CBSE Class 12 Economics 2025 Sample Paper Solved Set 4

1 Read the following statements carefully and choose the correct alternative given below:
Statement 1: Actual stocks include both desired as well as undesired stock
Statement 2: Only undesired inventory stocks are zero when AS=AD.
Alternatives:
a) Statement 1 is true and statement 2 is false.
b) Statement 2 is true and statement 1 is false.
c) Both the statements are true
d) Both the statements are false

Answer : a

2 If the increase in income is equal to increase in consumption, identify the value of marginal propensity to save (MPS).
a) Equal to unity
b) Greater than one
c) Less than one
d) Equal to zero

Answer : d

3 Read the following statements, Assertion (A) and Reason (R) and choose one of the correct alternatives given below.
Assertion (A): Slope of saving function is always positive.
Reason (R): Saving is negative to the extent consumption is positive when income is zero.
Alternatives:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
b) Both Assertion (A) and Reason (R) are true, and Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is true, but Reason (R) is false.
d) Assertion (A) is false but Reason (R) is true.

Answer : b

4 Arrange the following in the correct sequential order, if the government of a nation. trying to curtail the situation of inflationary gap
i) Decrease in disposable income
ii) Increase in taxes
iii) Decrease in Aggregate Demand
Alternatives:
a) i, ii, iii
b) iii, ii, i
c) ii , iii, i
d) ii , i , iii

Answer : d

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