CBSE EXAMINATION PAPER-2023

Read the following text carefully and answer the given questions on the basis of the same and common understanding.

The stabilisation and structural adjustment measures, initiated under the 1991 "Economic Reforms" mark a watershed moment in India's economic policies. For almost three decades since independence, India's development strategy and economic policies were guided by the objectives of accelerating the growth of output and employment with social justice and equity.

Ever since the 1970's, it was realised that many of the regulations on economic activities have outlived their usefulness and were in fact hampering economic growth and development. In response to this, the government initiated some milder liberalisation reforms for almost a decade since the early 1980's.

However, the Indian economy soon had to face the Gulf crisis and consequently :

(i)  The uncertainties about the Oil prices;

(ii) The external payment problems;

(iii) The serious inflationary pressures;

(iv) The scarcities of essential commodities;

(v) The deterioration of fiscal discipline, etc.

These led to the Indian economy on the verge of Economic crisis.

In response to this emerging crisis, the Government initiated a set of stabilisation and structural reforms like :

(i) Reduction in fiscal deficit;

(i) Containment of growth in money supply;

(ii) An exchange rate adjustment system etc.

The key objective of stabilisation policy was to bring the growth of aggregate demand in line with long term growth path Of the economy.

In conjunction, the structural adjustment measures like;

(i) industrial delicensing

(ii)  liberalisation Of policy regime governing international trade

(iii) deregulation of financial sector

Were taken to improve the supply side of the economy This shifted the long-term growth path of the economy itself completely.

(Adapted and modified)

Source :

https://nitiegov.in/planningeommission.gov.in/docs/reports/genreplarep9099/at94•

Read the following text carefully. Answer the given questions on the basis of the same and common understanding

On 30th September 2022, the Reserve Bank Of India (RBI) raised

Repo Rate for the fourth time in a row. The Monetary Policy Committee (MPC) decided to raise the policy rate by 50 basis points

I basis point — Of a percent . After this announcement, the new 100 repo rate stands at 5.9%, while the reverse repo rate continues to stand at

3.35%.

Commercial banks borrow money from the Central Bank, when there is a shortage Of funds. With the surge in the repo rate, borrowings by general public will become costlier. This is because, as RBI hikes its repo rate, it becomes costly for the banks to borrow short term funds from the Central Bank.

As a result, the banks hike the rates at which customers borrow money from them to compensate for the hike in the repo rate. Thi happens because banks Offer loans to retail consumers at an interest rate which is generally, directly proportional to the repo rate.

The increase of 0.50 percent in repo rate will lead to a higher interest rates on loans for borrowers, implying that the Equated Monthly Instalments (EMIs) for repaying the existing loans will also increase.

Source : https://www_businessst.andard policy-repo-rate-up-by-50bps-here-s-how-it-will-imvact-you-12209,3000267 (Edited.)

"In the Annual Budget 2022-23, the Government of India set up disinvestment targets Of 65,000 crore".

Such proceeds from disinvestment can be classified as ━━━━━━━━━━ receipts in the Government Budget as it leads to ━━━━━━━━━━ of the Government.

(Choose the correct alternative)                                                                                             

Read the following statements carefully :    

Statement 1 : The induced consumption shows, the direct relation between consumption and income.

Statement 2 : With a certain increase in income, induced consumption also increases.

In the light of the given statements, choose the correct alternative from the following :

Ms. Iqra Ansari, a teacher, was explaining in her class about various types of deposits with the commercial banks. She quoted that —

"'These deposits form a part of Ml measure of money supply and are payable on demand by the commercial banks."

Identify the type of deposits she was explaining about and choose the correct alternative . 

(i) Demand Deposits

(ii) Time Deposits

(iii) Post Office Deposits

Alternatives :

As per the Reserve Bank of India (RBI) press report, dated 22nd June,2022 : 

"Net Foreign Portfolio Investment (FPI) recorded an outflow Of US$15.2 billion mainly from the equity market."

The above transaction will be recorded in the ━━━━━━━━━━ account on ━━━━━━━━━━ side of Balance of payments account of India. (Choose the correct alternative)

Read the following statements carefully :

Statement 1 : Gross Domestic Product (GDP) is the sum total of the gross market value of all the final goods and services added by all the sectors in the economy during a fiscal year. 1

Statement 2 : Gross Value Added at Market Price (GVAMp) is equal to the excess of value of output over intermediate consumption. In the light of the given statements, choose the correct alternative from the following :

In order to tackle the problem of rising general price level in an economy, government may come up with a surplus budget to achieve the budget objective Of ━━━━━━━━━━ .

(i)  reallocation of resources

(ii) price stability

(iii) redistribution of income

Alternatives :

Read the following statements — Assertion (A) and Reason (R).

Choose one ofthe correct alternatives given below :                      

Assertion (A) : At the break-even level of income, the value of Average Propensity to Consume (APC) is zero.

Reason (R) : Sum Of Average Propensity to Consume (APC) and Average Propensity to Save (APS) is always equal to one.

Alternatives :

━━━━━━━━━━ refers to that level of Aggregate Demand, which can be met by the corresponding supply in the economy.

(Fill up the blank with correct alternative)                                                                                    

━━━━━━━━━━ formulates the Monetary Policy in the economy.

(Fill up the blank with correct alternative)                                                                                     

In the Indian economy, ━━━━━━━━━━ are issued by the Reserve Bank of India and acts as legal tender money.

(i) Coins of all denomination

(ii) Currency notes of various denominations, except one rupee note

(iii) Demand deposits

Alternatives:

Which of the following is NOT true about foreign trade during the colonial rule ?

(Choose the correct alternative)

━━━━━━━━━━ is a process, which includes all the activities from sowing till sale of the final produce in the market.

(Fill up the blank with correct alternative)                                                                          

━━━━━━━━━━ have emerged as an important micro finance system and led to women empowerment. (Fill up the blank with correct alternative)

Read the following statements — Assertion(A) and Reason (R). Choose one of the correct alternatives given below :

Assertion (A) : Human capital is not traded in the market; however its services are traded.

Reason (R) : Human capital is intangible in nature.

Alternatives :

Benefits of physical capital accrue only to private entities, whereas human capital provides private as well as ━━━━━━━━━━ benefits.

  (Fill up the blank with correct alternative)                                                                                     

Which of the following was NOT the benefit accruing from 'Golden Revolution' ?                                          

(Choose the correct alternative)                                                                                                                     

China initiated ━━━━━━━━━━  in 1958, that aimed at industrializing the country on a massive scale. (Fill up the blank with correct alternative)

━━━━━━━━━━ acts as a measure Of 'the extent Of democratic participation in social and political decision-making.'

(Fill up the blank with correct alternative)                                                                                     

In an economy, when the rate Of resource extraction is lower than the rate of regeneration of the resource, the environment may operate ━━━━━━━━━━ .

(Fill up the blank with correct alternative)

Read the following statements carefully :  

Statement I : Amongst India, China and Pakistan, China is the largest nation and has the highest population density.

Statement 2 : One-child policy introduced in the late 1970s in China led to a considerable decline in the population growth rate.

In the light Of the given statements, choose the correct alternative from the following :

On the basis of the data given below, identify the incorrect statement in terms of annual growth Of GDP (%) :   (Choose the correct alternative)

Alternatives :

"Under the flexible exchange rate system, the Central Bank does not intewene in the foreign exchange market."

Justify the statement, giving valid arguments.

On the basis Of the data given below for an imaginary economy, estimate the value of Net Domestic Product at factor cost (NDP C)

Explain the impact Of home currency depreciation on the exports Of a nation.

"Serious concerns over the climate change is taking over the attention of the world."

In the light of the above statement and image, discuss any two strategies to tackle this global concern of Environmental degradation.

Recently the Government of India has taken numerous steps towards increasing the farmer's income through agricultural diversification."                                                          

  In light of the above statement, explain any two advantages of diversification in agricultural.

"Active Government intervention is essential in education and health sectors in India."

Do you agree with the given statement ? Give reasons in support of your answer.

"In an economy ex-ante Aggregate Demand is more than ex-ante Aggregate Supply.'

Explain its impact on the level of output, income and employment.

"The process of credit creation by commercial banks comes to an end when the total Of required reserves become equal to the initial deposits."

With the help Of a numerical example, prove that the given statement is true.    

For a hypothetical economy, assuming there is an increase in the Marginal Propensity to Consume (MPC) from 75% to 90% and change in investment to be 1,000 crore.

Using the concept Of investment multiplier, calculate the increase in income due to change in Marginal Propensity to Consume (MPC).

With suitable examples, distinguish between Direct taxes and Indirect taxes.

Discuss any two merits and demerits of the Green Revolution in the agricultural sector in the Indian economy.

On the basis of the given data :

(i) Identify one income indicator and one health indicator, each.                  
(ii) Compare India and China on the basis of any one of the indicator identified above in part (i).    

"Expenditure on On-the-job training is an important means of human capital formation in an economy."

Give valid reasons to justify the given statement.

"Organic Farming is the need of the hour to promote sustainable development but, has its own limitations."

Elaborate any two advantages and limitations each of organic farming in the light of the above statement.

(i)'Kavya works on her family farm and is neither paid in cash nor in the form of grains.'

Can she be categorized as a worker ? Give valid reasons in support of your answer.  

(ii)"In the late 1990's India experienced a widening gap between the growth of GDP and employment generation". Discuss.

(i) Define Worker Population Ratio. Discuss its usefulness.

(ii) 'Mr. Rishi, after completing his education, has joined his family business but his marginal productivity is zero.'

Comment upon the employment status of Mr. Rishi. Give valid reasons in support of your answer.

(i) "Many goods and services which may contribute to welfare, but are not included in estimating Gross Domestic Product (GDP)." Do you agree with the given statement ? Give valid reason in support Of your answer.     

(ii) With suitable examples, distinguish between final goods and intermediate goods.     

(i) Using a suitable numerical example, distinguish between Real Gross Domestic Product (GDP) and Nominal Gross Domestic Product (GDP).                                                                  

(ii) State the meaning of 'normal resident' of a country.