Commerce (English Medium) Class 12 - CBSE Question Bank Solutions for Economics

Write down some of the limitations of using GDP as an index of welfare of a country.

What does the price elasticity of supply mean? How do we measure it?

A firm earns a revenue of Rs 50 when the market price of a good is Rs 10. The market price increase to Rs 15 and the firm now earns a revenue of Rs 150. What is the price elasticity of the firm’s supply curve?

The market price of a good changes from Rs 5 to Rs 20. As a result, the quantity supplied by a firm increases by 15 units. The price elasticity of the firm’s supply curve is 0.5. Find the initial and final output levels of the firm.

At the market price of Rs 10, a firm supplies 4 units of output. The market price increases to Rs 30. The price elasticity of the firm’s supply is 1.25. What quantity will the firm supply at the new price?

Answer the following question.
Gross Domestic Product (GDP) Does Not Give Us a Clear Indication of Economic Welfare of a Country. "Defend Or Refute the Given Statement with Valid Reason.

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

"Higher Gross Domestic Product (GDP) means greater per capita availability of goods in the economy."

Explain how ‘Non-Monetary Exchanges’ impact the use of Gross Domestic Product as an index of economic welfare.

Discuss briefly the concept of 'Externalities', with suitable example.

"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.

State the meanings of the following:

Externalities

Unemployment is reduced due to the measures were taken by the government. State its economic value in the context of production possibilities frontier.

What is likely to be the impact of efforts towards reducing unemployment on the production potential of the economy? Explain

Agriculture sector appears to be adversely affected by the reform process. Why?

Victor is able to get work only for two hours in a day. Rest of the day, he is looking for work. Is he unemployed? Why? What kind of jobs could persons like Victor be doing?

India’s post-1990 economic strategy entailed three important breaks with the past:

• To dismantle the vast network of controls and permits that dominated the economic system.
• To redefine the role of the state as a facilitator of economic transactions and as a neutral regulator rather than the primary provider of goods and services.
• To move away from a regime of import substitution and to integrate fully with the global trading system.

The 1991 reforms unleashed the energies of Indian entrepreneurs and gave untold choices to the consumers and changed the face of the Indian economy. The reform agenda constituted a paradigm shift and has defined the broad contours of economic policymaking for three decades.

Liberalization was adopted as the guiding principle of governance and all governments since 1991, have broadly stuck to that path.

Today we don’t need a paradigm shift. We need to look at individual sectors and see which one of these needs, reforms to create a competitive environment and improve efficiency. The power sector, the financial system, governance structures, and even agricultural marketing need reforms.

Today’s reforms also require much more discussion and consensus-building. The central government needs to work in tandem with state governments and consult different stakeholders impacted by reform decisions. Timing and sequencing are critically important in the new reforms’ agenda.

Read the following statements - Assertion (A) and Reason (R):

Assertion (A) - India’s pre-1990 economic strategy dismantles the vast network of controls and permits that dominated the economic system.

Reason (R) - The 1991 reforms unleashed the energies of Indian entrepreneurs, gave untold choices to consumers, and changed the face of the Indian economy.

From the given alternatives choose the correct one:

The unemployment rate for ____________ are found to be higher than for ____________.

Labour force refers to:

Which of the following is false regarding the labour force?

When a labour does not get employment opportunity despite his willingness to work at the existing wage rate.