Q1
mcq
1 mark
Read the following statements carefully:
Statement 1: Savings function can be derived from Consumption function.
Statement 2: Consumption curve must always start from the point of origin.
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.
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Q2
mcq
1 mark
Keeping other factors constant, if the price of crude oil falls in the international market, it may lead to ___________. (Choose the correct alternative to fill up the blank)
- A. increase in trade deficit
- B. decrease in trade deficit
- C. no change in trade deficit
- D. no change in the foreign exchange reserves
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Q3
mcq
1 mark
Identify which of the following is not a function of the Reserve Bank of India. (Choose the correct alternative)
- A. Controller of money supply
- B. Credit provider to
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Q4
mcq
1 mark
Read the following statements carefully: Statement 1: Import of gold from Dubai will be recorded on the debit side of the current account in Balance of Payments of India. Statement 2: Outflow of Foreign Institutional Investment (FII) from Indian stock markets will be recorded on the credit side of the capital account. 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.
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Q5
mcq
1 mark
Read the following statements carefully: Statement 1: Stock variables are measured at a point of time. Statement 2: Flow variables and stock variables are same. 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.
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Q6
mcq
1 mark
Identify flow variable from the following: (Choose the correct alternative)
- A. Distance between Delhi and Amritsar
- B. Annual expenditure of a school
- C. Bank balance of Mr. Mukesh as on 31st March, 2022
- D. Investments of Mr. Mohit as on 31st December, 2021
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Q6
mcq
1 mark
If in an economy, the value of Investment Multiplier is 5 and dissavings are ₹100 crore, the relevant savings at income level of ₹1,400 crore would be ________ crore. (Choose the correct alternative to fill up the blank)
- A. 80
- B. 180
- C. 140
- D. 240
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Q7
mcq
1 mark
If the central bank wants to reduce money supply in the economy, it may ___________. (Choose the correct alternative to fill up the blank)
- A. (i) increase Bank Rate
- B. (ii) reduce Cash Reserve Ratio
- C. (iii) sell securities in the open market
- D. (iv) buy securities in the open market
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Q8
mcq
1 mark
The range of value of Investment Multiplier is always between _____ and ______. (Choose the correct alternative to fill up the blanks)
- A. zero (0), infinity ($\infty$)
- B. one (+1), infinity ($\infty$)
- C. zero (0), one (+1)
- D. minus one (-1), plus one (+1)
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Q8
mcq
1 mark
(A) Identify, which of the following is not a source of supply of foreign exchange for India. (Choose the correct alternative)
- A. Exports of goods and services abroad
- B. Remittances by Indian workers working abroad
- C. Imports of goods and services from abroad
- D. Foreign Direct Investment (FDI) by a German automobile manufacturer
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Q8
mcq
1 mark
(B) Read the items given in Columns I and II carefully and choose the correct pair of statements from the given alternatives.
- A. i 1
- B. ii 2
- C. iii 3
- D. iv 4
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Q9
mcq
1 mark
Read the following statements : Assertion (A) and Reason (R). Choose the correct alternative from those given below.
Assertion (A) : Ex-ante savings and Ex-ante investments are never equal to each other.
Reason (R) : At equilibrium level of income, aggregate demand may not be equal to the aggregate supply.
Alternatives :
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
(b) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
(c)
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Q9
mcq
1 mark
Read the following statements : Assertion (A) and Reason (R). Choose the correct alternative from those given below.
Assertion (A) : Ex-ante savings and Ex-ante investments are never equal to each other.
Reason (R) : At equilibrium level of income, aggregate demand may not be equal to the aggregate supply.
- A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
- B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
- C. Assertion (A) is true, but Reason (R) is false.
- D. Assertion (A) is false, but Reason (R) is true.
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Q10
mcq
1 mark
Read the following statements : Assertion (A) and Reason (R). Choose the correct alternative from those given below.
Assertion (A) : The value of Average Propensity to Consume (APC) can never be zero or negative.
Reason (R) : Average Propensity to Consume (APC) is independent of the level of income.
- A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
- B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
- C. Assertion (A) is true, but Reason (R) is false.
- D. Assertion (A) is false, but Reason (R) is true.
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Q11
short answer
3 marks
(a) Differentiate between Value of Output and Value Added.
OR
(b) Justify the following statement :
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Q12
short answer
3 marks
Discuss briefly the determination of exchange rate under the flexible exchange rate system.
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Q13
short answer
Suppose the following information is given about a hypothetical economy :
C = 100 + 0.75 Y (where, C = Consumption and Y = Income)
$I_0$ = 200 ($I_0$ = Autonomous Investment)
Calculate the following on the basis of the given information :
(a) Equilibrium Level of Income
(b) Aggregate Demand at Equilibrium Level of Income
(c) Marginal Propensity to Save
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Q14
long answer
4 marks
(a) Read the following information carefully :
India (RBI), recently increased the Repo Rate by 50 basis points. The Rate stands today at 5.40%, whereas Reverse Repo Rate was left unchanged at 3.
Answer the following questions :
(i) Identify the nature of the two monetary policy measures mentioned in the above text.
(ii) Elaborate the likely economic rationale behind the increase in Repo Rate by the Monetary Policy Committee.
OR
(b) Suppose an imaginary economy is facing a situation of deficient demand in the short run time period.
Discuss briefly, the probable impacts of the same on the economy.
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Q14
short answer
1 mark
Read the following information carefully:
Reserve Bank of India (RBI), recently increased the Repo Rate by 50 basis points. The rate stands today at 5.40%, whereas Reverse Repo Rate was left unchanged at 3%.
Answer the following questions:
(i) Identify the nature of the two monetary policy measures mentioned in the above text.
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In India, after Covid-19 period, household and private sector consumption, as measured by Private Final Consumption Expenditure (PFCE), was 39.7 trillion in nominal terms in Q1 FY23, compared with 28.4 trillion for the same period last year, and 39.2 trillion in the fourth quarter (Q4) of 2021-22 (FY22). As a percentage of Nominal GDP, PFCE was 61.1 per cent, compared with 55.5 per cent in Q1 FY22. However, in real terms at constant prices, PFCE grew just 9.88 per cent, compared with Q1 of 2019-20 the year before the Covid-19 pandemic. According to Dr. D.K. Srivastava, the improvement in household demand is reflected by the growth rate of PFCE and GFCF (Gross Fixed Capital Formation) compared with the same quarter of the previous year. GFCF in Q1 FY23 reached 19 trillion, compared with 14.4 trillion in Q1 FY22. However, it is lower than 20.2 trillion in Q4 FY22. In terms of GDP, the chief economic adviser T.V. Somanathan stated that GFCF in Q1 was broadly similar to the previous quarter.
Q17
long answer
Read the following text carefully:
In India, after Covid-19 period, household and private sector consumption, as measured by Private Final Consumption Expenditure (PFCE), was 39.7 trillion in nominal terms in Q1 FY23, compared with 28.4 trillion for the same period last year, and 39.2 trillion in the fourth quarter (Q4) of 2021-22 (FY22). As a percentage of Nominal GDP, PFCE was 61.1 per cent, compared with 55.5 per cent in Q1 FY22. However, in real terms at constant prices, PFCE grew just 9.88 per cent, compared with Q1 of 2019-20 the year before the Covid-19 pandemic.
According to Dr. D.K. Srivastava, the improvement in household demand is reflected by the growth rate of PFCE and GFCF (Gross Fixed Capital Formation) compared with the same quarter of the previous year. GFCF in Q1 FY23 reached 19 trillion, compared with 14.4 trillion in Q1 FY22. However, it is lower than 20.2 trillion in Q4 FY22.
In terms of GDP, the chief economic adviser T.V. Somanathan stated that GFCF in Q1 was broadly similar to the previous quarter.
Answer the following questions based on the given text and common understanding:
(i) Compare and analyse the changes in the share of PFCE as a percentage of GDP in real and nominal terms.
(ii) With reference to market prices, explain why private final consumption expenditure is an important factor in determining the gross domestic product at market price.
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Q20
long answer
3 marks
Elaborate the likely economic rationale behind the increase in Repo Rate by the Monetary Policy Committee.
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Q20
mcq
1 mark
Identify the correct alternative with reference to the following statement: Mao introduced this movement under which professionals and students were asked to work and learn from real life situations prevailing in the country.
- A. Commune System
- B. Great Leap Forward
- C. Open Door Policy
- D. Great Proletarian Cultural Revolution
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Q20
mcq
1 mark
Read the following statements carefully:
Statement 1: In the agricultural sector, communes were established, where land holdings were allocated to individual households for ownership.
Statement 2: Special Economic Zones (SEZs) were established to attract foreign investments and technology.
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.
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Q21
long answer
4 marks
Suppose an imaginary economy is facing a situation of deficient demand in the short run time period. Discuss briefly the probable impacts of the same on the economy.
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Q21
mcq
1 mark
Micro credit programmes play a vital role in ensuring an overall development of the rural economy as they ____________. (Choose the correct alternative to fill up the blank)
(i) provide financial support
(ii) lead to women empowerment
(iii) enhance the reach of formal credit system
Alternatives:
- A. Only (i) and (ii)
- B. Only (ii) and (iii)
- C. Only (i) and (iii)
- D. (i), (ii) and (iii)
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Q21
mcq
1 mark
____________ revolution was the harbinger of major changes in the credit system as it led to diversification of the portfolio of rural credit towards production-oriented lending. (Choose the correct alternative to fill up the blank)
- A. White
- B. Silver
- C. Blue
- D. Green
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Q22
long answer
4 marks
Two friends, Deepak and Krish were discussing the impact of increase in GST rates on luxury items, as recently undertaken by the Government. Krish was of the view that most of the luxury items (like foreign travel, imported cigarettes, etc.) should be taxed exorbitantly, while the items related to daily consumption of poor and middle class should be tax-free. Identify and explain the objective of the Government budget Krish is suggesting.
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Q22
mcq
1 mark
Multiple reasons for economic slowdown and re-emergence of poverty in Pakistan may be enumerated. Identify which of the following might not be one of them.
- A. (i), (ii) and (iii)
- B. (ii) and (iii)
- C. (i) and (iii)
- D. Only (ii)
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Q23
short answer
2 marks
State any two examples of non-tax receipts of the Government.
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Q23
mcq
1 mark
Identify which of the following does not reflect a direct relationship between human capital formation and economic growth.
- A. Employability of an educated person is higher than that of an uneducated person.
- B. On-the-job training will reduce the skills of labour.
- C. Healthy workforce is a boon to the economy.
- D. Digital information helps in taking real time decisions.
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Q24
long answer
4 marks
The Government of India has incurred a lot of expenditure on acquisition of indigenous defence items. Identify and discuss the two types of budget expenditures which may be undertaken by the Government as suggested in the above statement.
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Q24
mcq
1 mark
Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative from those given below.
Assertion (A): Lower child mortality rate is a better indicator of gender equality.
Reason (R): Preference for a male child exists in India, Pakistan and China.
- A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
- B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
- C. Assertion (A) is true, but Reason (R) is false.
- D. Assertion (A) is false, but Reason (R) is true.
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Q25
mcq
1 mark
(A) __________ adopted the resolution to ban the use of Chlorofluorocarbon (CFC) compounds along with other ozone depleting chemicals. (Choose the correct alternative to fill up the blank)
OR
(B) According to Herman Daly (an environmental economist), which of the following is not an essential step towards achieving sustainable development?
- A. Kyoto Protocol
- B. Paris Protocol
- C. Montreal Protocol
- D. Brundtland Commission Report
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Q25
mcq
1 mark
__________ adopted the resolution to ban the use of Chlorofluorocarbon (CFC) compounds along with other ozone depleting chemicals.
- A. Kyoto Protocol
- B. Paris Protocol
- C. Montreal Protocol
- D. Brundtland Commission Report
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Q25
mcq
1 mark
According to Herman Daly (an environmental economist), which of the following is not an essential step towards achieving sustainable development?
- A. Limiting human population to carrying capacity of the environment
- B. Input inefficient technological progress
- C. Rate of extraction of renewable resources should not exceed rate of regeneration
- D. Correction of inefficiencies arising from pollution
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Q26
long answer
4 marks
Compare and analyse the changes in the share of PFCE as a percentage of GDP in real and nominal terms.
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Q26
mcq
1 mark
Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative from those given below.
Assertion (A): Government can try to reduce unemployment through special poverty removal programmes.
Reason (R): Such poverty removal programmes directly or indirectly lead to employment generation.
- A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
- B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
- C. Assertion (A) is true, but Reason (R) is false.
- D. Assertion (A) is false, but Reason (R) is true.
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Q26
mcq
1 mark
Read the following statements: Assertion (A) and Reason (R). Choose the correct alternative from those given below.
Assertion (A): Government can try to reduce unemployment through special poverty removal programmes.
Reason (R): Such poverty removal programmes directly or indirectly lead to employment generation.
Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
(b) Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
(c) Assertion (A) is true, but Reason (R) is false.
(d) Assertion (A) is false, but Reason (R) is true.
- A. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of the Assertion (A).
- B. Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).
- C. Assertion (A) is true, but Reason (R) is false.
- D. Assertion (A) is false, but Reason (R) is true.
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Q27
short answer
2 marks
With reference to market prices, explain why private final consumption expenditure is an important factor in determining the gross domestic product at market price.
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and Gross Fixed Capital Formation (GFCF) over the corresponding < 19 trillion in Q1 FY23, compared with < 14·4 trillion in Q1 FY22. However, it was slightly lower than < 20·2 trillion in Q4 FY22. In the media briefing after the GDP numbers, Finance Secretary T.V. Somanathan said this trend was expected as GFCF in present Q1 was usually lower than the previous year
Q28
short answer
2 marks
Private Final Consumption Expenditure is an important factor given statement.
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Q28
short answer
3 marks
(a) Define worker-population ratio and give its significance.
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Q29
mcq
1 mark
From the following alternatives, identify the correct full form of NITI:
- A. National Institution for Tribal India
- B. National Institution for Technical India
- C. National Institution for Transforming India
- D. National Institution for Training India
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Q29
short answer
3 marks
Elaborate how a well-structured agricultural marketing system helps the farmers to increase their income.
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Q30
mcq
1 mark
In a __________ economy, resources are owned and operated by both public and private sectors.
(Choose the correct alternative to fill up the blank)
- A. socialist
- B. capitalist
- C. democratic
- D. mixed
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Trends in Output Growth in Different Sectors, 1980-2015 Country 1980 90 2011 2015 Agriculture Industry Service Agriculture Industry Service India 3.1 7.4 6.9 2.3 5 8.4 China 5.9 10.8 13.5 4.1 8.1 8.4 Pakistan 4 7.7 6.8 2.7 3.4 4.4
Q30
long answer
4 marks
Read the following schedule carefully:
Trends in Output Growth in Different Sectors, 1980-2015
Country 1980 90 2011 2015
Agriculture Industry Service Agriculture Industry Service
India 3.1 7.4 6.9 2.3 5 8.4
China 5.9 10.8 13.5 4.1 8.1 8.4
Pakistan 4 7.7 6.8 2.7 3.4 4.4
Analyse the output growth trend in the three sectors over the given years between India and China.
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Q31
long answer
4 marks
(a) Some economists consider that the economic reforms of 1991 had a negative impact on the agricultural sector. Present valid arguments in support of your answer.
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Q31
long answer
2 marks
(b) (i) Explain any two shortfalls of the industrial policy under the British rule.
(ii) Quote the four goals of the five year plans process of India.
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Q48
long answer
4 marks
Analyse the output growth trend in the three sectors over the given years between India and China. With the given statement? Quote valid arguments in favour of your answer.
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Q49
short answer
2 marks
Explain any two shortfalls of the industrial policy under the British rule.
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Q50
short answer
2 marks
Quote the four goals of the five year plans process of India.
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Q52
short answer
2 marks
State and discuss any one recommendation of the Education Commission (1964 66).
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Q53
long answer
3 marks
In the light of the given image, identify and explain any one strategy to ensure sustainable development.
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With independence, India chose the closed economy model in pursuit of its objective of industrial self-sufficiency. As a result, industrial structure has become considerably important. In the post-independence era, the industrial growth was rapid during the first two decades, especially during the Second and Third Plan period. The Second Plan introduced Industrial R industrial growth witnessed during this period were due to : (i) Emphasis on industrialisation in economic policies. (ii) Making industrial growth the main objective in the industrial policy and planning. (iii) Huge investments being made to support capacity creation in the industrial sector. (iv) Growing demands for a variety of new products on the part of the urban consumers and the relatively better-off sections of the society. (v) Pace of economic expansion supported by domestic savings and inflow of resources from abroad.
Q54
long answer
Read the following text carefully : With independence, India chose the closed economy model in pursuit of its objective of industrial self-sufficiency. As a result, industrial structure has become considerably important. In the post-independence era, the industrial growth was rapid during the first two decades, especially during the Second and Third Plan period. The Second Plan introduced Industrial R industrial growth witnessed during this period were due to : (i) Emphasis on industrialisation in economic policies. (ii) Making industrial growth the main objective in the industrial policy and planning. (iii) Huge investments being made to support capacity creation in the industrial sector. (iv) Growing demands for a variety of new products on the part of the urban consumers and the relatively better-off sections of the society. (v) Pace of economic expansion supported by domestic savings and inflow of resources from abroad. On the basis of the given text and common understanding, answer the following questions :
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Q55
short answer
1 mark
State the time period of the Second Five Year Plan of India.
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Q56
short answer
1 mark
Who is considered as the Father of the Second Five Year Plan of India ?
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Q57
long answer
4 marks
Discuss briefly any two reasons behind the industrial growth during the Second and Third Five Year Plans of India.
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