Economics Practice Paper

Read the following statements carefully:

Statement 1: Equilibrium is possible even at a level lower than the full employment level. Statement 2: At equilibrium level of income, there is absence of involuntary unemployment.

In the light of the given statements, choose the correct alternative from the following:

• Statement 1 is true and statement 2 is false

• Statement 1 is false and statement 2 is true

• Both statements 1 and 2 are true

• Both statements 1 and 2 are false

If Marginal Propensity to Save (MPS) is 0.25 and initial change in investment is Rs.250 crores, then the final change in income would be __________ (Choose the correct alternative)

• Rs.1000 Crores

• Rs.1200 crores

• Rs.500 crores

• Rs.3500 crores

The following information is given for an imaginary economy.

(i) Revenue Expenditure - 45000 (ii) Borrowings - 12000 (iii) Revenue Receipt - 35000 (iv) Interest Payments - 30% of Revenue Deficit

Fiscal deficit will be ________ and Primary deficit will be ________

(Choose the correct alternative)

• Rs.10000/ and Rs.8000/

• Rs.10000/ and Rs.9000/

• Rs.12000/ and Rs.9000/

• Rs.12000/ and Rs.5000/

Ms Meenakshi is a student of class XII, was asking about the reason for price rise in petroleum products due to Russia Ukraine crisis. The teacher was explaining the hike in price of crude oil by the OPEC countries in the international market.

From the above discussion, which item of the Balance of Payment explained by them?

• Visible items

• Invisible item

• Unilateral items

• Capital items

Read the following statement carefully and choose the correct alternative from the following:

Statement 1: In accounting sense, Balance Of Payment (BOP) always remain balanced because of double entry system.

Statement 2: Imbalance in BOP account indicates that its subaccounts are imbalanced.

• Both the statements are true.

• Both the statements are false.

• Statement 1 is true and Statement 2 is false

• Statement 2 is true and Statement 1 is false

DIRECTION: Read the following statements — Assertion (A) and Reason (R). Choose one of the correct alternatives given below:

Assertion (A): Anything will be called money, if the law of a country proclaims it to be money. It will be commonly accepted measure of value as it will be endowed with legal tender power. Thus money is what law says it is.

Reason (R): Limited legal tender money can be accepted up to a certain maximum limit. In India, coins up to Rs. 1000 only can be accepted legally in payment. All currency notes have unlimited legal tender.

• Assertion and Reason both are correct statements and Reason is correct explanation for Assertion.

• Assertion and Reason both are correct statements but Reason is not correct explanation for Assertion.

• Assertion is true but Reason is false.

• Assertion is false but Reason is true

Read the following statements carefully and choose the correct alternative from the following:

Statement 1: Environment includes all the biotic and abiotic factors that influence each other. Statement 2: Biotic elements include nonliving elements like air, water, land etc.

• Both the statements are true.

• Both the statements are false.

• Statement 1 is true and Statement 2 is false

• Statement 2 is true and Statement 1 is false

Read the following statements – Assertion (A) and Reason (R). Choose one of the correct alternatives given below:

Assertion (A): The Aim of Great Leap Forward (GLF) campaign initiated in China was to transform agrarian economy into a modern economy through rapid industrialisation.

Reason (R): Under Great Leap Forward campaign, students and professionals were sent to work and learn from countryside.

• Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)

• Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)

• Assertion (A) is true but Reason (R) is false.

• Assertion (A) is false but Reason (R) is true