CBSE Class 12 2025 Economics Question Paper with Solution Pdf available for download here. CBSE conducted the Economics exam on March 19, 2025 from 10:30 AM to 1:30 PM. The total marks for the theory paper are 80. The question paper contains 20% MCQ-based questions, 40% competency-based questions, and 40% short and long answer type questions. Candidates can use the link below to download the CBSE Class 12 Economics Set 1 Question Paper with detailed solutions.
CBSE Class 12 Economics Question Paper 58-1-1 with Answer Key
| CBSE Class 12 2025 Economics Question Paper with Answer Key | Download PDF | Check Solution |
In the context of Current Account transactions of Balance of Payment, identify the incorrect statement from the following: (Choose the correct option)
From the items given in Column-I and Column-II, choose the correct pair.
(a) Income from Property & (i) Old age pension
(b) Income from Entrepreneurship & (ii) Profit
(c) Mixed Income & (iii) Rent free accommodation from an employer
(d) Compensation of Employees & (iv) Interest from capital
Read the following statements carefully:
Statement-1: Managed floating exchange rate system is an amalgamation of fixed and flexible exchange rate system.
Statement-2: Managed floating exchange rate system is also known as ‘hybrid system’.
In the light of the given statements, choose the correct option from the following:
View Solution
“Irfaan (a student) borrows Rs. 80,000 to finance his college fee. He plans to begin repaying the loan six months after his graduation, making payments over a span of ten years.”
Based on the above text, identify the indicated function of money. (Choose the correct option)
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Suppose, the saving curve of an economy makes an intercept at a negative value of Rs. 50 crores. In the economy, 20% of an increase in income is saved.
In the light of the above context, identify the value of investment multiplier (K). (Choose the correct option)
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Read the following statements: Assertion (A) and Reason (R). Choose the correct option from those given below:
Assertion (A): Public goods are those goods that are collectively consumed by the public.
Reason (R): Public goods are excludable and rivalrous in nature.
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Suppose, the value of Average Propensity to Consume (APC) is 0.8 and National Income is Rs. 4,000 crores, the value of saving would be Rs. ____ crores. (Choose the correct option to fill up the blank)
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In the context of the Commercial Banks, which of the following statements are correct? (Choose the correct option)
(I) Deposits received are liabilities for Commercial Banks.
(II) They are creator of credit in the economy.
(III) They accept deposits from general public.
(IV) They accept deposits on behalf of Reserve Bank of India.
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If a country exports goods worth Rs. 600 crores and imports goods worth Rs. 450 crores, the value of Balance of Trade of the country would be ____ of Rs. ____ crores. (Choose the correct option)
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From the set of terms given in Column-I and Column-II, choose the correct pair:
(a) Non-tax Revenue & (i) Goods and Services Tax
(b) Indirect Tax & (ii) Free-rider
(c) Capital expenditure & (iii) Borrowings
(d) Private goods & (iv) Rivalrous in nature
Calculate the value of Net Value Added at Factor Cost (NVA\textsubscript{FC}):
(i) & Operating Surplus & 3,740
(ii) & Increase in unsold stock & 600
(iii) & Sales & 10,625
(iv) & Purchase of raw materials & 2,625
(v) & Consumption of fixed capital & 500
(vi) & Subsidies & 400
(vii) & Indirect taxes & 1,200
Correct Answer:
Distinguish between Net Factor Income from Abroad (NFIA) and Net Exports (X -- M).
"The Government had launched Incredible India Campaign to promote tourism in various parts of the country."
Elaborate the impact of Incredible India Campaign on foreign exchange reserves and Balance of Payment of India.
"Under the Ayushmaan Bharat Scheme, the government provides free medical treatment to the poorer section of the society.
"Identify and explain the nature of budget expenditure and its objective in the Ayushmaan Bharat Scheme statement.
Suppose in an economy, primary deposits are Rs. 500, if the Reserve Ratio is 25%. Estimate the total deposits created and the total lending by the banking system.
(a) In an economy; \( C = 200 + 0.75Y \) (where \( C \) is consumption expenditure and \( Y \) is National Income). Investment expenditure is ₹ 4,000 crore. Calculate the following:
(i) Equilibrium level of income.
(ii) Total consumption expenditure at equilibrium income level.
View Solution
Given:
Consumption function: \( C = 200 + 0.75Y \)
Investment (I) = ₹ 4,000 crore
Step 1: Find Equilibrium Income
At equilibrium, \[ Y = C + I = (200 + 0.75Y) + 4000 \] \[ Y = 200 + 0.75Y + 4000 = 4200 + 0.75Y \] \[ Y - 0.75Y = 4200 \Rightarrow 0.25Y = 4200 \] \[ \Rightarrow Y = \frac{4200}{0.25} = ₹ 16,800 \, crore \]
Step 2: Total Consumption at Equilibrium Income \[ C = 200 + 0.75 \times 16800 = 200 + 12600 = ₹ 12,800 \, crore \]
Therefore, equilibrium income = ₹ 16,800 crore and total consumption = ₹ 12,800 crore. Quick Tip: Use the condition \( Y = C + I \) to find equilibrium income in two-sector models. Plug the equilibrium income back into the consumption function to find total consumption.
Explain the adjustment mechanism in case ex-ante savings are greater than ex-ante investments.
Mention the number of new price monitoring centres set up by government.
View Solution
The government has set up 140 new price monitoring centres to keep a close watch on wholesale and retail prices of essential commodities. Quick Tip: Key factual data such as figures or statistics mentioned in the passage should be used directly in the answer.
State any two proactive measures taken by government to boost domestic supply and reduction in prices.
View Solution
Two proactive measures taken by the government to boost domestic supply and reduce prices are:
1. Banning the export of food items like wheat, broken rice, non-basmati white rice, and onions.
2. Reducing import duties on edible oils and pulses to increase their availability in the domestic market. Quick Tip: Policy measures like export bans and duty reductions are supply-side interventions used to stabilize prices.
Explain any one monetary measure used to control inflation.
View Solution
One monetary measure used to control inflation is increasing the repo rate.
When the Reserve Bank of India (RBI) raises the repo rate, it becomes costlier for commercial banks to borrow money. This leads to reduced money supply in the economy, thereby decreasing demand and helping control inflation. Quick Tip: Monetary policy tools like repo rate and CRR are used by RBI to regulate inflation and liquidity.
Explain any two precautions to be adopted while estimating National Income by Expenditure method.
View Solution
Two precautions while using the expenditure method are:
1. Avoiding transfer payments: Expenditures like scholarships, pensions, or donations should not be included as they are not payments for goods and services.
2. Excluding expenditure on second-hand goods: These do not represent current production and hence must be excluded to avoid double counting. Quick Tip: Always include only final expenditures on currently produced goods and services in the expenditure method.
“Higher Gross Domestic Product (GDP) always means higher per capita availability of goods in the economy.”
Defend or refute the given statement as the index of welfare of the people of that country.
View Solution
The statement is only partially true. While higher GDP may indicate a higher availability of goods and services, it does not always reflect increased welfare due to the following reasons:
- Income inequality: GDP may rise, but the benefits might be concentrated in a few hands.
- Non-monetary aspects: Welfare also includes health, education, and environmental quality, which GDP does not account for.
- Population growth: If population increases faster than GDP, per capita availability may fall.
Therefore, GDP alone cannot be a complete indicator of welfare. Quick Tip: Welfare depends on both quantitative and qualitative aspects of economic growth.
Distinguish between Stock and Flow variables, using suitable examples.
View Solution
Stock Variable: It is measured at a particular point of time.
Example: Capital, wealth, and population.
Flow Variable: It is measured over a period of time.
Example: Income, savings, and investment.
Thus, stock is static and flow is dynamic in nature. Quick Tip: Stock is "as on" a date, while flow is "during" a time period.
Explain the components of ‘Profit’ as per Income Method of estimating National Income (NNP\textsubscript{FC}).
View Solution
The components of 'Profit' under the Income Method include:
1. Corporate Tax: Tax paid by companies on their profits.
2. Dividends: Part of profits distributed to shareholders.
3. Undistributed Profits: Retained earnings kept by firms for future use.
Together, these form the total profit component of factor income. Quick Tip: In the income method, only factor incomes like wages, rent, interest, and profit are included.
\rule{1.5cm}{0.15mm} sector was the primary focus of the Great Leap Forward in China.
(Fill up the blank with correct option)
Identify and select the recent phenomenon in which demand for resources surpasses their supply.
View Solution
The correct answer is: (B) Environmental crisis
The image shows heavy pollution and industrial waste, indicating an environmental crisis due to overuse and mismanagement of natural resources. Quick Tip: An environmental crisis occurs when the exploitation of natural resources exceeds their regenerative capacity.
Identify which of the following is NOT one of the strategies for Sustainable Development.
Statement 1: Hired workers may be regular salaried workers or casual workers.
Statement 2: Regular salaried employment is a major source of employment in rural areas in India.
In the light of the given statements, choose the correct option from the following:
From the terms given below in Column-I and Column-II, choose the correct pair of statements:
\begin{tabular{p{5cm p{5cm
Column-I & Column-II
(i) Subsidies & (a) Maximum quantity of goods that can be imported
(ii) Land ceiling & (b) Element of IPR 1956
(iii) Small Scale Industries & (c) Land to the tiller
(iv) Modernisation as a goal of five year plan & (d) Change in social outlook
\end{tabular
View Solution
The correct answer is: (iii) – (c)
Land ceiling refers to land redistribution to landless farmers, making (ii) – (c) incorrect.
Small Scale Industries provide employment and often use traditional resources, so option (iii) – (c) is a correct match. Quick Tip: Carefully relate policies to their objectives or outcomes in planning-based questions.
“It is short-term unemployment occurring, as people transit between jobs.”
On the basis of given definition, identify the type of unemployment indicated.
Read the following statements carefully: Assertion (A) and Reason (R). Choose the correct option from those given below:
Assertion (A): Prior to economic reforms, public investment in social infrastructure by China resulted in better Human Development Indicators (HDI).
Reason (R): China is ahead of India and Pakistan on many Human Development Indicators (HDI).
Study the following image carefully and identify the trade practice that has successfully replaced foreign goods with domestic production.
% Replace path with actual image path if used
\rule{3.5cm}{0.15mm} refers to a trade policy aimed at reducing reliance on imported goods by encouraging domestic production.
From the following terms given in Column-I, match the correct pair of meaning given in Column-II:
(a) & Human Development Indicator & (i) & Rule of Law
(b) & Demographic Indicator & (ii) & Constitutional Protection
(c) & Special Economic Zone & (iii) & Generation of additional economic activities
(d) & Commune System & (iv) & Collective industrialisation
View Solution
Correct matches:
(a) – (i): Human Development Indicator relates to Rule of Law
(b) – (ii): Demographic Indicator relates to Constitutional Protection
(c) – (iii): SEZs are for generating additional economic activities
(d) – (iv): Commune system relates to collective industrialisation
Thus, correct option is: (C) (c) – (iii)
\begin{quicktipbox
SEZs are areas developed to boost industrial growth and exports via incentives.
\end{quicktipbox Quick Tip: SEZs are areas developed to boost industrial growth and exports via incentives.
Read the following statements carefully: Assertion (A) and Reason (R). Choose the correct option from those given below:
Assertion (A): Human capital formation increases the rate of participation of population to economic activities and leads to economic growth.
Reason (R): Rate of participation of people refers to the percentage of people engaged in production process of a country.
India is NOT a member of which of the following regional/global economic grouping?
(a) "Cooperatives have received a setback during the recent past." Justify the given statement with valid explanation.
Trace the relationship between Human capital and Economic growth.
"Bio-pesticides help to reduce the ill-impacts of green revolution on soil and water bodies while promoting sustainable development." Justify the given statement with valid explanation.
Describe briefly a rationale behind choosing 'Self-reliance' as a planning objective for the Indian economy.
Explain how, Goods and Services Tax (GST) has simplified the multiplicity of taxes on goods and services.
Describe the path of developmental initiatives taken by Pakistan for its economic development.
Giving valid reasons, state whether the following statements are true or false.
(i) India followed unbalanced growth during the colonial rule.
(ii) The economic policies implemented in India between 1950–1990 sought to promote regional equality.
(iii) India has become a favourable destination of outsourcing in the post-1991 period.
(i) Distinguish between:
Tariff and Non-tariff Barriers
Tariff Barriers: These refer to taxes or duties imposed on imported goods. They raise the cost of imports and make domestic goods more competitive.
Non-tariff Barriers: These are restrictions other than taxes, such as quotas, licenses, standards, and regulations that limit imports and protect domestic industries.
Bilateral and Multilateral Trade
Bilateral Trade: Trade agreement or exchange of goods and services between two countries.
Multilateral Trade: Trade among more than two countries, often under international agreements like WTO.
(ii) "Small-Scale Industries require a shield against large-scale industries."
Explain, how agro-startups address the critical challenges faced by the agricultural sector.
View Solution
Agro-startups play a vital role in addressing the core issues of the agricultural sector by adopting modern, innovative strategies:
Technological Innovation: They introduce tools like precision farming, IT-based monitoring, and data-driven decision-making systems which improve crop yields and resource efficiency.
Supply Chain Efficiency: These startups streamline the agri-supply chain, enabling better access to markets and reducing post-harvest losses.
Market Linkages: By providing direct market access, agro-startups reduce the dependence on traditional intermediaries and ensure fair prices to farmers.
Rural Employment: They contribute to employment generation in rural areas, helping reduce migration to urban areas.
\begin{quicktipbox
Agro-startups combine technology and innovation to transform traditional farming into efficient and profitable ventures.
\end{quicktipbox Quick Tip: Agro-startups combine technology and innovation to transform traditional farming into efficient and profitable ventures.
Comment on the role of government in supporting agro-startups and entrepreneurs in India.
View Solution
The Indian government plays a key role in fostering agro-startups and rural entrepreneurship by providing targeted support through various schemes:
Policy Support: The government has consistently focused on promoting rural enterprises through favourable policy frameworks.
Financial Assistance: Programs like RKVY-RAFTAAR, Agri-Infrastructure Fund, and Agri-SURE provide crucial financial aid and startup incubation.
Capacity Building: These initiatives help build infrastructure, enable training, and improve access to credit and markets.
Encouraging Innovation: Through government support, agro-startups are encouraged to adopt sustainable practices and modern tools to enhance rural productivity.
\begin{quicktipbox
Supportive government schemes are critical in enabling agro-startups to scale and bring lasting change to rural India.
\end{quicktipbox Quick Tip: Supportive government schemes are critical in enabling agro-startups to scale and bring lasting change to rural India.
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