelastic Supply 
(d) Perfectly Elastic Demand 
 
5. Distinguish between positive economics and normative economics, with suitable 
examples. 3 
 
6. Explain the law of diminishing marginal utility, with the help of a hypothetical 
schedule. 3 
OR 
Elaborate the law of demand, with the help of a hypothetical schedule. 3 
 
7. The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 7: 
 
The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain. 4 
 
 
 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    3 
8.  
(a) The coefficient of price elasticity of demand for Good X is (–) 0·2. If there is a 5% 
increase in the price of the good, by what percentage will the quantity demanded 
for the good fall? 4 
(b) Arrange the following coefficients of price elasticity of demand in ascending order 
: (–) 3·1, (–) 0·2, (–) 1·1  
OR 
How would the demand for a commodity be affected by a change in ‘‘tastes and 
preferences’’ of the consumers in favour of the commodity? Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 8 (Alternative): 
 
How would the demand for a commodity be affected by a change in ‘‘tastes and 
preferences’’ of the consumers in favour of the commodity? Explain. 
 
9. Which of the following statements are true or false? Give valid reasons in support of 
your answer. 4 
(a) Average cost curve cuts Average variable cost curve, at its minimum level. 
(b) Average product curve and Marginal product curve are ‘U-shaped’ curves. 
(c) Under all market conditions, Average revenue and Marginal revenue are equal to 
each other. 
(d) Total cost curve and Total variable cost curve are parallel to each other. 
OR 
Explain a firm’s equilibrium under perfect competition, using a hypothetical schedule. 4 
 
10. Explain the meaning of the following features of the Oligopoly Market : 6 
(a) Non-Price Competition 
(b) Few Sellers 
 
11.   2+4 
(a) What is meant by increasing returns to a variable factor? 
(b) Discuss briefly, any two reasons for the decreasing returns to a variable factor. 
 
12. Explain the following conditions: 3+3 
(a) Movement along the same indifference curve. 
(b) Shift from a lower to a higher indifference curve. 
OR 
Explain the Law of Equi-Marginal Utility. 6 
 
 
 
 
Page 4


  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    1 
CBSE 
 Class XII Economics 
Board Paper 2019 All India (Set 1) 
 
Time allowed: 3 hrs Maximum Marks: 80 
 
General Instructions: 
(i) All questions in both the sections are compulsory. 
(ii) Marks for questions are indicated against each question. 
(iii) Question Nos. 1 – 4 and 13 – 16 are very short-answer questions carrying 1 mark 
each. They are required to be answered in one sentence each. 
(iv) Question Nos. 5 – 6 and 17 – 18 are short-answer questions carrying 3 marks each. 
Answers to them should normally not exceed 60 words each. 
(v) Question Nos. 7 – 9 and 19 – 21 are also short-answer questions carrying 4 marks 
each. Answers to them should normally not exceed 70 words each. 
(vi) Question Nos. 10 – 12 and 22 – 24 are long-answer questions carrying 6 marks each. 
Answers to them should normally not exceed 100 words each. 
(vii) Answers should be brief and to the point and the above word limits should be 
adhered to as far as possible. 
 
 
SECTION A 
 
1. The Total Revenue earned by selling 20 units is ` 700. Marginal Revenue earned by 
selling 21
st
 unit is ` 70. The value of Total Revenue earned by selling total 21 units will 
be ____________. (Choose the correct alternative) 1 
(a) ` 721   (b) ` 630 
(c) ` 770   (d) ` 720 
 
2. In the given figure X1Y1 and X2Y2 are Production Possibility Curves in two different 
periods T1 and T2 respectively for Good X and Good Y. A1 and A2 represent actual 
outputs and P1 and P2 represent potential outputs respectively in the two time periods.   
 1 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    2 
The change in actual output of Goods X and Y over the two periods would be 
represented by movement from _________. (Fill up the blank) 
(a) A2 to P2    (b) A1 to P2 
(c) P1 to A2    (d) A1 to A2 
OR 
The Marginal Rate of Transformation (MRT) is constant. The Production Possibility 
Curve, so formed, would be __________________ to the origin. (Fill up the blank) 1 
 
3. Under imperfect competition, Average Revenue (AR) remains _________ Marginal 
Revenue (MR). (Fill up the blank) 1 
OR 
‘‘For a firm to be in equilibrium, Marginal Revenue (MR) and Marginal Cost (MC) must 
be _________ and beyond that level of output Marginal Cost must be _________.’’  
(Fill up the blank) 1 
 
4. If the supply curve is a straight line parallel to the vertical axis (Y-axis), supply of the 
good is called as _________. (Fill up the blank) 1 
(a) Unitary Elastic Supply 
(b) Perfectly Elastic Supply 
(c) Perfectly Inelastic Supply 
(d) Perfectly Elastic Demand 
 
5. Distinguish between positive economics and normative economics, with suitable 
examples. 3 
 
6. Explain the law of diminishing marginal utility, with the help of a hypothetical 
schedule. 3 
OR 
Elaborate the law of demand, with the help of a hypothetical schedule. 3 
 
7. The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 7: 
 
The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain. 4 
 
 
 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    3 
8.  
(a) The coefficient of price elasticity of demand for Good X is (–) 0·2. If there is a 5% 
increase in the price of the good, by what percentage will the quantity demanded 
for the good fall? 4 
(b) Arrange the following coefficients of price elasticity of demand in ascending order 
: (–) 3·1, (–) 0·2, (–) 1·1  
OR 
How would the demand for a commodity be affected by a change in ‘‘tastes and 
preferences’’ of the consumers in favour of the commodity? Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 8 (Alternative): 
 
How would the demand for a commodity be affected by a change in ‘‘tastes and 
preferences’’ of the consumers in favour of the commodity? Explain. 
 
9. Which of the following statements are true or false? Give valid reasons in support of 
your answer. 4 
(a) Average cost curve cuts Average variable cost curve, at its minimum level. 
(b) Average product curve and Marginal product curve are ‘U-shaped’ curves. 
(c) Under all market conditions, Average revenue and Marginal revenue are equal to 
each other. 
(d) Total cost curve and Total variable cost curve are parallel to each other. 
OR 
Explain a firm’s equilibrium under perfect competition, using a hypothetical schedule. 4 
 
10. Explain the meaning of the following features of the Oligopoly Market : 6 
(a) Non-Price Competition 
(b) Few Sellers 
 
11.   2+4 
(a) What is meant by increasing returns to a variable factor? 
(b) Discuss briefly, any two reasons for the decreasing returns to a variable factor. 
 
12. Explain the following conditions: 3+3 
(a) Movement along the same indifference curve. 
(b) Shift from a lower to a higher indifference curve. 
OR 
Explain the Law of Equi-Marginal Utility. 6 
 
 
 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    4 
SECTION B 
(MACROECONOMICS) 
 
13. Primary deficit in a government budget will be zero, when ___________.  
(Choose the correct alternative) 1 
(a) Revenue deficit is zero 
(b) Net interest payments are zero 
(c) Fiscal deficit is zero 
(d) Fiscal deficit is equal to interest payment 
 
14. In order to encourage investment in the economy, the Central Bank may ___________. 
(Choose the correct alternative) 1 
(a) Reduce Cash Reserve Ratio 
(b) Increase Cash Reserve Ratio 
(c) Sell Government securities in open market 
(d) Increase Bank Rate 
 
15. What do you mean by a direct tax? 1 
OR 
What do you mean by an indirect tax? 1 
 
16. Define ‘money multiplier’. 1 
 
17. Calculate change in final income, if Marginal Propensity to Consume (MPC) is 0·8 and 
change in initial investment is ` 1,000 crores. 3 
 
18. State the impact of ‘‘Excess Demand’’ under the Keynesian theory on employment, in 
an economy. 3 
OR 
State the meaning of the following: 3 
(a) Ex-Ante Savings 
(b) Full Employment 
(c) Autonomous Consumption 
 
19. Classify the following statements as revenue receipts or capital receipts. Give valid 
reasons in support of your answer. 4 
(a) Financial help from a multinational corporation for victims in a flood affected area. 
(b) Sale of shares of a Public Sector Undertaking (PSU) to a private company, Y Ltd. 
(c) Dividends paid to the Government by the State Bank of India. 
(d) Borrowings from International Monetary Fund (IMF). 
 
 
Page 5


  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    1 
CBSE 
 Class XII Economics 
Board Paper 2019 All India (Set 1) 
 
Time allowed: 3 hrs Maximum Marks: 80 
 
General Instructions: 
(i) All questions in both the sections are compulsory. 
(ii) Marks for questions are indicated against each question. 
(iii) Question Nos. 1 – 4 and 13 – 16 are very short-answer questions carrying 1 mark 
each. They are required to be answered in one sentence each. 
(iv) Question Nos. 5 – 6 and 17 – 18 are short-answer questions carrying 3 marks each. 
Answers to them should normally not exceed 60 words each. 
(v) Question Nos. 7 – 9 and 19 – 21 are also short-answer questions carrying 4 marks 
each. Answers to them should normally not exceed 70 words each. 
(vi) Question Nos. 10 – 12 and 22 – 24 are long-answer questions carrying 6 marks each. 
Answers to them should normally not exceed 100 words each. 
(vii) Answers should be brief and to the point and the above word limits should be 
adhered to as far as possible. 
 
 
SECTION A 
 
1. The Total Revenue earned by selling 20 units is ` 700. Marginal Revenue earned by 
selling 21
st
 unit is ` 70. The value of Total Revenue earned by selling total 21 units will 
be ____________. (Choose the correct alternative) 1 
(a) ` 721   (b) ` 630 
(c) ` 770   (d) ` 720 
 
2. In the given figure X1Y1 and X2Y2 are Production Possibility Curves in two different 
periods T1 and T2 respectively for Good X and Good Y. A1 and A2 represent actual 
outputs and P1 and P2 represent potential outputs respectively in the two time periods.   
 1 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    2 
The change in actual output of Goods X and Y over the two periods would be 
represented by movement from _________. (Fill up the blank) 
(a) A2 to P2    (b) A1 to P2 
(c) P1 to A2    (d) A1 to A2 
OR 
The Marginal Rate of Transformation (MRT) is constant. The Production Possibility 
Curve, so formed, would be __________________ to the origin. (Fill up the blank) 1 
 
3. Under imperfect competition, Average Revenue (AR) remains _________ Marginal 
Revenue (MR). (Fill up the blank) 1 
OR 
‘‘For a firm to be in equilibrium, Marginal Revenue (MR) and Marginal Cost (MC) must 
be _________ and beyond that level of output Marginal Cost must be _________.’’  
(Fill up the blank) 1 
 
4. If the supply curve is a straight line parallel to the vertical axis (Y-axis), supply of the 
good is called as _________. (Fill up the blank) 1 
(a) Unitary Elastic Supply 
(b) Perfectly Elastic Supply 
(c) Perfectly Inelastic Supply 
(d) Perfectly Elastic Demand 
 
5. Distinguish between positive economics and normative economics, with suitable 
examples. 3 
 
6. Explain the law of diminishing marginal utility, with the help of a hypothetical 
schedule. 3 
OR 
Elaborate the law of demand, with the help of a hypothetical schedule. 3 
 
7. The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 7: 
 
The market for a good is in equilibrium. How would an increase in an input price affect 
the equilibrium price and equilibrium quantity, keeping other factors constant? 
Explain. 4 
 
 
 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    3 
8.  
(a) The coefficient of price elasticity of demand for Good X is (–) 0·2. If there is a 5% 
increase in the price of the good, by what percentage will the quantity demanded 
for the good fall? 4 
(b) Arrange the following coefficients of price elasticity of demand in ascending order 
: (–) 3·1, (–) 0·2, (–) 1·1  
OR 
How would the demand for a commodity be affected by a change in ‘‘tastes and 
preferences’’ of the consumers in favour of the commodity? Explain using a diagram. 4 
 
Note: The following question is for the Visually Impaired Candidates only, in lieu of  
Q. No. 8 (Alternative): 
 
How would the demand for a commodity be affected by a change in ‘‘tastes and 
preferences’’ of the consumers in favour of the commodity? Explain. 
 
9. Which of the following statements are true or false? Give valid reasons in support of 
your answer. 4 
(a) Average cost curve cuts Average variable cost curve, at its minimum level. 
(b) Average product curve and Marginal product curve are ‘U-shaped’ curves. 
(c) Under all market conditions, Average revenue and Marginal revenue are equal to 
each other. 
(d) Total cost curve and Total variable cost curve are parallel to each other. 
OR 
Explain a firm’s equilibrium under perfect competition, using a hypothetical schedule. 4 
 
10. Explain the meaning of the following features of the Oligopoly Market : 6 
(a) Non-Price Competition 
(b) Few Sellers 
 
11.   2+4 
(a) What is meant by increasing returns to a variable factor? 
(b) Discuss briefly, any two reasons for the decreasing returns to a variable factor. 
 
12. Explain the following conditions: 3+3 
(a) Movement along the same indifference curve. 
(b) Shift from a lower to a higher indifference curve. 
OR 
Explain the Law of Equi-Marginal Utility. 6 
 
 
 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    4 
SECTION B 
(MACROECONOMICS) 
 
13. Primary deficit in a government budget will be zero, when ___________.  
(Choose the correct alternative) 1 
(a) Revenue deficit is zero 
(b) Net interest payments are zero 
(c) Fiscal deficit is zero 
(d) Fiscal deficit is equal to interest payment 
 
14. In order to encourage investment in the economy, the Central Bank may ___________. 
(Choose the correct alternative) 1 
(a) Reduce Cash Reserve Ratio 
(b) Increase Cash Reserve Ratio 
(c) Sell Government securities in open market 
(d) Increase Bank Rate 
 
15. What do you mean by a direct tax? 1 
OR 
What do you mean by an indirect tax? 1 
 
16. Define ‘money multiplier’. 1 
 
17. Calculate change in final income, if Marginal Propensity to Consume (MPC) is 0·8 and 
change in initial investment is ` 1,000 crores. 3 
 
18. State the impact of ‘‘Excess Demand’’ under the Keynesian theory on employment, in 
an economy. 3 
OR 
State the meaning of the following: 3 
(a) Ex-Ante Savings 
(b) Full Employment 
(c) Autonomous Consumption 
 
19. Classify the following statements as revenue receipts or capital receipts. Give valid 
reasons in support of your answer. 4 
(a) Financial help from a multinational corporation for victims in a flood affected area. 
(b) Sale of shares of a Public Sector Undertaking (PSU) to a private company, Y Ltd. 
(c) Dividends paid to the Government by the State Bank of India. 
(d) Borrowings from International Monetary Fund (IMF). 
 
 
  
 
CBSE XII  |  Economics 
Board Paper 2019 – All India - Set 1 
 
    5 
20. ‘‘Higher Gross Domestic Product (GDP) means greater per capita availability of goods 
in the economy.’’ Do you agree with the given statement? Give valid reason in support 
of your answer. 4 
OR 
Explain the meaning of Real Gross Domestic Product and Nominal Gross Domestic 
Product, using a numerical example. 4 
 
21. Distinguish between ‘Qualitative and Quantitative tools’ of credit control as may be 
used by a Central Bank. 4 
 
22.    3+3 
(a) Define ‘‘Trade Surplus’’ and ‘‘Trade Deficit’’. 
(b) Discuss briefly the concept of managed floating system of foreign exchange rate 
determination. 
 
23. Discuss the adjustment mechanism in the following situations : 6 
(a) Aggregate demand is lesser than Aggregate Supply. 
(b) Ex-Ante Investments are greater than Ex-Ante Savings. 
 
24. Define the following : 6 
(a) Value Addition 
(b) Gross Domestic Product 
(c) Flow Variables 
(d) Income from property and entrepreneurship 
OR 
Given the following data, find the values of ‘‘Gross Domestic Capital Formation’’ and 
‘‘Operating Surplus’’. 6 
SR. 
No 
Particulars 
Amount 
(` in crores) 
(i) National Income 22,100 
(ii) Wages and Salaries 12,000 
(iii) Private Final Consumption Expenditure 7,200 
(iv) Net Indirect Taxes 700 
(v) Gross Domestic Capital Formation ? 
(vi) Depreciation 500 
(vii) Government Final Consumption Expenditure 6,100 
(viii) Mixed Income of Self-Employed 4,800 
(ix) Operating Surplus ? 
(x) Net Exports 3,400 
(xi) Rent 1,200 
(xii) Net Factor Income from Abroad (-) 150