ECONOMICS HOLIDAY HOMEWORK Assignment needs to be …a. BL is a downward sloping straight line b . Bundles which cost less than consumers money income lies outside the BL c. If there

ECONOMICS

HOLIDAY HOMEWORK

Assignment needs to be done in a separate HW copy and to be

submitted by 6 July 2018. This assignment consists of questions which

are important and frequently asked in the Board exam. It is a practice

for ES-II.

TEST –PAPER SET – A

TOPIC- Unit – I Introduction

Marks: 10

1. Pick up the variable of Macroeconomics. 1

a. Income of a family b. Production of wheat by a farmer c. General price level d. Salary of a computer engineer

2. The central problem of ‘For whom to produce?’ concerns with …………………….. 1

a. Whether rich or poor will purchase the commodities

b. Who will purchase the commodities

c. The distribution of National Income d. Equity and growth 3. Scarcity arises because: 1

a. Wants are unlimited b. Resources are limited c. Resources have alternative uses d. All the above

4. The government has started promoting foreign capital, what will happen to the PPC? 1

a. Growth of resources b. Underutilization of resources c. Mismanagement of resources d. Resources along the PPC

5. Why is PPC concave? Explain 3

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6. Complete the following table: 3

Possibilities Machines in K Wheat in M tons

MRT

A 0 75

B 1 5:1

C 2 8:1

D 3 50

E 4 30

F 5 30:1

TEST-PAPER SET - B


Marks: 10

1. Pick up the variables of Microeconomics: 1

a. Total output in an economy b. Inflation in the industrial sector c. Salary of a engineer d. Total investment

2. The economic problem is concern with ………………………………….. 1

a. production b. growth c. scarcity d. equity

3. ‘Efficiency’ arises when: 1

a. Wastage is the least b. Resources have alternative uses c. Reallocation of resources without

wastage d. Choosing production technique

4. Due to the implementation of employment schemes, what will happen to the PPC? 1

a. Under utilization of PPC b. Along the PPC c. Growth of PPC d. All the above

5. Explain any three characteristic of the PPC? 3

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6. The table below shows PPC. What is the pattern in the table that gives rise to the concave

shape of the PPC? 3

Possibilities Green chilli sugar

A 100 0

B 95 1

C 85 2

D 70 3

E 50 4

F 25 5

TEST-PAPER SET - C


Marks: 10

1. Pick up the example which shows Microeconomic variable depends upon Macroeconomic:1

a. Price determination is related to price of a commodity

b. Salary of a computer engineer will depend upon the wage-rate of the economy

c. National income is the sum total income of all the of all families

d. GDP depends upon the production of wheat of a farmer

2. The technique of ‘How to Produce’, can ……………………………………. 1

a. Increase production b. Solve the problem of distribution c. Growth and equity d. Profits of the firm

3. The natural calamity in a country will place the PPC: 1

a. Outside b. Inside c. on d. away

4. Opportunity Cost is defined as: 1

a. Cost incurred b. Cost forgone c. Additional cost d. Negative cost

5. Draw PPC for the following schedule. Also, calculate the MOC for different combination: 3

Combination Rice in ‘000 tonnes

Maize ‘000 tonnes

MOC

A 0 120

B 25 100

C 50 75

D 75 45

E 100 0

6. What are the three central problems of an economy? Why do they arise? 3

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TEST-PAPER SET - D


Marks: 10

1. Pick up the example which shows Macroeconomics depended on Microeconomics: 1

a. Price determination is related to price of a commodity

b. Salary of a computer engineer will depend upon the wage-rate of the economy

c. National income is the sum total income of all the of all families

d. GDP depends upon the production of wheat of a farmer

2. Capital Intensive technique would be chosen in an economy in which : 1

a. Rate of interest is high b. Mechanization is available c. Population is in surplus d. Capital formation is taking place

3. ‘Means’ in a problem which is faced by all economies. What are means? 1

a. Methods. b. Solution c. Resources. d. Techniques

4. PPC shift to the right when there is ……………………in the economy. 1

a. Growth of resources and improvement in technology

b. Underutilization of resources

c. Improvement in technology d. Efficient utilization of resources 5. Production in an economy is below its potential due to unemployment. Government starts

employment generation scheme. Explain its effect using PPC? 3

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6. The shows PPC combination of two goods. Calculate MOC and draw it:

Watches Shoes MOC

0 90,000

1 80,000

2 68,000

3 52,000

4 34,000

5 10,000

TEST-PAPER SET - A

UNIT – II Consumer’s Equilibrium M.M = 10

1. When MUx > Px, how will a consumer react: 1

a. Change his income b. Buy more of X c. Wait for the price to decrease d. Buy less of X

2. How many chocolates will you consume if these are free of cost, to achieve equilibrium

a. MU is positive b. MU is negative c. MU is zero d. MU is equal to

3. The equation for budget constraint: 1

a. P1X1 + P2X2 = M b. P 1X1 > P2X 2 = M c. P1X1 + P2X2 > M d. P1X1 + P2X2 < M

4. When MRS > MRE = Px/Py then the consumer: 1

a. Values X more than what market value

b. Values Y more than what market value

c. Values X less than what market value

d. Values Y less than what market value

5. Explain the three properties of Indifference Curve? 3

a. …………………………………………………………………………………………………

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………………………………………………………………………………………………… 6. With a hypothetical example explain the Consumer’s Equilibrium in two commodity

case? 4

TEST-PAPER SET - B


1. Which of the following statements is correct? 1

a. BL is a downward sloping straight line

b. Bundles which cost less than consumer’s money income lies outside the BL

c. If there is an increase in consumer’s income and no change in prices of goods, then the BL will shift to the left.

d. A decrease in the price of good measured along X-axis makes the BL steeper.

2. When MUx/Px > MUy/Py, as a result: 1

a. Consumption of Y rises,& X falls b. Consumption of X rises, & Y falls c. Consumption of X &Y rises d. Consumption of X &Y falls

3. Starting from an initial situation of C’s E, suppose the MU of money increases. How will

it affect the QD of the product? 1

a. It will increase b. It will decrease c. It will remain unchanged d. It will fall to zero

4. The slope of the Indifference curve is measured by: 1

a. Marginal rate of transformation b. Marginal rate of substitute c. Marginal rate of utility d. Marginal rate of technical

substitute 5. At the point of Equilibrium, IC must be convex to the origin. Why? 3

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…………………………………………………………………………………………………….. 6. State the condition of consumer’s equilibrium by Utility Analysis and explain it? 3

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TEST-PAPER SET - C


1. The Law of Diminishing MU states: 1

a. Successive units give more satisfaction.

b. Successive units give lesser satisfaction

c. Successive units give higher value d. Successive units give no satisfaction.

2. Which of the of the following condition of consumer’s equilibrium is correct in case of a

single commodity: 1

a. MU of good / Price of good = MUm b. Price of good / MU of good = Mum c. MU of good / MU of money = Px d. MUm / Price of good = MU of good

3. .………….. shows different possible combination of two goods that a consumer can buy

with given income and price of goods: 1

a. Budget set b. Budget line c. Indifference set d. Indifference curve

4. The shape of the Indifference curve is : 1

a. Concave to the origin b. Convex to the origin c. Rectangular hyperbola d. Straight line

5. What would be the impact on the Budget Line when: 3

(i) Price of good X increases: ……………………………………………………………………………….

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(ii) Income of the consumer decreases:

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………………………………… 6. If the consumer is in a position when MUx / Px < MUy / Py, what should he do to be in

equilibrium? 3

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TEST-PAPER SET - D


1. When does a commodity possess utility? 1

a. When the consumer requires the commodity

b. When the commodity satisfies a want

c. When the consumer has a income d. When MRS = price ratio 2. Budget ratio indicates: 1

a. Price ratio b. Income ratio c. Cost ratio d. MRS ratio

3. Which of the following equation is incorrect: 1

a. MU = TUn+2 – TUn+1 b. MU = TU / Q c. MU = TUn – TUn-1 d. TU = ∑MU

4. When TU is increasing at a diminishing rate, MU must be:

1

a. increasing b. decreasing c. constant d. negative

5. A consumer consumes only two goods X and Y. Aswini’s money income is Rs.24 and

the prices of Good X and Y are Rs. 4 & 2 respectively. Answer the following

questions? 6

(i) Can the consumer afford a bundle 4X and 5? Explain. ………………………………………

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…………………………………………………………………………………………… (ii) What will be the MRSxy when the consumer is in equilibrium? Explain. ……………

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…………………………………………………………………………………………… (iii) What is the equation of BL and its slope? ……………………………………………………………

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(iv) Give examples of two bundles on the BL? …………………………………………………………

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…………………………………………………………………………………………… (v) How much of X &Y will he buys spending his entire income? ……………………………

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…………………………………………………………………………………………… (vi) How does the BL change (a) if consumer’s income increase to Rs.48 (b) if price of

good X falls by Rs.1 but price of good Y and income remains unchanged? …………

TEST-PAPER SET - E


1. Suppose a consumer can afford to buy 6 units of good X and 8 units of good Y if Pooja

spends her entire income. The price of two goods is Rs. 6 & 8 respectively. How much is

the consumer’s income? 1

e. Rs. 110 f. Rs. 64 g. Rs. 36 h. Rs. 100

2. What can lead to a change in the Budget Set of a consumer? 1

a. Change in the income b. Change in the price of good X c. Change in the price of good Y d. All the above

3. Marginal Utility of money is: 1

a. diminishing b. increasing c. constant d. negative

4. Starting from initial situation of consumer equilibrium, suppose that MU of money

increases. How will it affect the quantity demanded of the product? 1

a. it will increase b. it will decrease c. it will remain unchanged d. it will fall to zero

5. Explain the two properties of BL? 3

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………………………………… 6. With a hypothetical data explain consumer’s equilibrium in case of one commodity? 3

TEST-PAPER SET - F


1. A consumer’s satisfaction from a commodity is maximum when MU is : 1

a. Less than price b. More than price c. Equal to price d. Equal to quantity

2. An increase in the price of good X will make the Budget Line: 1

a. slanting b. constant c. steeper d. curve

3. Slope of the Indifference Curve is : 1

a. MRE b. MRExy c. MRSxy d. Px /Py

4. What will happen to MU, when TU falls: 1

a. MU is constant b. MU is falling but positive c. MU is negative d. MU is rising


Quantity consumed 1 2 3 4 5

Total Utility 50 120 150

Marginal Utility 40 20

6. Explain with the help of diagram the following: 3

(i) Why is an Indifference Curve convex to the origin?

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…………………………………………………………………………………………… (ii) Why does a higher Indifference Curve represent a higher level of satisfaction?

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TEST – PAPER SET - A

UNIT – II DEMAND M.M= 10

1. The upward movement of the Demand Curve is due to: 1

a. Increase in the income of the consumer

b. Increase in the price of related good

c. Increase in the price of the good.

d. Increase in the price of normal good

2. Exception to the law of demand is: 1

a. Giffen’s good b. Normal good c. Complementary good d. Substitute good

3. The graphic representation of a table showing price & demand relationship

for a commodity in the market is called: 1

a. Individual demand curve b. Producer’s demand curve c. Market demand curve d. Consumer’s demand curve

4. Demand can also be a positively sloping curve? Refute or defend this

statement. 3

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5. What is the relation between good X and Y in each case, if with the fall in e

TEST – PAPER SET - B


1. What does a downward movement along the same demand curve indicate? 1

a. Increase in demand b. Decrease in demand c. Contraction in demand d. Expansion in demand

2. Income demand curve of an inferior good has a : 1

a. Positive slope b. Negative slope c. Zero slope d. Infinite slope

3. Which of the following factor causes a decrease in demand for a commodity?1

a. Fall in the price of substitute good

b. Fall in price of complementary good

c. Rise in price of the given commodity

d. Expectation of future increase in the price of the commodity

4. Distinguish with an example the difference between normal good and inferior

good? 3

Normal good Inferior good

a.

b.

c. E.g.

5. There is increase in demand of electricity? How is it caused? Explain briefly

how in two ways demand of electricity can be decreased? (Value Based) 4

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TEST – PAPER SET - C


1. As a result of rise in consumer’s income, demand curve for coarse grain

(inferior good): 1

a. Shift to the left b. Shift to the right c. Parallel to the X-axis d. Parallel to the Y-axis

2. Which of the following pairs represent substitute good? 1

a. Car and petrol b. Coffee and tea c. Bread and butter d. Vada and sambar

3. Shift in demand curve means: 1

a. Fall in demand due to rise in own price of the commodity

b. Rise in demand due to fall in own price of the commodity

c. Change in demand due to factors other than change in own price of the commodity

d. Change in the market supply

4. A good is inferior for one and at the same time, normal good for another

consumer. Explain? (Value based) 3

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5. How is ‘Law of Demand’ derived from Utility analysis? 4

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TEST – PAPER SET - D


1. Change in demand implies: 1

a. Shifting of price b. Shifting of income c. Shifting of demand d. Shifting of quantity demanded

2. Exceptions to the Law of Demand is: 1

a. Giffen’s good b. Inferior good c. Superior good d. All the above

3. If the price of good X rises and Quantity Demanded of good Y falls, how are

they related: 1

a. Inferior good b. Substitute good c. Complementary good d. Unrelated good

4. Explain the factors that affect only the Market Demand? 3

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5. Explain with the help of diagrams the effect of the following changes on the

demand of a commodity, when: 4

a. An unfavourable change in the taste of a buyer for the commodity.

b. A fall in the income of its buyer, if the commodity is inferior good.

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TEST – PAPER SET – A

UNIT – II Elasticity of Demand M.M =15

1. When demand for a commodity is Perfectly Inelastic, an increase in the

price of 2%, leads to increase in quantity demanded by ……………………… 1

a. 10% b. 0% c. 3% d. 2%

2. Which one of the following commodities will not have inelastic demand? 1

a. salt b. medicine c. mobile phone d. school uniform

3. If the demand curve is a rectangular hyperbola, absolute value of Ed is ? 1

a. one b. zero c. infinity d. less than one

4. Ed = (-)1. A consumer spends Rs.90 to buy the good at the current price.

How many units will he buy when the price changes to Rs.2 per unit?

Explain it by expenditure method? 3

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5. A consumer buys 20 units of a good at a price of Rs.5 per unit. He incurs an

expenditure of Rs.120 when he buys 24 units. Calculate the Ep using %

method. Comment on the likely shape of the demand curve based on this

information. 3

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6. Explain the different degrees of Ed on a single demand curve? 3

7. Explain by giving examples how substitute determines the Ep? 3

TEST – PAPER SET – B


1. For a typical straight line demand curve, the Ed at a point where it meets

the quantity axis will be ………….. 1

a. ∞ b. 0 c. <1 d. >1

2. Which of the following good have inelastic demand? 1

a. textbook b. air conditioner c. cars d. LED Television

3. The Ed = 0.5. The % change in QD = 4. What is the % ∆ in price? 1

a. 5 b. 4 c. 8 d. 6

4. The co-efficient of Ep of a commodity is 0.2. when its price is Rs. 10 per

unit. The QD =40 units. If the price falls to Rs. 5 per unit, how much will be

its QD? 3

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5. If ∆P / P = 0.25 and Ep= 1. Calculate the % fall in demand. Also estimate the

initial expenditure if new expenditure is Rs.600 at the price of Rs.10. 3

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6. Draw a single DD curve to show: (a) Inelastic (b) elastic &(c) Perfectly

elastic? 3

7. Explain by giving examples how proportion of income spent on commodity

can change Ed? 3

TEST – PAPER SET – C


1. If close substitute of a product are readily available in the market, its Ed will

be …………… 1

a. Greater than one b. Less than one c. Equal to one d. Infinite

2. If total expenditure does not change with change in the price of the

commodity then, Ep will be ………………………… 1

a. zero b. one c. greater than 1 d. less than 1

3. Demand for car for a poor man is: 1

a. inelastic b. relatively elastic c. perfectly inelastic d. infinite

4. Giving reasons state whether the following statements are true or false: 3

a. Ep at a point when a straight line demand curve meets the X-axis is ∞

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b. The price of a good and TE on it by a household both rises by 5%, Ep = 1

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c. Demand for a good will be more elastic in the long run than in the short

run …………………………………………………………………………………………………………

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5. When the price of a commodity falls from Rs.8 per unit to Rs.7 per unit, TE

on it increases from Rs.200 to Rs.210. calculate Ed by % method? 3

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6. How does the nature of a commodity influence the Ep? 3

7. Prove will the help of a diagram, the various Ep as: (a) Ed = 1, (b) Ed > 1,

(c) Ed = 0 3

TEST – PAPER SET – D


1. When there is no change in QD in response to any change in price, it is a

situation of : 1

a. Zero price elasticity b. Infinite price elasticity c. Unitary price elasticity d. Demand elasticity is > 1

2. After the mid-point of a straight line demand curve Ep is: 1

a. Ep > 1 b. Ep < 1 c. Ep = 0 d. Ep = 1

3. Generally commodities which are luxuries good have Ep, which is: 1

a. Relatively inelastic b. Relatively elastic c. Perfectly elastic d. Perfectly inelastic

4. For a commodity, ∆P / P = -0.2, and Ed= -0.5. Find QD after a fall in the price

when initially it was 60 units? 3

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5. Price elasticity of demand for flowers and toys are (-) 0.9 and (-) 0.5. Demand

for which one is more and why? 3

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6. A consumer buys 13 units of a good at a price of Rs.11 per unit. When price

rises to Rs. 13 he buys 11 units. Use expenditure approach to find Ep. Also

comment on the shape of the DD curve based on the information? 3

7. If the consumer is habitual to a commodity, how will his Ed change for it in

place of unfavourable commodity? 3

TEST – PAPER SET – E


1. Which of the following goods will have a steep sloping demand curve: 1

a. cars b. air conditioner c. pen d. lipsticks

2. when total expenditure varies directly with price, then: 1

a. Ep > 1 b. Ep = 1 c. Ep < 1 d. Ep = 0

3. The Ep = 2. The % ∆ in price = 5. What is the % ∆ in QD? 1

a. 5 b. 10 c. 2.5 d. 0.4

4. The initial demand for a commodity =60 units, the demand falls by 5 units

due to rise in price by Rs.10. If Ep = 1.5, calculate the price before change in

demand? 3

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5. A consumer buys 40 units of a good at a price of Rs.3 per unit. When price

rises to Rs.4 per unit, he buys 30 units. State whether demand is elastic or

inelastic by expenditure method? 3

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6. Prove with a hypothetical schedule: (a) perfectly inelastic and (b) perfectly

elastic, also draw the diagram. 3

7. Mention any three factors affecting elasticity of demand? 3

TEST – PAPER SET – F


1. If close substitute is already available in the market, its Ep will be……….. 1

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

2. When % ∆ in demand > than % ∆ in price, demand is said to be …. 1

a. inelastic b. elastic c. perfectly inelastic d. unitary

3. Slope of the demand curve will be a gentle slope if: 1

a. Ed >1 b. Ed < 1 c. Ed = 0 d. Ed = ∞

4. Given Ed = -0.2 and % increase in QD = 20%, find the % change in expenditure?

3

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…………

5. From the following data, calculate Ep by % method:

3

Price TE

4 600

5 525

6. With the help of a schedule explain the different situations of Ed by Outlay

method? 3

7. Explain the three factors that affect the Ed? 3

TEST– PAPER SET – A

TOPIC – Supply and Elasticity of Supply M.M=15

1. Supply curve is positively upward sloping as: 1

a. A fall in the input prices b. Increase in the price of related good

c. Reduction in the excise duty d. Increase in the number of producers

2. Following are the essential features of supply: 1

a. Total quantity of a product available for sale at a particular point of time

b. Quantity of a product offered for sale at a certain price

c. Supply is a stock variable d. Total sales in the market 3. What will be the affect on the supply curve of a T.V. set if there is an

increase in the excise tax: 1

a. Move downward b. Shift to the left c. Upward movement d. Shift to the right

4. What is the Es of a commodity, when the supply line is a 45 degree angle?

a. Es > 1 b. Es < 1 c. Es = 1 d. Es = 0

5. Draw the following schedule and mention the coefficient of price Es? 3

Px Qx 10 5

10 10

10 12

6. Supply of a commodity is 1200 units at a price of Rs.12 / unit. If the supply

of commodity increases to 1600 unit, what will be the new price of the

commodity if Es = 2? 4

7. What will happen to the supply curve if: 4

a. Government withdraws the Taxes on land.

b. Price of the related goods is increased.

……………………………………………………………………………………………………………………

……………………………………………………………………………………………………………..

TEST– PAPER SET – B


1. Following are the essential features of market supply: 1

a. Total quantity of a product available for sale at a particular point of time

b. Quantity of a product offered for sale at a certain price

c. Supply is a stock variable d. Total sales in the market 2. Supply curve is also be a negatively upward sloping as: 1

a. A fall in the input prices b. Increase in the price of related good

c. Reduction in the excise duty d. None of the above 3. What is the Es of a commodity, when the supply line is a 15 degree angle?

a. Es > 1 b. Es < 1 c. Es = 1 d. Es = 0

4. What will be the affect on the supply curve of a T.V. set if FIFA World Cup is

approaching: 1

a. Move downward b. Shift to the left c. Upward movement d. Shift to the right


Px Qx

5 5 8 5

13 5

6. What will happen to the supply curve if: 4

a. Government pursues a policy of Liberalisation.

b. Trade Union joins together to increase the wage rate.

7. A fruit seller sells 56 Kg per day when price of apples are Rs.7 per Kg. when

the price rises to Rs 8 per kg, how much will be the QS when Es is unitary? 4

TEST– PAPER SET – C


1. Which of the following statements is correct: 1

a. There is a difference between supply and stock

b. Supply does not depend on government tax-policy

c. Stock refers to the quantity which comes to market for sale

d. Stock and supply are always equal

2. The rise in supply due to rise in price is called: 1

a. Increase in supply b. Decrease in supply c. Extension of supply d. Contraction of supply

3. If 13% rise in price causes 23% increase in supply, Es will be: 1

a. 1.5 b. 1.7 c. 1 d. 0.7

4. When supply is a vertical line, it indicates: 1

a. Es > 1 b. Es < 1 c. Es = 0 d. Es = ∞

5. Draw the following schedule and mention the coefficient of price Es, when

price rises from 2 to 3? 3

Px Qx

1 20 2 40

3 60

6. Es of Good Y is ¾ the price of Good X. the price of X rises from Rs.10 to

Rs.11.50 per unit and its QS increases by 18 %. If price of Y falls from Rs.11

to Rs. 9.90, find the % fall in supply? 4

7. What will happen to supply curve when: 4

a. The firm works with obsolete technology.

b. Subsidies are granted by the government.

TEST– PAPER SET – D


1. Change in market supply is effected by: 1

a. Number of producer b. Supply of each firm c. Profits of the industry d. All the above

2. Reason for decrease in supply is due to: 1

a. Fall in the price of related good

b. Fall in the cost of production

c. Goals of the producer is sales maximization

d. Fall in the technological grade

3. Sx is a function of ( Px, Py, tec., goals, GT, Ip…….) this means ………… 1

a. Exception to the law of supply b. Determinants of supply

c. Slope of the supply curve d. Slope of Es 4. When supply is a slanting line, it indicates: 1

a. Es > 1 b. Es < 1 c. Es = 0 d. Es = ∞

5. Draw the following schedule and mention the coefficient of price Es, when

price rises from 22 to 33? 3

Px Qx 11 200

22 400 33 600

6. What will happen to the supply curve when: 4

a. Increase in the price of raw-material.

b. Subsidy is curtailed.

7. At a price of Rs.5 per unit of a commodity, total revenue is Rs.800. when its

price rises by 20%, total revenue increases by Rs.400. calculate its Es and

comment on the shape of the supply curve? 4

TEST– PAPER SET – E


1. If there is a fall in the sale of Ice-cream, what would the producer likely to

do? 1

a. Shift the supply rightward b. Shift the supply leftward c. Increase the price d. Wait for sales maximization

2. Law of supply is a ………………………….. statement. 1

a. quantitative b. summative c. qualitative d. negative

3. If slope of the supply curve is ∆P/ ∆QS, then Es is………………….. 1

a. ∆P / P *100 b. ∆Q / Q * 100 c. ∆Q / ∆P *P / Q d. ∆P / ∆Q * Q / P

4. Market supply curve is obtained by …………………. Summation of the entire

individual supply curve. 1

a. Vertical b. Diagonal c. horizontal d. all of the above


Px Qx

5 5 8 5

13 5

6. Es is of a commodity Y is ½ the price Es of commodity X. 16% rise in the

price of X result in 40% rise on its supply. If the price of Y falls by 8%.

Calculate the % fall in its supply. 4

7. What will happen to the supply curve when: 4

a. Price of related good increases.

b. When a firm spends more on advertisements.

TEST –PAPER SET – A

TOPIC – Price Determination M.M=10

1. Draw a diagram to show Excess Demand? 1

2. Give one example of indirect intervention of government in the market and its effect? 3

3. A shift in demand has a larger effect on price than the shift in supply, explain the chain effect

and analysis the slope of the curves? 6

TEST –PAPER SET – B


1. Draw a diagram to show Excess Supply? 1

2. What do you understand by (a) control price and (b) support price? Explain its effect on the

market? 3

3. Does increase in demand necessarily cause rise in price? Explain the chain effect, if you refute or

defend the statement? 6

09:05:18 TEST –PAPER SET – C


1. With help of a diagram explain what will happen if the price prevailing in the market is above

the market price? 1

2. Give one example of direct intervention of government in the market and its effect? 3

3. Explain the chain effect on Equilibrium Price and Equilibrium Quantity when : 6

a. Income of the consumer increases for Inferior Good.

b. Number of firms in the market increases.

09:05:18 TEST –PAPER SET – D


1. What is minimum support price? What is its economic value? 1

2. Can you think of any commodity on which price ceiling is imposed in India? What may be the

consequences of price ceiling? 3

3. How will the change in the price of coffee affect the equilibrium price of tea? Explain the effect

on equilibrium quantity also through a diagram? 6

MODEL TEST PAPER

SET – I ECONOMICS M.M = 50

Instructions:

(i) All questions are compulsory.

(ii) Marks for questions are indicated against each.

(iii) Question No. 1-4 are MCQ’s. Please write the answer choosing the option and not the

number.

(iv) Question No. 5 - 8 are three marker questions, answer them in only 60 words.

(v) Question No. 9 - 12 are four marker questions, limit your answer to 70-80 words only.

(vi) Question No. 13 – 15 are six marker questions, limit them to 100 words only.

(vii) Question No. 6 is a value-based question.

(viii) Draw diagrams wherever required to specify your answers.

1. Define an Indifference Map? 1

2. When is the demand for the good said to be perfectly inelastic? 1

3. What is meant by normal good in economics? 1

4. Why is demand for water inelastic? 1

5. Total revenue is Rs.400 when the price of a commodity is Rs.2 per unit.

When price rises to Rs.3 per unit, the quantity supplied is 300 units. Ca

calculate Es? 3

6. Explain the effect of the following on the price elasticity of demand of a

commodity: 3

a. Number of substitute.

b. Nature of the commodity.

7. Calculate APP and MPP of a factor from the following table of its TPP

schedule and lable the Phases of the Law: 3

Level of factor employed

0 1 2 3 4 5 6 7

TPP 0 5 12 20 28 35 40 42

8. Explain any two causes of ‘increase’ in demand of a commodity? 3

OR

Explain the inverse relationship between price and quantity demanded of a

commodity?

9. How does the equilibrium price of a ‘normal’ commodity change when

income of its buyers falls? Explain the chain effects? 4

10. Quantity demanded of a commodity rises by 6 units when its price falls by

Re.1 per unit. Its Ep (-) 1. If the price before the change was Rs.20 per unit,

calculate QD at this price? 4

11. Explain the problem of ‘how to produce’? 4

OR

Distinguish between Microeconomics and Macroeconomics. Give examples.

12. State whether the following statement is true or false. Give reasons for

your answer: 4

a. TPP always increase whether there is increasing returns or diminishing

returns to a factor.

b. At the point of inflexion APP > MPP.

13. What are the conditions of consumer’s equilibrium under the Indifference

Curve approach? What changes will take place if the conditions are not

fulfilled to reach equilibrium? 6

14. Explain the behavior of Production Function in the short run. Use

illustration and diagram. 6

OR

Give reasons for the occurrence of the stage of increasing returns and the

stage of diminishing returns.

15. The magnitude of change to a given change in the price of a commodity

varies. Explain any four factors on which this magnitude depends. 6

MODEL TEST PAPER

SET – II ECONOMICS M.M = 50

Instructions:

(ix) All questions are compulsory.

(x) Marks for questions are indicated against each.

(xi) Question No. 1-4 are MCQ’s. Please write the answer choosing the option and not the

number.

(xii) Question No. 5 - 8 are three marker questions, answer them in only 60 words.

(xiii) Question No. 9 - 12 are four marker questions, limit your answer to 70-80 words only.

(xiv) Question No. 13 – 15 are six marker questions, limit them to 100 words only.

(xv) Question No. 6 is a value-based question.

(xvi) Draw diagrams wherever required to specify your answers.

1. What causes the production possibility curve to be concave to the origin? 1

2. Draw a supply curve when Es >1. 1

3. If price of a good increase and demand for another good falls. What is the

relationship between the two goods? 1

4. What can you say about TPP when MPP is zero? 1

5. How is consumer’s equilibrium determined in two good cases using Utility

analysis? 3

6. Explain the problem of ‘what to produce’ with the help of PPC? 3

7. Explain the reasons for increasing returns to a factor? 3

OR

Why the First and the Third phases are called the phases of Economic

Absurdist?

8. Explain the three factors which can shift the supply curve to the right? 3


unit of

labour

0 1 2 3 4 5 6

TPP 0 18 - - 90 - -

MPP - - 22 - - 18 -

APP 0 - - 22 - - 10 10. Explain the geometric method of measuring elasticity of demand? 4

11. What is (a) Budget line (b) Budget Set (c) Marginal rate of Substitute

(d) Indifference Curve? 4

12. Explain how the market supply curve can be derived from individual supply

curve? 4

13. How would the supply for a commodity be affected if: 6

a. Raw material is purchased in bulk.

b. More firms enter the market.

14. Inspite of simultaneous change in demand and supply of a commodity, the

some consumers are still not contented with the coordination. Explain the

reason with the help of a diagram? 6

OR

At a given price there is Excess Demand. Is this price the equilibrium price?

What would be the effect of this?

15. Why does the demand curve for a commodity slopes down to the right? 6

AND PROJECT WORK ON THE SELECTED TOPICS:

A. AS PER xii CLASSE SYLLABUS

B. ANY TOPIC RELATED TO THE CURRENT ISSUES OF ECONOMICS.

Documents

ECONOMICS HOLIDAY HOMEWORK Assignment needs to be …a. BL is a downward sloping straight line b . Bundles which cost less than consumers money income lies outside the BL c. If there