This Paper has 48 answerable questions with 0 answered.
| Roll No……… | |
| Time allowed : 3 hours | Maximum marks : 100 |
| Total number of questions : 8 | Total number of printed pages : 2 |
| PART — A | |
| (Answer Question No.1 which is compulsory and any three of the rest from this part.) |
| 1. | (a) | State, with reasons in brief, whether the following statements are correct or incorrect : | ||||
| (i) | The concept of consumer surplus has been developed by Lionel Robbins. | (0) | ||||
| (ii) | Monopoly of issue of currency note is the function of commercial banks. | (0) | ||||
| (iii) | Monetary policy is formulated and implemented by the Government of India. | (0) | ||||
| (iv) | Monopolist is the sole seller of a product with no close substitutes for his product in the market. | (0) | ||||
| (v) | Salaried class suffers during inflation and deflation. | (0) | ||||
| (2 marks each) | ||||||
| (b) | Comment on any two of the following : | |||||
| (i) | Economics is neither a study of only wealth nor only of man and his actions. | (0) | ||||
| (ii) | Every increase in consumer’s income takes him to a higher indifference curve. | (0) | ||||
| (iii) | U–shaped short–run average and marginal cost curves suggest only economies of scale. | (0) | ||||
| (iv) | Devaluation means lowering the internal and external value of the home currency. | (0) | ||||
| (5 marks each) | ||||||
| (c) | Choose the most appropriate answer from the given options in respect of the following : | |||||
| (i) | Normally the slope of a demand curve is –– (a) Negative (b) Positive (c) Zero (d) Constant. | (0) | ||||
| (ii) | When marginal utility diminishes, total utility–– (a) Diminishes (b) Increases (c) Diminishes at increasing rate (d) Increases at diminishing rate. | (0) | ||||
| (iii) | In case of perfect complementary goods, the indifference curve is –– (a) Straight line (b) L–shaped (c) U–shaped (d) Convex to origin. | (0) | ||||
| (iv) | In case of inferior goods, the income effect is –– (a) Negative (b) Zero (c) Positive (d) Indeterminate. | (0) | ||||
| (v) | A cost curve which is not U–shaped –– (a) Marginal cost curve (b) Average cost curve (c) Average variable cost curve (d) Average fixed cost curve. | (0) | ||||
| (1 mark each) | ||||||
| 2. | (a) | Distinguish between any two of the following : | ||||
| (i) | ’Fixed exchange rate’ and ’floating exchange rate’. | (0) | ||||
| (ii) | 'Indifference curves' and 'isoquants'. | (0) | ||||
| (iii) | 'Buyers market' and 'sellers market'. | (0) | ||||
| (iv) | 'Returns to a factor' and 'returns to scale'. | (0) | ||||
| (4 marks each) | ||||||
| (b) | What do you understand by the term 'inflation' ? What are its merits and demerits ? | (0) | ||||
| (7 marks) | ||||||
| 3. | (a) | Write short notes on any three of the following : | ||||
| (i) | Features of a mixed economy | (0) | ||||
| (ii) | Limitations of open market operations | (0) | ||||
| (iii) | Production function | (0) | ||||
| (iv) | Opportunity cost | (0) | ||||
| (v) | Marginal rate of substitution. | (0) | ||||
| (3 marks each) | ||||||
| (b) | Consumer–X buys 100 units of a commodity at Rs.8 per unit. When its price falls by 50%, the demand rises to 200 units. Find out the price elasticity of demand for this product. | (0) | ||||
| (7 marks) | ||||||
| (c) | If the marginal propensity to consume is 0.8, find out the additional income generated when an additional investment of Rs.10,000 is made. | (0) | ||||
| (3 marks) | ||||||
| 4. | (a) | Discuss the main functions of a central bank of a country. | (0) | |||
| (7 marks) | ||||||
| (b) | What are the basic four functions of ‘money’ ? Explain briefly. | (0) | ||||
| (4 marks) | ||||||
| (c) | What do you understand by ‘balance of payments’ ? What are its main components ? | (0) | ||||
| (4 marks) | ||||||
| 5. | (a) | What is ‘discriminating monopoly’ ? How is price and output determined under it ? | (0) | |||
| (5 marks) | ||||||
| (b) | What is meant by ‘equilibrium level of income’ ? What are the conditions of its determination ? | (0) | ||||
| (5 marks) | ||||||
| (c) | How is national income estimated in India ? | (0) | ||||
| (5 marks) | ||||||
| PART — B | |||
| (Answer ANY TWO questions from this part.) | |||
| 6. | (a) | State, with reasons in brief, whether the following statements are correct or incorrect : | ||||
| (i) | Economic environment covers all those factors which are related to management of public affairs and their impact on the business of an organisation. | (0) | ||||
| (ii) | A larger share of India’s GDP is generated in the public sector. | (0) | ||||
| (iii) | Only the Central Government has the power to impose taxes in India. | (0) | ||||
| (iv) | Population growth rate in India has been rising since 1981. | (0) | ||||
| (v) | A subsidy is a negative tax. | (0) | ||||
| (2 marks each) | ||||||
| (b) | Choose the most appropriate answer from the given options in respect of the following : | |||||
| (i) | India does not import one of the following –– (a) Pulses (b) Tea (c) Edible oils (d) None of the above. | (0) | ||||
| (ii) | Functioning of the capital market in India is regulated by –– (a) Reserve Bank of India (b) Securities and Exchange Board of India (c) Bombay Stock Exchange (d) National Stock Exchange. | (0) | ||||
| (iii) | Presently, the share of agriculture in India’s national income is about — (a) 10 per cent (b) 20 per cent (c) 30 per cent (d) 40 per cent. | (0) | ||||
| (iv) | Service sector in India does not include the following activity — (a) Power generation (b) Transport and communication (c) Banking and insurance (d) Health and education. | (0) | ||||
| (v) | High growth of population is caused by — (a) High birth rate and high death rate (b) High birth rate and low death rate (c) Low birth rate and high death rate (d) Low birth rate and low death rate. | (0) | ||||
| (1 mark each) | ||||||
| 7. | (a) | What do you mean by ‘market failure’ ? State its principal causes. | (0) | |||
| (5 marks) | ||||||
| (b) | Do you think that the Industrial Policy of 1991 has reduced the importance of public sector in India ? Give reasons for your answer. | (0) | ||||
| (5 marks) | ||||||
| (c) | Examine the major changes in the structure of India’s foreign trade since 1991. | (0) | ||||
| (5 marks) | ||||||
| 8. | (a) | State in brief the major factors that influence the economic environment. | (0) | |||
| (5 marks) | ||||||
| (b) | Distinguish between 'monetary policy' and 'fiscal policy'. | (0) | ||||
| (5 marks) | ||||||
| (c) | Explain the components of Indian financial system. | (0) | ||||
| (5 marks) | ||||||
