Sathvik Suresh Practice papers

MONEY AND BANKING

Class 12 - Economics
Time Allowed: 1 hour Maximum Marks: 87

General Instructions:

TOTAL MARKS -50

SECTION A- 2 MARKS -ATTEMPT ANY 5

SECTION B- 3 MARKS -ATTEMPT ANY 4

SECTION C- 4 MARKS -ATTEMPT ANY 4

SECTION D- 6 MARKS -ATTEMPT ANY 2

Section A
1. What does current account record? [2]
2. What are invisible items? [2]
3. Give meaning of Balance of Trade. [2]
4. What is meant by the balance on the current account? [2]
5. What are invisible exports? [2]
6. Where are ‘borrowings from abroad’ recorded in BOP account and why? [2]
7. Define accommodating transactions in Balance of Payments of an economy. [2]
Section B
8. Where is ‘borrowings from aborad’ recorded in the Balance of Payments Account? Give the reasons. [3]
9. Trade Deficit must exist if a country is facing a situation of Current Account Deficit. [3]
Justify the given statement.
10. Give the meanings of ‘autonomous’ transactions and ‘accommodating’ transactions in the Balance of Payments [3]
account.
11. How does the balance of payments affect rate of exchange? [3]
12. What is Balance of Payments? What does it comprise? [3]
13. Distinguish between current account and capital account of BOP. [3]
14. From the following figures, calculate Balance of Trade: [3]

(₹ crores)

(i) Imports of Petrol 150

(ii) Exports of Sugar 60

(iii) Exports of Steel 200

(iv) Exports of Wheat and Rice 90

(v) Imports of Edible oil 120

(vi) Imports of Machine 140

1/2
 (vii) Shipping 30

(viii) Travel and Tourism 50

(ix) Unilateral Transfers 40

Section C
15. Distinguish between the current account and capital account of balance of payments account. Is import of [4]
machinery recorded in current account or capital account? Give reasons for your answer.
16. What will be the effect of the following on the Balance of Payments? [4]
i. Make in India Programme.
ii. Import of pulses.
17. Differentiate between balance of trade and current account balance. [4]
18. State the basic difference between autonomous items and accommodating items of BOP. Give an illustration. [4]
19. State the items of capital account of India’s BOP. [4]
20. a. Differentiate between the concepts of demand for domestic goods and services and domestic demand for [4]
goods and services.
b. Distinguish between Current Account Deficit and Current Account Surplus.
21. India’s current account deficit for the third quarter in 2019 narrowed to 2.5% of the GDP compared with 2.9% in [4]
the preceding quarter, latest data released by the Reserve Bank of India (RBI) showed. - The Hindu
In the light of the given statement explain what is current account and list the transactions of the current account
of the Balance of Payments.
Section D
22. How is balance of trade different from balance of payments? State the items not included in balance of trade. [6]
23. i. Explain, what can be the likely impact of the depreciation of the home currency on imports to the country. [6]
ii. Distinguish between Current Account Deficit (CAD) and Current Account Surplus (CAS).
24. Distinguish [6]
i. Between current account and capital account, and
ii. Between autonomous transactions and accommodating transactions of Balance of Payments account.

25. i. Define Trade surplus. How is it different from Current account surplus? [6]
ii. Indian Rupee (₹) plunged to an all-time low of ₹ 74.48 against the US Dollar ($). In light of the above report,
discuss the impact of the situation on Indian Imports.

2/2