HSC Economics Question Paper Solution 2024 | Maharashtra Board (Download Free PDF) - ScholarsZilla (2024)

HSC Economics Question Paper Solution 2024

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We know how stressful exams can be, especially regarding economics. So, to help ease your post-exam jitters, we’re here with the solution for the HSC Economics Question Paper Solution 2024.

Our expert teachers have analyzed the question paper and prepared detailed solutions for all the questions. You can find the solutions in this blog. The solutions have been prepared considering the latest Maharashtra Board guidelines and the previous year’s question papers.

All the best for your future exams!

HSC Economics Question Paper Solution 2024

Q. 1. (A) Choose the correct option : (5) {20}

3) Optional functions of Government.
i) Protection from external attack
ii) Provision of education and health services
iii) Provision of social security measures
iv) Collection of tax

Options :
a) ii, iii
b) i, ii, iii
c) ii, iii, iv
d) All of the above

4) Statements that highlight the significance of index numbers.
i) Index numbers are useful for making future predictions.
ii) Index numbers help in the measurement of inflation.
iii) Index numbers help to frame suitable policies.
iv) Index numbers can be misused.

Options :
a) ii, iii, iv
b) i, ii, iii
c) i, ii, iv
d) i, iii, iv

5) Blood bank is an example of _______.
i) Place utility
ii) Knowledge utility
iii) Service utility
iv) Time utility

Options :
a) i, ii, iii
b) ii, iii, iv
c) i, ii, iv
d) Only iv

(B)Find the odd word out: (5)

i) Types of demand :
Direct demand, Indirect demand, Composite demand, Market demand.

ii) Features of National Income :
Financial year, Money value, Static concept, Flow concept.

iii) Types of budget :
Deficit budget, Zero budget, Balanced budget, Surplus budget.

iv) Legal monopoly :
Patent, OPEC, Copyright, Trade mark.

v) Financial Assets :
Bonds, Land, Govt. Securities, Derivatives.

(C)Give economic term: (5)

i) More quantity is demanded due to changes in the favourable factors determining demand other than price. (Expansion of Demand)
ii) Deposits that are withdrawable on demand. (Demand Deposit)
iii) Charging different prices to different consumers for the same product or services. (Price Discrimination)
iv) Net addition made to total cost by producing one more unit of output. (Marginal Cost)
v) Degree of responsiveness of quantity demanded to change in income only. (Income Elesticity of Demand)

(D)Complete the correlation: (5)

i) General equilibrium : Macro Economics : : Partial equilibrium : Micro Economics

ii) Output method : Product Method : : Income method : Factor cost method

iii) Form utility : Furniture : : Knowledge utility : Doctor

iv) Perfectly elastic demand : Ed = ∞ : : Perfectly elastic demand : Ed = 0

v) Price constant : Change in supply : : Other factors constant : Variation of supply.

Q. 2. (A) Identify and explain the following concepts : (Any 3)(6) [12]

(i) Manisha satisfied her want of writing an essay by using pen and notebook.
Identified Concept: Utility
Explanation: Utility refers to the capacity of a commodity to satisfy a human want.

(ii) Raghu’s father invested his money in a market for long term funds both equity and debt raised within and outside the country.
Identified Concept: Capital Market
Explanation: A capital market is a market for long-term funds both equity and debt raised within and outside the country.

(iii) Due to mandatory use of masks during corona epidemic the demand for mask producing labour has increased.
Identified Concept: Indirect Demad
Explanation: It refers to demand for goods that are needed for further production.

(iv) Maharashtra purchased wheat from Punjab.
Identified Concept: Internal/Home Trade.
Explanation: The buying and selling of goods and services within the boundaries of a nation are referred to as ‘Internal Trade’ or ‘Domestic Trade’ or ‘Home Trade’.

(v) Jagruti receives monthly pension of Rs 5,000 from the state government.
Identified Concept: Transfer Income
Explanation: Transfer income refers tothe income received without rendering any productive service in return.

Q. 2. (B) Distinguish between (Any 3)(6)

(i) Recurring deposits and Fixed deposits.

(ii) Total utility and Marginal utility.

(iii) Perfectly elastic demand and Perfectly inelastic demand.

(iv) Price Index and Quantity Index.

(v) Internal debt and External debt.

Q. 3. Answer the following : (Any 3) (12)

i) Explain any four types of demand.

Answer:
Types of Demand

1) Direct demand: It is the demand by the consumer for goods that satisfy their wants directly. They serve the direct consumption needs of the consumers. Thus, it is the demand for consumer goods. For example, demand for cloth, sugar, etc.

2) Indirect demand: Indirect demand is also known as derived demand. It refers to the demand for goods that are needed for further production. It is the demand for producer’s goods. Hence, all factors of production have indirect or derived demand. For example, demand for workers in a sugar factory is derived or indirect demand.

3) Complementary/Joint demand: When two or more goods are demanded jointly to satisfy a single want, it is known as joint or complementary demand. For example, car and fuel, etc.

4) Composite demand: The demand for a commodity that can be put to several uses is known as composite demand. For example, electricity is demanded for several uses such as light, fan, washing machine, etc.

5) Competitive demand: It is demand for those goods which are substitutes for each other. For example, tea or coffee, sugar or jaggery, etc.

(ii) Explain any four problems of capital market in India.

Answer: The following points explain the problems faced by the Indian Capital Market

1) Financial Scams:
An increasing number of financial frauds have resulted in an irreparable loss for the capital market. Besides this, it has also led to public distrust and loss of confidence among individual investors.

2) Insider trading and price manipulation:
Insider trading means buying or selling of a security by someone who has access to non-public information or ‘unpublished information’ for personal benefit. Price manipulation or price rigging on the other hand means to simply raise the prices of shares through buying and selling of shares within certain individuals themselves for personal gains.

3) Inadequate debt instruments:
Debt instruments include bonds, debentures, etc. There is not much trading in the debt securities due to narrow investor base, high cost of issuance, and lack of accessibility to small and medium enterprises.

4) Decline in the volume of trade:
Regional stock exchanges have witnessed a sharp decline in the volume of trade because investors prefer to trade in securities listed in premier stock exchanges like BSE, NSE etc.

(iii) Explain any four features of utility.

Answer:
Utility: Utility is the capacity of a commodity to satisfy human wants. In other words, utility is the want satisfying power of a good.

The following are the features of utility:

1) Relative concept:
Utility is related to time and place. It varies from time to time and place to place. For example, (i) woollen clothes have a greater utility in the winter. (ii) sand has greater utility at the construction site than at the seashore.

2) Subjective concept:
It is a psychological concept. Utility differs from person to person. This is due to differences in taste, preferences, likes, dislikes, nature, habits, profession, etc. For example, a stethoscope has utility to a doctor but not to a layman.

5) Utility differs from pleasure:
A commodity may possess utility but it may not give any pleasure to the consumer. For example, injection for a patient has utility because it cures the ailment but it hardly gives any enjoyment or pleasure to him.

(iv) Explain any four reasons for the growth of public expenditure.

Answer: It is observed that there is a continuous growth in public expenditure in a developing country like India.

Following are some of the important reasons :

1) Increase in the Activities of the Government:
The modern government performs many functions such as the spread of education, public health, public works, public recreation, social welfare schemes, etc. It is observed that new functions are continuously being undertaken and old functions are being performed more efficiently on a large scale by the government. This leads to an increase in public expenditure.

2) Rapid Increase in Population:
The population of developing countries like India is increasing fast. In the 2011 Census, it was 121.02 crores. As a result, the government has to incur greater expenditure to fulfil the needs of the increasing population.

3) Growing Urbanization:
The spread of urbanization is a global phenomenon of the day. This leads to an increase in the government expenditure on water supply, roads, energy, schools and colleges, public transport, sanitation, etc.

4) Increasing Defence Expenditure:
In modern times, defence expenditure of the government is increasing even in peacetime due to unstable and hostile international relationships.

5) Spread of Democracy:
The majority of the countries in the world are democratic in nature. A democratic form of government is expensive due to regular elections and other such activities. This results in an increase in the total expenditure of the government.

v) Explain any four features of macro economics.

Answer:
Macroeconomics is the branch of economics that analyses the entire economy. It deals with the total employment, national income, national output, total investment, total consumption, total savings, general price level interest rates, inflation, trade cycles, business fluctuations, etc. Thus, macroeconomics is the study of aggregates.

Following are the features of macroeconomics.

i) Study of Aggregates

Lumping method is the study of the whole economy rather than its part. According to Prof. Boulding, “Forest is an aggregation of trees but it does not reveal the properties of an individual tree.”
This reveals the difference between microeconomics and macroeconomics.

Solution of other subjects
Solution of all Chapters of Economics 1 – 2 – 3A – 3B – 4 – 5 – 6 – 7 – 8 – 9 – 10

Q. 4. State with reasons whether you agree or disagree with the following statements (Any 3) (12)

(i) Over the last 75 years, India’s foreign trade has undergone a complete change in terms of composition and direction.

Answer: Yes, I agree with this statement.
Reason:
a) Desire means an individual’s wish to acquire a commodity.
b) In economics, demand means desire which is backed by willingness and ability to pay.
c) Symbolically, Demand = Desire + Ability to pay + Willingness to pay.
d) All desires may not be backed by ability to pay and willingness to pay.
e) Therefore, all desires are not demands.

(ii) Macro economics is different from micro economics.

Answer: Yes, I agree with this statement.
Reason:
a) The law of Supply states that “Other things being constant, higher the price of a commodity, more is the quantity supplied and lower the price of a commodity, less is the quantity supplied.
b) In simple words, higher the price, higher the supply, and lower the price, lower the supply.
c) The supply curve graphically represents this relationship between price and supply. It has a positive slope i.e. it slopes upward from left to right.

e) Therefore, there is a direct relationship between price and quantity supplied.

(iii) Price maker is the only feature of monopoly market.

Answer: Yes, I agree with this statement.
Reason:
a) Accepting deposits: The basic function of commercial banks is to accept deposits from customers. These deposits are of the following types:
i) Saving accounts (ii) Current account (iii) Fixed deposit
b) Granting loans and advances: The second most important function of commercial banks is to give loans and advances.
c) Agency functions: Commercial banks perform various agency functions such as Transfer of funds, Collection of funds, etc.
d) Discounting bills of exchange: Commercial Banks provide financial assistance to the business community by discounting bills of exchange.
e) Credit creation: Commercial banks create credit in the economy through demand deposits. Credit creation paves the path for the growth of the economy.
f) Thus, Commercial banks perform various functions.

(iv) There are many sources of non-tax revenue.

Ans: No, I disagree with this statement.
Reason:
a) An index number is a device to measure changes in an economic variable over a period of time.
b) Base year is the year against which comparisons are made.
c) Base year is also called the reference year. The base year should be normal i.e. it should be free from natural calamities. It should not be too distant in the past.
d) Therefore, Index numbers cannot be constructed without the base year.

(v) There are many types of index numbers.

Answer: No, I disagree with this statement.
Reason:
a) Relatively elastic demand has a flatter curve because the percentage change in quantity demanded is greater than a percentage change in price.
b) Theslopeofdemandissteeperin case ofrelatively inelastic demand the price may increase or decrease but the quantity demanded will near about remain the same.
c) Thus, Slope of relatively elastic demand curve is steeper.

Q. 5. Study the following table, figure, passage and answer the questions given below it (Any 2): (8)

(i)

(1) Complete the above table. (2)

(2) Draw an equilibrium price determination diagram based on the above table. (2)

(ii) The following diagram is a linear demand curve. on the basis of the above diagram answer the following questions:

1) Demand at point ‘P₂‘ is relatively inelastic. is this statement true or false?
2) Identify the elasticity of demand at point ‘P’.
3) What is denoted on ‘X’ axis in the above diagram?
4) Which method of measuring the elasticity of demand is denoted in the above diagram?

(iii)

In common language the term market means a specific place where buyers and sellers of a commodity meet and exchange their goods. But in Economics it is not necessarily a place but it is an arrangement through which buyers and sellers come in contact with each other directly or indirectly and exchange of goods takes place among them.

Market can be classified on the basis of place, time and competition. Market on the
basis of competition is perfect competition and imperfect competition. Perfect competition is an imaginary concept of market and in reality, we observe various types of imperfect competition like monopoly, duopoly, oligopoly and monopolistic completion.

In practice monopolistic competition is used. In this market there are some features of perfect competition and monopoly acting together. The uniqueness of this market lies in the fact that a difference is made between cost of production and selling cost. Selling cost refers to the cost incurred by the firm to create more demand for its product and increase the volume of sale. It includes expenditure on advertisem*nt, hoardings, window display etc.

(2) Write the classification of Market. (1)
Answer:
Banks provide different types of services like safe deposit lockers, D-mat facilities, internet banking, mobile banking, etc.

(3) Write your own opinion about selling cost. (2)

Q. 6. Answer the following questions in detail: (Any 2)(16)

i) State and explain the law of diminishing marginal utility with exceptions.

The table shows that marginal utility keeps on diminishing with an increase in consumption, further it becomes zero and then negative.

Explanation of the Diagram :
In the above diagram, units of commodity x are measured on X-axis, and marginal utility is measured on Y-axis. Various points of MU are plotted on the graph as per the given schedule. When the locus of all the points is joined, the MU curve is derived. MU curve slopes downwards from left to right which shows that MU goes on diminishing with every successive increase in the consumption of a commodity. When MU becomes zero, the MU curve intercepts the X-axis. Further consumption of a commodity brings disutility (negative utility) which is shown by the shaded portion in the diagram.

Exceptions to the Law of Diminishing Marginal Utility :
Following are the exceptions to the law of diminishing marginal utility :

1) Hobbies:

It is said that the MU of money never becomes zero. It increases when the stock of money increases. This is because money is a medium of exchange that is used to satisfy various wants. However, according to some economists, this law is applicable to money too. For example, the marginal utility of money is more to a poor person than to a rich person.

(ii) Explain the concept of National income and explain the features of National Income.

Answer:
The modern economy is a money economy. Hence, the national income of a country is expressed in terms of money. The total income of the nation is called national income.

In real terms, national income is the flow of goods and services produced in an economy during a year.

According to NIC “A national estimate measures the volume of commodities and services turned out during a given period counted without duplication.”

The following are the features of National Income :

1) Macro Economic concept:

National income represents the income of the economy as a whole rather than that of an individual. Hence it is a macroeconomic concept.

2) Value of only final goods and services:

In order to avoid double-counting in national income, the value of only final goods and services produced in the economy is considered. The value of intermediate goods or raw materials is not considered. For example, while estimating the production of shirts, there is no need to take the value of cotton, as it is already included in the price of the shirts.

3) Net aggregate value:

National income includes net value of goods and services produced and does not include depreciation cost. (i.e. wear and tear of capital assets)

4) Net income from abroad:

National income includes net income from abroad i.e. difference between export value and import value (X-M) and the net difference between receipts from abroad and payments made abroad (R-P).

5) Financial year:

National income is always expressed with reference to a time period. In India, it is from 1st April to 31st March.

6) Flow concept:

National income is a flow concept as it shows the flow of goods and services produced in the economy during a
year.

7) Money value:

National income is always expressed in monetary terms. It represents only those goods and services which are
exchanged for money.

(iii) Explain various reasons for the growth of public expenditure.

Answer: It is observed that there is a continuous growth in public expenditure in a developing country like India.

Following are some of the important reasons :

1) Increase in the Activities of the Government:

The modern government performs many functions such as the spread of education, public health, public works, public recreation, social welfare schemes, etc. It is observed that new functions are continuously being undertaken and old functions are being performed more efficiently on a large scale by the government. This leads to an increase in public expenditure.

2) Rapid Increase in Population:

The population of developing countries like India is increasing fast. In the 2011 Census, it was 121.02 crores. As a result, the government has to incur greater expenditure to fulfill the needs of the increasing population.

3) Growing Urbanization:

The spread of urbanization is a global phenomenon of the day. This leads to an increase in the government expenditure on water supply, roads, energy, schools and colleges, public transport, sanitation, etc.

4) Increasing Defence Expenditure:

In modern times, defence expenditure of the government is increasing even in peacetime due to unstable and hostile international relationships.

5) Spread of Democracy:

The majority of the countries in the world are democratic in nature. A democratic form of government is expensive due to regular elections and other such activities. This results in an increase in the total expenditure of the government.

6) Inflation:

Just like a private individual, the government has to buy goods and services from the market for the spread of economic and social development. Normally, prices show a rising trend. Due to this, the government has to incur increasing costs.

7) Industrial Development:

Industrial development leads to an increase in production, employment, and overall growth in the economy. Hence, the government makes huge efforts to implement various schemes and programs for industrial development. This results in an increase in government expenditure.

8) Disaster Management:

Many natural and man-made calamities like earthquakes, floods, cyclones, social unrest, etc. are occurring more frequently. The government has to spend a huge amount on disaster management which increases total expenditure.

Modern governments are working for the ‘welfare state’. Hence, there is a continuous increase in public expenditure.

Solution of other subjects
Solution of all Chapters of Economics 1 – 2 – 3A – 3B – 4 – 5 – 6 – 7 – 8 – 9 – 10

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