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Date:                             Class: XII 
Economics (030) 
Time: 3 Hrs                                             M. M: 100 
General Instructions: 
1. Answer all the questions carefully. 
2. Questions carrying 1 mark are multiple choice questions 
3. Questions carrying 3 marks should be answered in 40-60 words. 
4. Questions carrying 4 marks should be answered in 60-80 words. 
5. Questions carrying 6 marks should be answered in 80-100 words. 
 
 
 Part – A (Micro Economics)  
1 An economy achieves “productive efficiency” when 
a) Resources are employed optimally 
b) The best resources are employed  
c) The total number of produced goods is the greatest 
d) Goods and services are produced with least cost and no resources are wasted 
 
1 
2 Ed = 0 in case of: 
a) Luxuries                                                   b) Normal Goods 
c) Necessities                                               d) Essentials  
  
1 
3. If price is above the equilibrium price there is: 
a) excess demand                                         b) excess supply 
c) price ceiling                                             d) price floor 
   
1 
4 A firm’s average fixed cost is Rs 20 at 6 units of output. What will be the value of AFC at 4 units 
of output? 
a) 60       b) 30      c) 40    d) 20 
1 
5 ‘Scarcity and choices go altogether.’ Defend or Refute?  Give reasons. 
 
3 
6 Differentiate between budget set and budget line. What is the slope of budget line? 
 
3 
7 Derive the law of demand from single commodity equilibrium condition ‘marginal utility = 
price.’ 
3 
8 What is meant by returns to a factor? Explain the causes behind increasing returns to a factor. 
 
3 
Page 2


 
 
 
 
            
                      
  
Date:                             Class: XII 
Economics (030) 
Time: 3 Hrs                                             M. M: 100 
General Instructions: 
1. Answer all the questions carefully. 
2. Questions carrying 1 mark are multiple choice questions 
3. Questions carrying 3 marks should be answered in 40-60 words. 
4. Questions carrying 4 marks should be answered in 60-80 words. 
5. Questions carrying 6 marks should be answered in 80-100 words. 
 
 
 Part – A (Micro Economics)  
1 An economy achieves “productive efficiency” when 
a) Resources are employed optimally 
b) The best resources are employed  
c) The total number of produced goods is the greatest 
d) Goods and services are produced with least cost and no resources are wasted 
 
1 
2 Ed = 0 in case of: 
a) Luxuries                                                   b) Normal Goods 
c) Necessities                                               d) Essentials  
  
1 
3. If price is above the equilibrium price there is: 
a) excess demand                                         b) excess supply 
c) price ceiling                                             d) price floor 
   
1 
4 A firm’s average fixed cost is Rs 20 at 6 units of output. What will be the value of AFC at 4 units 
of output? 
a) 60       b) 30      c) 40    d) 20 
1 
5 ‘Scarcity and choices go altogether.’ Defend or Refute?  Give reasons. 
 
3 
6 Differentiate between budget set and budget line. What is the slope of budget line? 
 
3 
7 Derive the law of demand from single commodity equilibrium condition ‘marginal utility = 
price.’ 
3 
8 What is meant by returns to a factor? Explain the causes behind increasing returns to a factor. 
 
3 
 
 
9 Complete the following table: 
Output  AVC TC MC 
1 __ 80 20 
2 18 __ __ 
3 __ __ 18 
4 20 140 __ 
5 24 __ __ 
 
3 
 
 
 
 
 
 
10 Explain the relationship between Average revenue and Marginal revenue when a firm is able to 
sell more quantity of output 
a) at same price  
b) only by lowering the price 
 
3 
11 What conditions must hold if a profit maximizing firm produces positive output in a competitive 
market? 
 
3 
12 Why there are few firms under Oligopoly? 
                                                                      OR 
Why the demand curve facing monopolist is more elastic than under monopoly? 
 
3 
 
13 A consumer consumes only two goods A and B and is in equilibrium. Show that when price of 
good B falls, demand for B rises. Answer this question with the help of utility analysis. 
 
4 
14 Why a consumer buys more at same price? 
OR 
Consider the demand curve Q = 10 – 3P. What will be the elasticity at price 5/3?  
4 
15 What may be the consequences of price ceiling and floor price? Give examples. 
 
4 
16 a) Explain the central problem of whom to produce. 
b) PPF could be a straight line and convex to the origin under what conditions?  
 
6 
17. Consumer attains equilibrium when budget line is tangent to indifference curve. Why not any 
other point is equilibrium? Use diagram.  
 
6 
18.  How the following will affect the supply of a commodity: 
a) Government policy 
b) increase in the price of substitute goods 
c) increase in the price of inputs 
 
6 
19. Explain the implication of the following features: 
a) Price discrimination under Monopoly 
b) P = d = AR under Perfect Competition 
c) Product differentiation under Monopolistic Competition  
3+3 
= 6  
20.  There is simultaneous decrease in demand and supply curves of a commodity. When it will result 
in: 
a) no change in equilibrium price 
b) rise in equilibrium price 
                                                                     OR 
Market for a good is in equilibrium. Income of the consumer increases in case of normal good. 
Explain the chain reactions with diagrams. 
 
6 
  
 
 
Page 3


 
 
 
 
            
                      
  
Date:                             Class: XII 
Economics (030) 
Time: 3 Hrs                                             M. M: 100 
General Instructions: 
1. Answer all the questions carefully. 
2. Questions carrying 1 mark are multiple choice questions 
3. Questions carrying 3 marks should be answered in 40-60 words. 
4. Questions carrying 4 marks should be answered in 60-80 words. 
5. Questions carrying 6 marks should be answered in 80-100 words. 
 
 
 Part – A (Micro Economics)  
1 An economy achieves “productive efficiency” when 
a) Resources are employed optimally 
b) The best resources are employed  
c) The total number of produced goods is the greatest 
d) Goods and services are produced with least cost and no resources are wasted 
 
1 
2 Ed = 0 in case of: 
a) Luxuries                                                   b) Normal Goods 
c) Necessities                                               d) Essentials  
  
1 
3. If price is above the equilibrium price there is: 
a) excess demand                                         b) excess supply 
c) price ceiling                                             d) price floor 
   
1 
4 A firm’s average fixed cost is Rs 20 at 6 units of output. What will be the value of AFC at 4 units 
of output? 
a) 60       b) 30      c) 40    d) 20 
1 
5 ‘Scarcity and choices go altogether.’ Defend or Refute?  Give reasons. 
 
3 
6 Differentiate between budget set and budget line. What is the slope of budget line? 
 
3 
7 Derive the law of demand from single commodity equilibrium condition ‘marginal utility = 
price.’ 
3 
8 What is meant by returns to a factor? Explain the causes behind increasing returns to a factor. 
 
3 
 
 
9 Complete the following table: 
Output  AVC TC MC 
1 __ 80 20 
2 18 __ __ 
3 __ __ 18 
4 20 140 __ 
5 24 __ __ 
 
3 
 
 
 
 
 
 
10 Explain the relationship between Average revenue and Marginal revenue when a firm is able to 
sell more quantity of output 
a) at same price  
b) only by lowering the price 
 
3 
11 What conditions must hold if a profit maximizing firm produces positive output in a competitive 
market? 
 
3 
12 Why there are few firms under Oligopoly? 
                                                                      OR 
Why the demand curve facing monopolist is more elastic than under monopoly? 
 
3 
 
13 A consumer consumes only two goods A and B and is in equilibrium. Show that when price of 
good B falls, demand for B rises. Answer this question with the help of utility analysis. 
 
4 
14 Why a consumer buys more at same price? 
OR 
Consider the demand curve Q = 10 – 3P. What will be the elasticity at price 5/3?  
4 
15 What may be the consequences of price ceiling and floor price? Give examples. 
 
4 
16 a) Explain the central problem of whom to produce. 
b) PPF could be a straight line and convex to the origin under what conditions?  
 
6 
17. Consumer attains equilibrium when budget line is tangent to indifference curve. Why not any 
other point is equilibrium? Use diagram.  
 
6 
18.  How the following will affect the supply of a commodity: 
a) Government policy 
b) increase in the price of substitute goods 
c) increase in the price of inputs 
 
6 
19. Explain the implication of the following features: 
a) Price discrimination under Monopoly 
b) P = d = AR under Perfect Competition 
c) Product differentiation under Monopolistic Competition  
3+3 
= 6  
20.  There is simultaneous decrease in demand and supply curves of a commodity. When it will result 
in: 
a) no change in equilibrium price 
b) rise in equilibrium price 
                                                                     OR 
Market for a good is in equilibrium. Income of the consumer increases in case of normal good. 
Explain the chain reactions with diagrams. 
 
6 
  
 
 
 
 
Part B ( Macro – Economics) 
 
21.  Mixed income of self employed means 
a) gross profits received by proprietors 
b) rent, interest and profit of an enterprise 
c) combined factor payments that are not distinguishable 
d) wages of the family workers 
 
 
 
1 
22. Which of the following statement is true: 
a) If national income rises, per capita income rises 
b) if population rises, per capita income falls 
c) If national income rises, welfare must rise 
d) None of them 
1 
23. Machine purchased is always a final good. Do you agree? Give reasons in support of your answer. 
 
3 
24. What is externality? Explain how negative externality is limitation as an indicator of economic 
welfare. 
 
3 
25. Calculate ‘sales’ from the following data: 
Particulars In Crores 
National Income 2000 
Factor income to abroad 100 
Sales Tax 10 
Subsidies 80 
Excise Duty 10 
Import Duty 10 
Wealth tax 20 
Change in stock 20 
Factor income from abroad 50 
Gross domestic fixed capital formation 100 
Net domestic capital formation 100 
Purchase of raw material 180 
Imports 10 
Exports 20 
 
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26. Distinguish between leakages and injections. 
                                                      OR 
Distinguish between factor payments and transfer payments. 
3 
27. Explain the problem of double counting. How we could avoid it? 
                                                       OR 
Explain the concept of Circular Flow of Income in a 2 sector economy. 
 
4 
 
28.  Explain how the following is treated while calculating national income of the country: 
a) Dividend received by a foreigner from investment in shares of an Indian company. 
b) Fee to a mechanic paid by a firm 
c) Expenditure on purchasing a car for use by a firm. 
 
6 
29. Calculate GDPfc and subsidies from the following data: 
Particulars In crores 
Net factor income to abroad -20 
Consumption of fixed capital 50 
Personal tax 110 
6 
Page 4


 
 
 
 
            
                      
  
Date:                             Class: XII 
Economics (030) 
Time: 3 Hrs                                             M. M: 100 
General Instructions: 
1. Answer all the questions carefully. 
2. Questions carrying 1 mark are multiple choice questions 
3. Questions carrying 3 marks should be answered in 40-60 words. 
4. Questions carrying 4 marks should be answered in 60-80 words. 
5. Questions carrying 6 marks should be answered in 80-100 words. 
 
 
 Part – A (Micro Economics)  
1 An economy achieves “productive efficiency” when 
a) Resources are employed optimally 
b) The best resources are employed  
c) The total number of produced goods is the greatest 
d) Goods and services are produced with least cost and no resources are wasted 
 
1 
2 Ed = 0 in case of: 
a) Luxuries                                                   b) Normal Goods 
c) Necessities                                               d) Essentials  
  
1 
3. If price is above the equilibrium price there is: 
a) excess demand                                         b) excess supply 
c) price ceiling                                             d) price floor 
   
1 
4 A firm’s average fixed cost is Rs 20 at 6 units of output. What will be the value of AFC at 4 units 
of output? 
a) 60       b) 30      c) 40    d) 20 
1 
5 ‘Scarcity and choices go altogether.’ Defend or Refute?  Give reasons. 
 
3 
6 Differentiate between budget set and budget line. What is the slope of budget line? 
 
3 
7 Derive the law of demand from single commodity equilibrium condition ‘marginal utility = 
price.’ 
3 
8 What is meant by returns to a factor? Explain the causes behind increasing returns to a factor. 
 
3 
 
 
9 Complete the following table: 
Output  AVC TC MC 
1 __ 80 20 
2 18 __ __ 
3 __ __ 18 
4 20 140 __ 
5 24 __ __ 
 
3 
 
 
 
 
 
 
10 Explain the relationship between Average revenue and Marginal revenue when a firm is able to 
sell more quantity of output 
a) at same price  
b) only by lowering the price 
 
3 
11 What conditions must hold if a profit maximizing firm produces positive output in a competitive 
market? 
 
3 
12 Why there are few firms under Oligopoly? 
                                                                      OR 
Why the demand curve facing monopolist is more elastic than under monopoly? 
 
3 
 
13 A consumer consumes only two goods A and B and is in equilibrium. Show that when price of 
good B falls, demand for B rises. Answer this question with the help of utility analysis. 
 
4 
14 Why a consumer buys more at same price? 
OR 
Consider the demand curve Q = 10 – 3P. What will be the elasticity at price 5/3?  
4 
15 What may be the consequences of price ceiling and floor price? Give examples. 
 
4 
16 a) Explain the central problem of whom to produce. 
b) PPF could be a straight line and convex to the origin under what conditions?  
 
6 
17. Consumer attains equilibrium when budget line is tangent to indifference curve. Why not any 
other point is equilibrium? Use diagram.  
 
6 
18.  How the following will affect the supply of a commodity: 
a) Government policy 
b) increase in the price of substitute goods 
c) increase in the price of inputs 
 
6 
19. Explain the implication of the following features: 
a) Price discrimination under Monopoly 
b) P = d = AR under Perfect Competition 
c) Product differentiation under Monopolistic Competition  
3+3 
= 6  
20.  There is simultaneous decrease in demand and supply curves of a commodity. When it will result 
in: 
a) no change in equilibrium price 
b) rise in equilibrium price 
                                                                     OR 
Market for a good is in equilibrium. Income of the consumer increases in case of normal good. 
Explain the chain reactions with diagrams. 
 
6 
  
 
 
 
 
Part B ( Macro – Economics) 
 
21.  Mixed income of self employed means 
a) gross profits received by proprietors 
b) rent, interest and profit of an enterprise 
c) combined factor payments that are not distinguishable 
d) wages of the family workers 
 
 
 
1 
22. Which of the following statement is true: 
a) If national income rises, per capita income rises 
b) if population rises, per capita income falls 
c) If national income rises, welfare must rise 
d) None of them 
1 
23. Machine purchased is always a final good. Do you agree? Give reasons in support of your answer. 
 
3 
24. What is externality? Explain how negative externality is limitation as an indicator of economic 
welfare. 
 
3 
25. Calculate ‘sales’ from the following data: 
Particulars In Crores 
National Income 2000 
Factor income to abroad 100 
Sales Tax 10 
Subsidies 80 
Excise Duty 10 
Import Duty 10 
Wealth tax 20 
Change in stock 20 
Factor income from abroad 50 
Gross domestic fixed capital formation 100 
Net domestic capital formation 100 
Purchase of raw material 180 
Imports 10 
Exports 20 
 
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26. Distinguish between leakages and injections. 
                                                      OR 
Distinguish between factor payments and transfer payments. 
3 
27. Explain the problem of double counting. How we could avoid it? 
                                                       OR 
Explain the concept of Circular Flow of Income in a 2 sector economy. 
 
4 
 
28.  Explain how the following is treated while calculating national income of the country: 
a) Dividend received by a foreigner from investment in shares of an Indian company. 
b) Fee to a mechanic paid by a firm 
c) Expenditure on purchasing a car for use by a firm. 
 
6 
29. Calculate GDPfc and subsidies from the following data: 
Particulars In crores 
Net factor income to abroad -20 
Consumption of fixed capital 50 
Personal tax 110 
6 
 
 
Dividends 20 
Savings of private corporate sector 40 
Indirect taxes  100 
Corporation tax 90 
Rent 10 
COE in cash 300 
Wages and Salaries 110 
COE in kind  50 
GNPmp 600 
    
                                                   OR 
Calculate domestic income from the following data: 
Particulars In crores 
Household savings  300 
Profits 100 
Misc receipts of govt. administrative 
departments 
10 
Household consumption 100 
Savings of corporate sector 10 
Dividends 50 
Income tax 40 
NFIA -10 
Current transfers to government 30 
National debt interest 20 
Current transfers from government 10 
Income accruing to govt administrative 
departments 
70 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Page 5


 
 
 
 
            
                      
  
Date:                             Class: XII 
Economics (030) 
Time: 3 Hrs                                             M. M: 100 
General Instructions: 
1. Answer all the questions carefully. 
2. Questions carrying 1 mark are multiple choice questions 
3. Questions carrying 3 marks should be answered in 40-60 words. 
4. Questions carrying 4 marks should be answered in 60-80 words. 
5. Questions carrying 6 marks should be answered in 80-100 words. 
 
 
 Part – A (Micro Economics)  
1 An economy achieves “productive efficiency” when 
a) Resources are employed optimally 
b) The best resources are employed  
c) The total number of produced goods is the greatest 
d) Goods and services are produced with least cost and no resources are wasted 
 
1 
2 Ed = 0 in case of: 
a) Luxuries                                                   b) Normal Goods 
c) Necessities                                               d) Essentials  
  
1 
3. If price is above the equilibrium price there is: 
a) excess demand                                         b) excess supply 
c) price ceiling                                             d) price floor 
   
1 
4 A firm’s average fixed cost is Rs 20 at 6 units of output. What will be the value of AFC at 4 units 
of output? 
a) 60       b) 30      c) 40    d) 20 
1 
5 ‘Scarcity and choices go altogether.’ Defend or Refute?  Give reasons. 
 
3 
6 Differentiate between budget set and budget line. What is the slope of budget line? 
 
3 
7 Derive the law of demand from single commodity equilibrium condition ‘marginal utility = 
price.’ 
3 
8 What is meant by returns to a factor? Explain the causes behind increasing returns to a factor. 
 
3 
 
 
9 Complete the following table: 
Output  AVC TC MC 
1 __ 80 20 
2 18 __ __ 
3 __ __ 18 
4 20 140 __ 
5 24 __ __ 
 
3 
 
 
 
 
 
 
10 Explain the relationship between Average revenue and Marginal revenue when a firm is able to 
sell more quantity of output 
a) at same price  
b) only by lowering the price 
 
3 
11 What conditions must hold if a profit maximizing firm produces positive output in a competitive 
market? 
 
3 
12 Why there are few firms under Oligopoly? 
                                                                      OR 
Why the demand curve facing monopolist is more elastic than under monopoly? 
 
3 
 
13 A consumer consumes only two goods A and B and is in equilibrium. Show that when price of 
good B falls, demand for B rises. Answer this question with the help of utility analysis. 
 
4 
14 Why a consumer buys more at same price? 
OR 
Consider the demand curve Q = 10 – 3P. What will be the elasticity at price 5/3?  
4 
15 What may be the consequences of price ceiling and floor price? Give examples. 
 
4 
16 a) Explain the central problem of whom to produce. 
b) PPF could be a straight line and convex to the origin under what conditions?  
 
6 
17. Consumer attains equilibrium when budget line is tangent to indifference curve. Why not any 
other point is equilibrium? Use diagram.  
 
6 
18.  How the following will affect the supply of a commodity: 
a) Government policy 
b) increase in the price of substitute goods 
c) increase in the price of inputs 
 
6 
19. Explain the implication of the following features: 
a) Price discrimination under Monopoly 
b) P = d = AR under Perfect Competition 
c) Product differentiation under Monopolistic Competition  
3+3 
= 6  
20.  There is simultaneous decrease in demand and supply curves of a commodity. When it will result 
in: 
a) no change in equilibrium price 
b) rise in equilibrium price 
                                                                     OR 
Market for a good is in equilibrium. Income of the consumer increases in case of normal good. 
Explain the chain reactions with diagrams. 
 
6 
  
 
 
 
 
Part B ( Macro – Economics) 
 
21.  Mixed income of self employed means 
a) gross profits received by proprietors 
b) rent, interest and profit of an enterprise 
c) combined factor payments that are not distinguishable 
d) wages of the family workers 
 
 
 
1 
22. Which of the following statement is true: 
a) If national income rises, per capita income rises 
b) if population rises, per capita income falls 
c) If national income rises, welfare must rise 
d) None of them 
1 
23. Machine purchased is always a final good. Do you agree? Give reasons in support of your answer. 
 
3 
24. What is externality? Explain how negative externality is limitation as an indicator of economic 
welfare. 
 
3 
25. Calculate ‘sales’ from the following data: 
Particulars In Crores 
National Income 2000 
Factor income to abroad 100 
Sales Tax 10 
Subsidies 80 
Excise Duty 10 
Import Duty 10 
Wealth tax 20 
Change in stock 20 
Factor income from abroad 50 
Gross domestic fixed capital formation 100 
Net domestic capital formation 100 
Purchase of raw material 180 
Imports 10 
Exports 20 
 
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26. Distinguish between leakages and injections. 
                                                      OR 
Distinguish between factor payments and transfer payments. 
3 
27. Explain the problem of double counting. How we could avoid it? 
                                                       OR 
Explain the concept of Circular Flow of Income in a 2 sector economy. 
 
4 
 
28.  Explain how the following is treated while calculating national income of the country: 
a) Dividend received by a foreigner from investment in shares of an Indian company. 
b) Fee to a mechanic paid by a firm 
c) Expenditure on purchasing a car for use by a firm. 
 
6 
29. Calculate GDPfc and subsidies from the following data: 
Particulars In crores 
Net factor income to abroad -20 
Consumption of fixed capital 50 
Personal tax 110 
6 
 
 
Dividends 20 
Savings of private corporate sector 40 
Indirect taxes  100 
Corporation tax 90 
Rent 10 
COE in cash 300 
Wages and Salaries 110 
COE in kind  50 
GNPmp 600 
    
                                                   OR 
Calculate domestic income from the following data: 
Particulars In crores 
Household savings  300 
Profits 100 
Misc receipts of govt. administrative 
departments 
10 
Household consumption 100 
Savings of corporate sector 10 
Dividends 50 
Income tax 40 
NFIA -10 
Current transfers to government 30 
National debt interest 20 
Current transfers from government 10 
Income accruing to govt administrative 
departments 
70 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
First Term Answer Key  Class XII   Economics 
                                                        
                                                   Part – A (Micro Economics) 
 
1 An economy achieves “productive efficiency” when 
d) Goods and services are produced with least cost and no resources are wasted 
 
1 
2  Ed = 0 in case of: 
d) Essentials 
 
1 
3. If price is above the equilibrium price there is: 
b) excess supply 
   
1 
4 A firm’s average fixed cost is Rs 20 at 6 units of output. What will it be at 4 units of output? 
b) 30      
 
1 
5 ‘Scarcity and choices go altogether.’ Defend or Refute?  
Defend 
Scarcity is the root cause of all economic problems. Explain. 
Scarcity means when demand for resources is more than its supply like land. It could be used for 
agriculture, warehouses and factory but supply is limited so society chooses that suits best to the 
need. If things were available in plenty there would have been no choice problem….3mk 
 
3 
 
 
 
6 Differentiate between budget set and budget line. What is the slope of budget line? 
Budget set is possible combination of two goods that a consumer can consume given the price of 
the two goods and income of the consumer. 
Budget line is the graphical presentation of budget set that shows possible combinations of two 
goods that can be consumed with the given income and prices of the goods. 
Slope of budget line is Px/Py 
1mk each 
3 
7 Derive the law of demand from single commodity equilibrium condition ‘marginal utility = 
price.’ 
If a consumer has more and more of a good its marginal utility to him declines. A consumer is 
now not interested in buying more units a5t same price  instead he is ready to pay price equal to 
its MU. Mu declines in other words a consumer is willing to pay less at ore price. Therefore MU= 
price….3mk 
 
 
 
Price                                                                       Price 
                                                                                                                      D 
                                               
                                                   MU             Qty                                               Qty 
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
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