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 Series ARSP/06 Set ~ 6
Roll No. Q.P Code 15/6/6
Candidates must write the Q.P Code
on the title page of the answer-book.

 Please check that this question paper contains 5 printed pages.

 Q.P. Code given on the right hand side of the question paper should be written
on the title page of the answer-book by the candidate.
 Please check that this question paper contains 34 questions.
 Please write down the serial number of the question in the answer-book
before attempting it.
 15 Minute times has been allotted to read this question paper. The question
paper will be distributed at 10:15 a.m. From 10.15 a.m to 10.30 a.m, the students
will read the question paper only and will not write any answer on the answer –
book during this period.

ECONOMICS

Time allowed: 3 hours Maximum Marks: 80

General Instructions:

1. This question paper contains two sections:

Section A – Micro Economics

Section B – Statistics

2. This paper contains 20 Multiple Choice Questions type questions of 1 mark each.

3. This paper contains 4 Short Answer Questions type questions of 3 marks each to be answered in 60 to 80 words.

4. This paper contains 6 Short Answer Questions type questions of 4 marks each to be answered in 80 to 100 words.

5. This paper contains 4 Long Answer Questions type questions of 6 marks each to be answered in 100 to 150 words.

Section A
1. Assertion (A): The results drawn from statistical analysis are normally in approximates, estimates rather than [1]
exact statements.
Reason (R): As the statistical analysis is based on observations of mass data, a number of accuracies may be
present.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

2. A consumer price index measures changes in: [1]

a) Consumer prices b) Wholesale prices

c) Retail prices d) Producer's prices

3. Correlation coefficient is dependent on the: [1]
i. choice of origin and
ii. the scale of observations.

a) (i) is true and (ii) is false b) Both are true

c) Both are false d) (i) is false and (ii) is true

4. Taking 1999 as base year calculate index number of the year 2000 [1]

Year 1999 2000 2001 2002 2003 2004

Price (Rs) 10 14 16 20 22 24

a) 160 b) 130
 c) 140 d) 150
5. From the following which is not a problem in the construction of Index numbers? [1]

a) selection of commodities b) understanding of the purpose

c) selection of base d) selection of price

6. Fisher's index number is based on [1]

a) The Geometric Mean Laspeyre's and b) None of these.

Paasche's index numbers.

c) The Median of Laspeyre's and Paasche's d) The Arithmetic mean of Laspeyre's and
index numbers. Paasche's index numbers.
7. The long queues at railway booking counters, crowded buses, and trains, shortage of essential commodities, rush [1]
to get a ticket to watch a new film, etc. are all manifestations of

a) Abundance b) Allocation

c) Problems d) Scarcity
8. Two dimensional diagrams are: [1]

a) Any of these b) Linear Diagrams

c) Volume Diagrams d) Area Diagrams

9. A series of numerical figures which show the relative position is called: [1]

a) Rational number b) Relative number

c) Index number d) Absolute Number

10. Calculate the correlation coefficient of the marks obtained by 12 students in mathematics and statistics and [1]
interpret it

Marks (in Maths) 50 54 56 59 60 62 61 65 67 71 71 74

Marks (in statistics) 22 25 34 28 26 30 32 30 28 34 36 40

a) 0.76 b) 0.78

c) 0.77 d) +0.75
11. Calculate weighted aggregative price index number from the following data using Paasche’s method. [3]

Base Year Current Year

Commodity
Price (Rs.) Quantity Price (Rs.) Quantity

A 10 30 12 50

B 8 15 10 25

C 6 20 6 30

D 4 10 6 20

12. There are two factories employing 100 and 80 men, respectively. If the arithmetic mean of their monthly salaries [3]
are Rs.575 and Rs.625, then find the arithmetic mean of the salaries of both the factories together.
OR
 Which average would be suitable in the following cases?
i. Average production in factory per shift.
ii. Average wages in an industrial concern.
iii. In case of open ended frequency distribution.
iv. Average size of readymade garments.
v. Average intelligence of students in a class.
13. From the following data, prepare simple frequency distribution on the basis of equal class interval. [4]

Marks Number of Students

Less than 5 7

Less than 10 20

5-15 38

15 and above 55

20-25 20

25 and above 5

30 above 1

14. What are the essentials of a good statistical table? [4]

OR
Differentiate between sub divided and percentage bar diagram.
15. "In certain conditions sampling becomes a necessity”. Explain this statement. [4]
16. What do you mean by positive and negative correlation? [6]
17. Calculate the mode from the following data. [6]

Marks (Mid-value) 5 10 15 20 25 30 35 40 45

Number of Students 7 13 19 24 32 28 17 8 6

OR
Find out the missing value of the variate for the following distribution whose mean is 31.87.

Value (X) 12 20 27 33 ? 54

Frequency (f) 8 16 48 90 30 8

Section B
18. All the supply curves which pass through the origin are: [1]

a) less elastic b) unitary elastic

c) perfectly inelastic d) highly elastic

19. In which economic decisions are taken on the basis of the price mechanism? [1]

a) Socialist b) Mixed

c) Capitalist d) All of these

20. What should firm do when marginal revenue is greater than marginal cost? [1]

a) Firms should expand output b) All of above

 c) Effect should be made to make them equal d) Prices should be covered down
21. AR is same as MR in perfect competition as [1]

a) Price remains fixed b) Price can rise

c) Price does not remain fixed d) Price may fall

22. The costs which vary as the level of output varies are called: [1]

a) prime costs b) real costs

c) Implicit cost d) indirect costs

23. Assertion (A): When the law of demand fails, the inverse relationship between price and quantity does not hold [1]
good.
Reason (R): The demand curve may slope upward showing higher purchases at a higher price.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

24. In perfect competition, which of the following curves generally lies below the demand curve and slopes [1]
downward?

a) Marginal revenue b) Marginal cost

c) Average cost d) Average revenue

25. Can MR be zero or negative? [1]

a) Both are not related b) Both are related

c) Yes d) No
26. When TVC is zero at zero level of output, TFC [1]

a) Is positive and greater than zero b) Is positive and less than zero

c) Is negative but greater than zero d) Is positive and equal to zero

27. In the long run competitive market? [1]

a) Every firm will incur losses b) The firm will earn no profit

c) Every firm will earn economic profit d) Every firm will earn only normal profit
28. Discuss briefly the concept of normative economics, with suitable example. [3]
OR
With the help of a suitable example, explain the problem of for whom to produce.
29. Explain the implication of 'freedom of entry and exit of the firms' under perfect competition. [3]
30. Explain the effects of change in income on demand for a good. [4]
31. With the help of the given schedule, determine the firm’s equilibrium using marginal revenue - marginal cost [4]
approach. Give valid reasons in support of your answer.

Output (in units) Total Revenue (TR) (in ₹) Total Cost (TC) (in ₹)

1 20 20

2 40 30
 3 60 36

4 80 40

5 100 60

6 120 90

OR
What do you mean by producers equilibrium? State and briefly explain the conditions of producer's equilibrium with
Marginal Revenue and Marginal Cost approach. Use diagram.
32. Explain the concept of Budget line equation with the help of numerical examples. [4]
33. What is meant by diminishing returns to a factor? Discuss any two reasons for the operation of diminishing [6]
returns to a factor.
34. Answer the following questions [6]
(a) The demand rises by 20% as a result of fall in its price. Its Price Elasticity of Demand is (-) 0.8. [3]
Calculate the percentage fall in price.
(b) The price elasticity of demand of a commodity is (-) 1.5. When its price falls by Rs. 1 per unit its [3]
quantity demanded rises by 3 units. If the quantity demanded before the price change was 30 units,
what was the price at this demand Rs. Calculate.