NANANAVAIAIAAAAasasasasasVANASAAVAVAaSASASASASASNGIAIAIAIGIANA

SET-2
Series HFGIE/5 QP. Code 58/5/2

Roll No.
idates must write the Q.P. Code
on the title page of the answer-book.

ECONOMICS (Theory)
Aufka aT: 3 T 37Te7 T: 80
Time allowed 3 hours Maximum Marks: 80

f TT I 10.15 10.30 6 TTe b47 A-T7 TT H

Please check that this question paper contains 23 printed pages.

Q.P. Code given on the right hand side of the question paper should be
written on the title page of the answer-book by the candidate.
Please check that this question paper contains 34 questions.
Please write down the serial number of the question in the answer
book before attempting it.
15 minute time has been allotted to read this question paper. The
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and will not write
answer-book during this period.
any answer on the

6ANIAIAIAAVA ANAAAVAGITIAIAAJAAAASIAAANAAAAAA
58/5/2 246 B P.T.O.
General Instructions:
Read the following instructions carefully and follow then

(i) This Question Paper contains 34 questions. All questions are

compulsory.
(ii) This Question Papercontains two sections
Section A- Macro Economics
Section B- Indian Economic Development
(ii) This paper contains 20 Multiple Choice Questions type questions of
I mark each.
(iu) This paper contains 4 Short Answer Questions type-I questions of
3 marks each to be answered in 60 to 80 words.
(v) This paper contains 6 Short Answer questions type-II questions of
4 marks each to be answered in 80 to 100 words.
(ui) This paper contains 4 Long Answer Questions ype questions of
6 marks each to be answered in 100 to 150 words.
(vii) Attempt all parts of a question together.

Section-A
(Macro Economics)
"Considering the depreciation of Indian Currency () in the international
market, the Reserve Bank of India (RBI) has decided to purchase Indian
currency () in the open market."
This represents. exchange rate system.
(Fill up the blank with correct alternative) 1
(a) fixed (b) flexible
(c) managed floating8 (d) manipulated

2 Money is an asset which can be stored for use in future.' 1

In the light of given statement, identify the function of money.
(Choose the correct alternative)
(a) A measure of value
b) A standard of deferred payment
(c) A store of value
(d) A medium of Exchange

58/5/2 3 P.T.O.
D
 3. From the statements given in Column I and Column II, choose the
correct pair.
Column - I
Column- II
A. Vegetables grown in the Personal garden i) Non marketing activity
B. A car used as a taxi (ii) Consumer good
C. An air-conditioner used by household (ii) Capital good
D. Scholarship given to students by (iv) Factor income
government
Alternatives:
(a) A-) (6) B-(i)
(c)C-(ii) d) D-(iv)
OR
(B) Complete the table 1

Producer Value of Intermediate Value

output Consumption Added
Farmer 2000 2000
Baker 2000 2000
Retail Seller 4,400 400
Total 6,000 ...v)..
Alternatives
(a) 4000, 10400, 4000, 4000 (b) 4000, 10400, 4000, 4400
c) 2000, 6000, 6000, 4400 (d) 4000, 10400, 6000, 4000

ARead the followingstatements carefully

Statement 1 In a two sector economy, consumption expenditure and
investment expenditure are the two components of Aggregate
Demand.
Statement 2: Aggregate demand curve always start from point of origin
with positive slope.
In the light of 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.
(b)
Both statements 1 and 2 are true.
(d) Both statements 1 and 2 are false.

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 of
5 Deficit' in Balance of Payment (BOP) refers to the excess .

(Choose the correct alternative) 1

(a) Current account payments over Current account receipts.

(b) Capital account payments over Capital account receipts
(c) Autonomous payments over Autonomousreceipts
(d) Accommodating payments over Accommodating receipts

7 70 to
6. A) Suppose, the price of one UK Pound (¬) has increased from
T 80, owing to market forces.
This means that value of Indian Currency () has
(Choose the correct alternative)
(a) appreciated (6) depreciated
(c) revalued d) devalued
OR
has inflation than Country Y. Which of the
(B) Suppose, Country X, more

following is most likely situation to happen in such a case, assuming

other factors being constant ?
(Choose the correct alternative)

(a) A surplus trade balance in Country X

b) A deficit trade balance for Country X
( ) A rise in exports from Country X to Country Y
(d) A deficit trade balance for CountryY

If in the Investment Multiplier is 4 and Autonomous

A. (A an economy,

Consumption is ? 30 crore, the relevant consumption function would

(Fill up the blank with correct alternative) 1
be
(a) C 30+0.75 Y (b) C ( ) 30+0.25 Y
C 30+0.25 Y (d) C=() 30- 0.25 Y
(c)
OR
(B) If increase in National Income is equal to increase in Savings, the
value of Marginal Propensity to Consume would be_
(Fill up the blank with correct alternative)
(a) equal to unity (b) greater than one
(c) less than one (d) equal to zero

an economy, the value of Marginal Propensity

to Save (MPS) is 0.25,
&In
&
what will be the value of increase in income, if investments increased by
200 crores?
(b) 7 150 crores
(a) 200 crores
(c) 1,000 crores (d) 800 crores
58/5/2 7 P.T.O
9. Read the following statements carefully:
Statement 1: Money supply (M,) in India does
not include 'demand
deposits' with commercial banks.
Statement 2 : Money supply
(M,) refers to, assets available with the
Commercial Banks during a particular period of time.
In the light of the given statements, choose the correct alternative.
(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 Read the following statements Assertion (A) and Reason (R). Choose one
-

of the correct alternatives given below: 1

Assertion (A) : Full employment refers to, absence of involuntary
unemployment.
Reason (R): Under full employment situation, all willing and able
bodied people get employment at prevaiing wage rate.
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

(c)
correct explanation of Assertion (A).
Assertion (A) is true, but Reason (R) is false.
(d) Assertion (A) is false, but Reason (R) is true.

Giving valid reasons, state whether the following statements are

true or false: 3
) Dividend received from investment abroad is recorded on the
credit side of the capital account.
i ) Depreciation of the Indian Currency will lead to promotion of
Indian exports.
OR
b) Distinguish between Autonomous transactions and Accommodating
transactions. 3

Suppose only one Good X' is produced in the country. Output of 'Good X'
12.
during 2018 & 2019 were 100 units & 120 units respectively. The market
price of the product during the two years was50 & 60 per unit
respectively.
Calculate the percentage change in Real Gross Domestic Product (GDP) in
year 2019, using 2018 as the base year. 3

58/5/2 9 P.T.O.
 13. (a Explain the role of Central Bank as Governments' agent and advisor.
OR
(b) Define Reverse Repo Rate. Discuss briefly, how this instru
helps in controlling credit creation by commercial banks.

14. If planned savings exceeds planned investments in an economy, explain

its likely impact on income, output and employment. 4

16. As per the following news published in "The Hindu' on 6th August, 2022 :
The Monetary Policy Committee (MPC) of the Reserve Bank of India
raised the Repo Rate by 50 basis points
Identify and explain the likely cause and consequences behind this type of
action taken by the Reserve Bank of India.

16. Study the given pieture carefully

Sources of State and Local
government tax revenues for a financial year

Individual
Income Tax
Corporate 20%
Income Tax Property
3% Tax
35%
Sales&Gross
Receipts Tax
34%

Motor Vehicle
License Fee
2%
Answer the following questions based on common knowledge and picture
Categorise the given items in the picture into tax /non-tax receipts. 3
ka)
"Government has started spending more on providing free services
like education and health to the poor." 3
In the light of above statement, explain how the government can use
the budgetary policy in reducing 'inequalities of income'.

58/5/2 11 P.T.O.
17. (a) 1) "While estimating Gross Domestic Product (GDP) by
expenditure method, entire focus is on expenditures incurred by
the residents of the country." 3

Do you agree with the given statement ? Give valid reason in

support of your answer.
(1) Calculate the value of National Income from the following data : 3
Amount in
S. No. Particulars
( crores)
() Rent and Royalties 1,300
(ii) Net Indirect Taxes 200

(iii) Wages& Salaries (in cash & in kind) 1,700

(iv) Corporate Tax 400

(v) Depreciation 400

(vi) Retained Earnings 300

(vii) Dividends 400

(vii) Net Factor Income from Abroad 120

(ix) Mixed Income of Self Employed 1,400

(x) Change in Stock 200

OR
b) ) How should the following be treated in estimating National
Income of a Country? Give valid reasons. 3

) Profits earned by Foreign Banks in India.

firm.
(ii) Expenditure on upgradation of fixed asset by a

Suppose in financial year, the Gross Domestic Product (GDP)

H a
at market price of a country was 7 1,100 crore. Net factor
income from Abroad was 100 crore, the net indirect taxes was

7150 crore and National income was 850 crore. 3

Calculate the value of depreciation, on the basis of above

information.

13 P.T.O.
58/5/2
 SECTION B
(Indian Economic Development)
8. Identify, which of the following is an
incorrect function of environme 1
(a) Supplies resources
(b) Assimilates waste
(c) Land degradation
(d) Provides aesthetic services

19. (A) Read the following statements

carefully:
Statement 1 Great
Proletarian Cultural Revolution was
wa
introduced in China in 1950's.
Statement 2 : China's growth is mainly contributed by tne
manufacturing sector.
In the light of given statements, choose the correct alternative from
thefollowing:
(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.

OR
statement from the following: 1
B) Identify the incorrect
(Choose the correct alternative)

rate is better than that of Pakistan.

(a) China's Economic growth
India in HDI ranking.
b) Pakistan is behind
norm was adopted in Pakistan
(c) One Child Policy
adopted New Economic Reforms8.
In 1991, India
(d)
was restricted mainly
of Green Revolution, output
20. (A) In the first phase (Choose the correct alternative)
1
to Wheat and Rice
Cereals and
Pulses (b)
(a) (d) Jowar and Bajra
Cotton and Jute
(c) OR
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15
58/5/2
 1
is known as the architect of Indian Planning.
(a) Jawaharlal Nehru b) P.C. Mahalanobis

(c) Dr. Manmohan Singh (d) Dr. Rajendra Prasad

witnessed
During the British rule in India, Indian agricultural output
21. alternative) 1
stagnation due to (Choose the correct

Decline in handicrafts (b) Drain of Indian wealth

(a)
(c) Land settlement Introduction of railways
(d)

problem of human
which of the following associated with the
22 Identify, are
1
capital formation in India ?
Low academic standards
) Brain drain (i)
outlook
(iii) Rising population (iv) Changes in social
Alternatives
b) (i) and (iii)
(a) ) and (i)
(d) ) and iv)
(c) (), (i) and (ii)

statements carefully:
28. Read the following huge
Zones (SEZs) policy has led to
Statement 1 : Special Economic
flow to China.
Foreign Direct Investment (FD)
industrial growth was the result of its
Statement 2 : China's rapid

economic reform in 1981.

statements, choose the correct alternative:
In the light of the given
and Statement 2 is false.
(a) Statement 1 is true

and Statement 2 is true.

(6) Statement 1 is false
true.
statements 1 and 2 are
(c) Both
and 2 are false.
(d) Both s t a t e m e n t s 1

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58/5/2 17
 d
Read the
following statements
Assertion (A) and Reason
-

of the correct alternatives Reason (R).

(K). Choose one
given
sertion (A) During 1980's,below
: 1

than that of economic growth rate of Pakistan

more
India.
Reason (R) : Pakistan followed the path of mixed
with equal participation of economic structure
the public and the
Alternatives: private sector.
(a) Both Assertion (A) and Reason
(R) are true and Reason (H) 1s tne
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.

is the apex institution which plans and evaluates policies related

5.
to rural credit needs.
Banks
(a) Cooperative Credit Societies (b) Regional Rural
(d) NABARD
(c) Self Help Groups
1
6. Read the following statements
carefully:
commenced in the year
Statement 1 : First
Five Year Plan of China

1956. model,
and China adopted Socialist Economy
Statement 2 Both India

following USSR.
the correct alternative
choose
statements,
In the light ofthe given 2 is false.
Statement
true and
1 is
(a) Statement
Statement 2 is true.
false and
Statement 1 is
( true.
1 and 2
are
statements

(c)
(e Both
statements
1 and
2 arefalse.
aBoth ONO P.T.O.
19

8/5/2
 Identify, which of the
following is the correct
Worker-Population Ratio' ? formula for calculatin8 1
(Choose the correct alternative)
Total Labour Force Total Workers 100
(a) Total Population 100 (b) Total Population
Total Population Total Population
(c) Total Labour Force xx 100
100
(d) Total Workers
x 100

Interpret the situation of earth as depicted in the given picture, with

28.
reference to current environmental challenges

29 (a) State with valid reason whether the following statement is true or
3
false
Self employed workers are different from hired workers.
OR
to farmers in rural
(b) Explain the importance of credit availability 3
development.
1
30. (a) () State themeaning of Privatisation'.
affected by the Economic
(i) Agriculture sector has been adversely 3
reform process.' Comment.
QR
main causes behind infrastructural
(b) State and explain any two
rule.
development by British
true
whether, the following statements
are
S t a t e with valid reasons

false
is not the cause for quality of human capital
(a) Rising population 2
formation. are the outcome of investmer
and production
(6) "Higher productivity 2
in human resources.

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58/5/2 21
32 Compare and analyse the following
information related to Annual Growth
of Gross Domestic Product
(GDP) of India and China:
Annual Growth of Gross Domestic
Product
Country 1980 90 2015-17
India 5.7 7.3
China 10.3 6.8
(Source : Asian Development Bank, Philippines, World
indicator - 2018)
Development

33. Read the following text carefully and answer the given questions on the
basis of the same and common
understanding:
India urged the World Trade
Organisation (WTO)
to relax rules to allow
the country to export food
grains from its public stocks to the nations
facing food crises. India can help, reduce food insecurity but there is
hesitation on the part of the WTO, in relaxing its rules. India's Finance
Minister said food, fuel and fertilizers are global public goods and
ensuring access of these for developing and emerging economies is critical.
She also shared India's experiences, including robust gains in agriculture
production, citizen centric food security programmes and innovative
delivery mechanisms such as the One Nation one Ration Card' Scheme.
(Source: The Economic Times; July 16, 2022)

la) State and discuss any two objectives of World Trade Organisation.
b Name any two steps taken by India to strengthen the food security.

34. (a Define Agricultural diversification. 2

S t a t e the meaning of organic farming. Discuss how does it help
in promoting sustainable development.
OR
(b) G) Discuss the need for promoting women's education in India. 3
i) Explain absorptive capacity of environment with example. 3

58/5/2 23