12th economics Unit-1 guide answer

12th Economics Book Back Question and Answer Tamil Medium & English Medium

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12th Economics Book Back Question and Answer Tamil Medium & English Medium

Chapter 1  Introduction to Macro Economics

Introduction

• The subject Economics is classified into two branches, namely, Micro Economics and Macro Economics. Ragnar Frisch, a Norwegian economist and the co-recipient of the first Nobel Prize in Economic Sciences coined the words ‘micro’ meaning small and ‘macro’ meaning large in the year 1933. However, macroeconomics in its modern form, began with John Maynard Keynes and his book “The General Theory of Employment, Interest and Money” published in 1936. Keynes offered an explanation for fallout from the Great Depression, when goods remained unsold and workers unemployed. Hence, Keynes is regarded as the ‘Father of Modern Macro Economics’. 

Part-A
Multiple Choice Questions

1. The branches of the subject Economics is 

a) Wealth and welfare

b) production and consumption

c) Demand and supply

d) micro and macro

2. Who coined the word ‘Macro’?

a) Adam Smith

b) J M Keynes

c) Ragnar Frisch

d) Karl Marx

3. Who is regarded as Father of Modern Macro Economics?

a) Adam Smith

b) J M Keynes

c) Ragnar Frisch

d) Karl Marx 

4. Identify the other name for Macro Economics.

a) Price Theory

b) Income Theory

c) Market Theory

d) Micro Theory

5. Macro economics is a study of 

___________________.

a) individuals

b) firms

c) a nation

d) aggregates

6. Indicate the contribution of 

J M Keynes to economics.

a) Wealth of Nations

b) General Theory

c) Capital

d) Public Finance

7. A steady increase in general price level 

is termed as_____________.

a) wholesale price index

b) Business Cycle

c) Inflation

d) National Income

8. Identify the necessity of Economic 

policies.

a) to solve the basic problems

b) to overcome the obstacles

c) to achieve growth

d) all the above

9. Indicate the fundamental economic 

activities of an economy.

a) Production and Distribution

b) Production and Exchange

c) Production and Consumption

d) Production and Marketing

10. An economy consists of

a) consumption sector

b) Production sector

c) Government sector

d) All the above

11. Identify the economic system where 

only private ownership of production 

exists.

a) Capitalistic Economy

b) Socialistic Economy

c) Globalisic Economy

d) Mixed Economy

12. Economic system representing equality 

in distribution is _________.

a) Capitalism

b) Globalism

c) Mixedism

d) Socialism

13. Who is referred as ‘Father of 

Capitalism’? 

a) Adam Smith

b) Karl Marx

c) Thackeray

d) J M Keynes

14. The country following Capitalism is 

________________ .

a) Russia

b) America

c) India

d) China

15. Identify The Father of Socialism.

a) J M Keynes

b) Karl Marx

c) Adam Smith

d) Samuelson

16. An economic system where the 

economic activities of a nation are 

done both by the private and public 

together is termed as_____________. 

a) Capitalistic Economy

b) Socialistic Economy

c) Globalisic Economy

d) Mixed Economy

17. Quantity of a commodity accumulated 

at a point of time is termed as 

____________..

a)production

b) stock

c) variable

d) flow

18. Identify the flow variable. 

a) money supply

b) assests

c) income

d) foreign exchange reserves

19. Identify the sectors of a Two Sector 

Model. 

a) Households and Firms

b) Private and Public 

c) Internal and External

d) Firms and Government

20. The Circular Flow Model that 

represents an open Economy.

a) Two Sector Model

b) Three Sector Model

c) Four Sector Model

d) All the above

12th economics 2 marks Part - B

Answer the following questions in one or two sentences 

21. Define Macro Economics.

22. Define the term ‘Inflation’.

23. What is meant by an ‘Economy’?

24. Classify the economies based on status of development.

25. What do you mean by Capitalism?

26. Define ‘Economic Model’.

27. ‘Circular Flow of Income’ - Define.

12th economics 3 marks Part - C

Answer the following questions in about a paragraph

28. State the importance of Macro Economics.

29. Describe the different types of economic systems.

30. Outline the major merits of capitalism.

31. Indicate the demerits of socialism.

32. Enumerate the features of mixed economy.

33. Distinguish between Capitalism and Globalism.

34. Briefly explain the two sector circular flow model.

12th economics 5 marks Part - D

Answer the following questions in one page

35. Discuss the scope of Macro Economics.

36. Illustrate the functioning of an economy based on its activities.

37. Compare the features of capitalism and socialism.

38. Compare the feature among Capitalism, Secularism and Mixedism