SAMPLE QUESTION PAPER – 1 (2024-25)

ECONOMICS (030) CLASS XII

TIME: 3 HOURS M.M. – 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 of 1 mark each.
3. This paper contains 4 Short Answer Questions of 3 marks each to be answered in 60 to 80
words.
4. This paper contains 6 Short Answer Questions of 4 marks each to be answered in 80 to
100 words.
5. This paper contains 4 Long Answer Questions of 6 marks each to be answered in 100 to
150 words.
Q.NO. MARKS
SECTION A – MACRO ECONOMICS

1 Read the following statements carefully:

Assertion (A): The saving curve makes a negative intercept on the vertical axis at a
zero level of income.
Reason (R): Autonomous consumption occurs at 0 income level .
In light of the given statements, choose the correct alternative 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

2 Which one leads to factor cost?

a) Market price - Indirect taxes
b) Market price - Net indirect taxes
c) Market price + Indirect taxes 1
d) Market price + Net indirect taxes
3 APC is equal to ( choose the correct alternative)
a) Y/C
b) ∆C/∆Y
c) C/Y
1
d) ∆Y/∆C

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4
Net private transfer receipts and net investment income resulted in the outgo of dollars.
This transaction will be recorded in the ______ account on ______ side of BOP
account of India.
The above transaction will be recorded in the _______ account on ______ side of
Balance of payments account of India. (Choose the correct alternative to fill up the
blanks)
a) current, credit b) current, debit
1
c) capital, credit d) capital, debit

5
In barter system credit transactions were difficult to execute, as the borrower may not be
able to arrange the same quality goods at the time of repayment.

Which function of money eliminates this drawback of Commodity to commodity economy?

a) Asset Function of Money
b) Store of value 1
c) Standard for Deferred Payments
d) Medium of Exchange

6
In a hypothetical economy, initial deposits are Rs.12,00,000 and reserve requirement rate is
8% , then how much total amount of credit created is in form the loan amount.

a) Rs. 11,04,000.
b) Rs. 12,96,000
1
c) Rs. 2,40,000
d) Rs. 96,000

7 If the increase in National Income is equal to an increase in consumption, identify the value
of Marginal Propensity to Save :

a. Equal to unity
b. Greater than one
c. Less than one
d. Equal to zero 1

2
8 Choose the correctly matched pair from the following

Column A Column B
A. Demand of foreign exchange 1. Exchange rate = Price of foreign currency
B. Supply of foreign exchange 2. To undertake foreign tour
C. Excess demand 3. Exchange rate < price of foreign currency
D. Excess supply 4. Receipts from export of goods and services

a) A-4
b) B-1
c) C-3 1
d) D-2

9 Suppose in an economy,
Equilibrium level of income = ₹2500 crores.
Ratio of marginal propensity to consume and marginal propensity to save = 3:1
Calculate the investment needed to reach a new equilibrium level of income of ₹ 4000 crores

(Choose the correct alternative to fill up the blank)

a) ₹ 200 Cr.
b) ₹ 375 Cr.
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c) ₹ 325 Cr.
d) ₹ 600 Cr.

10 Read the following chart carefully and choose the correct alternative:

Alternatives:
a) Balance of Trade b) Primary transactions
1
c) Transfer payments d) Official foreign reserve

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(A) On the basis of the given data, estimate the value of National Income:

3
 S. No. Items Amount
(₹in crore) 3
i. GDPMP 5500
ii. GST 120
iii. Factor income from abroad 150
iv. Subsidies 70
v. Factor income to abroad 250
vi. Consumption of Fixed Capital 300

OR
(B) State the meanings of the following:
i) Mixed income ii) Capital loss iii) Factor income
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"Transactions recorded in current account affect income output and Employment of a

country"
Do you agree with the given statement? Give valid reason(s) in support of your answer.

13
For a hypothetical economy, In an economy, income increases by 20,000 as a result of a rise
in investment expenditure by 2,000. Calculate: (a) Investment Multiplier, (b) Marginal 4
Propensity to Consume

14 “ In an economy, ex-ante Aggregate supply is more than ex-ante Aggregate demand at natural
rate of unemployment. " 4
Elaborate the possible reasons of the same.
OR
“With an objective to control money supply, Reserve Bank of India is empowered to use 4
various tools .”
Discuss the various instruments of RBI's monetary policy..
15 Read the following text carefully:
"The Union Government has announced a substantial increase in public spending on
infrastructure projects, stating that such investments will significantly boost economic
growth and job creation. In the latest budget, capital expenditure has been raised by 4
₹5,000 crore to stimulate the economy."

4
 Based on the given text and common economic principles, explain how the increase in
investment impacts the National Income, assuming the Marginal Propensity to
Consume (MPC) as 0.75.

16 Read the following text carefully:

As economies developed, money evolved to facilitate trade and overcome the limitations of
barter. Initially, commodities such as gold, silver, and cowrie shells were used as money
due to their intrinsic value. Over time, paper money issued by central authorities replaced 3
commodity money, making transactions more efficient. In the digital age, central banks are
exploring Central Bank Digital Currency (CBDC) as a new form of money. CBDC offers 3
benefits such as reduced cash dependency, lower transaction costs, and improved financial
inclusion. However, it also poses risks like cybersecurity threats and technological
challenges.

Questions:
3
(I) “Money has changed its form over time to improve trade and transactions.”
In light of this statement, briefly discuss any two forms of money.

(II) “CBDC is being viewed as the future of money, but it has its own advantages and 3
risks.”
Do you agree with this statement? Support your answer with valid arguments.

17
(I) On the basis of the following hypothetical data:
3
(all figures in ₹ crore)

Year Nominal GDP Real GDP (Adjusted to Base Year Prices) 3

2022 4,200 5,000
2025 6,300 6,800
Calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2025,
using 2022 as the base year.

(II) “The government’s investment in expressways is expected to enhance connectivity and

reduce travel time.”
Based on the above statement, discuss the likely impact of such infrastructure investment on
Gross Domestic Product (GDP) and overall welfare in an economy.

or
3
(a) Giving valid reasons, explain how the following would be treated while estimating
Natioanl income?

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 (i) Anaya imported Samsung Mobile phone for Rs. 92000
(ii) Radha paid interest of Rs. 4000 on loan taken from Axis bank to buy new car.
3

(b) "All producer goods are capital goods ." Do you agree with the given statement? Give
valid reasons for your answer.

SECTION B – INDIAN ECONOMIC DEVELOPMENT

18 Identify the correct combination of the ‘Goals of Indian Five Year Plans’:
a) Growth with Sustainability
b) Growth with equality
c) Self –reliance with Sustainability
d) Modernisation through Self-Reliance 1

19 ‘China is at relatively better standing in all demographic indicators ’.

Identify which of the following is not a demographic indicator?
a) Sex ratio , Fertility ratio
b) Annual growth of population
c) Urbanisation
d) Maternal Mortality Rate (per 1 lakh births) 1

20
A farmer Chandu practices organic farming and uses crop rotation and
natural predators to control pests.
Is there an advantage of this approach provided as compared to
conventional pesticides use?
a) faster and predictable pest eradication
b) lower labor costs for pest management
c) increased risk of crop failure and reduced yields
d) reduced harm to beneficial insects and pollinators
1

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21
Study the following picture and answer the given question:

In rural household , men take up agricultural work to support them women looks after ______
to reduce dependence on risky agricultural employment.
(Choose the correct alternative to fill up the blank)
a) Animal husbandry b) Fisheries
c) Dairy farming d) Poultry 1

22 Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative
from those given below.
Assertion (A): Crisis of 1991 forced India for financial help from IMF and world bank which
also put conditions of liberalisation as a necessary for availing loan.
Reason (R): To unlock the economic potential of the country by encouraging private sector
and multinational corporations to invest and expand is necessary .
Alternatives:
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

23
_____was introduced in China to increase production by providing stable supply of inputs
for production process.
(Choose the correct alternative to fill up the blank)
a) Commune System b) Great Leap Forward 1
c) Dual Pricing d) Great Proletarian Cultural Revolution

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______made India a world leader in the production of mangoes, bananas, coconut and
spices.
a) Horticulture Revolution
b) Golden revolution
c) Green revolution
d) Pink revolution.
1

25
_____ was introduced by the United Nations Development Programme (UNDP).
(Choose the correct alternative to fill up the blank)
a) Human development indicator b) Liberty indicator
c) Health indicator d) Demographic indicator
1

26 Read the following statements carefully:

Statement 1: Casual wage work is the major source of employment in rural India
Statement 2: Casual wage workers are not hired on permanent basis and do not enjoy
regular income and job security.
In light of the given statements, choose the correct alternative 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

27 From the set of the events given in column I and corresponding facts given in Column II,
choose the incorrect pair of statements:
Column I Column II
A. Growth due to service sector I. India & Pakistan

B. High density of population II. India

C. Mixed economy III. India & Pakistan

D. Very high fertility IV. India

Alternatives: 1
a) A-I b) B-II
c) C-III d) D-IV

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28 (A) "On the eve of Independence, the agricultural sector of India experienced
deterioration and stagnation." 3
List any three factors responsible for the condition.
OR
(B) " The mercantilistic economic theory of britishers resulted into colonialisation of 3
India to achieve their end of Trade surplus "
Justify above statement by explaining foreign trade of India during pre-independence.

29
“Government of India started a programme so as to ensure important vaccinations for
Doctors of the country to ensure their safety and efficacy.”
Explain the impact of Government’s decision on human capital formation.
3

30 “Under China’s dual-track system, in which the command economy and the market economy
coexisted has pre-determined objectives to fulfil interest of different sections of society. "
Discuss the concept of Dual Pricing in the reform process of China.
4

31 (A) State and elaborate whether the following statements are true or false, with valid
arguments:
(i) Lack of agricultural marketing infrastructure often forces the farmers to sell their 2
produce at low prices for fear of spoilage or to pay off an imminent debt.
(ii) Information and Communication Technology ( ICT ) can also help combat rural and 2
urban poverty and foster sustainable development.
OR
(B) “Unemployment adversely affects the disposable income of families, erodes purchasing 4
power, diminishes employee morale, and reduces an economy's output.’ Discuss.
32

Identify the situation depicted in the given image. Suggest the impact of the indicated
situation, on the Indian economy.

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33 (A) “ The industrial sector became well diversified by 1990,largely due to public sector.”
Justify the statement, giving reasons in support of your answer.

3
(B) “Government of various steps to shield small scale industries from big firms.”
Briefly outline and discuss such steps taken by the government to protect small scale
industries .
OR 3
(C) “Agriculture sectors was adversely affected by the Reform process.” Do
you agree with the given statement? Give valid reasons in support of your answer.

(D) “The service sector's growth has been much faster than the manufacturing
sector. service sector's contribution to GDP increased from 41% in 1990–91 to 63% 3
in 2009–10.”
In the light of above statement highlight major factor responsible to the high growth of
service sector.
3

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34
Read the following text carefully:
Sustainable Global warming is the long-term warming of the planet's overall temperature.
Though this warming trend has been going on for a long time, its pace has significantly
increased in the last hundred years due to the burning of fossil fuels. As the human population
has increased, so has the volume of fossil fuels burned. Global warming occurs when carbon
dioxide (CO2) and other air pollutants collect in the atmosphere and absorb sunlight and
solar radiation that have bounced off the earth’s surface. Normally this radiation would
escape into space, but these pollutants, which can last for years to centuries in the
atmosphere, trap the heat and cause the planet to get hotter. These heat-trapping pollutants—
specifically carbon dioxide, methane, nitrous oxide, water vapor, and synthetic fluorinated
gases—are known as greenhouse gases, and their impact is called the greenhouse effect.
Global warming is already taking a toll on the United States. And if we aren’t able to get a
handle on our emissions, here’s just a smattering of what we can look forward to:
Disappearing glaciers, early snowmelt, and severe droughts will cause more dramatic water
shortages and continue to increase the risk of wildfires in the American West. Rising sea
levels will lead to even more coastal flooding on the Eastern Seaboard, especially in Florida,
and in other areas such as the Gulf of Mexico. Forests, farms, and cities will face troublesome
new pests, heat waves, heavy downpours, and increased flooding. All of these can damage
or destroy agriculture and fisheries. Disruption of habitats such as coral reefs and alpine
meadows could drive many plant and animal species to extinction. Allergies, asthma, and
infectious disease outbreaks will become more common due to increased growth of pollen-
producing ragweed, higher levels of air pollution, and the spread of conditions favorable to
pathogens and mosquitoes.
On the basis of the given text and common understanding, answer the following questions:
(i) Define Green house effect. Name two major green house gases. 2
(ii) Briefly elaborate, any two adverse effects of global warming. 4

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