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CBSE Board Exam 2020: Check Important Questions & Answers for Class 12 Economics (Micro) - Chapter 1: Introduction

If you are appearing for CBSE Class 12th Board exams 2020, check this list of important questions and answers from Chapter 1 of Microeconomics.

Feb 5, 2020 13:09 IST
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Important Questions & Answers for Class 12 Economics (Micro) - Chapter 1: Introduction
Important Questions & Answers for Class 12 Economics (Micro) - Chapter 1: Introduction

CBSE Class 12th Economic exam is scheduled for 13th March 2020. In this article we have complied a list of important questions from Chapter 1 of Part B (Microeconomics): Introduction. Questions given below are important questions and are expected to be asked in Class 12 Economics board exam 2019-20.

Ques 1 In the given figure, the movement on the production possibility curve from point A to point B shows ________. (Choose the correct alternative)

(a) Growth of all the resources in the economy.

(b) Underutilisation of resources.

(c) Production of more units of Good X and less units of Good Y.

(d) Production of more units of Good Y and less units of Good X

Solution: (c) Production of more units of Good X and less units of Good Y.

CBSE Class 12 Syllabus 2020: All Subjects

Ques 2 Identify and discuss the nature of the following newspaper reports in terms of positive or normative economic analysis :

(i) “India jumped 23 points in the World Bank’s ease of doing business index to 77th place, highest in 2 years.” – The Economic Times

(ii) “Government should further liberalise the business rules.” – The Economic Times

Solution: i) Positive statement – it deals with a real life situation, justifiable by facts.

ii) Normative statement- it deals with a situation as it ‘ought to be’.

 Ques 3 Distinguish between positive economics and normative economics, with suitable examples.

Solution:

Positive Economics

 

Normative Economics

Positive economics is that branch of economics which deals with economic issues as “what is”. It is based on facts and actual data.

 

Normative economics is that branch of economics which deals with economic issues as “what ought to be“. It is suggestive in nature.

 

e.g. Western Railways has earned 517.41 crores by selling scrap material in 2018-19.

 

e.g. the government should promote social safety nets to take care of the poor population

Ques 4 Distinguish between microeconomics and macroeconomics

Solution:

Microeconomics

Macroeconomics

Study of  individual economic unit

Study of aggregate economic unit 

Deals with determination of cost price and output in the individual markets

Deals with determination of general price and output in the whole economy

Takes bottoms up approach to anaylyze the economy

Takes top-down approach to anaylyze the economy

Ques 5 A production possibility curve (PPC) would be concave to the origin if marginal opportunity cost is : (Choose the correct alternative)

(a) Increasing

(b) Decreasing

(c) Constant

(d) Negative

Solution: a) Increasing

Download CBSE Class 12 Economics Syllabus 2019-20 in PDF format

Ques 6 In the given figure X1Y1 and X2Y2 are Production Possibility Curves in two different time periods T1 and T2 respectively. A1 and A2 represent actual outputs in T1 and T2 periods respectively. P1 and P2 are potential outputs in T1 and T2 periods respectively.

The change in potential production over the two periods would be represented by a shift from __________ . (Choose the correct alternative)

(a) P2 to A2

(b) A1 to A2

(c) A2 to A1

(d) P1 to P2

 

Solution: d) P1 to P2

Ques 7‘‘Problem of resource allocation would not arise, if resources do not have alternative uses.’’ Defend or refute the statement with valid arguments.

Solution: Yes the given statement is correct. The economic problem of resource allocation arises because resources are scare & can be put to alternate uses. If a resource can be put only to a specific use then the problem of resource allocation would not arise

Ques 8 Explain briefly the central problem of ‘‘What to produce’’.

Solution: The problem of ‘what to produce’ relates to the choice of goods for production. For example choice between capital goods and consumer goods, between war time goods and peace time goods and the like. The actual quantity of two possible goods would ultimately depend upon the market conditions of demand and supply for each of the goods.

Ques 9 Distinguish between a centrally planned economy and a market economy.

Solution:

Centrally Planned Economy

Market Economy

 

In a centrally planned economy,all important decisions regarding production, exchange and consumption of goods and services are made by the government.

In a market economy, all economic decisions related to production, exchange and consumption are organised through the market.

 Ques 10 What is a market?

Solution: A market is a set of arrangements where economic agents can freely exchange their commodities or products with each other.

Download CBSE Class 12 Economics Syllabus 2019-20 in PDF format

Important Questions & Answers for Class 12 (Macro) Economics - Chapter 1 , Chapter 2, Chapter 3, Chapter 4, Chapter 5, Chapter 6

 

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