ISC Board Class 12 Economics Sample Exam 2025: Download Free PDF Here

Points K and T are NOT met by the consumer. Select the reason from the options below. (Understanding)

(a) K is not on any IC and all the money is not spent at T.

(b) K exceeds the consumer’s financial capacity and T offers a lower level of satisfaction.

(c) The equilibrium should be unique and this is point E.

(d) K gives more of goods A and B and T gives less of B.

(ii) Utility-maximizing consumers would like to reduce their consumption if (Understanding)

a) MUX = PX

b) MUX > PX

c) MUX X

d) MUX = Pj

Referring to the diagram shown above, select the reason for the movement from point M to N from the following options. (Analysis)

a) Increase in the real income of the consumer and increase in the relative price of the good.

b) Increase in the real income of the consumer and decrease in the relative price of the good.

c) Decrease in the real income of the consumer and increase in the relative price of the good.

d) Decline in the real income of the consumer and decline in the relative price of the commodity.

(iv)

Naseer is planning to buy a car for his family. Look at the picture shown below and select the most rational response of Naseer. (Application)

Petrol price

(1)

(A)

Naseer will not change his decision to buy a car.

(B)

He will postpone his plan to buy a car.

(C)

Naseer becomes undecided.

(D)

He will decide to buy two cars instead of one.

(v)

Which of the following statements about the national budget is CORRECT? (Application)

(1)

(A)

The interest paid on government bonds reduces the state’s liability.

(B)

The financial assistance received from the World Bank for the cyclone-affected areas is a source of income.

(C)

Grants provided by the central government to the state government are capital expenditure.

(D)

The profits of the public utility BHEL increase the state’s wealth.

from (vi)

If the value of the US dollar against the yen continues to rise, this leads to (understanding)

(1)

(A)

more imports from the USA to Japan.

(B)

more imports from Japan through the USA.

(C)

more US exports to Japan.

(D)

less export from Japan to the USA.

(vii) Sometimes a firm takes into account the actions and reactions of its competitors in determining its prices and production quantities.

To which market type does such a company belong? (Retrieve) (1)

a) Perfect competition

b) Monopol

c) Monopolistic competition

d) Oligopoly

(viii) Given below are two statements marked as Assertion and Reason. Read the statements carefully and choose the correct option. (Analysis)

Claim: A company can sell a larger quantity of a good by lowering its price.

Reason: Because the firm sells additional units of the good at a lower price, the firm’s marginal revenue is less than its average revenue.

(a) Both the claim and the reason are true and the reason is the correct explanation of the claim.

(b) Both the claim and the reason are true, but the reason is not the correct explanation of the claim.

(c) The claim is true and the reasoning is false.

(d) Both the claim and the reason are false.

(ix) Given below are two statements marked as Assertion and Reason. Read the statements carefully and choose the correct option. (Analysis)

Claim: GST is a type of proportional tax.

Reason: The tax rate remains the same regardless of people’s income.

(a) Both the claim and the reason are true, and the reason is the correct explanation of the claim.

(b) Both the claim and the reason are true, but the reason is not the correct explanation of the claim.

(c) The claim is true and the reasoning is false.

(d) Both the claim and the reason are false.

(x) An oligopoly differs from monopolistic competition, which is based on multiple suppliers. List other differences between these two types of market. (Retrieve)

(xi) APC may be greater than one, but MPC is always less than one. Give a reason to justify this phenomenon.