ch1

Core Economics with Video Lectures for ClassXII Copyright GBP-Copy in any form is Prohibited.1

GOYAL BROTHERS PRAKASHAN

1 Scope of Economics

ANSWERS TO TEXTBOOK EXERCISES

Multiple Choice Questions (1 Mark)

Choose the correct alternative in the following questions.

1. Microeconomics deals with economic behaviour of : (a) Economic System (b) Economic entities that make up the system (c) Country (d) Regions of a countryAns. (b) Economic entities that make up the system 2. Macroeconomics deals with economic functions of : (a) Central bank (b) Government (c) Policy Commission (d) All the aboveAns. (d) All the above 3. Microeconomics is study of : (a) A producer (b) Production of a good (c) An industry (d) All the aboveAns. (d) All the above 4. Macroeconomics is study of : (a) Consumption behaviour of all members of a family. (b) Sum of all consumers of a product. (c) Sum of all consumers of all products. (d) All the aboveAns. (c) Sum of all consumers of all products. 5. Which is macroeconomic variable? (a)Unemployment (b) Inflation (c) Income inequalities (d) All the aboveAns. (d) All the above



6. Macroeconomics generalises : (a) How economic decisions are taken? (b) How economic decisions are taken by people? (c) How economic decisions are taken by the industry? (d) How economic decisions are taken by government?Ans. (b) How economic decisions are taken by people?

7. Which one is microeconomic variable? (HOTS) (a) Foreign exchange (b) Balance of payments (c) Exports and imports of a country (d) None of the aboveAns. (c) Exports and imports of a country

8. Macroeconomics deals with : (a) Pricing of a product (b) Pricing of a factor of production (c) General price level (d) None of the aboveAns. (d) None of the above

Short Answer Questions (3 Marks)Answer the following questions in about 60 words. 1. Distinguish between microeconomics and macroeconomics with an example

of each.Ans. Microeconomics Macroeconomics

(a) It is the study of individual economic units of an economy.

It is the study of economy as a whole and its aggregates.

(b) Its central problem is price determination and allocation of resources.

Its central problem is determination of level of income and employment.

(c) It deals with individual income, individual prices and individual output etc.

It deals with aggregates like national income, general price level and national output etc.

2. Explain the relation between microeconomics and macroeconomics.Ans. Both microeconomics and macroeconomics are simply two ways of looking

at the same thing. It is because the behaviour of the economy as a whole is dependent on the behaviour of the units that make it up. For example, aggregate demand of the economy is the sum total of demand of all individual units that make the economy. Similarly, national income is the sum total of income of all the residents of the economy.



3. Giving reason and identify which of the following are the subject matter of microeconomics or of macroeconomics : (HOTS)

Ans. (i) National income Macroeconomics as it deals with the income of the whole nation.

(ii) Supply by an industry Microeconomics as it deals with individual economic unit.

(iii) Government budget Macroeconomics as it is related to the budget for the nation.

(iv) Supply by a firm Microeconomics dealing with individual economic units.

CBSE Examination Questions

1.Definemicro-economics.Ans. Microeconomics is that part of economic theory which deals with behaviour

ofindividualunitsofaneconomysuchasahousehold,afirmetc.

2.Definemacro-economics.Ans. Macroeconomics studies the economy in its totality as a whole. 3. Give two examples of microeconomics. Ans. Examples Individual income, consumers equilibrium. 4. Give two examples of macroeconomics.Ans. Examples National income, unemployment.

Value Based Questions

1. Which branch of economics studies aspects concerning people of the country as a whole?

Ans. Macroeconomics 2. Inflationhitsthecommonmanthemost.Whichbranchofeconomicstries

tofindsolutionofthisproblem?Ans. Macroeconomics 3. Which branch of economics deals with the problem of unemployment, a

curse for the society?Ans. Macroeconomics

ch1

Documents