Class 12 Economics: CBSE Sample Question Papers (2024-25) | Economics Class 12 - Commerce PDF Download

 Page 1


1 
 
ECONOMICS (030)  
CLASS XII (2024-25) 
SAMPLE QUESTION PAPER  
TIME: 3 HOURS                                                                                 M.M. – 80 
GENERAL INSTRUCTIONS: 
I. This question paper contains two sections:  
Section A – Macro Economics  
Section B – Indian Economic Development 
II. This paper contains 20 Multiple Choice Type Questions of 1 mark each. 
III. This paper contains 4 Short Answer Type Questions of 3 marks each to be answered in 60 
to 80 words. 
IV. This paper contains 6 Short Answer Type Questions of 4 marks each to be answered in 80 
to 100 words. 
V. This paper contains 4 Long Answer Type Questions of 6 marks each to be answered in 100 
to 150 words.  
 
Q.NO. SECTION A – MACRO ECONOMICS   MARKS 
1. Read the following statements: Assertion (A) and Reason (R). Choose the 
correct option from those given below: 
Assertion (A): The government can reduce the deflationary gap by 
purchasing government securities in the open market. 
Reason (R):  The Central Bank purchases government securities in the open 
market to increase the lending capacity of commercial banks. 
Options: 
A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct 
explanation of Assertion (A). 
B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the 
correct explanation of Assertion (A). 
C. Assertion (A) is true, but Reason (R) is false. 
D. Assertion (A) is false, but Reason (R) is true. 
1 
2. “The Cabinet led by Prime Minister has decided that the Central Government 
will provide free food grains to  81.35 crore (approx.) beneficiaries under the 
Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) for a period of five 
years with effect from 1st January, 2024.” 
Source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1980689  
Based on the aforesaid statement, identify the budgetary objective the 
government is trying to achieve and choose the correct option: 
A. Reallocation of resources  B. Economic stability 
C. Redistribution of income  D. Economic instability 
1 
3. To arrive at the value of Gross Value Added at Market Price (GVAMP) ______ 
must be added to Gross Value Added (GVA) at Basic Prices.   
(Choose the correct option to fill up the blank) 
A. Product Taxes   B. Net Product Taxes 
C. Production Taxes   D. Net Production Taxes  
1 
4, Under the _______ exchange rate system, market forces automatically adjust 
the surplus and deficit in the Balance of Payments account. 
(Choose the correct option to fill up the blank) 
1 
Page 2


1 
 
ECONOMICS (030)  
CLASS XII (2024-25) 
SAMPLE QUESTION PAPER  
TIME: 3 HOURS                                                                                 M.M. – 80 
GENERAL INSTRUCTIONS: 
I. This question paper contains two sections:  
Section A – Macro Economics  
Section B – Indian Economic Development 
II. This paper contains 20 Multiple Choice Type Questions of 1 mark each. 
III. This paper contains 4 Short Answer Type Questions of 3 marks each to be answered in 60 
to 80 words. 
IV. This paper contains 6 Short Answer Type Questions of 4 marks each to be answered in 80 
to 100 words. 
V. This paper contains 4 Long Answer Type Questions of 6 marks each to be answered in 100 
to 150 words.  
 
Q.NO. SECTION A – MACRO ECONOMICS   MARKS 
1. Read the following statements: Assertion (A) and Reason (R). Choose the 
correct option from those given below: 
Assertion (A): The government can reduce the deflationary gap by 
purchasing government securities in the open market. 
Reason (R):  The Central Bank purchases government securities in the open 
market to increase the lending capacity of commercial banks. 
Options: 
A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct 
explanation of Assertion (A). 
B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the 
correct explanation of Assertion (A). 
C. Assertion (A) is true, but Reason (R) is false. 
D. Assertion (A) is false, but Reason (R) is true. 
1 
2. “The Cabinet led by Prime Minister has decided that the Central Government 
will provide free food grains to  81.35 crore (approx.) beneficiaries under the 
Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) for a period of five 
years with effect from 1st January, 2024.” 
Source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1980689  
Based on the aforesaid statement, identify the budgetary objective the 
government is trying to achieve and choose the correct option: 
A. Reallocation of resources  B. Economic stability 
C. Redistribution of income  D. Economic instability 
1 
3. To arrive at the value of Gross Value Added at Market Price (GVAMP) ______ 
must be added to Gross Value Added (GVA) at Basic Prices.   
(Choose the correct option to fill up the blank) 
A. Product Taxes   B. Net Product Taxes 
C. Production Taxes   D. Net Production Taxes  
1 
4, Under the _______ exchange rate system, market forces automatically adjust 
the surplus and deficit in the Balance of Payments account. 
(Choose the correct option to fill up the blank) 
1 
2 
 
Aggregate Expenditure  
Aggregate demand  
A. fixed      B. flexible 
     C. managed floating   D. dirty floating 
5. From the given diagrams, identify the correct option that indicates the 
‘Reference Line’ passing through the origin drawn at a particular angle.                    
 (i)   (ii)        (iii)            (iv) 
 
A. (i)    B. (ii)  C. (iii)   D. (iv) 
For Visually Impaired Candidates: 
Under the Keynesian theory, ‘Reference Line’ is a straight line passing 
through the origin drawn at an angle of _____.  
                                       (Choose the correct option to fill up the blank) 
A. 25
0
   B. 45
0 
  C. 55
0
  D. 75
0
 
1 
 
 
 
 
 
 
 
 
 
 
 
 
1 
 
6. As per the data presented in the Union Budget 2023-24, the total receipts of 
the government other than borrowings and the total expenditure are 
estimated at ? 27.2 lakh crore and ? 45 lakh crore respectively.  
The value of the ________ deficit would be ? 17.8 lakh crore. 
(Choose the correct option to fill up the blank) 
      A. revenue    B. fiscal   
C. budgetary    D. primary 
1 
7. Read the following statements carefully: 
Statement 1: The maximum value of Marginal Propensity to Consume (MPC) 
can be unity. 
Statement 2: As the income of an economy increases, the proportionate 
increase in the level of consumption is always more than the increase in the 
level of income. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
1 
8. In a two-sector economy, Aggregate Demand can be determined by adding 
______.                               (Choose the correct option to fill up the blank) 
A. Autonomous Consumption, Induced Consumption and Induced 
Investment 
B. Autonomous Consumption, Autonomous Investment and Induced 
Investment 
C. Autonomous Consumption and Autonomous Investment 
D. Autonomous Consumption, Induced Consumption and Autonomous 
Investment 
1 
9. Read the following statements carefully: 
Statement 1: Foreign grants-in-aid receipts do not lead to any claim on the 
government. 
1 
Income 
Income Income Income 
Page 3


1 
 
ECONOMICS (030)  
CLASS XII (2024-25) 
SAMPLE QUESTION PAPER  
TIME: 3 HOURS                                                                                 M.M. – 80 
GENERAL INSTRUCTIONS: 
I. This question paper contains two sections:  
Section A – Macro Economics  
Section B – Indian Economic Development 
II. This paper contains 20 Multiple Choice Type Questions of 1 mark each. 
III. This paper contains 4 Short Answer Type Questions of 3 marks each to be answered in 60 
to 80 words. 
IV. This paper contains 6 Short Answer Type Questions of 4 marks each to be answered in 80 
to 100 words. 
V. This paper contains 4 Long Answer Type Questions of 6 marks each to be answered in 100 
to 150 words.  
 
Q.NO. SECTION A – MACRO ECONOMICS   MARKS 
1. Read the following statements: Assertion (A) and Reason (R). Choose the 
correct option from those given below: 
Assertion (A): The government can reduce the deflationary gap by 
purchasing government securities in the open market. 
Reason (R):  The Central Bank purchases government securities in the open 
market to increase the lending capacity of commercial banks. 
Options: 
A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct 
explanation of Assertion (A). 
B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the 
correct explanation of Assertion (A). 
C. Assertion (A) is true, but Reason (R) is false. 
D. Assertion (A) is false, but Reason (R) is true. 
1 
2. “The Cabinet led by Prime Minister has decided that the Central Government 
will provide free food grains to  81.35 crore (approx.) beneficiaries under the 
Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) for a period of five 
years with effect from 1st January, 2024.” 
Source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1980689  
Based on the aforesaid statement, identify the budgetary objective the 
government is trying to achieve and choose the correct option: 
A. Reallocation of resources  B. Economic stability 
C. Redistribution of income  D. Economic instability 
1 
3. To arrive at the value of Gross Value Added at Market Price (GVAMP) ______ 
must be added to Gross Value Added (GVA) at Basic Prices.   
(Choose the correct option to fill up the blank) 
A. Product Taxes   B. Net Product Taxes 
C. Production Taxes   D. Net Production Taxes  
1 
4, Under the _______ exchange rate system, market forces automatically adjust 
the surplus and deficit in the Balance of Payments account. 
(Choose the correct option to fill up the blank) 
1 
2 
 
Aggregate Expenditure  
Aggregate demand  
A. fixed      B. flexible 
     C. managed floating   D. dirty floating 
5. From the given diagrams, identify the correct option that indicates the 
‘Reference Line’ passing through the origin drawn at a particular angle.                    
 (i)   (ii)        (iii)            (iv) 
 
A. (i)    B. (ii)  C. (iii)   D. (iv) 
For Visually Impaired Candidates: 
Under the Keynesian theory, ‘Reference Line’ is a straight line passing 
through the origin drawn at an angle of _____.  
                                       (Choose the correct option to fill up the blank) 
A. 25
0
   B. 45
0 
  C. 55
0
  D. 75
0
 
1 
 
 
 
 
 
 
 
 
 
 
 
 
1 
 
6. As per the data presented in the Union Budget 2023-24, the total receipts of 
the government other than borrowings and the total expenditure are 
estimated at ? 27.2 lakh crore and ? 45 lakh crore respectively.  
The value of the ________ deficit would be ? 17.8 lakh crore. 
(Choose the correct option to fill up the blank) 
      A. revenue    B. fiscal   
C. budgetary    D. primary 
1 
7. Read the following statements carefully: 
Statement 1: The maximum value of Marginal Propensity to Consume (MPC) 
can be unity. 
Statement 2: As the income of an economy increases, the proportionate 
increase in the level of consumption is always more than the increase in the 
level of income. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
1 
8. In a two-sector economy, Aggregate Demand can be determined by adding 
______.                               (Choose the correct option to fill up the blank) 
A. Autonomous Consumption, Induced Consumption and Induced 
Investment 
B. Autonomous Consumption, Autonomous Investment and Induced 
Investment 
C. Autonomous Consumption and Autonomous Investment 
D. Autonomous Consumption, Induced Consumption and Autonomous 
Investment 
1 
9. Read the following statements carefully: 
Statement 1: Foreign grants-in-aid receipts do not lead to any claim on the 
government. 
1 
Income 
Income Income Income 
3 
 
Statement 2: Disposal of equity by the Public Sector Undertakings in the 
market may lead to a decrease in the assets of the government. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
10. Based on the given diagram: 
The trade under current account during January 2024 reflects a _________ 
of USD _____ billion.  (Choose the correct option to fill up the blank) 
A. surplus, 0.74    B. surplus, 3.85 
     C. deficit, 0.74    D. deficit, 3.85  
Overall Trade (Merchandise + Services)  
 
 
 
 
 
 
 
 
 
 
 
Source: https://commerce.gov.in/wp-content/uploads/2024/02/PIB-Press-Release-January-2024-1.pdf  
For Visually Impaired Candidates: 
________ indicates the situation of Current Account Deficit in the Balance of 
Payments Account. 
A. Receipts > Payments on current account 
B. Receipts = Payments on current account 
C. Receipts < Payments on current account 
D. Receipts < Payments on capital account 
1 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1 
 
 
 
11. 
(A) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
11. 
(B) 
On the basis of the given data, estimate the value of Domestic Income 
(NDPFC):  
S. No. Items Amount 
(? in crore) 
i.   Household Consumption Expenditure 800 
ii.   Gross Business Fixed Capital Formation 150 
iii.   Gross Residential Construction Investment 120 
iv.   Government Final Consumption Expenditure 170 
v.   Excess of Imports over Exports 20 
vi.   Inventory Investment 140 
vii.   Gross Public Investment 500 
viii.   Net Indirect Taxes 70 
ix.   Net Factor Income From Abroad (-) 50 
x.   Consumption of Fixed Capital 40 
OR 
State the steps pertaining to the estimation of National Income under the 
income method. 
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
3 
Page 4


1 
 
ECONOMICS (030)  
CLASS XII (2024-25) 
SAMPLE QUESTION PAPER  
TIME: 3 HOURS                                                                                 M.M. – 80 
GENERAL INSTRUCTIONS: 
I. This question paper contains two sections:  
Section A – Macro Economics  
Section B – Indian Economic Development 
II. This paper contains 20 Multiple Choice Type Questions of 1 mark each. 
III. This paper contains 4 Short Answer Type Questions of 3 marks each to be answered in 60 
to 80 words. 
IV. This paper contains 6 Short Answer Type Questions of 4 marks each to be answered in 80 
to 100 words. 
V. This paper contains 4 Long Answer Type Questions of 6 marks each to be answered in 100 
to 150 words.  
 
Q.NO. SECTION A – MACRO ECONOMICS   MARKS 
1. Read the following statements: Assertion (A) and Reason (R). Choose the 
correct option from those given below: 
Assertion (A): The government can reduce the deflationary gap by 
purchasing government securities in the open market. 
Reason (R):  The Central Bank purchases government securities in the open 
market to increase the lending capacity of commercial banks. 
Options: 
A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct 
explanation of Assertion (A). 
B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the 
correct explanation of Assertion (A). 
C. Assertion (A) is true, but Reason (R) is false. 
D. Assertion (A) is false, but Reason (R) is true. 
1 
2. “The Cabinet led by Prime Minister has decided that the Central Government 
will provide free food grains to  81.35 crore (approx.) beneficiaries under the 
Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) for a period of five 
years with effect from 1st January, 2024.” 
Source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1980689  
Based on the aforesaid statement, identify the budgetary objective the 
government is trying to achieve and choose the correct option: 
A. Reallocation of resources  B. Economic stability 
C. Redistribution of income  D. Economic instability 
1 
3. To arrive at the value of Gross Value Added at Market Price (GVAMP) ______ 
must be added to Gross Value Added (GVA) at Basic Prices.   
(Choose the correct option to fill up the blank) 
A. Product Taxes   B. Net Product Taxes 
C. Production Taxes   D. Net Production Taxes  
1 
4, Under the _______ exchange rate system, market forces automatically adjust 
the surplus and deficit in the Balance of Payments account. 
(Choose the correct option to fill up the blank) 
1 
2 
 
Aggregate Expenditure  
Aggregate demand  
A. fixed      B. flexible 
     C. managed floating   D. dirty floating 
5. From the given diagrams, identify the correct option that indicates the 
‘Reference Line’ passing through the origin drawn at a particular angle.                    
 (i)   (ii)        (iii)            (iv) 
 
A. (i)    B. (ii)  C. (iii)   D. (iv) 
For Visually Impaired Candidates: 
Under the Keynesian theory, ‘Reference Line’ is a straight line passing 
through the origin drawn at an angle of _____.  
                                       (Choose the correct option to fill up the blank) 
A. 25
0
   B. 45
0 
  C. 55
0
  D. 75
0
 
1 
 
 
 
 
 
 
 
 
 
 
 
 
1 
 
6. As per the data presented in the Union Budget 2023-24, the total receipts of 
the government other than borrowings and the total expenditure are 
estimated at ? 27.2 lakh crore and ? 45 lakh crore respectively.  
The value of the ________ deficit would be ? 17.8 lakh crore. 
(Choose the correct option to fill up the blank) 
      A. revenue    B. fiscal   
C. budgetary    D. primary 
1 
7. Read the following statements carefully: 
Statement 1: The maximum value of Marginal Propensity to Consume (MPC) 
can be unity. 
Statement 2: As the income of an economy increases, the proportionate 
increase in the level of consumption is always more than the increase in the 
level of income. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
1 
8. In a two-sector economy, Aggregate Demand can be determined by adding 
______.                               (Choose the correct option to fill up the blank) 
A. Autonomous Consumption, Induced Consumption and Induced 
Investment 
B. Autonomous Consumption, Autonomous Investment and Induced 
Investment 
C. Autonomous Consumption and Autonomous Investment 
D. Autonomous Consumption, Induced Consumption and Autonomous 
Investment 
1 
9. Read the following statements carefully: 
Statement 1: Foreign grants-in-aid receipts do not lead to any claim on the 
government. 
1 
Income 
Income Income Income 
3 
 
Statement 2: Disposal of equity by the Public Sector Undertakings in the 
market may lead to a decrease in the assets of the government. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
10. Based on the given diagram: 
The trade under current account during January 2024 reflects a _________ 
of USD _____ billion.  (Choose the correct option to fill up the blank) 
A. surplus, 0.74    B. surplus, 3.85 
     C. deficit, 0.74    D. deficit, 3.85  
Overall Trade (Merchandise + Services)  
 
 
 
 
 
 
 
 
 
 
 
Source: https://commerce.gov.in/wp-content/uploads/2024/02/PIB-Press-Release-January-2024-1.pdf  
For Visually Impaired Candidates: 
________ indicates the situation of Current Account Deficit in the Balance of 
Payments Account. 
A. Receipts > Payments on current account 
B. Receipts = Payments on current account 
C. Receipts < Payments on current account 
D. Receipts < Payments on capital account 
1 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1 
 
 
 
11. 
(A) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
11. 
(B) 
On the basis of the given data, estimate the value of Domestic Income 
(NDPFC):  
S. No. Items Amount 
(? in crore) 
i.   Household Consumption Expenditure 800 
ii.   Gross Business Fixed Capital Formation 150 
iii.   Gross Residential Construction Investment 120 
iv.   Government Final Consumption Expenditure 170 
v.   Excess of Imports over Exports 20 
vi.   Inventory Investment 140 
vii.   Gross Public Investment 500 
viii.   Net Indirect Taxes 70 
ix.   Net Factor Income From Abroad (-) 50 
x.   Consumption of Fixed Capital 40 
OR 
State the steps pertaining to the estimation of National Income under the 
income method. 
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
3 
4 
 
12. “Tax revenue collection of the government may be categorized under two 
heads.” 
State and explain the two heads of tax revenue. 
3 
13. 
 
(I) ‘Foreign Portfolio Investment (FPI) witnessed a sharp turnaround during 
2023-24 with net FPI inflows of US$ 32.4 billion.’ 
In which sub-account and on which side of the Balance of Payments account 
the above transaction will be recorded? Give reasons in support of your 
answer.  
 
(II) State the meaning of ‘Balance of Payments Deficit’. 
3 
 
 
 
 
 
1 
14. 
(A) 
 
 
 
 
 
14. 
(B) 
 
 
 
 
“Saving curve can be derived from the consumption curve” 
Justify the statement, citing valid steps with the help of a well-labelled 
diagram. 
For Visually Impaired Candidates: 
“Saving curve can be derived from the consumption curve” 
Justify the statement, citing valid steps. 
OR 
For two hypothetical economies A and B, the value of Marginal Propensity to 
Consume (MPC) stands at 0.6 and 0.8 respectively. Assuming for both the 
economies, Autonomous Consumption ( c ¯) to be ? 40 crore and Investment 
Expenditure (I) to be ? 100 crore. 
Calculate: 
(I) Break-even level of income for Economy A 
(II) Equilibrium level of income for Economy B 
4 
 
 
 
 
 
 
 
 
 
 
 
2 
2 
15. Read the following text carefully: 
“Union Finance Minister stated, that investments in infrastructure and 
productive capacity have a large multiplier impact on growth and employment 
and in view of this, capital investment outlay is being proposed to increase 
steeply in the Budget 2023-24 by 1,000 crore.” 
Based on the given text and common understanding, explain the working 
process of the increase in investment on the National Income, assuming the 
Marginal Propensity to Save (MPS) as 20%.  
 
 
 
 
4 
 
16. Read the following text carefully: 
As societies developed from hunters and gatherers, the material needs of 
human beings increased – to build a house, wear clothes, make weapons and 
implements etc. Since these needs could not be produced individually, people 
had to purchase them from others. These purchases, for example, were paid 
initially by barter – a leather skin cloak for a spear. As barter had its limits – 
how many cloaks for a spear – barter got standardized in terms of metals or 
cowrie shells. Now people knew the value of both the cloak and the spear in 
terms of bronze or cowrie shells. This was still barter, as both bronze and 
shells had intrinsic value (shells were desired for their beauty). This system 
evolved over time into metal currencies. Gold and silver coinage were the 
offshoot of this system where they had features of barter (both gold and silver 
had intrinsic value) as well as money (they were standardized representation 
of value). 
In respect of money two facts emerge historically: 
• Money has taken the form of either commodities (which have intrinsic 
value) or in terms of debt instruments.   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Page 5


1 
 
ECONOMICS (030)  
CLASS XII (2024-25) 
SAMPLE QUESTION PAPER  
TIME: 3 HOURS                                                                                 M.M. – 80 
GENERAL INSTRUCTIONS: 
I. This question paper contains two sections:  
Section A – Macro Economics  
Section B – Indian Economic Development 
II. This paper contains 20 Multiple Choice Type Questions of 1 mark each. 
III. This paper contains 4 Short Answer Type Questions of 3 marks each to be answered in 60 
to 80 words. 
IV. This paper contains 6 Short Answer Type Questions of 4 marks each to be answered in 80 
to 100 words. 
V. This paper contains 4 Long Answer Type Questions of 6 marks each to be answered in 100 
to 150 words.  
 
Q.NO. SECTION A – MACRO ECONOMICS   MARKS 
1. Read the following statements: Assertion (A) and Reason (R). Choose the 
correct option from those given below: 
Assertion (A): The government can reduce the deflationary gap by 
purchasing government securities in the open market. 
Reason (R):  The Central Bank purchases government securities in the open 
market to increase the lending capacity of commercial banks. 
Options: 
A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct 
explanation of Assertion (A). 
B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the 
correct explanation of Assertion (A). 
C. Assertion (A) is true, but Reason (R) is false. 
D. Assertion (A) is false, but Reason (R) is true. 
1 
2. “The Cabinet led by Prime Minister has decided that the Central Government 
will provide free food grains to  81.35 crore (approx.) beneficiaries under the 
Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) for a period of five 
years with effect from 1st January, 2024.” 
Source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1980689  
Based on the aforesaid statement, identify the budgetary objective the 
government is trying to achieve and choose the correct option: 
A. Reallocation of resources  B. Economic stability 
C. Redistribution of income  D. Economic instability 
1 
3. To arrive at the value of Gross Value Added at Market Price (GVAMP) ______ 
must be added to Gross Value Added (GVA) at Basic Prices.   
(Choose the correct option to fill up the blank) 
A. Product Taxes   B. Net Product Taxes 
C. Production Taxes   D. Net Production Taxes  
1 
4, Under the _______ exchange rate system, market forces automatically adjust 
the surplus and deficit in the Balance of Payments account. 
(Choose the correct option to fill up the blank) 
1 
2 
 
Aggregate Expenditure  
Aggregate demand  
A. fixed      B. flexible 
     C. managed floating   D. dirty floating 
5. From the given diagrams, identify the correct option that indicates the 
‘Reference Line’ passing through the origin drawn at a particular angle.                    
 (i)   (ii)        (iii)            (iv) 
 
A. (i)    B. (ii)  C. (iii)   D. (iv) 
For Visually Impaired Candidates: 
Under the Keynesian theory, ‘Reference Line’ is a straight line passing 
through the origin drawn at an angle of _____.  
                                       (Choose the correct option to fill up the blank) 
A. 25
0
   B. 45
0 
  C. 55
0
  D. 75
0
 
1 
 
 
 
 
 
 
 
 
 
 
 
 
1 
 
6. As per the data presented in the Union Budget 2023-24, the total receipts of 
the government other than borrowings and the total expenditure are 
estimated at ? 27.2 lakh crore and ? 45 lakh crore respectively.  
The value of the ________ deficit would be ? 17.8 lakh crore. 
(Choose the correct option to fill up the blank) 
      A. revenue    B. fiscal   
C. budgetary    D. primary 
1 
7. Read the following statements carefully: 
Statement 1: The maximum value of Marginal Propensity to Consume (MPC) 
can be unity. 
Statement 2: As the income of an economy increases, the proportionate 
increase in the level of consumption is always more than the increase in the 
level of income. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
1 
8. In a two-sector economy, Aggregate Demand can be determined by adding 
______.                               (Choose the correct option to fill up the blank) 
A. Autonomous Consumption, Induced Consumption and Induced 
Investment 
B. Autonomous Consumption, Autonomous Investment and Induced 
Investment 
C. Autonomous Consumption and Autonomous Investment 
D. Autonomous Consumption, Induced Consumption and Autonomous 
Investment 
1 
9. Read the following statements carefully: 
Statement 1: Foreign grants-in-aid receipts do not lead to any claim on the 
government. 
1 
Income 
Income Income Income 
3 
 
Statement 2: Disposal of equity by the Public Sector Undertakings in the 
market may lead to a decrease in the assets of the government. 
In light of the given statements, choose the correct option from the following:  
A. Statement 1 is true and Statement 2 is false. 
B. Statement 1 is false and Statement 2 is true. 
C. Both Statements 1 and 2 are true. 
D. Both Statements 1 and 2 are false. 
10. Based on the given diagram: 
The trade under current account during January 2024 reflects a _________ 
of USD _____ billion.  (Choose the correct option to fill up the blank) 
A. surplus, 0.74    B. surplus, 3.85 
     C. deficit, 0.74    D. deficit, 3.85  
Overall Trade (Merchandise + Services)  
 
 
 
 
 
 
 
 
 
 
 
Source: https://commerce.gov.in/wp-content/uploads/2024/02/PIB-Press-Release-January-2024-1.pdf  
For Visually Impaired Candidates: 
________ indicates the situation of Current Account Deficit in the Balance of 
Payments Account. 
A. Receipts > Payments on current account 
B. Receipts = Payments on current account 
C. Receipts < Payments on current account 
D. Receipts < Payments on capital account 
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11. 
(A) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
11. 
(B) 
On the basis of the given data, estimate the value of Domestic Income 
(NDPFC):  
S. No. Items Amount 
(? in crore) 
i.   Household Consumption Expenditure 800 
ii.   Gross Business Fixed Capital Formation 150 
iii.   Gross Residential Construction Investment 120 
iv.   Government Final Consumption Expenditure 170 
v.   Excess of Imports over Exports 20 
vi.   Inventory Investment 140 
vii.   Gross Public Investment 500 
viii.   Net Indirect Taxes 70 
ix.   Net Factor Income From Abroad (-) 50 
x.   Consumption of Fixed Capital 40 
OR 
State the steps pertaining to the estimation of National Income under the 
income method. 
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12. “Tax revenue collection of the government may be categorized under two 
heads.” 
State and explain the two heads of tax revenue. 
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13. 
 
(I) ‘Foreign Portfolio Investment (FPI) witnessed a sharp turnaround during 
2023-24 with net FPI inflows of US$ 32.4 billion.’ 
In which sub-account and on which side of the Balance of Payments account 
the above transaction will be recorded? Give reasons in support of your 
answer.  
 
(II) State the meaning of ‘Balance of Payments Deficit’. 
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14. 
(A) 
 
 
 
 
 
14. 
(B) 
 
 
 
 
“Saving curve can be derived from the consumption curve” 
Justify the statement, citing valid steps with the help of a well-labelled 
diagram. 
For Visually Impaired Candidates: 
“Saving curve can be derived from the consumption curve” 
Justify the statement, citing valid steps. 
OR 
For two hypothetical economies A and B, the value of Marginal Propensity to 
Consume (MPC) stands at 0.6 and 0.8 respectively. Assuming for both the 
economies, Autonomous Consumption ( c ¯) to be ? 40 crore and Investment 
Expenditure (I) to be ? 100 crore. 
Calculate: 
(I) Break-even level of income for Economy A 
(II) Equilibrium level of income for Economy B 
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15. Read the following text carefully: 
“Union Finance Minister stated, that investments in infrastructure and 
productive capacity have a large multiplier impact on growth and employment 
and in view of this, capital investment outlay is being proposed to increase 
steeply in the Budget 2023-24 by 1,000 crore.” 
Based on the given text and common understanding, explain the working 
process of the increase in investment on the National Income, assuming the 
Marginal Propensity to Save (MPS) as 20%.  
 
 
 
 
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16. Read the following text carefully: 
As societies developed from hunters and gatherers, the material needs of 
human beings increased – to build a house, wear clothes, make weapons and 
implements etc. Since these needs could not be produced individually, people 
had to purchase them from others. These purchases, for example, were paid 
initially by barter – a leather skin cloak for a spear. As barter had its limits – 
how many cloaks for a spear – barter got standardized in terms of metals or 
cowrie shells. Now people knew the value of both the cloak and the spear in 
terms of bronze or cowrie shells. This was still barter, as both bronze and 
shells had intrinsic value (shells were desired for their beauty). This system 
evolved over time into metal currencies. Gold and silver coinage were the 
offshoot of this system where they had features of barter (both gold and silver 
had intrinsic value) as well as money (they were standardized representation 
of value). 
In respect of money two facts emerge historically: 
• Money has taken the form of either commodities (which have intrinsic 
value) or in terms of debt instruments.   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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• Money is usually issued by a sovereign (or a Central Bank as its 
representative). 
In modern economies, currency is a form of money that is issued exclusively 
by some competent authority (Central Bank). It is a liability of the issuing 
Central Bank and an asset of the holding public. Currency is usually issued in 
paper (or polymer) form, but the form of currency is not its defining 
characteristic.  
In the recent past, the Reserve Bank of India, issued Central Bank Digital 
Currency (CBDC). A CBDC is the currency issued by a central bank in a digital 
form. It serves all the purposes of a paper currency in a different form. 
The introduction of CBDC has the potential to provide significant benefits, 
such as reduced dependency on cash, lower transaction costs, reduced 
settlement risk. Introduction of CBDC would possibly lead to a more robust, 
efficient, trusted, regulated payments option. There are associated risks such 
as cyber-attacks and technology preparedness, but they need to be carefully 
evaluated against the potential benefits.  
Source: https://website.rbi.org.in/web/rbi/-/speeches-interview/central-bank-digital-currency-
is-this-the-future-of-money-1111          (adapted and modified) 
On the basis of the given text and common understanding, answer the 
following questions: 
(I) “Over the centuries, money has evolved in various forms.” 
In the light of the given statement, state and discuss briefly any two forms of 
money.  
 
(II) “Various economists have formed a strong opinion that, in the modern 
times digital currency (like CBDC) is quite essential. However, it comes with 
its own benefits and potential risks.” 
Do you agree with the given statement, giving valid arguments in support of 
your answer. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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17. 
(A) 
 
 
 
 
 
 
 
 
 
 
 
 
 
17. 
(B) 
 
 
 
(I) On the basis of the following hypothetical data:  
                                                (all figures in ? crore) 
Year Nominal GDP Nominal GDP 
adjusted to base year 
prices 
2020 3,000 4,000 
2023 4,000 4,500 
Calculate the percentage change in Real Gross Domestic Product in the 
year 2023 using 2020 as the base year. 
(II) “The public investment on the construction of a multi-lane flyover may 
reduce traffic congestion.” 
On the basis of the above statement, discuss its likely impact on Gross 
Domestic Product (GDP) and welfare in an economy. 
OR 
 
(I) “Basis of classification of final goods into consumption and capital goods 
depend on the economic nature of its use.” 
Defend or refute the statement, with the help of a suitable example. 
(II) ‘Natural calamities in the hill states of India have led to massive destruction 
of capital assets.’ 
Identify the type of loss (depreciation or capital loss) indicated in the aforesaid 
statement. Give valid reasons in support of your answer. 
 
 
 
 
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