CBSE Sample Paper Class XII ECONOMICS
Time: 3 hours M.M 100
All questions in both the sections are compulsory.
- Marks for questions are indicated against each.
- Questions 1 & 13 are very short answer questions carrying 1 mark for each part. They are to be answered in one sentence each.
- Questions 2-5 & 14-17 are short answer questions carrying 3 marks each. Answers to them should not normally exceed 60 words each.
- Questions 6-9 & 18-21 are also short answer questions of 4 marks each. Answers to them should not normally exceed 70 words each.
- Questions 10-12 & 22-24 are long answer questions of 6 marks each. Answers to them should not normally exceed 100 words each.
- Answers should be brief and to the point and the above word limits be adhered to as far as possible.
- All parts of the question should be answered at one place.
SECTION A—[INTRODUCTORY MICRO ECONOMIC THEORY]
1.Answer the following questions:
- Define marginal opportunity cost along a production possibility curve?
- State the condition of consumers’ equilibrium.
- What are patent rights?
- If two demand curves intersect, which one has higher price elasticity?
2. Explain the problem of what to produce with the help of a PPC? 
3.Price of a commodity falls from Rs. 4 to Rs. 3 per unit. As a result total expenditure on
it rises from Rs. 200 to Rs. 300. Find out price elasticity of demand by percentage method. 
4.Under perfect competition MR=AR, but under monopoly MR is less than AR, give reasons for the difference. 
5. Show the effect of an increase in the price on total expenditure depending on the values of price elasticity 
6. Why is there inverse relationship between price of a commodity and its quantity demanded? 
7. Total fixed costs of a firm are Rs. 100. Its average variable cost at different levels of
Output is given below. Calculate total cost and marginal cost at each level of output
|Average Variable Cost||60||56||60||64|
8.With the help of a diagram explain the relationship between marginal cost, average variable cost, average fixed cost and average total cost. 
9.What does a leftward shift of the supply curve of a commodity indicate? Which changes can cause such a shift? 
10.Define equilibrium price and explain with the help of a diagram. Also show the case when demand and supply increase but there is no change in equilibrium price. 
11. Explain with the help of diagrams the effect of the following on the supply of a good:
(1) A rise in the rate of excise duty
(2) An improvement in technology
(3) A rise in the price of inputs. 
12.Distinguish between returns to a factor and returns to scale. What are the factors, which give, rise to increasing returns to scale in the long run? 
SECTION B—[INTRODUCTORY MACRO ECONOMIC THEORY]
13. Answer the following questions:
1. Define revenue deficit.
2. Give one difference between microeconomics and macroeconomics?
3. Ten US dollars are exchanged for Rs. 500.What is the exchange rate for Indian currency?
4. What do economising resources mean? [1×4=4]
14.Distinguish between revenue receipts and capital receipts in a government budget. Give two examples of each. 
15. Calculate (a) Private income (b) Personal disposable income and (c ) Net National disposable income: 
|2.||Saving of private corporate sector||30|
|4.||Current transfers from Govt. administrative departments||60|
|5.||Income from property and entrepreneurship accruing to
Govt administrative departments
|6.||Current transfers from rest of the world||50|
|7.||Savings of non-departmental government enterprises||40|
|8.||Net Indirect taxes||250|
|9.||Direct taxes paid by households||100|
|10.||Net factor income from abroad||(-) 10|
16. Explain the concept of inflationary gap with the help of a diagram. Explain one fiscal measure to reduce this gap. 
17. What is the value of MPC if an additional investment of Rs. 40 crore leads to an increase in income by Rs. 100crore? 
18.Explain any two drawbacks of barter system. How does money help in removing them? 
19. Distinguish between (a) Direct and Indirect Taxes (b) Plan and Non-Plan Expenditure
20.Explain the determination of equilibrium exchange rate. Use diagram
Define Balance of payments. Explain the components of current account of Balance of payments. 
21. What are the various agency functions of commercial banks?
Define a central bank. Explain the quantitative measures used by central bank to control credit creation.
22. Explain the concept of equilibrium level of income with the help of Consumption and Investment (C+I) curve. Can there be unemployment at equilibrium level of income? Explain. 
23. Explain the value added method of estimating national income with the help of a suitable example. 
24. From the following data, calculate Gross National Product by (a) income method and (b) expenditure method. [3+3]
Rs. In crores
|1||Compensation of employees||800|
|2||Net domestic capital formation||100|
|3||Private final consumption expenditure||800|
|4||Net Factor income from abroad||(-)20|
|5||Change in stock||15|
|6||Employer’s contribution to social security schemes||10|
|7||Consumption of fixed capital||20|
|10||Net Indirect taxes||100|
|12||Government final consumption expenditure||200|