Class 12 Question Paper 2023-24 Economics (Half Yearly)

2023-24
HALF YEARLY
EXAM
NCERT BASED
SYLLABUS
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FOR
CBSE BOARD
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Half Yearly Exam 2023-24
Question Paper

Class - XII Subject – Economics
Time – 3 Hours Maximum Marks- 80

General Instructions

i. This Question Paper contains two parts:
 Section A – Macro Economics (40 marks)
 Section B – Indian Economic Development (40 marks)
ii. Question No. 1 – 10 and 18-27 are very short answer questions carrying 1 mark each.They
are required to be answered in one word or one sentence each.
iii. Question No. 11-12 and 28-29 are short answer questions carrying 3 marks each. Answers
to them should not normally exceed 60 - 80 words each.
iv. Question No. 13-15 and 30-32 are short answer questions carrying 4 marks each. Answers
to them should not normally exceed 80 - 100 words each.
v. Question No. 16–17 and 33-34 are long answer questions carrying 6 marks each. Answers to
them should not normally exceed 100-150 words each.

SECTION-A

1. Money serves as a common denomination. This function of money highlighted as: [1]
(a) Store of value
(b) Standard of deferred payment
(c) Unit of account
(d) Medium of exchange
2. Increase in National Income due to increase in current market prices is: [1]
(a) Increase in real national income.
(b) Increase in nominal national income
(c) Increase in national income based on the prices of base year.
(d) Decrease in per capita income.
OR
Giving reason, state whether the following statement is true or false:
‘Nominal GDP is always higher than Real GDP’.
3. Read the following statements carefully and choose the correct alternative: [1]
Statement 1: Recovery of loans is a non- debt creating capital receipt.
Statement 2: Recovery of loans cause a reduction in assets of the government.

(a) Both the statements are true
(b) Both the statements are false
(c) Statement 1 is true and Statement 2 is false.
(d) Statement 2 is true and Statement 1 is false.

1

4. “In 2016, RBI declared currency notes of Rs.500 and Rs. 1000, no longer a legal tender”. This
function of RBI is called as ______________. This process is called as ___________. [1]
(a) Bank of Issue, Remonetisation
(b) Financial Advisor, Demonetisation
(c) Bank of Issue, Demonetisation
(d) Banker to the Government, Demonetisation

5. If ‘A’ sells sugarcane to ‘B’ for Rs. 100 and ‘B’ manufactures sugar and sells it to ‘C’ for Rs.300
who sells sugar candies to consumers for Rs. 500, then total value added by ‘B’ and ‘C’ in the
production process is: [1]

(a) Rs. 500 (b) Rs. 900 (c) Rs.800. (d)Rs.400

6. Read the following statements- Assertion (A) and Reason (R). Choose one of the correct
alternatives given below: [1]
Assertion (A): Ex-post Investments represent planned Investments; whereas Ex- ante
Investments represent actual level of investments.
Reason (R): At equilibrium level, Ex- ante Savings and Ex- ante Investments are always equal.
(a) Assertion (A) is true but Reason (R) is false
(b)Assertion (A) is false but Reason (R) is true
(c) Both (A) and (R) are true and Reason (R) is correct explanation of Assertion (A)
(d) Both (A) and (R) are true but Reason (R) is not the correct explanation of Assertion (A)
7. In a Government Budget, Primary Deficit is Rs.10,000 crore and Interest Payment is Rs. 8000
crores, calculate Fiscal Deficit. [1]
(a) Rs. 15,000. (b) Rs.2000. (c) Rs. – 2000 (d) Rs. 18,000
8. Which of the following is not a transfer payment? [1]
(a) Interest on national debt
(b) Retirement pensions
(c) Old- age pensions
(d) Donations

9. From the following pair of terms and statements in column I and column II, choose the correct
pair of statement. [1]
Column I Column II
(A) Break-even point (i) 1/MPS

(B) Slope of saving curve (ii) S=0

(C) Equilibrium point (iii) S=I

(D) Investment multiplier (iv) change in savings/change in
income

(a) A-i (b) B-ii (c) C-iii (d) D-iv

2

10. Which of the following sources of receipts in a government budget increase its liabilities? [1]
(a) Borrowings
(b) Recovery of loans
(c) Dividend from Public Sector Undertakings
(d) Direct taxes

11. (a) Calculate Investment expenditure from the following data about an economy which is in
equilibrium. [3]
National income is 10 times of autonomous consumption.
Marginal Propensity to save = 0.2
Autonomous Consumption expenditure= Rs.100
(b) If APC is constant, C and Y should also be constant. Defend or refute the given
statement.
OR
(a) Using a well labelled diagram, show how consumption curve can be derived from saving
curve.
(b) What is a Consumption Function?

12. Calculate ‘Gross Fixed Capital Formation’ from the following data: [3]

Sl. No. Particulars Rs. in Crores
i Private final consumption expenditure 1,000
ii Government final consumption expenditure 500
iii Net Exports -50
iv Net factor income from abroad 20
v Gross domestic product at market price 2,500
vi Opening Stock 300
vii Closing Stock 200

13. (a) Read the following text carefully, discuss briefly the relevant function of the Central Bank
indicated: [4]
Recently, The Reserve Bank of India made transactions to foreign monetary agency
representing government of India also sold and purchase government security to counter
inflationary and deflationary position in the economy.
(b) Explain the components of Legal Reserve Ratio.
OR
(a) State whether the following statement is true or false with valid reasons:
(i) Money Supply in the economy refers to only the fiat money issued by the RBI.
(ii) To reduce inflation, the Central Bank should reduce cash reserve ratio (CRR).
(b) Using a numerical illustration explain the role of credit multiplier in determining the credit
creation capacity of the banking system.

14. (a) ‘Taxation is an effective tool to reduce the inequalities of income.’ Justify the given
statement with valid reasons. [4]
(b) Give two differences between Revenue Receipt and Capital Receipt.

15. What is meant by an Investment Multiplier? In an economy, if initial investments are increased
by Rs. 100 crores, discuss the working of investment multiplier presuming marginal
propensity to consume is 0.8. [4]

3

16. (a) Explain the equilibrium level of income using saving and investment curve. If planned
saving is greater than planned investment, what adjustments will bring about equality
between the two? [6]
(b) What is inflationary gap? How can Repo Rate help in reducing this gap?
OR
(a) Explain the theory of determination of equilibrium level of output and income with the help
of aggregate demand and aggregate supply curves.
(b) What is deflationary gap? How can Reverse Repo Rate help in reducing this gap?

17. (a) Giving reasons, explain how the following are treated in estimating national income: [6]
(i) Expenditure by government on providing free education.
(ii) Gifts given by an employer to his employees on Independence Day.
(iii) Addition to stocks during a year.
(b) Calculate (i) Operating Surplus and (ii) Domestic Income
Sl. Particulars Rs. in Crores
No.
i Compensation of Employees 2,000
ii Rent and Interest 800
iii Indirect taxes 120
iv Corporation tax 460
v Consumption of fixed capital 100
vi Subsidies 20
vii Dividend 940
viii Undistributed profits 300
ix Net factor income to abroad 150
x Mixed income 200

SECTION-B

18. Read the following statements- Assertion (A) and Reason (R). Choose one of the correct
alternatives given below: [1]
Assertion (A): There was decay of Indian handicrafts during the British Rule.
Reason (R): India was the net exporter of raw material in the world.
(a) Assertion (A) is true but Reason (R) is false
(b)Assertion (A) is false but Reason (R) is true
(c) Both (A) and (R) are true and Reason (R) is correct explanation of Assertion (A)
(d) Both (A) and (R) are true but Reason (R) is not the correct explanation of Assertion (A)

19. Industrial Policy Resolution (IPR) 1956 formed the basis of the __________ Five Year plan. [1]
(a) First
(b) Fourth
(c) Second
(d) Third
OR
Significant expansion of _____________ industries was observed in the period 1950-1990.

(a) Electronic Industry (b) Telecommunication Industry
(c) Iron and Steel Industry (d) Leather Industry

4

20. ________________ refers to a process of making a bulk sale by the developed country in the
markets of developing countries at extremely lower prices. [1]
(a) Outsourcing (b) Hedging (c) Dumping (d) None of the above
21. _______________ is an example of Maharatna. [1]
(a) Steel Authority of India Limited
(b) Hindustan Aeronautics Limited
(c) Mahanagar Telephone Nigam Limited
(d) Indian Railway Catering and Tourism Corporation Limited
22. Giving reason, state whether the following statement is true or false: [1]
“Green Revolution and Golden Revolution is one and the same thing.”
23. The state with the highest expenditure on education is______________. [1]
(a) Delhi (b) Punjab (c) Himachal Pradesh (d) Tamil Nadu
24. _______________ is the process which includes all the activities from sowing till sale of the final
produce in the market. [1]
(a) Rural Development (b) Agricultural Diversification
(c) Organic Farming (d) None of the above
25. For Small Scale Industry in India, maximum limit of investment in assets has been revised
from ____________ to ___________ . [1]
(a) One lakh to one crore
(b) 5 lakhs to one crore
(c) 5 lakhs to 10 crores
(d) 10 lakhs to 5 crores
26. From the following pair of terms and statements in column I and column II, choose the correct
combination. [1]
Column I Column II
(A) Organic Farming (1) Micro Credit Programme
(B) Operation Flood (2) Related to fruits, flowers, vegetables
(C) Horticulture (3) Related to milk
(D) Self Help Group (4) Related to eco-friendly agricultural
technology

A B C D A B C D
(a) 2 4 1 3 (b) 4 3 2 1
(c) 3 1 4 2 (d) 1 3 2 4

27. ____________ committee was set up in_____________ which aimed at bringing children in the
age group of 6-14 years in the school premises. [1]
(a) Tapas Majumdar Committee,1998 (b) Mahalanobis Committee, 1991
(c) Karve Committee,1955 (d) Manmohan Singh Committee, 1994

28. What do you understand by Occupational Structure? Highlight the salient features of India’s
pre- independence occupational structure. [3]
OR
When was the Suez Canal opened? How did it affect the Indian economy?
5

29. (a) Name the foreign trade policy adopted in India during 1950.
(b) ‘Atmanirbhar Bharat’ had been at the roots of the Indian planning process. Do you agree
with the given statement? Justify the rationale of the given statement. [1+2]
30. (a) Briefly explain any two challenges facing rural development in India. [2+2]
(b) Discuss the functions of NABARD in the expansion of rural credit.

31. (a) Economists believe that India should spend at least 6% of its GDP on Education for
achieving desired results.” Justify the statement with valid reason. [2+2]
(b) State whether the following statement is true or false with valid reasons:
(i) Human Development is a broader term as compared to Human Capital.
(ii) India has a rich stock of scientific and technical manpower in the world.
OR
(a) Migration leads to Human Capital Formation. How?
(b) State whether the following statement is true or false with valid reasons:
(i) Trained and educated people can become an asset in accelerating economic growth and in
ensuring social change in decided direction.
(ii) There is a positive relationship between brain drain and human capital formation.
32. (a) “India is often called as outsourcing destination of the world.” Discuss the prime reasons
for this name given to India.
(b) Discuss briefly any two major steps taken by the Government of India on ‘Financial Sector’
front under the economic reforms of 1991. [2+2]
33. (a) Discuss briefly the importance of horticulture as a source of diversification. [6]
(b) List any two important roles of non-farm employment in promoting rural diversification.
(c) Mention two measures taken by the government to improve agricultural marketing in
India.
OR
(a) Identify any two benefits and limitations of Organic Farming.
(b) “Jan Dhan Yojana helps in the rural development.” Do you agree with this statement?
Explain.
(c) What are self-help group bank linkage program for micro finance?
34. Read the following text carefully and answer the given questions on the basis of the same
and common understanding: [6]
Privatisation is the opposite of Nationalisation. It is the transfer of ownership, property, or
business from government to the private sector and the government stops being the owner of
the entity or business. In other words, the government becomes either a minority stakeholder
i.e., holding less than 50% equity or completely transferring the ownership in the earlier
government managed enterprises. In January 2022, Air India was privatized ad transferred to
the Tata Group. Privatization reduces state dominance in the economic sphere which was
necessary in India in 1991 to restore the rotten PSUs. Private sector participation also improves
the quality of goods and services produced. There is efficient utilization of resources of the
nation.
(a) What are the major methods followed to do privatization?
(b) Justify the following statement with valid explanation:

‘Privatization reduces state dominance in the economic sphere which was necessary in
India in 1991 to restore the rotten PSUs.’

6

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