PRACTICE PAPER-II
ECONOMICS (030)
Class XII Session 2024-25
Time: 3 Hours Max. Marks: 80
General Instructions:
1. This question paper contains two sections:
Section A- Macro Economics
Section B- Indian Economic Development
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
such to be answered in 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-Macro Economics
Multiple Choice Questions (Q1 to Q10) 1 x 10=10
1. Under the Balance of Payment structure of a nation, the two man categories
of accounts for the classification of the transactions are___________
and_________.
(i) current account (ii) unilateral transfer account
(iii) capital account (iv) loan account
Identify the correct alternatives from the following:
(a) (iii) an (iv) (b) (iv) and (i)
(c) (i) and (iii) (d) (i) and (ii)
2. Which out of the following items is not included in money supply at a
country?
(a) Demand deposits (b) Coins and Currency
(c) Time deposits (d) All of these
3. Gifts and remittances to abroad' are recorded on the:
(a) Debit side of Current Account (b) Credit side of Current Account
(c) Credit side of Capital Account (d) Debit side of Capital Account
207 Class XII : Economics (English)
or
Excess of export of goods over import of goods is called
(a) Surplus in Balance of Payments (b) Surplus in Balance of Trade
(c) Neither (a) nor (b) (d) Either (a) or (b)
4. Read the following carefully.
Statement 1: Accommodating items of trade are undertaken in order to
maintain the balance in the BoP account.
Statement 2: Accommodating items are net consequences of autonomous
transactions that are undertaken to correct disequilibrium in autonomous
items of BoP.
(a) Statement 1 is false and statement 2 is true
(b) Statement 1 is true and statement 2 is false
(c) Both statements 1 and 2 are false
(d) Both statements 1 and 2 are true
5. Aggregate demand can be increased by:
(a) increasing cash reserve ratio
(b) increasing bank rate
(c) selling government securities by Reserve Bank of India
(d) None of these
or
If the Marginal Propensity to Consume is greater than Marginal Propensity
to Save, the value of the multiplier will be:
(a) less than 2 (b) equal to 2 (c) equal to 5 (d) greater than 2
6. The following information is given for an imaginary country:
[Link] ( in crores)
(i) imports of goods 400
(ii) Export of goods 340
(iii) Shipping 3
(iv) Travel tourism, etc. 5
(v) Interest, dividends, profits 50
(vi) Unilateral transfers 40
7. Read the following statements carefully
Statement 1: In India, SLR and CRR are fixed by the commercial banks
themselves.
Statement 2: Secondary deposits of a commercial bank are always less than
its primary deposits.
Class XII : Economics (English) 208
(a) Statement 1 is false and statement 2 is true
(b) Statement 1 is false and statement 2 is false
(c) Both Statement 1 and 2 are false
(d) Both Statement 1 and 2 are true
8. Read the following statements-Assertion (A) and Reason (R). Choose one
of the correct alternations given below:
Assertion (A): Import of goods and services reflects demand of foreign
currency Reason (R): Import of goods and services shows inflow of foreign
exchange.
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of Assertion (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of Assertion (A)
(c) Assertion (A) is false but Reason (R) is true
(d) Assertion (A) is true but Reason (R)is false
9. Choose the correct alternatives to be filled in given blanks A, B and C.
Current Account of
Balance of Payments
A
Trade in
Goods
Import of
goods
Net Factor
Trade in Income
Services
Transfer
C
Payment
209 Class XII : Economics (English)
(a) A- Export of goods, B- Gifts, remittances and grants, C- Net non-factor
income
(b) A- Gifts, remittances and grants, B- Export of goods, C- Net non-factor
income
(c) A- Net non-factor income, B- Export of goods, C-Gifts, remittances
and grants,
(d) A- Export of goods, B-Net non-factor income, C-Gifts, remittances and
grants,
10. Suppose in a hypothetical economy, the income rises from 5, 000 crores
to 6, 000 crores. As a result, the consumption expenditure rises from
4, 000 crores to 4, 600 crores. Marginal propensity to consume in such a
case would be___________.
(a) 0.8 (b) 0.6 (c) 0.4 (d) 0.2
Short Answer Questions (Q11 to Q12)
11. It is stated that "amalgamation of many central and state taxes into a single
tax called 'Goods and Services tax (GST)' would facilitate a common
national market." Do you agree with the statement? Justify your answer.
12. State whether the following statements are true or false. Support your
answer with reason.
(a) Taxation is a effective tool to reduce the inequalities of income
(b) Revenue deficit increases when government fails to recover loans
forwarded to different nations.
or
1.3
1.2 1.19
Rs. lakh crore
1.1 1.08
1.0 0.08 1.01
0.9 0.90
0.8
0.7
0.6
2017-18
2018-19
2019-20
2020-21
2021-22
(a) Interpret the above trends of GST collections.
(b) When was GST implemented in India?
Class XII : Economics (English) 210
Short Answer Questions (Q13 to Q15) 4x3=12
13. Suppose a ban is imposed on consumption of tobacco. Examine its likely
effects on (a) gross domestic product and (b) welfare.
or
Government spends on child immunisation programme. Analyse its impact
on Gross Domestic Product and welfare of the people.
14. Explain the role of the Reserve Bank of India as the "lender of last resort".
15. In an economy, investment expenditure is increased by 400 crores and
marginal propensity to consume is 0.8. Calculate total increase in income
and saving.
Long Answer Questions (Q16 to Q17)
6x2=12
16. (a) Calculate Net Domestic PRoduct at Factor Cost from the given data:
[Link] ( in crores)
(i) Net factor income to abroad 30
(ii) Sales 2, 000
(iii) Subsidies 20
(iv) Consumption of fixed capital 50
(v) Closing stock 100
(vi) Opening stock 200
(vii) Intermediate costs 1, 000
(viii) Indirect tax 150
(b) Transfer payments should not be included in the estimation of National
Income? Do you agree? Give reason in support of your answer.
or
(a) Given nominal income, how can we find real income?
(b) Calculate National Income:
[Link] ( in crores)
(i) Compensations of employees 2, 000
(ii) Profit 800
(iii) Rent 300
(iv) Interest 250
211 Class XII : Economics (English)
(v) Mixed income of self-employed 7, 000
(vi) Net current transfers to abroad 200
(vii) Net exports (-) 100
(viii) Net indirect taxes 1, 500
(ix) Net factor income to abroad 60
(x) Consumption of fixed capital 120
17. Discuss the working of the adjustment mechanism in the following situations
(a) Aggregate demand is greater than aggregate supply
(b) Ex-ante investment are lesser than Ex-ante savings.
Section B-Indian Economic Development
Multiple Choice Questions (Q18 to Q27)
18. In____, the Great Proletarian Cultural Revolution was introduced in China.
(a) 1985 (b) 1965 (c) 1995 (d) 1975
or
In____, the Special Economic Zones (SEZs) were set up in China.
(a) 1979 (b) 1972 (c) 1982 (d) 1975
19. Read the following statements carefully:
Statement 1: SAARC stands for South Asian Association for Regional
Cooperation.
Statement 2: ASEAN stands for Association of South-east Asian NAtions..
In the light of the given statements, choose the correct alternative from the
following:
(a) Statement is false and statement 2 is true
(b) Statement is true and statement 21 is false
(c) Both statements 1 and 2 are false
(d) Both statements 1 and 2 are true
20. Arrange the following events of China in chronological order and choose
the correct alternative:
i) Special Economic Zones
ii) Great Proletarian Cultural Revolution
iii) Great Leap Forward Campaign
iv) Economic reforms were initiated
(a) (iii), (ii), (iv), (i)
(b) (iv), (i), (ii), (iii)
Class XII : Economics (English) 212
(c) (iv), (ii), (i), (iii)
(d) (ii), (iv), (iii), (i)
21. Read the following statements Assertion (A) and Reason (R) Choose one of
the correct alternative given below:
Assertion (A) Rular development in India is of key significance.
Reason (R): Nearly two-third of population in India is dependent on
agriculture
Alternatives
a) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of Assertion (A)
b) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion.
c) Assertion (A) is false but Reason (R) is true
d) Assertion (A) is tile but Reason (R) false
22. Read the following statements carefully:
Statement 1: Seasonal workers are the worst affected by seasonal
unemployment in India.
Statement 2: Population is the total number of people who reside in
particular loeality at a particular point of time. In the light of the given
statements, choose the correct alternative from the following:
a) Statement 1 is false and statement 2 is true
b) Statement is me and statement 2 is false
c) Both statements 1 and 2 are false
d) Both statements 1 and 2 are true
23. From the set of events systems given in Column I and corresponding
relevant fact given in column II, choose the correct pair of statement.
Column I Column II
A. The growth rate of agriculture (i) 1995
sector decelerated to about 3%
per annum..
B. A major change occurred when (ii) after 1989
India adopted social banking
C. A thrift and credit society was (iii) 1995
started in Kerala.
D. By March end more than seven (iv) 2010
lakh SHG's been credit linked.
213 Class XII : Economics (English)
Alternatives:
(a) C-(iii)
(b) A-(i)
(c) D-(iv)
(d) B-(ii)
24. States where land reforms were successful on account of they being
committed to the policy of 'land to the tiller' are:
(a) Punjab and Kerala
(b) Kerala and West Bengal
(c) Andhra Pradesh and West Bengal
(d) Kerala and Andhra Pradesh
or
Identify the option which is are not true in the context of demographic
condition of India during the British rule?
(a) High Birth Rate
(b) Low Death Rate
(c) Low Infant Mortality Rate
(d) High life expectancy
(a) (i) and (iii) (b) (i) and (ii) (c) (i), (ii) and (iii) (d) (ii), (iii) and
(iv)
25. Read the following statements-Assertion (A) and Reason (R). Choose one
of the correct alternations given below.
Assertion (A): The growth rate of population of Pakistan is lowest as
compared to India and China in 2017-18.
Reason (R): China adopted one child policy to control population in the
year 1979.
Alternatives:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of Assertion (A)
b) Both Assertion ( A ) and Reason (R) are true and Reason (R) is the
correct explanation of Assertion( A)
c) Assertion (A) is false but Reason (R) is true
d) Assertion (A) is true but Reason (R)is false
26. A person got two job offers, one from Mumbai while other from Chennai.
Before deciding which one to opt, he go through the cost and benefit
analysis. Which source of human capital formation he takes into account?
(a) Expenditure on Training (b) Expenditure on Eduction
(c) Expenditure on Migration (d) Expenditure on Health
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27. Which of the following in not true for small scale industries?
(a) SSI is capital intensive and therefore, increases productivity.
(b) SSI is labour intensive and therefore, employment oriented.
(c) SSI shows locational flexibility and is therefore, equality oriented
(d) SSI needs small investment and is therefore, equity oriented.
Short Answer Questions (Q28-10 Q29)
28. Interpret the given picture on account of World Trade Organisation (WTO)
29. "Subsidies were needed to encourage farmers." Discuss the importance of
subsides in relevance to the Indian farmers.
or
"Small scale and cottage of industry are important in the development of
India company." Elaborate.
Short Answer Questions (Q 30 to Q32)
30. Answer the following questions on the basis of the following data:
(a) Comment upon the People Below Poverty line among the three countries.
(b) Comment upon the percentage of Undernourished Children among
China and Pakistan.
Country People Below Poverty Undernourished Children (%)
Line (%)
India 37 39
China 32 9
Pakistan 44 45
215 Class XII : Economics (English)
31. Elaborate any four positive contributions made by Britishers in India.
or
Throw light on the 'economic drain' during the colonial period.
32. Discuss the importance of credit in rural development.
Long Answer Questions (Q33 to Q34)
33. Elucidate the function of Pollution Control Board in India to address the
environment concerns in India.
or
(a) Give any three causes of backwardness of Indian agriculture.
(b) Give any three challenges facing India education system.
34. Read the following text carefully and answer the given question on the
basis of the same and common understanding.
Blessed with a varying climate and soil conditions, India has adopted
growing of diverse horticultural crops such as fruits, vegetables, tuber crops,
flowers, medicinal and aromatic plants spices and plantation crops. These
crops olay a vital role in providing food and nutrition, besides addressing
employment concerns. Horticulture sector contributes nearly one-third of
the value of agriculture output of six per cent of Gros Domestic of India.
India has emerged as a world leader in producing a variety of fruits like
mangoes, bananas, coconuts, cashew nuts and a number of spices and is
the second largest producer of fruits and vegetables. Economic condition
of many farmers engaged in horticulture has improved and it has become
a means of improving livelihood for many unprivileged classes. Flower
harvesting, nursery maintains, hybrid seed production and tissue culture,
propagation of frits and flowers and food processing are highly remunerative
employment options for women in rural areas.
(a) How the term 'Golden Revolution' is different from 'Green Revolution'?
(b) How horticulture as an alternative source of employment improves the
economic condition of farmers?
Class XII : Economics (English) 216