MODEL TEST PAPER

SET I

ECONOMICS

M.M = 50

Instructions:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)

1.
2.
3.
4.
5.

6.

7.

All questions are compulsory.

Marks for questions are indicated against each.
Question No. 1-4 are MCQs. Please write the answer choosing the
option and not the number.
Question No. 5 - 8 are three marker questions, answer them in only 60
words.
Question No. 9 - 12 are four marker questions, limit your answer to 7080 words only.
Question No. 13 15 are six marker questions, limit them to 100 words
only.
Question No. 6 is a value-based question.
Draw diagrams wherever required to specify your answers.

Define an Indifference Map?

1
When is the demand for the good said to be perfectly
inelastic? 1
What is meant by normal good in economics?
1
Why is demand for water inelastic?
1
Total revenue is Rs.400 when the price of a commodity is
Rs.2 per unit. When price rises to Rs.3 per unit, the quantity
supplied is 300 units. Ca calculate Es?
3
Explain the effect of the following on the price elasticity of
demand of a commodity:
3
a. Number of substitute.
b. Nature of the commodity.
Calculate APP and MPP of a factor from the following table of
its TPP schedule and lable the Phases of the Law:
3

Level of
factor

employ
ed
TPP
0
8. Explain

12

20

28

35

40

42

any two causes of increase in demand of a

commodity?
3
OR

Explain the inverse relationship between price and quantity

demanded of a commodity?
9. How does the equilibrium price of a normal commodity
change when income of its buyers falls? Explain the chain
effects?
4
10.
Quantity demanded of a commodity rises by 6 units
when its price falls by Re.1 per unit. Its Ep (-) 1. If the price
before the change was Rs.20 per unit, calculate QD at this
price?
4
11.

Explain the problem of how to produce?

4
OR

Distinguish between Microeconomics and Macroeconomics.

Give examples.
12.
State whether the following statement is true or false.
Give reasons for your answer:
4
a. TPP always increase whether there is increasing returns or
diminishing returns to a factor.
b. At the point of inflexion APP > MPP.
13.
What are the conditions of consumers equilibrium
under the Indifference Curve approach? What changes will
take place if the conditions are not fulfilled to reach
equilibrium?
6
14.
Explain the behavior of Production Function in the short
run. Use illustration and diagram.
6
OR

Give reasons for the occurrence of the stage of increasing

returns and the stage of diminishing returns.
15.
The magnitude of change to a given change in the price
of a commodity varies. Explain any four factors on which this
magnitude depends.
6

MODEL TEST PAPER

SET II

ECONOMICS

M.M = 50

Instructions:
(ix)
(x)
(xi)
(xii)
(xiii)
(xiv)
(xv)
(xvi)

All questions are compulsory.

Marks for questions are indicated against each.
Question No. 1-4 are MCQs. Please write the answer choosing the
option and not the number.
Question No. 5 - 8 are three marker questions, answer them in only 60
words.
Question No. 9 - 12 are four marker questions, limit your answer to 7080 words only.
Question No. 13 15 are six marker questions, limit them to 100 words
only.
Question No. 6 is a value-based question.
Draw diagrams wherever required to specify your answers.

1. What causes the production possibility curve to be concave

to the origin? 1
2. Draw a supply curve when Es >1.
1
3. If price of a good increase and demand for another good
falls. What is the relationship between the two goods?
1

4. What can you say about TPP when MPP is zero?

1
5. How is consumers equilibrium
determined in two good
cases using Utility analysis?
3
6. Explain the problem of what to produce with the help of
PPC?
3
7. Explain the reasons for increasing returns to a factor?
3
OR
Why the First and the Third phases are called the phases of
Economic Absurdist?
8. Explain the three factors which can shift the supply curve to
the right? 3
9. Complete the following table:
4
unit of

labour

TPP
0
18
90
MPP
22
18
APP
0
22
10
10.
Explain the geometric method of measuring elasticity of
demand? 4
11.
What is (a) Budget line (b) Budget Set (c) Marginal rate
of Substitute
(d) Indifference Curve?
4
12.
Explain how the market supply curve can be derived
from individual supply curve?
4
13.
How would the supply for a commodity be affected if:
6
a. Raw material is purchased in bulk.
b. More firms enter the market.
14.
Inspite of simultaneous change in demand and supply
of a commodity, the some consumers are still not contented
with the coordination. Explain the reason with the help of a
diagram?
6

OR
At a given price there is Excess Demand. Is this price the
equilibrium price? What would be the effect of this?
15.
Why does the demand curve for a commodity slopes
down to the right? 6