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Economics

Part – A

One mark questions from all the lessons (240 questions)

Choose the correct answer. (60 questions, each carry one mark.)

1. The author of wealth definition is : (a) Alfred Marshall b) Lionel Robbins c) Adam Smith d) Samuelson

2. The author of scarcity definition is (a) Adam Smith b) Samuelson c) Alfred Marshall d) Lionel Robbins

3. The concept of Net Economic Welfare has been given by (a) Samuelson b) Marshall c) Adam Smith d) Lionel Robbins

4. Economics is a a) positive science b) normative science c) Both d) none

5. In economics, we make use of a) deductive method b) inductive method c) Both d) none

6. The basic economic problems are common to a) Capitalism b) Socialism c) Mixed economy d) All the above

7. Traditional economy is a a) Subsistence economy b) Market economy c) Command economyd) Monetary economy

8. The basic force that drives the capitalist economy is a) Planning b) Technology c) Government d) Profit – motive

9. In a socialist economy, all decisions regarding production and distribution are taken by : a) Market forces b) Central planning authorityc) Customs and traditions d) Private sector.

10. Red-tapism and corruption lead to a) Inefficiency of production b) Inequality of income and wealthc) Absence of technology d) Efficient use of resources

11. Necessaries, comforts and luxuries are a) Classification of goods and services b) Classification of wantsc) Classification of utility d) None of the above

12. The Indifference curve approach was introduced by a) Alfred Marshall b) Lionel Robbins c) J.R. Hicks and R.G.D. Allen d) Adam Smith

13. Utility is a a) Social concept b) Subjective / psychological conceptc) Political concept d) Scientific concept

14. Single commodity consumption mode is a) Production possibility curve b) Law of Equi-marginal utilityc) Law of supply d) Law of Diminishing Marginal Utility

15. Consumer surplus is Potential Price – Actual Pricea) Potential Price – Actual Price b) MUn = TUn –TUn-1c) Demand = supply d) None

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16. Demand for a commodity depends on All the abovea) Price of that commodity b) Price of related goods c) Income d) All the above

17. Law of Demand establishes inverse relationship between price and quantitya) inverse relationship between price and quantity b) Positive relationship between price and quantityc) Both d) None

18. Increase in demand is shown by Shifts of the demanda) Movement along the same demand curve b) Shifts of the demand curvec) The highest point on the demand curve d) Lowest point on the demand curve

19. The degree of response of demand to change in price is Price elasticity of demanda) Price elasticity of demand b) Income elasticity of demand c) Cross – elasticity of demand d) All the above.

20. Factors determining supply are : a) Production technology b) Prices of factors of productionc) Taxes and subsidies d) All the above

21. At the point of equilibrium a) Only one price prevails b) Quantity demanded = quantity suppliedc) The demand curve intersects the supply curve d) All the above

22. Above the equilibrium price a. S < D b. S > D c. S = D d. none

23. Changes in quantity demanded occur Only when price changesa. Only when price changes b. Due to change of taste c. both d. None

24. The time element in price analysis was introduced by Alfred Marshalla. J.R. Hicks b. J.M. Keynes c. Alfred Marshall d. J.S. Mill

25. In the long period a. All factors change b. Only variable factor changesc. Only fixed factor changes d. Variable and fixed factors remain constant.

26. Production refers to a. destruction of utility b. creation of utilities c. exchange value d. None

27. The initial supply price of land is a. Zero b. Greater than one c. Less than one d. Equal to one

28. Labour cannot be separated from a. Capital b. labourer c. profit d. organization

29. Reward paid to capital is a. interest b. profit c. wages d. rent

30. A successful entrepreneur is one who is ready to accept a. Innovations b. Risks c. deciding the location of the production unit d. none.

31. Real cost is a) pain and sacrifice b) subjective conceptc) efforts and foregoing leisure d) All the above

32. Economic cost includes explicit cost and implicit costa) implicit cost b) social cost c) fixed cost d) money cost

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33. social costs are those costs all of thesea) not borne by the firms b) incurred by the society c) health hazards d) all of these

34. Average fixed cost is obtained by dividing a) TC/Q b) TFC/Q c) TVC/Q d) None

35. Marginal revenue is the least addition made to the a) average revenue b) Total production c) Total revenue d) none

36. Perfect competition is a market situation where we have a single seller a. a single seller b. two sellers c. large number of sellers d. few sellers

37. A firm can achieve equilibrium when its a. MC = MR b. MC = AC c. MR = AR d. MR = AC

38. The firm and industry are one and the same under a. perfect competition b. duopoly c. oligopoly d. monopoly

39. Under perfect competition, the demand curve is a. Upward sloping b. horizontal c. downward sloping d. vertical

40. Most important form of selling cost is a. Advertisement b. Sales c. Homogeneous product d. None

41. Rent is the price paid for the use of a) Capital b) Organisation c) Labour d) Land

42. Profits are the reward for a) land b) capital c) labour d) organisation

43. The demand for labour is a) effective demand b) direct demand c) derived demand d) elastic demand.

44. The author of the concept of quasi – rent is a) Adam Smith b) Marshall c) Ricardo d) Samuelson

45. The author of liquidity preference theory is a) J.M. Keynes b) Marshall c) Samuelson d) Knight

46. The macro economic thinking was revolutionized by a) David Ricardo b) J.M. Keynes c) Adam Smith d) Malthus

47. The Classical Theory assumed the existence of a) Unemployment b) Disguised unemployment c) Full employment d) Under-employment

48. The central problem in Macro Economics is a) Income and employment b) Price and Output c) Interest and Money d) None

49. To explain the simple theory of income determination, Keynes useda) Consumption and Investment b) Aggregate demand and aggregate supplyc) Production and Expenditure d) All the above

50. The marginal propensity to consume a) ΔS/ΔY b) C/y c) ΔP/ΔQ d) ΔC/ΔY

51. Monetary policy is controlled by a) central government b) state government c) central bank d) private sector.

52. Currency with the public is known as a) M1 b) M2 c) M3 d) M4

53. Bank rate is raised during

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a) deflation b) inflation c) stable prices d) unemployment54. During inflation

a) Businessmen gain b) wage earners gain c) salaried people gain d) Rentiers gain55. A situation marked by rising prices and stagnation in demand is known as

a) Cost-push inflation b) demand – pull inflation c) stagflation d) wage – push inflation.56. Public finance is concerned with the income and expenditure of

a) Private sector b) Agricultural sector c) Public authorities d) Industrial sector57. Tax revenue deals with the

a) Fees b) Kinds of taxes c) Revenue d) Non tax revenue58. The federal form of government consists of

a) Central, state and local government b) central and state governmentc) State and local government d) above all

59. The compulsory charge levied by the government is a) License b) Gifts and grants c) Loan d) Tax

60. In ZBB every year is considered as a a) base year b) financial year c) new year d) academic yearFill in the blanks

1. The term “micro” means_________ Ans : small2. Strictly speaking production refers to the creation of__________ Ans : utilities3. Exchange of goods for goods is known as _________ Ans : barter4. Economics is a _________ Ans : Science social5. An example of cosmopolitan wealth is _____________ Ans : ocean6. In a traditional economy, basic problems are solved by____ and _____. Ans : Customs and

Traditions7. Most of the economic activities of capitalism are centered on__________ Ans : Price

Mechanism8. Production possibility curve is also known as _________ Ans : Transformation / producton

possibility frontier9. The prime motive of socialist economy is __________. Ans : Social /COLLECTIVE

WELFARE10. Under mixed economy, the economic control is exercised by _________ and ________. Ans :

Private and public sectors.11. ____________ means using up of goods and services Ans : Consumption12. wants may be both ________ and _________ Ans : Competitive and complementary13. Marshallian utility approach is ________ Ans : Cardinal utility analysis14. Marginal utility falls to zero, when the total utility is __________ Ans : Total utility15. An indifference curves is _________ to the origin. Ans :convex16. The demand curve slopes downwards due to _______ Ans : Law of diminishing marginal

utility17. Adding up of individual consumers schedule is _______ Ans : Market demand schedule18. Goods that are demanded for their social prestige come under _____ Ans : Veblen effect19. The concept of elasticity of demand was introduced by _________ Ans : Alfred Marshall20. The rate of change of supply to a change is price is ________ Ans : Elasticity of supply.

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21. ____________ is the major determinant of supply. Ans : Price22. Agriculture, industry, growth and distribution are the _______ of the economy. Ans : Sub-

systems23. At _______ price, there is no tendency to change the price or quantity. Ans : Equilibrium24. Modern economists divide time periods into ______ and ________ Ans : Short period and

long period25. The supply curve in the market period is a _________ line. Ans : Vertical26. Land and labour are called ____________ factors Ans : primary27. An enquiry into the nature and causes of wealth of nations was written by _________. Ans :

Adam Smith28. ___________ is limited by the extent of market. Ans : Division of labour29. ____________ is man-made physical goods used to produce other goods. Ans : capital30. The functional relationship between inputs and output is known as _________.

Ans : Production function.31. Money cost is also called ________. Ans : Nominal cost32. Economic profit is the difference between total revenue and_________. Ans : Economic cost

/ total cost33. the distinction between the fixed and variable factors is possible only in ________. Ans :

Short run34. Total cost is the sum of _________ Ans : total fixed cost and total variable cost35. The marginal cost curve is _________ Ans : ‘U’ shaped36. Under perfect competition, the firms are producing ______ product. Ans : homogeneous37. When the Average revenue of the firm is greater than its average cost, the firm is earning

________ Ans : Super normal profit38. The perfect competitive firms are _________ Ans : price-takers39. Monopoly power achieved through patent right is called _________ Ans : legal monopoly40. Firms realize the importance of ________ under oligopoly. Ans : mutual co-operation41. Marginal productivity theory is the _________theory of distribution. Ans : general42. Marginal productivity theory is based on the assumption of ____________ competition. Ans :

perfect43. Transfer earnings refer to ___________ cost. Ans : opportunity44. Money wages are also known as __________ wages. Ans : nominal45. Organization is done by the ___________ Ans : entrepreneur46. The term consumption function explains the relationship between________ and ________

Ans : Income and Consumption47. _________ is the ratio of charge in saving to a change in income. Ans : Marginal Propensity

to save48. The worldwide depression of 1930s was also caused by a ________ Ans : Fall in investment49. __________ refers to the cash holdings of the people. Ans : Liquidity Preference50. The magnified effect of initial investment on income is called______ effect. Ans : Multiplier51. The direct exchange of goods for goods is known as _________ Ans : barter system52. Deflation is a period marked by __________ prices Ans : falling53. The equation of exchange (MV = PT) was given by Ans : Prof. Irving Fisher

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54. Galloping inflation is also known as ________. Ans : hyper-inflation or run-away inflation55. Monetary policy is usually effective in controlling __________. Ans : inflation56. _______ means different sources of government income. Ans : Public revenue57. the absence of direct and proportional benefit is ________ Ans : Quid pro – quo58. __________ are considered as fundamental principles of taxation. Ans : canons of taxation59. The classification of direct and indirect taxes is based on criterion of _________ tax.

Ans : shifting of the incidence60. _________ tax is a blend of progressive tax and proportional tax. Ans : Degressive

Match the following:1. “Principles of Economics” - Marshall2. First Nobel prize - Timbergen and Frisch3. Dynamic approach - Time Element4. Wealth - Stock5. Income - Flow6. Minimum cost - Maximum benefit7. Opportunity cost - next alternative foregone8. private property - Laissez faire economy9. Bureaucratic expansion - socialism10. Market forces - supply, demand and price11. Wants - Advertisements12. “Principles of economics” - Marshall13. Maximum social advantage - Hicks and Dalton14. Indifference curve - Ordinal Ranking15. Luxuries - Diamond, Jewels16. Positive relationship of - Veblen effect

price and demand17. Tea and coffee - substitutes 18. Segment between two points - Arc19. Ed > 1 - elastic demand20. Cross-elasticity is zero - X and Y are not related21. Equilibrium - Pair of price and quantity22. Excess demand - D > S23. Price discount - Annual stock 24. Long period supply curve - More elastic25. Short period price - Demand and supply.26. Entrepreneur, an innovator - Schumpeter27. Division of labour - Adam Smith28. Production function - Cobb Douglas29. Bundle of risks - Hawley30. Exertion of body or mind - Marshall31. Average cost - cost per unit32. TC - TFC + TVC

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33. The long run average cost curve - planning curve34. MCn - TCn – TCn-35. Profit - TR – TC36. Global market - Gold and silver37. Consumer sovereignty - Perfect competition38. South Africa - Diamond39. Technical monopoly - Coco Cola40. Monopolistic competition - E.H. Chamberlin41. Residual claimant theory - Walker42. Waiting theory of Interest - Marshall43. Loanable Funds Theory - Neo-classical theory44. Dynamic Theory of profit - Clark45. Risk-bearing theory of profit - Hawley46. Aggregate Demand - C + I + G +(X-M)47. Slope - Vertical Change/Horizontal Change48. K - 1/1-MPC49. Y - C + S50. Keynes - Liquidity Preference51. Quantitative credit control - Bank rate52. Selective credit control - Moral Suasion53. Cheap money policy - Low rate of interest54. Wages and prices push one another - Creeping inflation.55. Value of money - Purchasing power of money 56. Conons of taxation - Adam Smith57. Progressive tax - Best tax system58. Fiscal policy - Rebate and subsidies59. Regressive tax - Tax rate decreases60. Balanced Budget - Revenue and expenditure are equal

IV. Answer in a word or two : (60 questions for each question, one mark)1. What is the other name for Economics? Political economy2. What are the subjects that econometrics make use of ? Statistics, mathematics, economics3. What is the method that Ricardo made use of? Deductive method4. Give one or two examples of free goods. Air, sunshine5. What is the other name for money income? nominal income6. Is traditional economy a subsistence economy? Yes7. What is the basic force that drives a capitalist economy? Profit Motive8. What is the result of over-production? Depression9. Name any two successful socialist economies. China and Cuba10. Is there planning under mixed economies? Yes, Manufactures consumer and capital goods

in the interest of public welfare.11. Define Utility. Want satisfying power

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12. What is the other name for the law of Equi-Marginal Utility? Gossen’s second law13. What is Indifference curve? Locus of different combinations of two commodities14. What is Indifference Map? It is a group of indifference curves for two commodities15. What is the other name for budget line? Price – ratio line16. What is the basic assumption of economic theory? Other things being equal / ceteris

paribus condition17. How does the demand change during boom and depression?

During boom demand increases and during depression demand decreases18. Give the formula for point method.

ep = lower segment of the demand curve / upper segment of the demand curve19. What is income elasticity of demand?

The degree of responsiveness of demand to change in income.20. When the demand for labour is inelastic, can a trade union raise wages? Yes21. What is equilibrium in general? State of rest / balance22. What are the determinants of shift in demand curve? Income, taste, price of substitutes23. Who has introduced the time element? Alfred Marshall24. Give an example for fixed input? Heavy machinery / building and capital equipments25. Is supply fixed in the market period? Yes26. Who is the changing agent of the society? Entrepreneur27. How do internal economies arise? From within the firm28. What is other name for isoquant? Iso-Product curve29. Give the condition for producer’s equilibrium ? MRTS xy = Px / Py30. State the Cobb-Douglas production function. Q = b La Cb

31. When average revenue remains constant what will be M.R.? M.R. remains constant / coincide with A.R.

32. What is Marginal Revenue? Addition made to the total revenue.33. What is break-even point? No - profit no-loss point34. What is an envelope curve? It is a group of short run cost curves (planning curve)35. How will you calculate AC? TC/q36. What is an industry? Group of firms37. Who undertakes the public utilities? state38. How does the government control monopoly? taxation / legislative method39. What is the essential feature of monopolistic competition? product differentiation40. In which year the MRTP Act was passed? 196941. According to Ricardio, do all lands get rent? No42. Even if all lands are equally fertile, can rent arise? Yes43. Who is the author of Agio theory of interest? Bohm-Bawerk44. Who is the author of the rent theory of profits? Prof. Walker45. What is the name of Schumpeter’s theory of profits? Innovation theory46. What crippled the free enterprise economies of US and UK? Great Depression47. State J.B. Say’s Law of Market. Supply creates its own demand48. Who is the author of the “General Theory of Employment, Interest and Money”? J.M. Keynes

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49. Name the point of intersection of Aggregate Demand and Aggregate Supply. Keynesian cross

50. Give the formula for Multiplier. K = 1 / 1-MPC51. Name the bank which controls money supply in a country. central bank52. When is dear money policy followed? during inflation to central money53. What is the name of inflation without a rise in price level? suppressed inflation54. Is wage cut a remedy for depression? No55. Give the example of a country that experienced hyperinflation. Germany56. What is a tax? Compulsory contribution by each person57. Give the expansion for VAT. Value added tax58. What is the meaning of proportional tax? Uniform tax rate59. What are the kinds of budget? Balanced and unbalanced budget60. What is public debt? Borrowing from the public

Answer the following questions in four or five lines (3 marks)Chapter - 1

1. State Alfred Marshall’s definition of Economics.In 1890, Alfred Marshall wrote a book “Principles of Economics”. He defined Economics as “a study of mankind in the ordinary business of life” According to him study of man is more important than the study of wealth.

2. What are the divisions of Economics?1. Consumption 2. Production 3. Exchange 4. Distribution 5. Public Finance

3. Describe the relationship between Economics, Mathematics, Statistics.1. Statistics is the science of averages.2. Many tables and diagrams used in economics are based on statistical analysis.3. Mathematical methods are largely used in modern economics.

4. Distinguish between free goods and Economic goods. Free goods Economic goods

1. Gifts of nature (Air, sunshine) 1. They are produced2. Do not command price in the market 2. Command a price in the market3. They are not scarce 3. They are scarce4. They have no value – in – exchange 4. They have value – in – Exchange

5. Explain the difference between value – in – use and value – in – exchange.Value has two kinds - Value in use and value in exchangeValue in use : Air, rain and sunshine have value – in – use. There is no price.

Do not have value – in – exchange.Value - in – exchange : Economics gives importance to those goods which have value – in –

exchange. For a good to have value – in - exchange, it must possess utility, it must be scarce in relation to demand and it must be possible for us to exchange it.

Chapter - 26. What are the basic issues / problems of any society?

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1. What to produce ? How much?2. How to produce?3. For Whom to produce?

7. Name the important general economic systems.1.Traditional Economy. 2.Capitalist Economy.3.Socialist Economy and 4.Mixed Economy

8. List the basic features of socialism.1. Social welfare motive. 2. Limited Right to private property.3. Central planning 4. Market forces

9. Is India a mixed economy? Explain.Yes, Both Public and private sector co exists and exercise economic control.Government Sector : All decisions regarding what, how and for whom to produce are taken by state.Private sector : Produces and distributes goods and services.

10. What is opportunity cost?1. The next best alternative foregone. (or)2. The benefits that could be received from the opportunity. (or)3. Differences between the concepts of ‘economic cost’ and ‘accounting cost’.

Chapter - 311. What are causes for wants?

1. Arises due to psychological causes.2. Arises due to social causes.3. Arises due to customs and habits.4. Arises due to advertisements.

12. What are the classifications of goods. (wants)1. Necessaries (Food, Clothing)2. Comforts (fruits, milk)3. Luxuries (diamond jewels)

13. Define the Law of Diminishing Marginal Utility.“The additional benefit which a person derives from a given increase of his stock of a thing diminishes with every increase in the stock that he already has”. (Marshall’s law)

14. What are the properties of Indifference curve?1. Slopes downwards to the right.2. Convex to the origin.3. No two Indifference curves can ever cut each other.

15. Define consumers surplus in the words of Marshall.“The excess of price which a person would be willing to pay rather than go without the thing over that which he actually does pay is the Economic measure of this surplus of satisfaction”. Consumers surplus = potential price – Actual price.

Chapter - 516. What is equilibrium price?

At a particular price, the quantity demanded by the buyer is equivalent to the quantity seller is willing to sell. It is the point of intersection of the supply curve and the demand curve.

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17. Distinguish between change in demand and shift in demand.Change in demand Shift in demand

1. Due to change in price2. Movement on the same demand curve3. Only one demand curve exists.

1. Due to change in factors.2. Factors shift the demand curve as a

whole3. More than one demand curve occurs.

18. What are the determinants of shift in supply?1. Number of producers or firms2. Prices of factors3. Prices of other products4. Taxes and subsidies.5. Production technology

19. Differentiate the short period from the long period.Short period : some inputs cannot be varied. Long period : All inputs can be varied. (changed)

20. Write a short note on market period.1. Very short period and during this period firms cannot change their supply in response to changes in demand.2. Supply is fixed.3. Price is determined according to demand. Eg. Fruits, flowers.

Chapter - 621. Name the types of utility.

1) Form utility2) Place utility3) Time utility and4) Possession utility.

22. Define labour.Labour is the human input. “The use or exertion of body or mind, partly or wholly, with a view to secure an income apart from the pleasure derived from the work”. – Marshall.

23. What is meant by division of labour?Dividing the process of production into distinct and several component processes and assigning each component in the hands of a labourer or a set of labourers. Eg. : production of Readymade garments.

24. What are the forms of capital?1) Physical capital or Material Resources. (Plant and machinery)2)Money Capital or monetary Resources (Bank deposits, shares and securities)3) Human Capital or Human Resources. (education, health)

25. What is Production function? What are its classifications?The functional relationship between inputs and outputs is known as production function. Inputs

: land, labour, capital and enterprise. Output : refers to the volume of goods produced.Classification :

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1)Short-run production function which is studied through Law of Variable Proportions.2)Long-run production function which is explained by Constant Returns to scale.

26. What are economic costs?Includes Explicit cost and implicit cost. The money rewards for the own services of the entrepreneur and the factors owned by himself and employed in production are known as implicit cost.

27. What is Marginal cost.Marginal cost is the addition made to the total cost by the production of one additional unit of output.

28. Mention the relationship between SAC and SMC1) SMC < SAC, SAC is falling2) SMC > SAC, SAC is increasing3) SMC must cut the SAC at SAC’s minimum point from below. At the minimum point SMC = SAC.

LESSON - 101. What are the criticisms of says law?

1. Great Depression made say’s law unpopular.2. All incomes earned are not always spent on consumption.3. Whatever saved is not invested.4. Law was based on wrong analysis of market.5. Suffers from the fallacy of aggregation.6. Aggregate supply and aggregate demand are not always equal.7. Rate of interest is not the equilibrating factor.8. Capitalist system is not self – adjusting always.9. Perfect competition is an unrealistic assumption.10. Money is a dominant force in the economy.11. Law is applicable only for a long period.12. Say’s law holds good only in the barter economy.

2. Draw the flow chart to depict the essence of Keynes theory.

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Basic ideas of Keynes :1. Total income depends on total employment.2. Total employment depends on effective demand.3. Depends on consumption expenditure and investment expenditure.4. Consumption depends on income and propensity to cosume.5. Investment depends upon the Marginal efficiency of capital and the rate of interest.

3. Describe the consumption function with a diagram.Consumption Function :-1. People spend most of their income on commodities. 2. Some spend their income fully 3. Some others spend a portion and keep the rest for saving. 4. It is about the relationship between income and consumption.

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Graphical explanation : 1. OY axis represents income, OC represents expenditure.2. Propensity to consume is the ratio that measures the functional relationship between

income and consumption.3. The psychology of the community is such that when real income is increased but not so

much as income.4. C = a + b y …. ( 2 )

C = 4 + 0.8Y5. The consumption curve CC is a short-run curve.6. Consumption takes place even when income is zero.7. Curve starts from 4 on the vertical axis.8. In equation 80% of additional income is spent.9. MPC = C/Y10. Autonomous consumption. That is consumption is not related to income.11. Slope curve b is marginal propensity to consume.

4. What are the determinants of consumption other than income?1. Income distribution2. Size and nature of wealth distribution3. Age distribution of population4. Inflation or price level5. Government policies6. Rate of interest7. Expectations about price, income, etc.8. Advertisements9. Improvement in the living standard10. Changes in cultural values

5. What are the assumptions of Keynes’ Simple Income Determination?Income Determination :-

1. There are only two sectors viz. consumers ( C ) and firms ( I ).2. Government influence on the economy is nil. ( G = 0 )3. Closed economy (x – M = 0)4. Wages and prices remain constant.5. There are unemployed resources and hence less than full employment equilibrium prevails.6. There is no variation in the rate of interest.7. Investment is autonomous.8. The consumption expenditure is stable.9. Due to the first three assumptions.

Y = C + I + G + (X – M) Y = C + I

Chapter - 121. Explain the canons of taxation.

Canon of equity1. It means that taxes should be imposed according to the capacity of the tax payer.

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2. Poor should be taxed less and rich should be taxed more. 3. This canon involves the principle of justice. Canon of certaintyEach tax payer should know that the amount of tax to be paid, when to be paid, and where to be paid and also should be certain about the rate of tax to make investment decisions.Canon of convenience1. Tax payment should be convenient and less burden to the tax payer.

e.g. income tax - collected at source, land tax - collected after harvest.Canon of economy1. The cost of collecting the revenue should be kept at the minimum possible level. 2. The tax laws and procedures should be made simple, administrative expenditure to be kept

at a minimum.

2. What are the main sources of tax and non-tax revenue of the state government ?1. Land revenue,2. Taxes on land and building 3. Taxes on the consumption of electricity4. Taxes on agricultural income,5. Excise duty on alcoholic liquors and narcotics,6. Taxes on vehicles, animals and boats,7. Entertainment tax,8. Taxes on trade, profession and employment,9. Income from irrigation and forests,10. Grants from the central government and11. Taxes on advertisements other than those in newspaper,12. Stamp duties, court fees and registration,

3. Explain Budget - balanced and unbalanced budget.Budget :- Statement of receipts and expenditure. April 1 to March 31. Indicates the probable income and expenditure of the government, the financial policies,

taxation measures, investment opportunities, extent of saving, utilization of resources, mobilization of capital.

Definition - Dimock :- A balanced estimate of expenditures and receipts for a given period of time. Balanced Budget : Government budget is said to be balanced when its tax revenue and expenditure are

equal. Over a period of time both are equal.Unbalanced Budget :(surplus or Deficit) Government’s income and expenditure are not equal.Surplus Budget :

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When there is an excess of income over expenditureDeficit Budget : When there is an excess of expenditure over income.

14. What are the limitations of fiscal policy ?1) Size of Fiscal measures* Not a mere statement of receipts and revenues but shapes the economic structure of a country. * Direct taxation at times become an instrument of limited applicability, as the vast majority of the people are not covered by it. * When the total tax revenue forms a smaller portion of the national income, fiscal measures will not step up the sagging economy requiring massive help.2. Fiscal policy as ineffective anti-cyclical measure* When the different sectors of the economy are not closely integrated with one another will not stimulate economic growth.* Action taken by the government may not always have the same effect.* Recession in some sectors is followed by a rise in price in other sectors. 3. Administrative delay* Fiscal measures may introduce delay, uncertainties and arbitrariness arising fromadministrative bottlenecks. * As a result, fiscal policy fails to be a powerful.Other Limitations* Large scales of underemployment, lack of co-ordination from the public, tax evasion, low tax base etc.

5. Differentiate between the direct and indirect taxes?Direct tax Indirect tax

1. Dalton : tax paid by a person on whom it is imposed.

2. Impact of the tax fall on the same person

3. Eg. Income tax, gift tax4. Collected from the public directly5. Imposed on and collected from the

same person6. One cannot evade paying.7. Transfer of tax is difficult.8. No shifting of incidence.9. Tax imposed on rich.

1. imposed on one person, paid by another.2. Impact of tax falls on one person and incidence of the tax falls on another person3. Excise duty, sales tax4. imposed on commodities & services.5. Incidence is upon one person who ultimately pays it.6. One can evade paying tax7. Easy to transfer tax.8. Shifting of incidence is there.9. Tax is imposed on poor.

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(20 marks) Chapter - 4

31. Explain Law of demand with the help of diagram.Demand and supply :-Demand for a commodity refers to the desire backed by ability to pay and willingness to buy it. If a person below poverty line wants to buy a car, it is only a desire but not a demand as he cannot pay for the car. If a rich man wants to buy a car it is demand as he will be able to pay for the car. Thus desire backed by purchasing power is demand.

The demand for any commodity mainly depends on the price of that commodity. The other determinants include price of related commodities, income of the consumers, tastes and preferences of consumers, and the wealth of consumers. Hence the demand function can be written asDx = f(Px, Ps, Y, T, W)Dx = demand for good x.Px = price of good x.Ps = Price of related goodsY = incomeT = taste and preferences of the consumers w = wealth of the consumer

Price (Rs.) Quantity Demanded (units)

6 105 204 303 402 501 60

The above said is a demand schedule. It shows a list of prices and corresponding quantities demanded by an individual consumer. This is an individual demand schedule.

Demand Curve :The demand schedule can be converted into a demand curve.

10 20 30 40 50 Quantity Demanded

Law of Demand :-Law of demand states that there is a negative or inverse relationship between the price

and quantity demanded of a commodity over a period of time.

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Definition :-Alfred Marshall stated that “the greater the amount sold, the smaller must be the price at

which it is offered, in order that it may find purchasers; or in other words, the amount demanded increases with a fall in price and diminishes with rise in price”. According to Ferguson, the law of demand is that the quantity demanded varies inversely with price.

“The people will buy more at lower prices and buy less at higher prices” - other things remaining the same. – Law of Demand.Assumptions :-1. No change in the consumer’s income.2. No change in consumer’s tastes and preferences.3. No changes in the prices of other goods.4. No new substitutes for the goods have been discovered.5. People do not feel that the present fall in price is a prelude to a further decline in price.Demand Schedule and individual demand scheduleDemand schedule is a tabular statement showing of how much of a commodity is demanded at different prices.

In the above figure DD is the demand curve. The curve slopes downwards from left to right showing that when price rises less is demanded and vice versa. Thus the demand curve represents the inverse relationship between the price and quantity demanded other things remaining constant. Why does the demand curve slope downwards?

The demand curve slopes downwards mainly due to the law of diminishing marginal utility. The law of diminishing marginal utility states that an additional unit of a commodity gives a lesser satisfaction. Therefore the consumer will buy more only at a lower price. The demand curve slopes downwards because the marginal uitility curve also slopes downwards.Individual demand and market demand schedules.

Individuals demand schedule tells the quantities demanded by an individual consumer at different prices.Individual demand schedule for oranges :

Price of Orange (Rs.) Quantity of Oranges5 1

0

1

2

3

4

5

6

10 20 30 40 50

Pric

e

Quantity Demanded

Price

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4321

2345

Explanation :-It is clear from the schedule that when the price of orange is Rs.5 the consumer demands

just one orange. When the price falls to Rs.4 he demands 2 oranges. When the price falls further to Rs.3, he demands 3 oranges. Thus when the price of a commodity falls, the demand for that commodity increases and vice versa.

Market demand scheduleA demand schedule for a market can be constructed by adding up demand schedules of the

individual consumers in the market. Suppose that the market for oranges consists of 2 consumers. The market demand is calculated as follows :

Demand schedule for two consumers and the Market demand schedule :Price of oranges in

Rs. Quantity Demanded

Consumer I Consumer II Market Demand5 1 - 14 2 1 33 3 2 52 4 3 71 5 4 9

Market demand curveThe market demand also increases with a fall in price and vice versa.

32. Explain the methods of measurement of price elasticity of demand in detail.Price Elasticity of Demand :-

The rate at which demand changes to a change in price. The degree of responsiveness of quantity demanded to a change in price is called price

Elasticity of Demand.

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pricein change Percentagedemandedquantity in change Percentagedemandofelasticity Price

Symbolically, P

PQQ

pp

QQ

ep

Measurement of price elasticity of demand :-Important methods for calculating price elasticity of demand are

1) Percentage method2) Point method or slope method3) Total outlay method4) Arc method1. Percentage method

The relative change in demand is divided by relative change in price (or) percentage change in demand is divided by percentage change in price.

For example, the price of rice rises by 10% and the demand for rice falls by 15%.

Then 5.11015

pe

This means that the demand for rice is elastic. If the demand falls to 5% for a 10% rise in price. This means the demand for rice is inelastic.Five measures of elasticity :-a) Relative elastic demand (ed > 1)b) Relatively inelastic demand. (ed < 1)c) Unitary elastic demand. (ed = 1)d) Perfectly inelastic demand. (ed = 0)e) Perfectly elastic demand. (ed = ∞)

Quantity Demanded Quantity Demanded

PP1

D

0 Q Q1

D

X

Y

P

P1

D

D

0 Q Q1

Y

X

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Point method :-We can calculate the price elasticity of demand at a point on the linear demand curve.Formula to find out

ep = curvedemand theofsegment Upper curvedemand theofsegment Lower .

Example :- The length of the demand curve below is AB = 4 cm.

Exactly at middle point of AB demand curve,

(Anything by zero becomes infinity a mathematical principleTotal outlay method :-We can measure elasticity through a change in expenditure on commodities due to a

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change in price.1. Demand is elastic, if total outlay or expenditure increases for a fall in price (ep > 1)2. Demand is inelastic, if total outlay or expenditure falls for a fall in price. (ep < 1)3. Elasticity of demand is unitary, if total expenditure does not change for a fall in price (ep =

1)The results are tabulated in the following table.

4) Arc methodSegment of a demand curve between two points is called an Arc. Arc elasticity is calculated from the following formula.

21

21

21

21

PPPP

qQqqEp

21

21

21

21

2121

qQpp

pq

ppp

qQq

ppp

qQq

Arc elasticity formula should be used when the change, in price is some what large. It can be shown by diagrams.

In the above figure we can measure arc elasticity between points A and B on the demandcurve; we will have to take the average prices of OP1 and OP2 and average of the two quantities demanded (original and the new). This is Arc Elasticity of Demand.

Q = change in quantity demandedP = change in price of the commodityP1 = original priceP2 =new priceQ1 =original quantityQ2 = new quantity

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Chapter – 1 Nature and scope of Economics

Choose the correct answer :-1. The author of wealth definition is :

(a) Alfred Marshall b) Lionel Robbins c) Adam Smith d) Samuelson2. The author of scarcity definition is

(a) Adam Smith b) Samuelson c) Alfred Marshall d) Lionel Robbins3. The concept of Net Economic Welfare has been given by

(a) Samuelson b) Marshall c) Adam Smith d) Lionel Robbins4. Economics is a

a) positive science b) normative science c) Both d) none5. In economics, we make use of

a) deductive method b) inductive method c) Both d) none

Fill in the blanks :-6. The term micro means __________.7. Strictly speacking production refers to the creation of _________.8. Exchange of goods for goods is known as _________.9. Economics is a ___________ Science.10. An example of cosmopolitian wealth is _________.

Match the following :-11. Principles of Economics a. Stock12. First Nobel prize b. Flow13. Dynamic Approach c. Marshall14. Wealth d. Time element15. Income e. Timbergen and Frisch

Answer each one of the questions in a word or two:16. What is the other name for economics?17. What are the subjects that Econometrics make use of ?18. What is the method that Ricardo mode use of ?19. Give one or two examples of free goods?20. What is the other name for money income?

Chapter:2 Basic Economic problems 1. The basic economic problems are common to---

a. Capitalismb. Socialism c. Mixed economy d. All of these2. Traditional economy is a

a. Subsistence Economy b. Market economy d. Command economyd. Monetary economy

3. The basic force that drives the capitalist economy is

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a. Planning b. Technology c. Government d. Profit – motuse4. In a socialist economy all decisions regarding production and distribution are taken by

a. Market forces b. Central planning authorityc. Customs and traditionsd. Private sector

5. Red tapism and corruption lead to a. Inefficiency of production b. Inequality of income and wealthc. Absence of technology d. Efficient use of resourcesFill in the blanks:

6. In a traditional economy, basic economic problems are solved by ------ and -----7. Most of the economic activities of capitalism are centred on -------8. Production possibility curve is also known as -----9. The prime motive of socialist economy is ------10. Under mixed economy, the economic control is exercised by ------ and -----sectors.

Match the following:11. Minimum cost a. next alternative foregone12. Opportunity cost b. socialism13. Private property c. supply, demand, price14. Bureaucratic expansion d. maximum benefit15. Market forces e. Laissez-Faire economy

Answer each one of the questions in a word or two:16. Is traditional economy a subsistence economy.17. What is the basic force that drives a capitalist economy?18. What is the result of over production?19. Name any two successful socialist economies.20. Is there planning under mixed economy?

Chapter : 3. Theory of consumer BehaviourChoose the correct answer:

1. Necessaries, comforts and Luxuries are a. Classification of goods and services b. Classification of wantsc. Classification of utility d. None of the above

2. The Indifference curve Approach was introduced bya. Alfred Marshall b. Lionel Robbins c. J.R.Hicks and RGD. Allen

3. Utility is a a. Social concept b. Subjective / Psychological conceptc. Political concept d. Scientific concept

4. Single commodity consumption mode is a. Production possibility curve b. Law of Equi – Marginal utilityc. Law of supply d. Law of diminishing marginal utility

5. Consumer’s surplus is a. potential price - Actual price b. MVn = TVn – TVn – 1c. Demand = Supply d. NoneFill in the blanks:

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6. ---------- means using up of goods and services.7. Wants may be both ------- and -----8. Marshallian utility approach is ------- analysis.9. Marginal utility falls to zero when the total utility is ------10. An indifference curve is ------ to the origin.

Match the following:11. Wants a. Marshall12. “Principles of Economics” b. Hicks and Dalton13. Maximum Social advantage c. Diamond jewels14. Indifference curve d. Advertisements15. Luxuries e. Ordinal ranking

Answer in a word or two:16. Define Utility.17. What is the other name for Equi-Marginal Utility?18. What is Indifference Curve?19. What is Indifference Map?20. What is the other name for budget line?

Chapter: 4. Demand and SupplyChoose:

1. Demand for a Commodity depends on a. price of that commodity b. price of related goods c. Income d. All the above

2. Law od demand establishesa. Inverse relationship between prices and quantityb. Positive relationship between price and quantity c. Both d. None

3. Increase in demand is shown by a. Movement along the same demand curve b. Shifts of the demand curvec. The highest point on the demand curved. Lowest point on the demand curve

4. The degree of response of demand to change in price is a. Income elasticity of Demand b. Cross Elasticity of Demandc. Price Elasticity of Demand d. All the above

5. Factors determining supply are a. production technology b. prices of factors of productionc. Taxes and subsidies d. All the aboveFill in the blanks:

6. The demand curve slopes downwards due to -----7. Adding up of individual consumers schedule is 8. Goods that are demanded for their social prestige come under ------ effect.9. The concept of elasticity of demand was introduced by ------10. The rate of change of supply to a change in price is ------

Match the following:11. Positive relationship a. substitutes12. Tea and Coffee b. inelastic demand

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13. Segment between two points c. X and Y are not related14. Ed >1 d. Veblen effect15. Cross elasticity is zero e. Arc

Answer in a word or two:16. What is the basic assumption of economic theory?17. How does the demand change during boom and depression?18. Give the formula for point method.19. What is income elasticity of demand?20. When the demand for labour is inelastic can a trade union raise wages?

Chapter: 5. Equilibrium PriceChoose the correct answer:

1. At the point of equilibriuma. only one price prevails b. Quantity demanded = quantity suppliedc. Demand curve intersect supply curve d. All the above

2. Above the equilibrium pricea. S<D b. S>D c. S=D d. None

3. Changes in quantity demanded occur-a. Only when price changes b. Due to change of taste c. both d. None

4. The time element in price analysis was introduced bya. J.R. Hicks b. J.M.Keynes c. Alfred Marshell d. J.S. Mill

5. In the long period a. All factors change b. Only variable factor changesc. Only fixed factor changes d. Variable and Fixed remain constantFill in the blanks:

6. -------- is the major determinant of supply.7. Agriculture, industry, growth and distribution are the ------- of the economy.8. At ------- price there is no tendency to change the price or quantity.9. Modern economists divide time periods into ------- and -------10. The supply curve in the market period is a -------- line.

Match the following:11. Equilibrium a. Annual stock clearance12. Excess demand b. More elastic13. Price discount c. Pair of price and quantity14. Long period supply curve d. D>S15. Short period price e. Demand and supply

Answer in a word or two:16. What is equilibrium in general?17. What are the determinants of shift in demand curve?18. Who has introduced the time element?19. Give an example for fixed input.20. Is supply fixed in the market period?

Chapter: 6. Production

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Choose the correct answer:1. Production refers to

a. Destruction of utility b. Creation of utilitiesc. Exchange value d. None2. The initial supply price of land is

a. Zero b. Greater than one c. Less than one d. Equal to one3. Labour cannot be separated from

a. Capital b. Labourer c. Profit d. Organisation4. Reward paid to capital is

a. Interest b. Profit c. Wages d. Rent5. A successful entrepreneur is one who is ready to accept

a. Innovation b. Risks c. Deciding the location of the production unit d. NoneFill in the blanks:

6. Land and labour are called -------- factors7. An Enquiry into the Nature and causes of wealth of Nations was written by -------8. -------- is limited by the extent of the market.9. -------- is man made physical goods used to produce other goods.10. The functional relationship between inputs and output is known as ---------

Match the following:11. Entrepreneur, an innovator a. cob – Douglas12. Division of labour b. Hawley13. Production function c. Schumpeter14. Bundle of risks d. Marshall15. Exertion of body or mind e. Adam Smith

Answer in a word or two:16. Who is the changing agent of the society?17. How do internal economies arise?18. What is the other name for iso – quant?19. Give the condition foe producers equilibrium.20. State the Cobb – Douglas production function.

Chapter : 7 Cost and RevenueChoose the correct answer:

1. Real Cost is a. Pain and Sacrifice b. Subjective conceptc. Efforts and foregoing leisure d. All the above

2. Economic cost includes explicit cost anda. Implicit cost b. Social cost c. Fixed cost d. Money cost

3. Social costs are those costsa. Not borne by the firms b. Incurred by the societyd. Health hazards d. All of these

4. Average Fixed cost is obtained by dividinga. TC/Q b. TFC/Q c. TVC/Q d. None

5. Marginal Revenue is the least addition made to the

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a. Average revenue b. Total production c. Total revenue d. NoneFill in the blanks:

6. Money cost is also called as --------7. Profit is the difference between total revenue and ----------8. The distinction between the fixed and variable factors is possible only in -------9. Total cost is the sum of --------10. The Marginal cost curve is ------ shaped.

Match the following:11. Average cost a. Planning curve12. TC b. TCn – Tcn – 113. The long – run Average cost curve c. TR – TC14. MCn d. Cost per unit15. Profit e. TFC + TVC

Answer in a word or two:16. When Average revenue remains constant what will be MR?17. What is Marginal Revenue?18. What is break – even point?19. What is envelope curve?20. How will you calculate AC?

Chapter – 8 Market structure and PricingChoose the correct answer:

1. Perfect competition is a market situation where we have a. Single seller b. Two seller c. Large number of sellers d. Few sellers

2. A firm can achieve equilibrium when itsa. MC = MR b. MC = AC c. MR = AR d. MR = AC

3. The firm and industry are one and the same undera. Perfect competition b. Duopoly c. Oligopoly d. Monopoly

4. Under perfect competition the demand curve isa. Upward sloping b. Horizontal c. Downward sloping d. Vertical

5. Most important form of selling cost is a. Advertisement b. Sales c. Homogeneous products d. NoneFill in the blanks:

6. Under perfect competition, the firms are producing ---------- products7. When the Average revenue of the firm is greater than its average cost, the firm is earning-8.

The perfect competitive firms are ---------9. Monopoly power achieved through patent right is called -------10. Firms realize the importance of ------ under Oligopoly.

Match the following:11. Global market a. E.H. Chamberlin12. Consumer Sovereignty b. Coco Cola13. South Africa c. Gold and Silver14. Technical Monopoly d. Perfect competition

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15. Monopolistic competition e. DiamondAnswer in a word or two:

16. What is an industry?17. Who undertakes the public utilities?18. How does the Government control monopoly?19. What is the essential feature of monopolistic competition?20. In which year the MRTP Act was passed?

Chapter: 9 Marginal ProductivityTheory of Distribution

Choose the correct answer:1. Rent is the price paid for the use of

a. Capital b. Organisation c. Labour d. Land2. Profits are the reward for

a. Land b. Capital c. Labour d. Organisation3. The demand for labour is

a. Effective demand b. Direct demand c. Derived demand d. Elastic demand4. The author of the concept of the quasi – rent is

a. Adam Smith b. Marshall c. Ricardo d. Samuelson5. The author of Liquidity preference Theory is

a. J.M.Keynes b. Marshall c. Samuelson d. KnightFill in the blanks:

6. Marginal productivity theory is the -------theory of distribution.7. Marginal productivity theory is based on the assumption of -------- competition.8. Transfer earnings refer to -------- cost.9. Money wages are also known as -------- wages.10. Organisation is done by the ---------

Match the following:11. Residual claimant theory a. Marshall12. Waiting theory of interest b. Walker13. Loanable funds theory c. Hawley14. Dynamic theory of profit d. Neo-classical theory15. Risk – bearing theory of profit e. Clark

Answer each one in a word or two:16. According to Ricardo, do all lands get rent?17. Even if all lands are fertile can rent arise.18. Who is the author of Agio theory of interest?19. Who is a the author of rent theory of profit?20. What is the name of Schumpeter’s theory of profits?

Chapter : 10 Simple Theory of Income DeterminationChoose the correct answer:

1. The Macro economic thinking was revolutionized by a. David Ricardo b. J.M. Keynes c. Adam Smith d. Malthus

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2. The classical theory assumed the existence of a. Unemployment b. disguised unemploymentc. Full employment d. Under employment

3. The central problem on Macro economics is a. Income and employment b. Price and outputc. Interest and Money d. None

4. To explain the simple theory of income determination Keynes used a. Consumption and investment b. Aggregate demand and Aggregate supplyc. Production and Expenditure d. All the above

5. The Marginal propensity to consume

a. ΔtΔS b.

ΔQΔP.

yC c.

ΔQΔP d.

ΔyΔC

Fill in the blanks:6. The term consumption function explains the relationship between ------ and -----7. -------- is the ratio of change in saving to a change in income.8. The world wide depression of 1930s was also caused by a -------9. --------- refers to the cash holdings of the people.10. The magnified effect of initial investment on income is called ------- effect.

Match the following:11. Aggregate demand a. Vertical change / Horizontal change12. Slope b. C + S13. K c. C + I + G + ( X – M )14. Y d. Liquidity preference15. Keynes e. I / 1 – MPC

Answer in a word or two:16. What crippled the free enterprise economies of U.S and UK?17. State J.B. Say’s Law of Market?18. Who is the author of the General theory of Employment, Interest and Money?19. Name the point of intersection of Aggregate demand and Aggregate supply.20. Give the formula for Multiplier.

Chapter : 11 Monetary PolicyChoose the correct answer:

1. Monetary Policy is controlled by a. Central Government b. State Government c. Central Bank d. Private Sector

2. Currency with the public is known as a. M1 b. M2 c. M3 d. M4

3. Bank rate is raised during a. Deflation b. Inflation c. Stable prices d. Unemployment

4. During inflationa. Businessmen gainb. Wage earners gainc. Salaries people gain d. Renters gain

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5. A situation marked by rising prices and stagnation in demand is known as a. Cost push inflation b. Demand pull inflation c. Stag flation d.Wage–push inflationFill in the blanks:

6. The direct exchange of goods for goods is known as ------7. Deflation is a period marked by -------- prices8. The equation of exchange (MV + PT) was given by --------9. Galloping inflation is also known as ---------10. Monetary policy is usually effective in controlling -------

Match the following:11. Quantitative credit control a. low rate of interest12. Selective credit control b. bank rate13. Cheap Money Policy c. Moral Suasion14. Wages and prices push one another d. purchasing power of money15. Value of Money e. Creeping inflation

Answer in a word or two:16. Name the bank which controls money supply in a country.17. When is dear money policy followed?18. What is the name of inflation without a rise in price level?19. Is wage cut a remedy for depression.20. Give the example of a country that experienced hyper inflation.

Chapter : 12 Fiscal Policy Choose the correct answer:

1. Public Finance is concerned with the income and expenditure ofa. Private sector b. Agricultural sector c. Public authorities d. Industrial sector

2. Tax revenue deals with the a. Fees b. Kinds of taxes c. Revenue d. Nontax revenue

3. The federal form of Government consists of a. Central, State and local government b. Central and State governmentc. State and local government d. Above all

4. The compulsory charge levied by the government is a. Licence fees b. Gifts and grants c. Loans d. tax

5. In ZBB every year is considered as aa. Base year b. Financial year c. New year d. Academic yearFill in the blanks:

6. -------- means different sources of government income.7. The absence of direct and proportional benefit is --------8. -------- are considered as fundamental principles of taxation.9. The classification of direct and indirect taxes is based on criterion of --------tax.10. -------- tax is a blend of progressive tax and proportional tax.

Match the following:11. Canons of taxation a. Rebate and subsidies12. Progressive tax b. Adam Smith

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13. Fiscal policy c. Tax rate decreases14. Regressive tax d. Revenue and expenditure15. Balanced budget e. Best tax system

Answer in a word or two:16. What is a tax?17. What is VAT?18. What is the meaning of proportional tax?19. What are the kinds of budget?20. What is public debt?

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Higher Secondary 2nd year – Question Bank for Economics Questions for those students to get pass marks.

Part – BAnswer the following questions in four five lines. 3 marks.

Chapter - 11. State Alfred Marshall’s definition of Economics.2. What are the main divisions of Economics3. Describe the relationship between economics mathematics and statistics?4. Distinguish between free goods and economic goods.5. Explains the difference between value – in use and value – in – exchange.

Chapter – 26. What are the basic issues of any society?7. Name the important general economic systems.8. List the basic features of socialism.9. Is India a Mixed economy?10. What is opportunity cost?

Chapter -11. What are the causes for wants?12. What are the classifications of goods or wants?13. Define the Law of Diminishing Marginal utility.14. What are the properties of Indifference curve?15. Define consumer’s surplus in the words of Marshall.

Chapter – 5 – Two questions16. What is equilibrium price?17. Distinguish between change in demand and shift in demand.18. What are the determinants of shift in supply?19. Differentiate short-period from long period.20. Write a short note on market period.

Chpter – 6 – Two questions.21. Name the types of utility.22. Define labour.23. What is meant by division of labour?24. What are the forms of capital?25. What is production function? What are its classifications?

Chapter – 7 - Two questions.26. What are economic costs?27. Define marginal cost?28. Mention the relationship between SAC & SMC.

Part – CAnswer the following questions in a page – 10 marks.

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1. What are the criticisms of say’s law?2. Draw the flow chart to depict the essence of Keynes theory.3. Describe the consumption function with a diagram. Chapter 104. What are the determinants of consumption other than income? _________5. What are the assumptions of keynes’ simple Income determination? Two questions6. Explain the canons of taxation?7. What are the main sources of tax and non-tax revenue of the state government? Chapter8. Define budget? Explain the balanced and unbalanced budger? 129. Differentiate between the direct and indirect taxes? Two 10. What are the limitations of fiscal policy? questions

Part – DAnswer the following in about three pages – 20 marks.

1. Discuss the law of Demand.2. Explain the methods of measurement of price Elasticity of demand in detail.

Important questions for students to score full marks.Three marks question bank.

1. State Alfred Marshall’s definition of Economics?2. What are the main divisions of Economics?3. Describe the relationship between Economics, Mathematics and Statistics.4. Distinguish between free goods and economic goods.5. What are the basic issues of any society?6. Name the important general economic systems.7. Is India a mixed economy? Explain.8. What is opportunity cost?9. What are the causes for wants?10. What are the classification of goods?11. What are the properties of Indifference curve?12. Define consumers surplus in the words of Marshall.13. Enumerate the determinants of demands.14. Why does the demand curve slope downwords?15. Write a note on Giffen’s Paradox.16. What are the types of Elasticity of demand?17. What is equilibrium price?18. Differentiate the short period from long period.19. Write a short note on market period.20. Name the types of utility.21. Define labour.22. What re the forms of capital?23. What is production function? What are its classifications?24. What are economic costs?25. Mention the relationship between SAC and SMC.26. Classify the market based on competition.27. Mention any three benefits of perfect competition.28. What is transfer earnings?29. Distinguish between real wages and money wages.30. What are the three motives of Liquidity preference?31. What is effective demand?

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32. Write a note on Multiplier.33. Give the factors on which the aggregate demand depends.34. Define Money.35. What are the four components of money supply in India?36. Define Monetary Policy.37. What is stagflation?38. Define public Finance.39. What is a tax?40. What is Zero based budget?

Question Bank of ten marks1. What is capitalism? Explain the merits and demerits.2. What are the Salient features, merits and demerits of socialism3. What are the merits and demerits of mixed economy?4. Explain the shift in demand with the help of a diagram.5. How is the equilibrium price determined in the market period?6. Describe the characteristics of capital.7. What are the functions of entrepreneur?8. Explain the merits and demerits of division of labour.9. Give a note on Long – run Average cost curve.10. Explain the relationship between AR and MR curve.11. Explain the relationship between SAC and SMC.12. What are the critisms of says Law of market?13. What are the determinants of consumption other than income?14. What are the assumptions of keynes’ simple income Determination?15. Explain the Canons of taxation.16. What are the main sources of tax and non-tax revenue of the state government?17. Differentiate between the direct and indirect taxes.18. What the limitations of fiscal policy?

20 marks Question BankChapter – 1 Nature and scope of Economics.

1. Discuss the relationship between Economics and other social sciences.2. Discuss the nature and scope of Economics.3. Discuss the nature and importance of Economic Laws.4. Examine Lionel Robbins’ definition of Economics.5. Examine Marshalls’ definition of Economics.

Chapter – 3 Theory of Consumer Behaviour1. Describe the Law of Diminishing Marginal utility with a diagram.2. Explain the characteristics of Human wants.3. Explain consumer’s surplus with the help of a diagram and bring out its importance and its

criticism.4. What is indifference curve Map. Explain the properties of Indifference curve with diagrams.

Chapter – 4 Demand and Supply1. Explain the Law Of Demand with diagram.2. What is Elasticity of Demand? Explain types of Elasticity of Demand.3. Explain the methods of measurement of price Elasticity of Demand in detail.

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Part – BAnswer the following questions in four or five lines. 3 marks

1. State Alfred Marshalls’ definition of Economics.2. What are the main divisions of Economics?3. Describe the relationship between Economics, Mathematics and Statistics.4. Distinguish between free goods and economic goods.5. Explain the difference between value – in use and vanue – in – exchange.

6. What are the basic issues of any society?7. Name the important general economic systems.

8. List the basic features of socialism.9. Is India a Mixed economy?10. What is opportunity cost?11. What are the causes for wants?

12. What are the classifications of goods or wants?13. Define the Law of Diminishing Marginal utility.14. What are the properties of Indifference curve?15. Define consumer’s surplus in the words of Marshall.16. What is equilibrium price?

17. Distinguish between change in demand and shift in demand.

18. What are the determinants of shift in supply?19. Differentiate short-period from long period.20. Write a short note on market period.21. Name the types of utility.

22. Define labour.23. What is meant by division of labour?24. What are the forms of capital?25. What is production function? What are its classifications?26. What are economic costs?

27. Define marginal cost?

28. Mention the relationship between SAC & SMC.Part – C

Answer the following questions in a page.1. What are the criticisms of say’s law?

2. Draw the flow chart to depict the essence of Keynes theory.3. Describe the consumption function with a diagram.4. What are the determinants of consumption other than income?

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5. What are the assumptions of keynes’ simple Income determination?6. Explain the canons of taxation?

7. What are the main sources of tax and non-tax revenue of the state government?8. Define budget? Explain the balanced and unbalanced budget?9. Differentiate between the direct and indirect taxes?10. What are the limitations of fiscal policy?

Part – DAnswer the following in about three pages – 20 marks.

1. Discuss the law of Demand.2. Explain the methods of measurement of price Elasticity of demand in detail.

--------------3 marks questions

(Note : @ symbol is the number of questions asked in previous years public examinations)

1. i. State Alfred Marshall’s definition of Economics. @@@@@@ii. What are the main divisions of Economics @@@iii. Distinguish between free goods and economic goods.@@@@

2. i. Is India a mixed economy. Explain. @@@ii. What is opportunity cost? @@@@@@@@@@@iii. List the basic features of socialism. @@@@@@iv. What are the basic issues of any society. @@@@@@@

3. i. Name the important general economic systems.@@@@ii. Define consumer’s surplus’ in the words of Marshall. @@@@

4. i. What are the causes for wants. @ii. What are the properties of Indifference curve. @@@@@@iii. Define utility. @iv. What are the classifications of goods? (wants) @@

5. i. Write a note on Giffen paradox.@@@@ii. What is demand?@@@@iii. Why does the demand curve slope downwards?@@@@iv. What are the types of Elasticity of Demand? @@v. Enumerate the determinants of demand. @@

6. i. What is equilibrium price. @@@@@@@@@ii. Write a short note on market period. @@@@@@@

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7. i. Differentiate short period from the long period. @@@@@@@@@ii. What are the determinants of shift in supply. @@@iii. Distinguish between change in demand and shift in demand. @

8. i. Define Labour. @@@@@@ii. Name the types of utility. @@@@@@iii. What is meant by economics of scale. @

9. i. Who is an entrepreneur? @ii. What are the forms of capital? @@@@@@@iii. What is meant by division of labour?@@@@iv. What is meant by production function. What are its classifications? @@

10. i. What are economic costs. @@@@@@@ii. Bring out the distinction between short run and long – run. @@

11. i. Mention the relationship between SAC and SMC. @@@@@@@ii. Define marginal cost. @@@@@@@iii. What is meant by money cost. @

12. i. What is standard of living theory of wages. @ii. What are the three motives of Liquidity preference? @@@@@@@@@iii. Distinguish between real wages and money wages. @@@iv. What is transfer earnings? @@@v. Mention any three benefits of perfect competition. @vi. What are the assumptions of Marginal productivity theory of distribution? @

13. i. Write a note on multiplier. @@@@ii. What is effective demand. @@@iii. What are the assumptions of say’s law of market. @@iv. Give the factors on which the aggregate demand depends. @

14. i. Define money. @@@@@@ii. What are the four components of money supply in India. @@@iii. Define monetary policy.@@@@iv. What is meant by Reserve money? ?

15. i. Define public finance. @ii. What is the subject matter of public finance? @@iii. Define Public finance. @@@iv. What is tax? @

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v. What are the kinds of tax? @@vi. What is zero based budget? @@@

10 marks questions.16. i. What are the salient features of capitalism? @@@@@@

ii. Explain the merits and demerits of a mixed economy. @@@@@iii. What are the merits of socialist economy? @@iv. Write a note on traditional economy. @@

17. i. How is the equilibrium price determined in the market period? @@@@@@ii. Explain the shift in demand with the help of a diagram. @@@@@@iii. Explain with the help of diagram how demand and supply exert influence on price in the short period. @iv. Describe the flatten long run supply curve. @v. Explain the shift in supply with diagram. @

18. i. Distinguish between laws of returns and returns to scale. @@ii. Explain the merits and demerits of division of labour. @@@@iii. Define the characteristics of capital. @@iv. What are the functions of entrepreneur? @@@@

19. i. Explain the relationship between AR and MR. @@@@@@@@ii. Give a note on Long-run Average cost curve. @@@@@@@

20. i. Explain the marginal cost with suitable illustration. @@@@ii. Explain the relationship between SAC and SMC. @@@@@@@iii. Explain the short run Average Cost curves. @@

21. i. Explain the features of perfect competition. @@@@ii. Describe the wastes of monopolistic competition. @@iii. What are the methods of controlling monopoly? @@@@iv. Write a note on product differentiation. @v. Briefly explain the classification of markets. @

22. i. What are the criticisms of Say’s law? @@@@@@@@@23. i. What are the determinants of consumption other than income? @@@@

ii. Describe the consumption function with a diagram. @@@@iii. What are the assumptions of Keynes’ simple Income determination?@@@@@@@iv. Draw the flow chart to depict the essence of Keynes theory. @@@@

24. i. Explain the Canons of taxation. @@@@@@@ii. What are the limitations of fiscal policy. @iii. What are the main sources of tax and non-tax revenue of state government? @@@@@iv. Define budget. Explain the balanced and unbalanced budget. @@@@@v. What are the main sources of tax and non-tax revenues of central government? @

25. i. Differentiate between direct and indirect taxes.@@@@@@@@@@

20 marks questions.26. i. Discuss the nature and importance of Economic laws. @@@@@@@@

ii. Discuss the nature and scope of Economics. @@iii. Discuss the relationship between Economics and other social sciences. @iv. Examine Lionel Robbins’ definition of Economics. @

27. i. Explain consumers’ surplus with the help of a diagram and bring out its importance and criticisms. @@@ii. Explain the characteristics of human wants. @@@@iii. Describe the Law of Diminishing Marginal utility with a diagram. @@@@@@

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iv. What is Indifference curve Map. Explain the properties of Indifference curve with diagrams.

28. i. Explain the methods of measurement of Price elasticity of demand in detail. @@@@@ii. Discuss the Law of Demand. @@@@@@@@@

29. i. How is price and output determined in the short-run and long-run under perfect competition.@@

ii. How is price and output determined in the short-run under perfect competition. @@@@iii. Explain the price and output determined under monopoly. @@@@@@@iv. Explain the advantages and disadvantages of Monopoly. @

30. i. Describe Loanable Funds Theory of Interest. @ii. Discuss Marginal productivity Theory of Distribution. @@iii. Discuss Keynesian Thoery of Interest. @@@@iv. Examine Ricardian Theory of Rent. @@@@@@v. Profit is the reward for risk-taking and uncertainty – bearing. @

31. i. Discuss the objectives and instruments of monetary policy. @@@@@@@@ii. Discuss the causes, effects and remedies for inflation. @@@@@@

--------------

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Commerce E.M. Pg. No. 1

Commerce

1. Define organization.Louis A. Allen has defined organisation as “the process of identifying and grouping the work to be performed, defining and delegating responsibility and authority and establishing relationship for the purpose of enabling people to work most effectively together in acomplishing objectives.”

2. Who is a KARTA?The head of the Joint Hindu family is known as “KARTA”. The members are called coparceners.

3. What is scalar principle?Line of authority must proceed from the highest executive to the worker at the bottom level through a downward flow. This is known as ‘chain of command’.

4. Give examples of multinational company?1. Unilever limited - It is a British company2. Union caribide - It is an American company3. Philips - It is a Dutch Company4. Coco cola - It is an American Company

5. State the meaning of Board organaisation?Organisation management is carried on by a government nominated independent Board. It has its own rules and regulations.

6. What is co-ordination?The various activities of undertaking should be co-ordinated to secure the desired results. The purchase department and sales department activities must be well co-ordinated to increase profit.

7. What is unlimited liability?The liability of the proprietor for the debts of the business is unlimited. The creditors

have the right to recover their case the business assets are not sufficient to pay their dues.

8. Define sole trader?The sole proprietorship is a form of organization in which an individual introduces his own capital, uses his own skill and intelligence and its entirely responsible for the results of its operations.

9. What is limited parternership?(i) The liability of the partner(ii) Atleast one partner whose liability is unlimited.(iii) The law does not permit the formation of a limited partnership in India.

10. What is a joint and several liabilities?Joint liability - The creditors can claim their dues of all the partners.

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Several liability - The creditors can take action against any one of the partner.

11. Define partnership?According to the section 40f Indian partnership act of 1932 “The relation between persons who have agree to share the profits of a business carried on by all or any of them acting for all”.

12. Define co-operation?The Indian co-operative societies Act, 1912 defines “A society which as its objectives for promotion of the interests of its members in accordance with the principle of co-operation”.

13. What is meant by ‘one man one vote’?(i) Co-operative societies are managed on democratic lines.(ii) Every member has only one vote irrespective of the members of shares held by him.

14. Who are Rochdale pioneers?(i) Robert owen started the first co-operative movement in the year 1844 with 28 members called as ‘Rochdale society of equitable pioneers’.(ii) The father of this movement was Robert owen.

15. What is patronage Dividend?The profit of co-operative societies is distributed to the members in proportion of purchases made by them and not on shares held by them. The payment of dividend on shares to members will be at the rate of 14% per annum on the paid up value of shares.

16. Give four examples of co-opertaive super market?Chennai - Kamadhenu Super MarketCoimbatore - Chinthamani Super MarketVellore - Karpagam Super MarketSalem - Ponni co-operative Super Market

17. Define State enterprises?A.H. Hansen says “Public enterprise means state ownership and operation of industrial, agriculatural, financial and commercial undertaking”.

18. What is nationalization?When governments takes over an existing industrial or commercial unit owned by private persons it is called nationalization.

19. Give four examples of Departmental undertaking.(i) Railways (ii) Defence (iii) Atomic power (iv) Post and telegraph

20. What is Government Company?Any company in which not less than 51% of the paid up share capital is held by the central or state government is known as Government Company.

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21. Give four examples of Government Companies?(i) BHEL (ii) SAIL (iii) Coal Mines (iv) State Transport Corporation Ltd.

22. Explain the management of public corporation?Public corporation is managed by board of directors. Board is nominated by the government on the bases of their experience and skill.

23. What is limited liability?The liability of the member of a company is generally limited of value of shares. This liability is known as limited liability.

24. What is debenture?Debenture refers to a document issued by a company acknowledging a debt due by it to its holders. It also provides for payment of interest at a fixed rate at stated intervals. It also contain an undertaking to repay the debt or at its options.

25. What is a statutory meeting?The first meeting of the shareholders of a public limited company which is mandatory as per the companies Act. This is held only once in the life time of the company.

26. What do you mean by quorum?The minimum number of members required to be personally present at a meeting for validly transacting any business. Usually quorum is fixed by the Articles.

27. What is an agenda?(i) Agenda means the list of business to be transacted at the meeting.(ii) It is generally prepared by the secretary in consultation with the chairman.

28. What is proxy?The term ‘proxy’ may refer to a person who is authorized by a member for the purpose of attending a meeting. It also means the instrument by which the proxy is authorized.

29. What is “Minutes”?(i) The term minutes refers to accurate official record of decisions taken at various company meetings.(ii) Minutes should be brief and factual.

30. Who is an alternate director?If empowered by Articles, the Board may appoint an alternate director during his absence for a period of not less than 3 months from the date in which meetings of the Board are ordinarily held.

31. Define a stock exchange?According to Hastings “stock exchange or securities market comparies all the places where buyers and sellers of stock and bonds or their representatives, undertake transactions involving the sale of securities.

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32. What is listing?The inclusion of the name of a company in the official trade list of a stock exchange is called “listing”. Listing is now made compulsory for all public companies.

33. What is BOLT?BOLT is the online trading system in use at the stock exchange, Mumbai since March 1995. It is one of the few stock systems in the world handling mixed models of trading, both order – driven and quote – driven.

34. Who is a speculator?The speculators buy securities with a hope to sell them at a profit, in future. They are not genuine investors.

35. What is a security?A security means a certificate or document indicating either ownership interest (share) or creditorship interest (debenture).

8 marks

1. Write short notes on Joint Hindu Family business. India is unique in the system of Joint Hindu Families. A joint Hindu family comprises of father, mother, sons, daughters, grandsons and grand

daughters. They hold the property jointly. The head of joint Hindu family is known as ‘KARTA’. The members are called “Coparceners”. These families engage in Agriculture, handicrafts small industries etc. There are two laws “MITAKSHARA” and “DAYABHAGA”. Governed under “HINDU SUCCESSION ACT, 1956”.

2. Explain the position of minor in the partnership Firm.A minor is a person who has not completed 18 years of age. A minor cannot become a partner. He can be admitted into the benefits of partnership.Position before attaining majority He can share the property and profits of the firm He can inspect and take copy of the accounts of the firm. His liability is confined only to the extent of his share in the profits and property of the firm.Position of the attaining majority On attaining majority the minor partner has to decide with six months by giving notice

whether he shall continue in the firm or not, otherwise he becomes liable to the firm from the date on admission.

3. Write notes on Multinational Companies. The term “multinational” consists of two different words “multi” and “national”.

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It operates in several countries. It is also called as “Global giant” (or) “World enterprise” (or) International Enterprise” A MNC is operated in more than one country simultaneously. It is generally very large in size. It reduces transport costs There are 500 to 700 MNC’s in the world. Ex : Philips, Coca – cola.

4. Explain the various kinds of partners.Sleeping partner :The partners who do not take active interest in the conduct of the business are called sleeping partners.Nominal partner :He does not contribute capital not takes part in the management of the firm. He lends his name to be used as partner in the firm. He is liable to the firm’s debt.Minor partner :A minor is a person who has not completed 18 years of age where a guardian is appointed by court his age of majority extends to 21 years.Sub – Partner :When a partner makes an arrangement with a partner to share his profit he is known as sub-partner.

5. What is a partnership Deed? What are its contents?

A partnership Deed is a written agreement containing all the terms and conditions of partnership. Name of the firm Date of agreement and principal place of business. Names and addresses of all partners. Duration of partnership. Profit sharing ratio. Amount of capital contributed by each partner. Amount of withdrawal of each partner. Interest on capital and interest on drawings.

6. What are the drawbacks of non-registration of partnership firm? An unregistered firm cannot file any case against its partners. An unregistered firm cannot enforce its claims against third parties for recovering a sum

exceeding rupees one hundred. A partner of an unregistered firm cannot file any case against any other partners. The firm forfeits its rights in restricting the outsiders from using the trademarks and

copyrights of the firm.

7. What are the demerits of co-operative societies. Inefficient Management

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Members of a co-operative society do not generally possess the ability and experience to manage the business.

Limited capitalThe principle of “one man one vote” discourages the members to invest large amount.

Lack of motivationThe employees do not have interest to work hard as they get low salaries.

Lack of co-operationMembers do not have Unity among themselves.

Lack of secrecyThe business affairs of a co-operative society are openly discussed in the meetings.

No Credit facilityCredit facilities are not usually offered to members.

8. State the meaning of super market and explain its features.It refers to a type of large scale retailing. The articles of daily use are sold in different

departments without the help of sales persons, It is started to earn profit.Features It is a form of large scale retailing There are wide variety of goods available The system of self – service is used No need for salesman in self – service session The layout is in the form of different departments Sales are on cash basis No adulteration is practised. Scarce commodities are also supplied.

9. What are the conditions for issuing shares at a discount? The shares to be issued must be a class already issued. It must be authorized by an ordinary resolution. It should be sanctioned by the Central Government. The maximum rate of discount is 10%.

10. Differentiate between Investors and Speculators.Investors Speculators

1. Interested in safety of his investment Interested in earning profits quickly.2. Seeks income from his investment Seeks profit from trading of securities.3. Risk is low Risk is high4. Income is stable Profit is uncertain5. Commitment is for a long term Commitment is for a short period.

11. Write the differences between Public and Private sector.Public Sector Private Sector

1. Service motive - Profit motive2. Unlimited resources - Limited resources3. Checks concentration of economic power - heads to concentration of Economic

power

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4. Develops those sectors which are Develop those industries in which risk is neglected by the private sector - less and returns is more.

5. Deserves nation wealth - Exploitation of natural resources6. Brings balanced growth in backward area - Do not establish industries in

backward area7. Consumer welfare is protected - Consumers are exploited8. Model employer - Exploitation of employees

12. Explain the different kinds of speculators.Bull : * Expects rise in prices of securities.

* Optimistic speculatorBear : * Expects fall in prices of securities.

* Pessimistic speculator.Stag : * He is a cautious speculator.

* Expects to sell the securities at premium* He is a premium hunter.

Lame Duck : * A bear struggling to carry over the transaction.* Not able to get securities in time.

13. What is Memorandum of Association? What are its contents?Name clause :

In this clause the name of a company is mentioned. If it is a Public Limited Company it should end with the word ‘limited’. If it is a private limited company it should end with the word ‘Private Limited’.Situation Clause :

The state in which a company has its registered office is to be stated here.Objects Clause :

It states the activities of the company. It lays down the maximum permitted range of activities.Liability Clause :

This clause states that the liability of members is limited.

20 marks 1. Explain briefly the principles of organization.

Principles of organization : Unity of objectives Division of work Span of control Scalar principle Unity of command Functional Definition Unity of Direction Co-ordination Delegation of Authority The principle of Responsibility1) Unity of objectives

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The term objective means a goal to be achieved.2) Division of work

The total work should be divided. This is known as departmentation.3) Span of control

An executive should be asked to supervise a reasonable number of subordinates.4) Scalar principle

Line of authority must proceed from the highest executive to the worker at the bottom level through a downward flow. This is known as “Chain of command”.

5) Unity of commandEach individual should receive orders from only one boss.

6) Functional DefinitionThe authority and responsibility of every individual should be clearly defined.

7) Unity of DirectionThere must be one head and one plan for a group of activities directing towards the same objectives.

8) Co-ordinationThe various activities of undertaking should be co-ordinated to secure the desired results. The purchase department and sales department activities must be well co-ordinated.

9) Delegation of AuthorityDelegation means the entrustment of part of the work or some duties to the subordinates.

10) The Principle of responsibilityThe superior should be held responsible for the acts of his subordinates.

2. Describe the various types of business organization.Various types of business organisation.

Individualistic Institutions Government Institutions1. Sole trader 1. Departmental undertaking2. Joint Hindu Family 2. Public corporation3. Partnership 3. Government company4. Joint Stack company 4. Board organization5. Co-operatives6. Multi national companies

1) Sole TraderAny business unit which is owned and controlled by a single individual is known as a sole trading concern.

2) Joint Hindu FamilyJoint Hindu Family do the business under the control of the head of the family. The head of the family is known as “KARTA”. The members are called coparceness.

3) PartnershipThe partnership is formed as a result of an agreement between two or more persons.

4) Joint stack companyA company is an artificial person created by law having a common seal the perpectual succession.

5) Co-operative society

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A co-operative society is a voluntary association of persons. Service is the primary motto of a co-operative.

6) Multinational companiesA multinational company is a company carrying on business in two or more countries.Ex. : Philips, IBM.

Government Institutions1) Departmental Undertaking.

Departmental Undertaking may be run either by central government or by state government.Ex. : Railways

2) Public corporationThis is established under a specific statute passed in the parliament. Ex. : Reserve Bank of India.

3) Government companyIt is a company in which not less than 51% of paid up share capital is held by the central (or) state government. Ex. : BHEL, SAIL.

4) Board organization :In this organization management is carried on by a government nominated independent Board. Ex. : Tamilnadu Electricity Board.

3) Explain the main characteristics of sole Trading.Features of a Sole Trading.1) One man ownership and control2) Capital contribution3) Unlimited Liability4) Enjoyment of Entire Profit5) No special Legislation6) Registration7) Duration8) Simplicity9) Local Business10) Small capital

1) One-man ownership and controlA Sole Trading concern is owned by an individual.

2) Capital contributionIn sole tradership, the capital is employed by the owner himself from his personal resources.

3) Unlimited LiabilityThe liability of the proprietor is unlimited.

4) Enjoyment of Entire profitThe sole trader is entitled to enjoy all profits and should bear the entire loss of the business.

5) No special LegislationSole tradership is not governed by any special legislation.

6) RegistrationA sole trader business need not be registered.

7) Duration

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The life of sole trader business depends upon the life of the sole trader. Anything which affects the personal life of a sole trader affects his business also.

8) SimplicityIt is simple to commence and simple to close a sole trader business.

9) Local BusinessMost of the sole trading business confine only to a particular place such as a street, a block or a village.

10) Small capitalA sole trader business can be commenced with a small amount of capital.

4. Explain the role of sole trading form of business.Role of sole trader in the society.1) Solution to unemployment – problem2) Provide Investment Avenues3) Provision of goods at low price4) Helps small producers5) Supply of Quality goods6) Philanthrophic Activities7) Equal distribution of Income and Wealth8) Helpful to consumers

1) Solution to unemployment problemSole trader business organization gives large employment opportunities to the less educated and uneducated persons.

2) Provide Investment AvenuesSole trader organization provides a chance for small investors.

3) Provision of goods at low price.Goods are sold by sole traders at a lesser price.

4) Helps small producersM small local producers are benefited by the sole traders.

5) Supply of Quality goodsSole traders sell goods of high quality nowadays to maintain their reputation.

6) Philanthrophic ActivitiesSole traders undertake a number of social welfare activities such as conducting eye camps, maintaining parks, provision of basicades on the roads, supplying furniture to schools etc.

7) Equal distribution of Income and WealthEqual Distribution of Income and Wealth is ensured as there are more entry of sole Proprietors in trading activities.

8) Helpful to consumersThe sole traders supply the goods to the consumers at their door steps. So the time and energy of the consumers are saved.

5. What are the circumstances under which a partnership is dissolved?1) Dissolution by Agreement

A partnership is created and dissolved by an agreement.2) Compulsory dissolution

A firm is compulsory dissolved either the insolvency of all the partners or the object of the firm unlawful.

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3) Dissolution on the happening of certain contingencies.a) Death of a partnerb) Expiry of the timec) Completion of the ventured) Adjudication of a partner as an insolvent

4) Dissolution by notice of partnership – at – willAny partner by giving a notice in writing the firm may be dissolved.

5) Dissolution through court.a) Partner’s Insanity

If any partner becomes insane, the court may order for dissolution.b) Permanent Incapacity

When a partner becomes permanently incapable of doing business the court may order dissolution.

c) Persistent Breach of AgreementIf a partner persistently violates the agreement the firm may be dissolved.

d) Mis conduct of a partnerIf any partner is guilty of misconduct then any partner can file a suit for dissolution.

e) Transfer of shareWhen a partner transfers his share in the business then the firm may be dissolved.

f) Continuous lossWhen the business cannot be carried on except at a loss, the court order for dissolution.

g) Just and equitable grounds.When the court feels that it is just and equitable, it may order for dissolution.

6. Explain the rights and duties of partners.Rights of partners1) Right to take part in the conduct and management of the business.2) Right to expression opinion.3) Right to the consulted.4) Right to be inspect and take copy of books of account and records of the firm.5) Rights to an equal share in the profits.6) Rights to receive interest on loans and advances.7) Right to indemnified for the expresses incurred.8) Right to use the assets of the firm for its business.9) No new partner can be admitted without the consent of their partners.10) Right to retire from the firm.Duties of partners1) Act diligently and honestly in the discharge of his duties.2) Act in a loyal and faithful manner towards each other.3) Act within scope of the authority entrusted to him.4) To share the losses.5) Every partner must identify the firm against loss sustained due to his willful negligence.6) No partner can transfer his intrest.7) Every partner must maintain and render true and correct accounts of the firm.8) No partner can engage himself in a business which is likely to compete with the firm.9) Every partner should use the firm’s property only for the firm’s business and interest.

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10) No partner can make any secret profit.

7. Bring out the distinction between a company and a partnership.Partnership Joint stock company

1. The Act

2. Registration

3. Number of members

4. Liability

5. Transfer of shares

6. Stability

7. Procedural Complexities

8. Financial Resources

9. Audit

10. Dissolution

Indian Partnership Act, 1932

Optional

Minimum – 2Maximum – BankingBusiness – 10Non Banking – 20

Joint and Several

Cannot transfer

Not stable

Procedures are simple

Capital contribution limited

Not compulsory

Partnership can be mutually dissolved at any time.

Companies Act 1956

Compulsory

Private limitedCompany Minimum – 2Maximum – 50Public Limited Company Minimum – 7Maximum – LimitlessLimited Liability

In a Public Limited company shares are fully transferable.

Stable

Many legal formalities.

Mobilizing large resources.

Audit is essential.

Legal formalities for winding up are many

8. Distinguish between shares and debentures.Basis of Difference Shares Debentures1. Rights

2. Payment of Profit

3. Level of Profit

4. Approval

5. Payment of returns

6. Liability

1. Share holder is a real owner of the company

2. Dividend is paid from the profit only

3. The rate of dividend is changeable

4. Need Board approval for paying dividend

5. Dividend is an appropriation of profit

6. Share holder’s liability is limited

1. Debenture holder is only a creditor of the company.

2. Interest is payable at stated intervals regardless of profit or loss.

3. A fixed rate of interest is payable

4. The question of getting approval does not arise

5. Interest is a charge on the profit.

6. There is no such liability

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7. Issue of Discount

8. Charge on assets

9. Return of capital10. Participation in

meetings

7. Issued at discount only under certain conditions

8. Shares have no charge on the assets of the company

9. Shares are non-repayable10. Shareholders can participate

in the company meeting and to vote.

7. There is no restriction

8. Debentures are generally secured.

9. Debentures are redeemable10. Debenture holders are not

entitled to attend meetings.

9. Explain important features of co-operative organization.1) Voluntary organization :

A co-operative society is a voluntary association of persons. A person can join a co-operative society whenever he likes and leaves it whenever he wants.

2) Equality :In a co-operative society all persons are equal. Its members have equal rights and more capital does not provide more rights to an individual.

3) Democratic Management :Co-operative societies are managed on democratic lines. Every member has only one vote irrespective of the number of shares held by him.

4) Spirit of service :The objective of co-operative organsiation is that the service is primary and profit is secondary.

5) Plural Membership :A minimum of 25 persons are required to form a co-opeartive society. There is no limit on the maximum membership.

6) Finance :The capital of co-operative society is divided into many shares of equal value. A person becomes a member by purchasing its shares.

7) Local membership :Generally, in any co-opeartive society people from the particular locality become members. This is because only people in a particular locality can have a common economic problem.

8) Mutual Help :The main principle of co-operative organisation is the mutual help. Every member of the society is expected to help himself and also help every other member.

9) Statutory Audit :The Government inspects the activities and the accounts through co-operative audit department.

10) Cash Trading :Credit transactions are not permitted in the societies. The entire trading is carried on cash basis.

10. Distinguish between Joint Stock Company and co-operative society.Basis distinction Joint stock company Co – operatives society1. Meaning It is mained organized for making profit service in primary object2. Minimum number private company – 2 minimum number of members

Public company – 7 is 25

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3. Maximum number Private company -50 no limit Public company –no limit4. Registration company is formed and registered co –operative society registered

as per the companies act 1956. as per the co – operatives act.5. Rights to vote one share one vote principle is one man one vote principle

is followed is followed6. Importance money is more important than a man man is more important than

Money7. Transfer of shares shares are freely transferable A member can surrender his

Shares8. Value of shares value of shares is generally greater shares are offered only at par

Sell shares either at par or at a value Premium or at a discount.

9. Facilities Government do not provide any Concession co- operative society enjoys

Concessions10. Local membership members belong to different members belongs to the same Parts of the country locality

____________

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Commerce E.M. Pg. No. - 15

CommerceChoose the best answer:

1. What is the advantage of sole proprietor shipa. small capital b. hasty decision c. limited capital d. limited managerial ability

2. Partnership may come into existence a. by the operation of lawb. by an express agreement c. by an express or implied agreement d. by inheritance of property

3. Registration is compulsory in the case ofa. a sole trader b. a partnership c. a joint stock company d. a joint hindu family business

4. The most suitable form of organisation for operating defence industries isa. Government company b. public corporation c. departmental organisation d. board organisation

5. A multinational company is also known asa. global giant b. partnership c. co - operative society d. public corporation

6. Sole trading business can be started bya. at least two persons b. at least seven person c. any one person

7. The liability of a sole trader isa. limited only to his investment in the business b. limited to total property of the business c. unlimited

8. “One man control is the best in the world” This statement is given bya. H. Haney b. William R. Basset c. Neil H. Jocoby d. The direction of government

9. A partnership is formed bya. agreement b. relationship among person c. The direction of government

10. The basis of partnership isa. utmost good faith b. money available for investment c. desire to work together

11. A partnership firm may be registered undera. 1949 act b. 1956 act c. 1932 act

12. In partnership there exists a relationship ofa. principal and agent b. owner and servant c. employer and employee

13. Registration of partnership isa. compulsory b. optional c. not necessary

14. The minimum number of members for a public limited companya. 2 b. 3 c. 7 d. 10

15. The liability of shareholders of a private limited company is limited toa. The paid up value of the shares b. amount remaining unpaid on the sharesc. the extent of private assets d. amount called up

16. The existence of a company comes to a closea. on the death of all its promoters b. on death of all the directors of the boardc. on transfer of shares, by most of its original members d. none of the above

17. The minimum subscription specified in the prospectus must be received with ina. 90 days b. 120 days c. 130 days d.60 days

18. Table A of the companies act is aa. model of minutes book b. model form of balance sheetc. model of articles of association d. model of memorandum of association

19. Debenture holders of a company are itsa. creditors b.members c. credit customers d. borrowers

20. Every partner has the right to receive interest on loan and advances at the rate of ____% per annuma. 6% b.10% c. 12% d. no interest

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21. Shares can be forfeited fora. non - payment of any debt due to the companyb. non attending three annual general meetings consecutively c. for non payment of cell moneyd. for violent activities at the annual general meetings.

22. A person can hold directorship of not more than _____ public limited companies.a. 10 b. 15 c. 20 d. limitless

23. A company secretary is appointed bya. Government b. the institute of company secretaries of Indiac. The board of directors d. shareholders in annual general meetings

24. The list of business to be transacted at the meeting is calleda.agenda b. minutes c. resolution d. quorum

25. First directors are appointed bya. members in statutory meeting b. members in the first annual general meetingc. by being named in the articles of association d. registrar of companies

26. The interval between two annual general meetings shall not be exceeda.15 month b. 12 month c.18 month d. 20 month

27. Which of the following must hold a statutory meeting?a. statutory companies b. private limited cos c. public limited companies d. chartered companies

28. The first issues are floated ina. primary market b. secondary market c. commodity market d. regulated market

29. An optimistic speculator isa. bull b. bear c.stag d. lame duck

30. Securities contract regulation act was passed ina. 1952 b. 1956 c.1964 d. 1954

31. Stock exchanges deal ina. goods b. services c. financial securities d. country’s currency

32. Number of recognised stock exchange in Indiaa. 2 b. 21 c. 22 d. 24

33. A pessimistic speculator isa. stag b. bear c. bull d. lame duck

34. A bull operator believes ina. increase in prices b. decrease in prices c. stability in prices d. no change in prices

35. A cautious spectator is known asa. stag b. bull c.lame duck d. bear

36. SEBI has the following number of members including chair mana. 5 b. 7 c.6 d. 8

37. Co - operative society can be starteda. only at villages b. it towns and villages c. only in cities d. only in urban areas

38. The minimum number of members required to form a co - operative society isa. 2 b. 9 c. 100 d. 25

39. Dividend is declared in a co - operative store to its membersa. share capital b. number of shares purchasedc. amount of patronage given d. none of the above

40. Central co - operative bank is established ata. villages b. districts c. state head quarters d. urban areas

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41. A co - operative supermarket suppliesa. credit b. service c. goods d. cash

42. Consumer co-operation was first successful ina. England b. USA c. Swiss d. India

43. Minority interest can be protected ina. sole trader b. partnership c. co - operative society d. public company

44. In a government company the share capital of the government must not be less thana. 51% b. 60% c. 75% d. 90%

45. Public corporations are managed by a ______ nominated by the governmenta. Board of directors b. Government servants c. directors d. committee of directors

46. In a public corporation the management hasa. limited freedom b. no freedom of action c. controlled freedom d. unrestricted freedom of action

47. This organisation has Tax concessiona. Departmental organisation b. Co-operative Society c. Government Company

48. The overall maximum managerial remuneration in a Public Limited Company shall not exceeda. 11% if net profits b. 11% of paid up capital c. 5% of Net profits d. 5% of paid up capital

49. Jobbers transact in a Stock Exchangea) For their clients b. For their own transaction c. For other brokers d. For other members

50. Government companies are registered undera. Special statute of Government b. Companies Act 1956 c. Royal Charter d. Other of the Government

51. Which of the following is not the characteristics of sole proprietorshipa) Single ownership b. One man control c. Whole profit to proprietor ship d. non flexibility

52. The agreement of partnershipa. Must be oral b. must be writing c. must be writing in the stamp paper d. can be either oral or in writing

53. Membership by birth is main feature ina. Sole Trader b. Joint stock company c. Joint Hindu family business d. Partnership

54. In a co-operative societya. One share one vote principle to followed b. One man one vote principle is followedc. A member must have 2 votes d. Shares are transferable.

55. Co-operative society can be starteda. only in villages b. in towns and villages c. Only in cities d. Only in state head quarters

56. Management of a joint stock company is entrusted toa. The Registrar of companies b. The Board of Directorsc. The share holders d. The Debenture holders

57. The oldest form of business organisationa. Sole Trading b. Partnership c. Joint stock company d. Co-operatives

58. Decision making process in sole trading business isa. Quick b. Slow c. Neither quick nor slow

59. Sole proprietorship is suitable fora. Large scale concerns b. Medium scale concerns c. Small scale concerns

60. ________ described as an extension of the ‘Principle of Agency’a. Partnership b. Sole Trading c. Joint stock company d. Co-operatives

61. Sleeping Partner is also known asa. Active Partnerb. Dormant Partner c. Nominal partner d. Sub Partner

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62. The maximum number of member for non-banking firm is ______.a. 2 b. 10 c. 20 d. 30

63. The partnership partners are collectively ______.a. firm b. family c. company d. co- operative

64. Which of the following is created by a special act of parliament or in state assemblya. chartered company b. foreign company c. Government company d. statutory company

65. A private company can commerce businessa. immediately on receiving the certificate of incorporationb. only after the certificate of commencement of businessc. on getting name of approval from the registrard. on filing all the documents necessary for formation with the registrar.

66. Which of the following companies must file with the registrar a statement of lieu of prospectus?a. a public limited company which raises funds from the public through issue of shares.b. a public limited company which has made arrangement for raising its capital from directors andtheir relativesc. a private limited company d. all of them

67. Where the shares are issued at a discount and the nominal value of share is Rs. 100, the maximumdiscount that can be allowed isa. Rs. 5 b. Rs. 10 c. Rs. 20 d. Rs. 15

68. Which of the following document define a scope of a company’s activities?a. memorandum of association b. articles of associationc. prospectus d. statutory declaration

69. A preference share has priority ina. dividend only b. only in return on capital at the time of winding upc. voting rights d. both dividend and return of capital on winding up

70. A company should compulsorily appoint a qualified company secretary, compulsorily having a paid upshare capital of more thana. Rs. 5 lakhs b. Rs. 50 lakhs c. Rs. 25 lakhs d. Rs. 15 lakhs

71. A partner who contributes capital and takes active part in the management is known as ______.a. sleeping partner b. nominal partners c. managing partner d. partners in profit only

72. Debenture holders are entitled to receive interest in the following circumstancesa. when there are profits b. when share holders also get dividendc. every year irrespective of loss d. all the above

73. A director is acting asa. agent of the company b. trustee of the companyc. chief executive officer of the company d. all of these

74. The value of qualification shares of a direction in a public limited company shall not exceeda. Rs. 5000 b. Rs 50,000 c. Rs. 5,00,000 d. Rs. 500

75. _______ is run on the principle of “All is he and he is all in all”.a. the sole trading concern b. partnership c. joint hindu family d. co - operatives

76. Which of the following business is not transacted at the annual general meeting.a. appointment of auditors b. issue of debenturesc. appointment of directors in place of those retiring d. declaration of dividend

77. The popular method of sale of new shares in India ina. public issue b. offer for sale c. managing brokers d. underwriting

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78. Stock exchange allow trade ina. all types of shares of any company b. bands issued by the Governmentc. listed securities d. unlisted securities

79. SEBI in formed as pera. securities contracts ( Regulation) Act b. securities and exchange board of India actc. companies act d. Indian constitution

80. Stock exchange _______ speculation in sharesa. does not allow b. discourage c. encourage d. prohibits

81. A stock exchange is a place toa. exchange one security for another b. buy and sell financial securitiesc. float new shares d. buy and sell stock of goods

82. Maximum membership in a co- operative society isa. 50 b. 60 c. 100 d. unlimited

83. Public can also subscribe to the share capital ofa. public corporation b. departmental undertakingc. Government company d. none of these

84. For the efficient working of state enterprise the form of organisation generally considered suitable isa. departmental organisation b. public corporation c. Government company d. none of these

85. Indian telephone industries is the examples ofa. departmental organisation b. public corporation c. Government company d . none of theseFill in the blanks:

86. Life insurance corporation of India is the example of _______.87. The liability of sole trader is ________.88. A sole proprietorship concern is generally run on a ______ scale basis.89. Person who enter into partnership are collectively called __________.90. The maximum number of members in non - banking firm is ______.91. The partners liability in India is ______.92. _______ means the termination of the original partnership agreement.93. The minimum number of members in a private company is _______.94. An advertisement inviting the public to buy the debenture of a public limited company is known as _____.95. First directors are usually named in the ______.96. Directors act as ______ trustees and officers of the company.97. Altering the articles of association requires ______ resolution.98. Auditors are generally appointed and their remuneration fixed at the _______ meeting.99. Debentures denotes ______ interest.100. Secondary market deals with _____ traded in primary market.101. BOLT is the online trading system in use at _____ stock exchange.102. The latin word co - operative mean _______.103. Management of co - operative society is fully _____.104. Exploitation of consumers and employees is a feature of ______.105. The primary aim of state enterprises is _____.106. Division of work is called ______.107. Broadcasting comes under ______ form of organisation.108. TamilNadu electricity board is the example of ______.109. Public corporation is also known as _______.

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110. A partner who does not take part in the working of the firm is called _____ partner.111. An unregistered firm cannot enforce its claims against third parties for recovering a sum exceeding

rupees ____.112. ____ is a right vested with a partner to be used in emergency situation to protect the interest of the firm.113. The liability of a member of a company limited by guarantee is _____.114. The company which need not have separate articles of association of its own is ____ company limited

by shares.115. The aggregate nominal value of qualification shares shall not exceed ______ rupees.116. Shares at a discount must be issued within _____ months from the date of sanction by the central

Government .117. A person appointed to attend a meeting on behalf of a share holder is known as ____.118. The overall managerial remuneration in a public limited company shall not exceed ____ % of net profit.119. The quorum for a general meeting of members of a public company is ____.120. ____ act as intermediary to float new shares.121. Application money should not be less than _______ percent of the value of a share.122. Cleared securities are also called ________.123. ______ are the employees of the members of a stock exchange.124. _______ act as a substitute for initial public offering .125. The father of the co- operative movement was _____.126. Super market refers to large scale______.127. Service is the main objective of ______.128. In co- operative society only _____ of the profits to be distributed as dividend.129. Public corporation are created by ______ central or state Government.130. The oldest form of public enterprise is ____.131. Public corporations are managed by a ______ nominated by the Government.132. In a Government company atleast _____ shares are owned by the Government.133. The most suitable form of organisation for manufacturing defence goods is ________.134. Minimum subscription is fixed at ____ of the issued capital.135. Ready delivery contracts are also called as ______.136. Delegation means the ____ of part of the work.137. Partners share profits and losses____.138. In India registration of partnership is ______.139. A company is regarded as a ______.140. Government policy is also favourable towards ______.141. Government company employees are not ______.142. In co - operative society all members are ______.143. _____ acts as a stimulant for hard work in sole trading business.144. Coco cola corporation is the example of _____.145. The profit and loss of a partnership firm is shared in the _____ among the partners.146. Active partner is also known as ______.147. A partnership is formed by _______.148. ______ is a person who has not completed 18 years of age.149. _____ can keep his business secrets.150. Sole proprietor ship in suitable for _____.151. The partnership agreement is also known as ____.

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152. Where the ______ partnership can be terminated, if any partner notifies his desire to quit.153. ______ is a temporary partnership which is formed to complete a specific venture or job during a

specified period.154. When a person makes an arrangement with a partner to share his profit, he is known as a _____.155. A partnership in which the liability of a partner is limited is called ______.156. ______ability of a sole trader is limited.157. In partnership the name under which the business is carried on is called ______.158. ______ is not governed by any special legislation.159. ______ mean dissolution of partnership.160. General partnership is also known as ______.161. Sole trading business can be started by _____ person.162. ______ document define the scope of activities of a company.163. A private company should have atleast directors.164. Preference shares which carry a right to arrear divided are known as _____.165. When a company has issued shares of qualification shares that a director should hold is _____.166. The minimum number of members in a public limited company is _______.167. East India company is the example of ______168. Share holders are the _____ of the company .169. When the shares are issued at a price higher than its face value, it is called _____.170. Where debentures are to be redeemed after a specified period, they are known as _______.171. The forfeited shares can be reissued at a ______.172. Every public limited company must compulsorily hold statutory meeting within______ month and not

earlier than _____ month form the date to commence business.173. The interval between two annual general meetings shall not exceed ____ month.174. The notice calling the annual general meeting must be given to all its members at least

_____ days before the date of the meeting.175. A statutory report must be sent to every member of the company atleast _____ days before

the meeting is to be held.176. The minimum number of members required for a meeting is known as _____177. A person cannot act as a managing director of more than _____ companies at a time.178. _____ means 51% or more of the votes have been cast in favour of the resolution.179. Joint stock companies require _____.180. _____ is a document issued by a company acknowledging a debt due by it to its holders.181. _____ is a commonly used method of issuing new shares.182. _____ is an invitation to the public to subscribe of the shares.183. The volume of business in secondary market depends on _____.184. There are _____ regional stock exchanges in India.185. Listing is _____ for public companies.186. _____ order gives a freehand to its brokers of a client to buy or sell a particular se??? for

any price.187. Investors retains securities for _____ period.188. Stag is called _____.189. _____ enables small investors to participate in the investment on share capital of large

companies.190. Large scale undertakings are originated in the form of _____.

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191. The long term capital required by the company is divided into small units of fixed amountcalled _____.

192. Primary market is concerned with _____.193. _____ act as intermediary of float new shares.194. After allotment of shares, allottes become the _____ of the company.195. Second hand securities are traded in _____.196. Inclusion of securities in the official list of stock exchange is called _____.197. _____ are the employees of the members of a stock exchange.198. _____ is the supervisory body established to regulate Indian stock market.199. _____ is known as stag.200. The liability of the members of a co-operative society is _____.201. An industrial co-operative is organised by _____.202. consumers are the _____.203. Agriculture credit societies are classified into

a) Rural credit society b) _____.204. When the Government takes over an existing private concern it is called _____.205. Exploitation of consumers and employees is a feature of _____.206. _____ is an undertaking owned and controlled by Government.207. _____ Checks concentration of economic power in the hands of few.208. Where the authority to a partner is expressly conferred by an agreement, it is called _____.209. The person who contributes capital and manages the business is called as _____.210. The size of sole trading business remains _____.211. When a proposal placed before the meeting is passed by the meeting, it becomes _____.

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ANSWERS1. Limited Capital2. By an express agreement3. A Joint Stock Company4. Departmental Organisation5. Global Giant6. Any one person7. Unlimited8. William R. Basset9. Agreement10. Utmost good faith11. 1932 Act12. Principal and agent13. Optional14. 715. amount remaing unpaid on the shares16. None of the above17. 90 days18. Model of articles of association19. Creditors20. 6 %21. For non payment of call money22. 1523. The Board of Directors

24. Agenda25. By being named in the Articles of Association26. 15 months27. Public Limited Company28. Primary Market29. Bull30. 195631. Financial Securities32. 2133. Bear34. Increase in prices35. Stag36. 637. In towns and villages38. 2539. Amount of patronage given40. Districts41. Goods42. England43. Co-operative Society44. 51%45. Board of Directors46. Controlled freedom

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47. Co-operative Society48. 11% of net profits49. For their won transaction50. Companies Act, 195651. Non - flexibility52. Must be writing in the stamp paper53. Joint Hindu family business54. one man one vote principle is followed55. in town and villages56. The board of Directors57. Sole trading58. Quick59. Small scale concerns60. Partnership61. Dormant Partner62. 2063. Firm64. Statutory company65. immediately on receiving the certificate of

incorporation66. a Public Limited Company which has made

arrangement for raising its capital from directorsand their relatives

67. Rs. 1068. memorandum of association69. both dividend and return of capital on winding up70. Rs. 50 lakhs71. Managing partner72. all the above73. All of these74. Rs. 500075. The sole trading concern76. issue of debentures77. Public issue78. Listed securities79. Securities and Exchange Board of India Act80. encourage81. buy and sell financial securities82. Unlimited83. Government company84. Public corporation85. Government company86. Public corporation87. unlimited88. small89. Firm90. 2091. Unlimited92. Dissolution of partnership93. 294. prospectus

95. articles of association96. agents97. special98. Annual General99. creditorship100. resale of securities101. Mumbai102. to work with103. democratic104. Private sector105. Public welfare106. Departmentation107. Departmental108. Board Organisation109. Satutory corporation110. sleeping partner111. One hundred112. Implied Authority113. limited114. Public115. 5000116. 2117. Proxy118. 11%119. 5120. Issue house121. 5 %122. Securities on forword list123. Authorised clerks124. Mutual funds125. Robert owen126. retailing127. Co-operatives128. 14 %129. special act130. Departmental organisation131. Board of Directors132. 51 %133. Departmental Organisation134. 90 %135. Spot contracts136. entrustment137. in an agreed ratio138. Optional139. Person by law140. Multinational companies (MNCS)141. Government servants142. equal143. Fear of loss144. Multinational Company (MNC)145. agreed ratio

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146. Managing partner (or) working partner147. agreement148. A minor149. A sole trader150. small scale concerns151. Partnership Deed152. Partnership - at -will153. A joint venture154. subpartner155. limited partnership156. The managerial157. Firm name158. Sole trading159. Dissolution of firm160. Unlimited partnership161. any one162. Memorandum of association163. 2164. cumulative preference shares165. One166. 7167. Chartered company168. real owners169. Issue of shares at a premium170. Redeemable debentures171. discount172. 6 months, one month173. 15174. 21 days175. 21 days176. Quorum177. 2178. Ordinary resolution

179. Enormous Capital180. Debenture181. Public issue182. Prospectus183. Primary market184. 21185. compulsory186. Discretionary order187. Longer188. Premium Funds189. Mutual Funds190. joint stock company191. shares192. issue of new shares193. Issue Houses194. share holders195. Secondary market196. Listing197. Authorised clerk198. SEBI199. Cautious Speculator200. Limited201. small scale producers202. Kings203. Primary credit societies204. nationalisation205. Private sector206. State enterprise207. Public sector208. Expressed Authority209. Sole trader210. small211. a resolution

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Accountany E.M. Pg. No. - 1

Accountancy

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Accountancy Volume - ILesson - I

I. Fill in the blanks:1. Net profit is transferred from profit and losss account to ____ account.2. Closing stock is valued of cost price or _______ price which ever is lower.3. Outstanding expenses are shown on the _____ side of the balance sheet.4. Prepaid expenses are shown on the _____ side of the balance sheet.5. Income accured but not received will be shown on the ____ side of the balance sheet.6. Income received in advance will be shown on the side of the balance sheet.7. Interest on capital is debited in _____ account.8. Interest on drawings is gredited in _____ account.9. Interest on loan borrowed unpaired is shown on lthe side of the balance sheet.10. Depreciation is deducted from the concerned _____ in the balance sheet.11. Provision for bad & doubtful debts is deducted from _____ in the balance sheet.12. Provision for discount on creditors is deducted from _____ in the balance sheet.13. Debts which are not recoverable from sundry debtors are termed as ________.14. Returns in wards are ______ deducted from.15. The profit and loss account _____ or ______ shows.16. Rent out standing is ______.17. Closing stock is shown in _____ and _____ .18. Opening stock is shown in _____ account.19. Gross profit is transferred to _____ and _____.20. Interest on capital is added to ______ account.21. Interest on drawing is deducted from _____.22. Outstanding interest on loan borrowed is to be added to _____ A/C.23. All the items given in the adjustment will appear at _____ at the final accounts.24. 31. 3. 2004 as on bad debits at 5% on Rs.______.25. Trial balnce as on 31. 03. 2005 shows bank loan Rs 1,00, 000 at 10% per annum on 01.04.2004.

Interest paid Rs 4000 interest outstanding is ______.26. Trial balance shows investment Rs. 1,25,000 @ on 31.3.2004 Interest received is as 15,000. Accured

interest is ______ on.27. Trial balance shows investment 2,00,000 @ 10.1.on 31.3.2005. Interest received is Rs. 1,500 . Accured

interest is ______ on28. Trial balance as on 31.3.2004 sundry creditors Rs. 25,000 2% discount on sundry creditors Rs ____ on

1.4.2005.29. Trial balnace as on capital Rs. 6,00,000 per year interest on capital Rs _____.30. Trial balance shows sundry debtors Rs 2,00,000 31.12.2006 write of bad debts Rs 20000

provide 20% bad and doubtful debts the amount of provision for bad and doubtful debtors is ______.Chapter - 2

I. Fill in the blanks:1. Incomplete records are those records which are not kept under _____ system.2. Statement of affairs method is also called as ______ method.3. ______ capital can be found by preparing a statement of affairs at the beginning of the year.4. A statement of affairs resembles a _______.5. Closing capital can be found by preparing a statement affairs at the _____ of the year.

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6. In the single system, only personal and _______ are opened.7. Credit purchase can be ascertained as the balancing figure in the _____.8. The excess of assets over liabilities is ______.9. The total assets over liabilities is ________.10. A firm has assets worth Rs 60,000 and capital Rs 45,000 it is liabilities is ______.11. Incomplete records are generally used by _____ traders.12. Gredit sales is obtained from ______ accounts.13. Single entry system is __________.14. The capital of a business is ascertained by preparing _______.15. ______ calculate prfit it is approximately.16. Statement of affairs calculate to the profit basic two date between _____.17. As on 01.April .2003 - sundry creditors Rs 8000, 2003 - march 31 sundry creditors Rs 13,500. This

year credit purchase is ______.18. The company closing capital Rs 20,000 drawing Rs 5000, additional capital Rs7,000, profit Rs 3000

shown opening capital is _________.19. Trial balance as on sundry creditors Rs 30,000 give the adjustment discount on sundry creditors at 2%

entry of the balance shet shown in sudry amount creditors_______.20. A form has capital Rs 1,50,000 and liabilities Rs 2,80,000. Then its assets is ______.

Chapter - 3I. Fill in the balnks:1. All assets whose benefit is derived fpr a _____ period of time are called as fixed assets.2. The estimated sale value of assets at the end of its economic life is called as _____ value.3. _____ method of depriciation is calculated on the original cost of assets.4. Under _____ method, depreciation is calculated on the book value of the assets each year.5. ______ method of depreciation is used in the case of lease6. Under insurance policy method, cash is paid by way of every year.7. _____ method of depreciation is suitable for special type of assets like loose tools.8. Under straingth line method, rate of depreciation is calculated on ______-.9. Under dimishing balance method, depreciation _____ every year.10. The term deptetion is used for ______ assets.11. If selling price is more than the book value of the assets on the date of sale, it is _______.12. If selling price is less than the book value of the assets it denotes _______.13. Profit made on sale of fixed assets is debited to _______.14. Loss on sale of fixed assets appear on the _______ account.15. The amount of depreciation charged on machinery will be debited to _____ A/ C.16. Total amount of depreciation provided on the written down value method at the rate of 10% pa on

Rs 10,000 for the first three years will be _____.17. Total amount of depreciation is provided on the straight line method at the rate at 10% p.a on

Rs 3,00,000. For first three years back assets book value Rs ____on.18. The machinery sales at Rs 5,00,000 at profit Rs 50,000 the machinery book value at Rs_____.19. Total amount of depreciation provided on the written down value method at the rate of 10% pa on Rs

10,000 for the first three years will be ______.Chapter -4

I. Fill in the blanks:1. _____ is mathematical relationship between two item expressed in quantitative form.

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2. Ratio helps in _____ fore casting.3. _____ Ratio measures the firm ability to pay off its current dues.4. ____ are those assets which are easily convertiable into cash.5. Bank overdraft is an example of _____ liability.6. Liquid ratio is used to assess the firm’s _____ liquidity.7. Liquid assets means current liabilities less _______and _____.8. _____ratio is modified form of liquid ratio.9. Liquid liabilities means current liabilities less _______.10. Proprietery ratio shows the releation shipe between _____ and total tangible assets.11. Gross profit can be ascertained by deducting cost of goods sold from ______.12. Stock turn over ratio is otherwise called as _______.13. 100% operating profit ratio is equal to _____ ratio.14. When total sales is Rs. 2,00 000 cash sales is Rs 65,000 then credit sales will be Rs ______.15. Liquid ratio is other wise known as _______.16. All solvency ratios are expressed in terms of ______.17. All activity ratios are expressed in terms of _______.18. All profiability ratio are expressed in terms of _______.19. Share holders funds includes ______.20. Gross profit ratio establishes the relationship between ______.21. Opening stock is equal to Rs 10,000 purchase Rs 2,00,000 and closing stock Rs 5,000. Cost of goods

sold is equal to ________.22. Operating ratio is equal to _______.23. Total sales of a business concern is Rs 8,75,000. If cash sales is Rs 3,75,000 then credit sales will be

________.24. Total sales is Rs 3,40,000 and the gross profit made is Rs. 1,40,000. The cost of goods sold will be

_____.25. Cost of goods sold is Rs 4,00,000 and average stock is Rs 80,000 stock turn over ratio will be ____.26. Current assets of a business concern is Rs 60,000 and current liabilities are Rs 30,000. Current

ratio will be ________.27. Equity share capital is Rs. 2,00,000 reserves & scorplus is Rs. 30,000. Debenture is Rs. 40,000 and

the share holders funds will be ______.28. _______ Ratio shows the number of times the capital has been rotated in the process of carriying

business.29. Sales isRs 3,50,000. Capital empolyed is Rs 1,75,000 capital turnover ratio is ______.30. Land + Building + Furniture _______ Assets.

Chapter -5I. Fill in the blanks:1. The term ‘cash’ in cash budget stands for _____ and ______.2. Cash budget is also called as _____.3. There are ______ methods by which a cash budget is prepared.4. The opening balance of cash in April is Rs. 1,270. Total receipts for the month are Rs. 4,300 and total

payment amounted to Rs 3,750 opening balance of cash in May will be _______.5. Cash budget is a useful tool for _______.6. The closing balance of one month will be the _____ balance of the next month.7. Budget is an estimate relating to _______ period.

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8. Cash budget ______ and ______ expressed in terms of.9. Cash budget deals with ______ and _____.10. Purchase of furniture is an examples for ______.11. Opening balance of cash in January Rs 9,000 the estimated cash receipts are Rs 14,000 and esti

mated cash payment Rs 10, 000 the opening balance at February is ________.12. Opeing balance at cash in January Rs 15,000 the estimated cash receipts are 20,000 and estimated

cash payment Rs 10,000 the opening balance of February is ________.Volume - II

Chapter - 6,7,81. A sole trader business is owned and managed by _____ person.2. Indian partnership act was enacted in the year_______.3. Mutual and ______ agency is the essence of partnership.4. The profit and losses of the business will be shared among the partners in the ______ ratio.5. Under fluctuating capital mehtod, profitor loss in a year. Will be transferred to the respective ______

accounts.6. The capital accounts of partners may be ______ or flucturating.7. Under _____ capiatal arraangements, current accounts will not be maintained.8. The debit balance of the current account, will be shown in the _______ side of hte balance sheet.9. Interest on partners capital is allowed, only when the ________ specifically provides for it.10. Money lent to the business by a partner is Gedited to his account and not his capital account.11. Interest on parnter’s loan sholuld be paid, even if there is no __________ in a year.12. Good will is an _____ assets.13. The excess of average profit overnormal profit is ______.14. In the absence of partnership deed, no interest is to be changed on _______.15. A partnership can be formed only fora ____ business.16. The persons who entered into partnershp are collectively known as _____.17. The minimum number of persons in a partnership firm is _______.18. Ina partnership business , agreement is _______.19. In a partnership, partnership share their profit and losses in ______ ratio.20. Under fixed capital system, the profits losses of partners will be transferred to their _______ account.21. Interest on capital is calculate on the ______.22. Current accounts for partners will be opened under.23. In the absence an agreement proift and losses and divided_______.24. X and Y are partner sharing the profit and losses in the ratio of 2:3 with capitals pf Rs 1,20,000 and Rs

60,000 respectively profit for the year are Rs 9,000. IF the partnership deed in silent as to interest oncapiatal show how proift is shared amount X and Y.

25. Where a partners entitled to interest on capital such interest will be payable _______26. Where a partners entitled to interest on capital such interest will be payable _______27. Under fixed capital methods capital methods salary payable to a partner is reocorded _____.28. If a firm is maintaining both capital accounts and current accounts of the partners A and B additional

capital introduced by B will be recorded in ______.29. Interesting drawing calculated ______ methods used.30. Current accounts credit of the balance sheet _____ side of entry.31. Amount drawn regularly at the beginning of every month during the year, interest is calculated for.32. Amount drawn regularly at the middle of every month during the year interest in calculated for.

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33. Amount drawn regularly at the end of energy month during the year interest is calculated for.Chapter - 8

I. Fill in the blanks:1. The retiring partner should be paid off of the amount due to him, will be treated as his _____ to the firm.2. At the time of retirement of partners stamd to ______.3. If the value of liabilities decrease, its result in ______ item.4. At the time of retirement, the increases in the value of good will will be transferred to the ____ side of

thecapital accounts of all the partners.5. At the time of retirement, the profit on revaluation of assets and liabilities will be tranfered to the_____

side of the capital account of the partners.6. At the time of retirement the revaluation profits of business will be shared by _____ partners.7. In the absence of any specific agreement between the partners, partners loan to the firms will carry

an interest at the rate of ______ percentage.8. The accumulated reserves will be transferred to the old partners capital amount in the ______ ratio at

the time of his retirement.9. The amount due on the retiring partners is either ______ or is paid in ________.10. ________ is calculated to determine the amount of compensation to be paid by each of the continuing]

partners to the outgoing partners.11. A,B and C shares profit as ½ to A 1/3 to B and 1/6 to C. If B retires then the new proift sharing ratio is

_______.12. Sacrificing ratio is the ratio in whichh the ole parnters caxisting? Have agreed tp sacrifice their _____ in

favour of _______.13. At the time of retirement of a partner, calculation of new profit ratio is ________.14. Undistributed profit and losses _____ transferred to all the partners account at the time of retirement

of partners.15. At the time of retirement balance sheet, items like profit loss account and general reserve must be

transferred to ________.16. If the good will account is raised for 30,000 the amount is debited to _______.17. ______ ratio is calculating by taking out the difference between new profit sharing ratio and old profit

sharing ratio.18. On retirement of partner goodwill amount is credited to the account of _______.19. A,B and C are sharing profits in the ratio of 2/5:2/5:1/5 C retired from business and his share was

purchased equally by A and B. Then new profit sharing ratio shall be _________.20. When the amount due on outgoing partners is not paid immediately, then it is transferred to _____.21. If the amount due to the outgoing partners is transferred to loan account then he is entired to interest at

untill it is paid out.22. Graming ratio is calculated at the time of _______.23. A, B and C partners sharing profit in the ratio of ½ ,1/3,1/6 A partners retired from business by B and C

Then new profit sharing ratios calculated to _______.Chapter - 9

a. Fill in the blanks:1. Companies have been defined in section _____ of the companies act, _______2. ______ is considered as the official signature of the company.3. The management of a company is done by _______.4. The liability of share holders are _____ in a company.

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5. Audit of accounts are done by practicing chartered accounts who are appointed by ____ at the ____.6. _____ is the maximum amount of capital that can be issued by company.7. Nominal capital is the capital mentioned in the ______ of the company .8. The part of the authorised capital not offered for subscription to the public in known as _______.9. Reserve capital canbe issued only at the time of _______.10. A public issue can be kept open for more ______ days.11. Minimum subscription that should ne received by the company is ______ % of the issued capital.12. When excess application monely is adjusted towards allotment is called as ____ allotment.13. There should be a time gap of _____ between two calls.14. Capital Reserve represents _____ profit.15. Projected sheres have to be reissued at a price _____ than the face value.16. Securities premium is shown in the _________ side of the balance sheet.17. According to companies ( Amendment) Act 2000 a company limited by share can issue ____ kinds

of shares.18. The public issue must be keep open for atleast _______.19. Minimum amount to be collected by a company as application money according to SEBI is ______%

of the issue price.20. When more number of application are received than that are offered to the public it is called ______.21. The maximum calles that a company can make is _______.22. According to table A interest charged on calls - in - arrears is _________23. According to table A, interest charged on calls in advance is _______.24. A company can issue shares _____.25. When the company issue shares at a price more than the face value it is called as an issue at

_____.26. Normally companies can issue shares at _____ of discount.27. When shares are forefided the shares capital of the company will _____.28. Securities premium will appear in the ______ side of the balance sheet.29. The balance of forfeited share account it _______ in the balance sheet.30. Calls - in - arrears is shown inthe balance sheet as _______.31. Capital Reserve is shown on the _____ side of balance sheet.32. A company issued 2,00,000 shares of Rs 10 each to the public but only 1,50,000 shares were

subscribed. Its subscribed capital_______.33. The directors of company forfeited 100 share of Rs 10 each on which the find call money Rs .3 was

not paid. Later these shares were reissued for Rs 800 capital reserve will be _______.34. A company had authorised capital of Rs 4,00,000 divided into 4,000 shares of Rs 100 each. It offered

3,000 shares to the public. Its issued capital is ________.35. The directors of a company forfeited 500 shares of Rs. 10 each on which the final call money Rs. 2

was not paid later these shares were reissued at Rs 8 per shares capital reserve will be ________.36. ULTD issued 70,000 shares of Rs 10 fully subscribed by public Rs. 7 pershare has been called up.

Then Rs _____ will represent un called capital.37. The amount credited to share forfeiture account is Rs 3,000. The discount on reissue of forfeited

shares is Rs. 1,500 capital reserve will be_______.38. The company forfeited shares reissued at share at premium amount _______.39. A company reissued Rs 50,000 shares at Rs 10 each. Share Rs 2 issued to premium, at premium

amout Rs _______.

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40. The company winding time at issued calls time called up capital and one part ______ calls.

Answers

Lessons - 11. Capital 2. Market 3. Liability 4. Assets5. Assets 6. Liabilities 7. Profit & loss a/c 8. Capital9. Liabilities 10. fixed assets 11. sundry debtors 12. sundry creditors13.Bad debts 14. Sales 15. Net profit & Net loss 16. Liabilities17. Trading a/c, balance sheet 18. profit & loss a/c 19. profit & loss a/c20. Capital A/C 21.Capital A/C 22. loan A/C 23. two24. Rs 1500 25. Rs 6000 26. Rs 6000 27. Rs 500028. Rs 500 29. Rs 36000 30. Rs 36000

Lesson - 21. Double entry 2. networth 3. opening 4. Blance sheet 5. end6. single entry 7. total creditors A/c 8. capital 9. 1,50,000 10. 1500011. small trades 12. total debetors accounts 13. in complete double entry system14. statement of affairs 15. single entry 16.capital 17.36 500 18. 1500019. 29 400 20. 4,30,000

Lessons - 31. long 2. redidual value 3. straight line 4. written down value 5. annxity 6. premium 7. revaluation 8. wear and tear of the asse.9. Original cost 10.decreses every year 11. natural resources 12. profit13. loss 14. fixed asset a/c 15. fixed asset a/c 16. depreciation17. Rs 2710 18. Rs 2, 10,000 19. 4,50,000 20. Rs 1,45, 800

Lesson - 41. Ratio 2. finacial 3. liquid 4. current assets5. current 6. short term 7. stock, prepaid expenses 8. absolute liquid9. bank over draft 10.share holders fund 11. sales 12. inventory turnovev ratio13. operation ratio 14. Rs 1,35,000 v 15. quicke ratio 16. proportion17. time 18.percentage 19. reserve and surplus20. Gross Proift & Total sales 21. 20,500 22. 100- operating profit ratio23. 2,00,000 24.5,00,000 25. 5 items 26. 2:127. 2, 30,000 28. capital sales 29. two times 30. tangiable.

Lesson - 51. Cash - balanace bank balance 2. finance budget 3. Three 4. Rs. 18005. Finance planning 6.opening 7. future 8.money &physical units9. Estimate cash receipts 10. Estimate cash payments11. Rs 13000 12. Rs 25000

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Lesson - 61.one 2. 1932 3. implied 4. agreed 5. capital 6.fixed7. fluctuating 8. assets 9. partnership agreement 10. Loan 11.profit12. Intansiable 13. super profit 14. drawing 15. legal 16. firm 17. two18. not necessary19. agreed 20. current 21. opening capital 22. fixed capital23. equal 24. Rs x = 3600 YRs 5400 25. capital 26. capital 27. current28. B- capital 29.Averagemethod 30. liabilities 31. 13/2432. P2/24 33. 11/24

Lesson - 7,81. loan 2. gaining 3. profit 4. credit 5. credit6. all 7. six 8. old profit sharing 9. paid off immediately instalments10. gaining ratio 11. Bill 12. incoming partners profit ratio 13. demant14. Transfered 15. partners capital 16. goodwill 17. gaining ratio 18. all partners19.A - 1/2, B 1/2 20. Loan 21. 6% 22. dissolved 23. 2:1

Lesson - 91. sec 3(1) (i) 1956 2. common seal 3. board of director 4. limited5. share holders annual general meeting 6. authorised 7. memorandum of association8. unissued 9. winding up 10. 10 days 11. 90%12. prorata / proportional 13. one month 14. capiatal 15. lesser than16. liability 17. two 18. three 19. 25%20. over subscription 21. threee 22. 5% 23. 6%24. face value, premium discount 25. premium 26. 10%27. reduce 28.assets 29. added to paid up capital30. deducation from called up capital 31. liabilities 32. Rs 15,00033. Rs 500 34. Rs. 3,00,000 35. Rs. 3000 36. 2,10,00037. Rs 1500 38. capital reserve 39. Rs 1,00,000 40. Reserve capital

~~~~~~~~~~~~~~~

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Accountancy E.M. Pg. No. - 11

Accountancy

5 marks questions.Answer the following:

1. What is outstanding expense?Expense which have been incurred but not yet paid during the accounting period for which the final account are being prepared are called as outstanding expense.

2. What is prepaid expense?Expenses which have been paid in advance are called prepaid expense. It is also called as unexpired expense.

3. What is accrued income?Income which have been earned but not received during the accounting period is called assured income.

4. What is income received in advance?Income received during a particular accounting period for the work to be done in future period is called as income received in advance.

5. What is bad debts?Debts which cannot be recovered are called bad debts. It is treated as a lose for the business.

6. Write notes on provision for bad and doubtful debts?If sundry debtors figure is to be shown correctly in the balance sheet provision for bad and doubtful debts must be adjusted.

7. Write note on provision for discount on debtors?

To motivate the debtors to make prompt payments cash discount may be allowed to them. After providing provision for bad and doubtful debts the remaining debtors are called as good debtors. So a provision for discount on good debtors at a certain percentage may have to be created.

8. What is adjusting Entry?In a firm both expense and income has to adjust. If such item are not adjusted the final account will not reval the true and fair picture of the business performance. All such item which need to be brought into book of account at the time of preparing final accounts are called adjustments.

9. Define Single Entry system?According to Kohler single entry system is a system of book keeping in which as a rule only records of cash and personal account are maintained. It is always in complete double entry varying with circumstances.

10. What is statement of affairs?If is the statement of prepared to find out capital of a business under single entry system. It looks like a balance sheet.

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11. What is conversion method?If is desired to calculate profit by preparing trading and profit and loss account under single entry then it is called conversion method.

12. What are the limitation of single entry system?

Trial balance can note be prepared

Difficults to local frauds

13. What are the features of single entry?

Suitable for sale trading and partnership firms

Only personal accounts and cash account are kepts

True financial position can not be ascertained

Not accepted by Tax authorities

14. Define Depreciation?Carter defines depreciation as the gradual and permanent decrease in the value of an assets from any causes.

15. Write notes on revaluation method of depreciation?Under this method, the assets like loose tools are revalued at the end of the accounting period and the same is compared with the value of the assets at the beginning of the year. The difference is considered as depreciation.

16. What is insurance policy method of depreciation?According to this method an Insurance Policy is taken for the amount of the asset to be replaced. The amount of the policy is such that it is sufficient to replace the asset when it is worm out. A sum equal to the amount of depreciation is paid as premium every year.

17. What are different method of providing depreciation?1. Straight line method of fixed installment method.2. Written down value method or diminishing balance method.3. Annuity method.4. Depreciation Fund method.5. Insurance policy method.6. Revaluation method.

18. What is residual value?It implies the value expected to be realised on its sale on the expiry of its useful life. This is otherwise known as scrap value or turn – in value.

19. What is Annuity method of depreciation?

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The annuity method considers that the business besides loosing the original cost of the assets in terms of depreciation and also looses interest. The annual amount of depreciation is determined with the help of annuity table.

20. Define the ratio?In the words of Kennedy and Me Millian “the relationship of an item to another expressed in simple mathematician form is known as a ratio”.

12 marks

1. Define Depreciation? What are the reasons for providing depreciation?Define :Carter defines depreciation as the gradual and permanent decrease in the value of an asset from any cause.1) To ascertain correct profit / loss :

It is necessary to charge depreciation against revenue is each accounting year to calculate the correct net profit or net loss.

2) To present a true and fair view of the financial position?Hence to present a true and fair financial position of the business, it is necessary that depreciation must be deducted from the book value of the assets in the balance sheet.

3) To ascertain the real cost of production :For ascertaining the real cost of production it is necessary provide depreciation.

4) To comply with legal requirements :As per section 205 (1) of the companies Act 1956 it is compulsory for companies to provide depreciation on fixed assets before it declares dividend.

5) To replace asssets :Depreciation is provided to replace the assets when it becomes useless.

2. Explain the causes for Depreciation.Causes of Depreciation

Internal External1. Wear and Tear 1. Obsolescence2. Disuse 2. Effusion of time3. Maintenance 3. Time factor4. DepletionI. Internal causes1. Wear and tear: Wear and tear is an important cause of depreciation in case of tangible fixed asset. It is due to use of the asset.2. Disuse : When a machine is kept continuously idle, it becomes potentially less useful.3. Maintenance : The value of machine deteriorates rapidly because of lack of proper maintenance.4. Depletion : It refers to the physical deterioration by the exhaustion of natural resources. E.g. : mines, quarries, oil wells etc.II. External causes :

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1. Obsolescence : The old asset will become obsolete (useless) due to new inventions, improved techniques and technological advancement.

2. Efflux of time : When assets are exposed to forces of nature, like weather, wind, rain, etc., the value of such assets may decrease even if they are not put into any use.

3. Time factor : Lease, copy-right, patents are acquired for a fixed period of Time. ON the expiry of the fixed period of time, the assets cease to exist.

3. Write note on cash budget and what are the characteristics and advantages of cash budget?

1. Cash budget is one of the most important budgets prepared by a business concern as every transaction directly or indirectly deals with cash.2. Cash budget shows the estimate of cash receipts and cash payments from all sources over a specific period.3. This is also called a finance Budget.Characteristics :Budget has the following important characteristics.1. It is prepared in advance and relates a future period.2. It is expressed in terms of money and / or physical units.3. It is a mean to achieve the planned objective.Advantages :1. It helps in maintaining an adequate cash balance.2. It provides the following useful information to the management.3. To determine the future cash needs of a business concern.4. To plan for financing those needs and 5. To have control over cash balance of the business concern.

4. What is Good will ? What are the factors affecting good will?Good will is the value of the reputation of the firm which the business builds up due to its efficient service to its customers and quality of its products. It is value of all favaourable attributes relating to a businss enterprise. It is an intangible asset.The Good will affecting factors are : 1. Quality : If the firm enjoys good reputation for the quality of its products, there will be a ready sale and

the value of goodwill therefore will be high.2. Location : If the business is located in a prominent place, its value will be more.3. Efficient management : If the management is capable, the firm will earn more profits and that will raise the firm’s value.4. Competition : When there is no competition or competition is negligible, the value of those business will be high.5. Advantage of patents : Possession of trade marks, patents or copyrights will increase the firm’s value.6. Time : A business establishes reputation in course of time which is running for long period on profitable line.7. Customer’s altitude : The type of customers which a firm has is important. If the firm has more customers, the value will be high.8. Nature of business : A business having a stable demand is able to earn more profit and therefore has more good will.

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5. What are the differences between fixed capital account and fluctuating capital account ?

Basis of Distinction Fixed Capital method Fluctuating capital method1. Change in capital The capital normally remains

unchangedThe capital is changing from period to period

2. Number of Accounts Each partner has two accounts, namely, capital account and current account.

Each partner has only one account. i.e., capital account

3. Balance Capital account shows always a credit balance. Current account may sometimes show debit or credit balance

Capital account shows always a credit balance

4. Adjustments All adjustments relating to partners are recorded in the current accounts

All adjustments relating to partners are recorded directly in the capital accounts itself.

6. Distinguish between sacrificing ratio and gaining ratio.

Distinction Sacrificing Ratio Gaining Ratio1. Meaning It is the ratio in which the old partners

have agreed to sacrifice their shares in profit in favour of new partners.

It is the ratio in which the continuing partners acquire the outgoing partners share.

2. Purpose It is calculated to determine of amount the compensation to be paid by the incoming partner to the sacrificing partners.

It is calculated to determine the amount of compensation to the paid by each the continuing partners to the outgoing partner.

3. Calculation It is calculated by taking out the difference between old ratio and new ratio

It is calculated by taking out the differences between new ratio & old ratio.

4. Time It is calculated at the time of admission of a new partner.

It is calculated at the time of retirements of a partners.

5 marks sum

38. Interest on Drawing Rs.5,000 give adjusting Entry and Transfer Entry.Adjusting Entry

Particulars Debit CreditCapital A/c Dr. 5,000To interest on drawing A/c 5,000

Transfer entryInterest on drawing A/c Dr 5,000To profit and loss A/c 5,000

Interest on capital Rs.6,000 give adjustment and transfer entry.Adjusting Entry

Particulars Debit Credit

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Interest on capital A/c Dr. 6,000To capital A/c 6,000

Transfer EntryProfit and Loss A/c Dr. 6,000To Interest on capital 6,000

Write on Bad debts Rs.2,000Adjusting Entry

Bad debts A/c Dr. 4,000To sundry debtors 2,000

Transfer EntryParticulars Debit Credit

Profit and loss A/c Dr. 2,000To bad debts A/c 2,000Building Rs.4,00,000, Adj : - DepreciationBuilding at 10%

Adjustment EntryDepreciation A/c Dr. 40,000Building A/c 40,000

Transfer EntryProfit, Loss A/c or 40,000Depreciation A/c 40,000

39. Sinle Entry Systems :-What shall be the profit of the concern if

Opening capital Rs.1,60,000Closing capital Rs.1,80,000Drawing Rs. 36,000Additional capital Rs. 10,000

Ans : Statement of profit (or) Loss.Closing capital 1,80,000

(+) Drawing 36,0002,16,000

(-) Additional capital 10,0002,06,000

(-) Opening capital 1,60,000Profit 46,000

40. Calculate the missing :Profit made during 2,500Capital at the end 6,000Capital introduced 2,000Drawings 1,200Opening capital ?

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Statement of Profit (or) Loss.Capital at the end - 6,000

(+) Drawing - 1,2007,200

(-) Capital introduced the year - 2,0005,200

(+) Profit - 2,500Opening capital - 2,700

41. Calculate the missing information :Drawing - Rs. 5,000Additional Capital - Rs. 10,000Opening Capital - Rs.1,00,000Profit - Rs. 25,000

Opening capital 1,00,000(+) Additional capital 10,000

1,10,000(+) Profit 25,000

1,35,000(-) Drawing 50,000

Closing Capital 85,000

42. From the following particulars, find out the rate of depreciation under straight line method.Cost of fixed asset - Rs.50,000Residual value - Rs. 5,000Estimated life - 10 years

Amount of depreciation = Total cost – scrap value Estimated life

= 50,000 – 5,000 10

= 45,00 = 4,500

1Amount of Depreciation = 4,500Rate of Depreciation = Amount of depreciation x 100

Original cost

= 45 x 1 = 9

5, Rate of Depreciation = 9%

43. Find out rate of depreciation under straight line method.Cost of the plant = 2,30,000Installation charges = 20,000

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Expected life in year = 10 yearsScrap value = 50,000

Cost of the plant + Installation charges= 2,30,000 + 20,000= 2,50,000

Amount of Depreciation + Total cost – scrap valueEstimated life

= 2,50,000 – 50,000 10 year

= 2,00,000 – 20,000 = 2,00,00 =

70 1 yearAmount of Depreciation = 20,000

Rate of Depreciation = Amount of Depreciation x 100Original cost

= 2 x 1 = 8%

2,5

45. (A) The Trial Balance shows on 31.3.2002, sundry debtors Rs.1,25,000.Adjustment :-1. Bad debts to be written off Rs.5,000.2. Provide @ 5% provision for bad and doubtful debts and3. Provide @2% provision for discount on debtors.Pass entries and show how these items will appear in the Final accounts.Adjusting EntriesDate Particulars L.F. Debit Credit2002 Bad debts A/c 5,000March 31To Sundry debtors 5,000

Profit & Loss A/c 5,000To Bad debts A/c 5,000Profit & Loss A/c 6,000To provision for Bad & Doubtful debts A/c 6,000Profit and loss A/c 2,280To provision for discount 2,280

Profit & Loss A/cParticulars Rs. Particulars Rs.

To bad debts A/c 5,000To provision for bad and doubtful debts A/c 6,000To provision for discount on debtors 2,250

Balance SheetLiabilities Rs. Rs. Assets Rs. Rs.

Sundry debtors 1,25,000

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(-) Bad debts 5,0001,20,000

(-) Provision for bad and doubtful debts 6,0001,14,000

(-) Provision for discount 2,2801,11,720

The trail balance show sundry debtors Rs.65,000 31.12.2005.Adjustments :(1) Bad debts by written off : Rs.5,000.(2) Provide @5% provision for bad and doubtful.(3) Provide @2% provision for discount on debts.

20 marks53.a) Mr. John keep his books on in complete double entry. From the following detects prepare Trading and

Profit and Loss A/c for the year ended 31.03.2002 and balance sheet on at that date.

Particulars 01.04.2001 31.03.2002Stock 75,000 37,500Cash 18,750 30,000Machinery 7,500 7,500Sundry debtors 1,87,500 2,62,500Sundry creditors 1,12,500 1,31,250

Additional Information :Cash received from sundry debtors 4,05,000Cash paid sundry creditors 3,37,500Sales return 11,250Purchase Return 3,750Discount received 11,250Discount allowed 7,500Sundry expenses 26,250Drawing 30,000

Total DebtorsTo balance b/d 1,87,500 By cash received 4,01,250

To credit sales 4,95,000 By sales returns 11,250By discount allowed 7,500By balance c/d 2,62,500

6,82,500 6,82,500Total Creditors

To cash paid 3,37,500 By balance b/d 1,12,500To purchase returns 3,750 By credit purchase 3,71,250To discount received 11,250To balance b/d 1,31,250

4,83,750 4,83,750Statement of affairs

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Sundry creditors 1,12,500 Stock 75,000Opening capital 1,76,250 Sundry Debtors 1,87,500

Cash 18,750Furniture 7,500

2,88,750 2,88,750Trading and Profit & Loss Account

To opening stock 75,000 By sales Cash 3,750 Credit Sales 4,95,000 4,98,750

To purchase 3,71,250 (-) Sales Returns 11,250 4,87,500(-)purchase returns 3,750 3,67,500 Closing stock 37,500Gross Profit 82,500

5,25,000 5,25,000Tp discount paid 7,500 By Gross Profit 82,500To General Expenses 26,250 By Discount received 11,250To Net Profit 60,000

93,750 93,750Balance SheetLiabilities AssetsSundry Creditor 1,31,250 Cash 30,000Capital 1,76,250 Sundry Debtors 2,62,500(-) Drawing 30,000 Furniture 7,500 1,46,250 Closing stock 37,500(+) Net profit 60,000 2,06,250

3,37,500 3,37,500

b. From the following details, prepare trading and profit and loss A/c and balance sheet.

As on 1.4.2003 As on 31.3.2004Rs. Rs.

Sundry stock 50,000 25,000Sundry debtors 1,25,000 1,75,000Furniture 5,000 5,000Cash 12,500 20,000Sundry Creditors 75,000 87,500

Other details :Discount received 7,500Discount allowed 5,000Sundry expense 15,000Cash paid to sundry creditors 2,25,000Cash received from sundry debtors 2,67,500

Drawing 20,000Sales return 7,500Purchase return 2,500

Charge depreciation on Furniture @ 5%.54. The following are the balance extracted from the books of Mrs. Nandhini as on 31st March 2004.

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Debit Balance Rs. Credit balance Rs.Drawing 40,000 Capital 2,00,000Cash at Bank 17,000 Sales 1,60,000Cash in hand 60,000 Sundry creditors 45,000Wages 10,000Purchases 20,000Stock (31.03.03) 60,000Building 1,00,000Sundry debtors 44,000Bills receivable 20,000Rent 4,500Commission 2,500General Expense 8,000Furniture 5,000Suspense Accounts 5,000

4,05,000 4,05,000Adjustments :1. Closing stock Rs.40,000.2. Depreciation on furniture at the rate of 5% per annum.3. Interest on drawing at 5% to be provided.4. Outstanding wages Rs.1,000.5. Prepaid rent Rs.900.

Tranding and Profit and Loss Account of Mrs. Nandhini for the period ending 31.03.2002

Particulars Amount Amount Particulars Amount AmountTo opening stock 60,000 By sales 1,60,000To Purchase 20,000 By closing stock 40,000To wages 10,000(+) Outstanding wages 1,000 11,000Gross Profit 1,09,000

2,00,000 2,00,000To Rent 4,500 By Gross Profit 1,09,000(-) Prepaid Rent 900 3,600 By Interest on Drawing 2,000To commission 2,500To General expenses 8,000To furniture on Depreciation

250

Net Profit 96,6501,11,000 1,11,000

Balance Sheet of Mrs. Nandhini as on 31.3.2002Liabilities Amount Amount Assets Amount AmountSundry creditors 45,000 Cash in hand 17,000Outstanding wages 1,000 Cash at Bank 65,000Capital 2,00,000 Sundry debtors 44,000(+) Net profit 96,650 Bills receivable 29,000

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2,96,650 Prepaid Rent 900(-) Drawing 40,000 Furniture 5,000

2,56,650 (-) Depreciation 250 4,750(-) Interest 2,000 Building 1,00,000Drawing 2,54,650 Closing stock 40,000

3,00,650 3,00,650

Mr. Anbu book shows the following balance. Prepare Trading and Profit and loss Account for the year ended March 2009 and balance sheet on that

Debit Balance Rs. Credit Balance Rs.

Cash Balance 16,000 Capital 2,00,000Bank balance 40,000 Sales 1,62,000Drawing 5,000 Sundry Creditors 38,000Wages 4,000Purchase 25,000Opening stock 37,000Building 1,50,000Bills receivable 13,000Sundry debtors 87,000Commission 4,000General expense 11,000Insurance 8,000

4,00,000 4,00,000Adjustment :1) Closing stock Rs.25,0002) Outstanding wages Rs.1,000

3) Prepaid Insurance Rs.2,0004) Depreciation building 10% per annum5) Interest on capital 6%

56. Prepare a cash budget for the month March, April and May.

Month Credit Purchase Credit sale Administration selling expense

January 75,000 1,50,000 1,20,000February 1,00,000 1,35,000 1,35,000March 85,000 1,75,000 65,000April 1,25,000 1,20,000 70,000May 90,000 1,40,000 80,000

1) Expected cash balance 1.3.2005 Rs.80,0002) Suppliers allowed a credit period of two month.3) A credit period of one month is allowed to customer.4) Expense are paid in the same month.

5) Sale of fixed assets Rs.25,000 in April.6) Purchase of fixed assets in May Rs.25,000.

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Particulars March April MayOpening cash balance(+) Cash receivable from customerSales fixed assetsTotal Cash available during the month

80,0001,35,000

-2,15,000

75,0001,75,000

25,0002,75,000

1,05,0001,20,000

-2,25,000

(-) Payment to suppliers Administration and sales expensePurchase of Fixed assets

75,00065,000

-

1,00,00070,000

-

85,00080,00025,000

1,40,000 1,70,000 1,90,000Total Cash payment during the month 75,000 1,05,000 35,000

57. Prepare cash budget of Rama Ltd. For the month of January to March 2004 from the following information.

Month Credit purchase Credit Sales Expenses2003 November 2,00,000 2,50,000 50,000 December 3,50,000 3,00,000 60,0002004 January 3,00,000 4,50,000 70,000 February 4,00,000 2,00,000 80,000 March 5,00,000 3,50,000 70,000

Additional information :(i) Expected cash balance on 1.1.2004 Rs.75,000(ii) Supplier allowed credit of two months and a credit of two months is allowed to the customers.(iii) Lag is payment of expense one month.(iv) Sale of fixed assets in the month of February 95,000.

58. Prepare a cash budget for October, November and December 2004 from the following information.Month Sales Purchase Expense

September 2004 1,00,000 8,00,000 1,10,000October 2004 12,00,000 12,00,000 1,30,000November 2004 14,00,000 8,00,000 1,50,000December 2004 16,00,000 10,00,000 1,70,000

1) All sales are for cash.2) The period of credit allowed by the suppliers is one months.3) Lag in payment of expense is one month.4) Opening cash balance on 01.10.2004 Rs.90,000.

5) In December an asset for Rs.4,00,000 is to be purchased.----------------

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History

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History3 mark question & answer

I. Rohilkand1. Rohilkand was a small kingdom situated in between oudh and the marathan2. The people of Rohilkand was called Roihillas.3. Its ruler was Hafiz rahmat Khan

2. Pitts India Act -17841. It abolishes the demerits of regulating act.2. It was passed during the time of pitt the younger in 1784 A.D3. A board of control consisting of six members was created

3. Treaty of Srirangapattinam1. It was signed at the end of Third Mysore war.2. Tipu sultan to give up half of his dominious to British.3. After this war, although the strength of mysore had been reduced.

4. Treaty of Bassein1. It was signed between Lor Wellesley Maratha Peshwa Baji rao II.2. This treaty was belongs to subsidiary allaince system.3. Other Marathas considered this tready as slave document.

5. Abolition of sati1. The practice of Sati, the age old custom of burning of widows alive on the funeral pyre of their husbands2. It was prevalent in North India and Bengal.3. It was abolished in 1829 by Lord william Bentinck

6. Female infanticide1. Practice of killing female infants was very much prevalent in places like Rajputana, Punjab, Malwa and Cutch.2. Bentinck took effective steps to prevent the ritual of child sacrifice ot sauger Island in Bengal.3. Bentinck prohibited female infanticide, declared them as punishable crime.

7. Lord Mecaulay1. During the time of William Bentinck he introduced Western Education in India.2. Maccaulay insisted medium of instruction should be in English.3. In 1835 English became an administrative language and teaching language.

8. Doctrine of lapse1. For extending of British empire lord Dalhausie followed the policy of Doctrine of Lapse.2. It cancelled the right of adoption by an Indian State.3. It was also one among the reason for 1857 First War of Indian Independance

9. Half an anna Postal system1.Dalhousie laid a foundation for Modern Postal System in India.2. He introduced a uniform rate of half an anna per post card was charged throughout India.3. It was introduced in the year 1854 . A.D.

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10. Woods Despatch1. It was ntroduced in 1834 during the time of Lord Dalhausie.2. It was considered as”Intellectual Charter of Inida”.3. It provided an outline for the comprehensive scheme of education at primary, secondary and collegiate levels.

11. Ryotwari System1. It was introduced by sir Thomas Mudro in Madras Presidency2. The peasant was recognised as the proprietor of land.3. There was no intermediary like Zamindars.4. Land tax was directly paid by the peasants.

12. Mahalwari System1. In 1833 Mahalwari System was introduced in Punjab, UttarPradesh.2. It was introduced by William Bentinck3. Under this system the basic unit of revenue settlement was Village or Mahal.

13. Purdah System1. Voices were raised the practice of purdah during the 19th and 20th century.2. It was not prevailed in South India.3. The condition of women among the peasantry was relatively better in this respect.

14. Bennerman1. Chief of the British expedition against Kattabomman.2. In 1799 september the major served an Ultimatum directing Kattabomman to surrendar.3. Bennerman announced death penalty to Kattabomman and hanged to death at Kayattar.

15. Puli Thevar1. Palaykkarar of Nerkkatumseval Palayam.2. Puli Thevan exibited the Maravas Valour and Patiatism.3. He was defeated by col . cambell in 1767A.D.

16. Clonel Gillerpie1.He was the commander of Ranipet regiment.2.He curshed the Vellore mutiny.3. In 1806 at Vellore Fort he killed so much of Indian soliders.

17. Sir John Cradock1. The commander - in - chief of the vellore fort in 1806.2. He introduced new form turban for Vellore Fort soldiers.3. Wearing ear rings and caste marks wer also prohibited to soliders.

18. Nana Sahib1. Foster son of Peshwa Baj rao II2. He was the head of Kanpur Mutiny.3. He was very much supported by Tantia Tope the other was Aximullah.

19. Vernacular Press Act -18781. It was passed during the time Lytton.

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2. This Act crushed the freedom of the Indian press.3. An undertaking from the editor of a vernacular newspaper that nothing would be published against the English Government.

20. Ilbert Bill1.It was brought during the time of Lord Ripon2. According to this bill Indian judges can tried Europe criminals.3. It was very much opposed by Europeons and Lord Ripon resigned.

21. Swamy Vivekananda1. The original name of Swami Vivekananda was Narendra Dutta.2. He was the famous discliple of Rama Krishna Paramahamsa.3. Swami Vivekananda participated at the parliament of religion held in chicago in 1893 amd raised the prestige of India very high.

22. Aligarh Movement1.It was founded by sir Syed Ahamed Khan .2. It was started for social and educational advancement of the Muslims in India.3. In 1875 he founded a modern school at Aligarh.

23. Partition of Bengal1. In 1905 Lord Curzon partitional Bengal into two.2.This partition divided the Hindus ans Muslims in Bengal.3. This had also inteurified the national movements.

24. Surat Split1. In 1907 at Surat congress, got divided into two2. One group was named as Moderates and another group was named as extremists.3. Extremists came out of the congress led by Tilak and others.

25. Muslim League 19061. It was founded by Nawab Saleemullah.2. Their first achievement won the seperate electorates for the Muslims in the Minto- Marley reforms.2. It was welfare for Muslims.

26. Queen Victoria’s Proclaimation1. It was the result of 1857 Great Indian Revolt in 1858.2.By this procolaimation East India company rule in India came to an end.3. All Indians are equal to Europeans.

27. Dandi March1. In 1930 Gandhiji began his famous March to Dandi2. By treating the salt laws Gandhiji with his famous chosen 79 followers March to dandi.3. In 1930 April .6 Dandi sea cost break the salt law.

28. Panch Sheel1. It was designed by Pandit Jawaharlal Nehru.2. He was the architect of the Non - Aligned movement during the codl war era.3. Nehru outlived the five principles of co - existence (or) Panch Sheel.

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29. Renaissance1. The term Renaissance literally means rebirth (or) revival2. The most important centribution of the renaissance was the revival and learning of ancient Greek and Latin literature.3. It was started in Italy.

30. Ignatious Loyola1. He founded society of Jesus of counter reformation society.2. The aim of this society was to reform and restore the glory of the Catholic Church.3. They established schools and colleges in several parts of the world.

31. Townshand Laws1. Charles Townshend the finance minister of England imposed fresh taxes on glass, paper,

tea, paints etc. in 1767.2. It was known as Townshend laws3. The American protested it and boycotted the British goods.

32. Boston Tea Party1. In 1773, a new Tea Act was passed imposing a tax on import of tea.2. It was a symbol to show that the British Parliament had the right to tax the colonies.3. But Americans showed their protest. A group of Americans dressed as Red Indinas.

Climbed on the ships and threw away the tea boundles into the sea at the Boston harbour.

33. Rousseau1. Rousseau was the author of the famous book, Social contract.2. He said that the real sovereignty rests with the people.3. His famous statement, Man is born free and is everywhere in chains.

34. John Mc Adam1. He belonged to England.2. He built a type of Hard surfaced road in England.3. France copied the English methods.

35. Long March1. Mao retired to northern China. It is known as the Long March.2. There the communists established their control.3. A Civil war broke out between the communists and the kuomuistang. Finally, Mao

established the People’s Republic of China in October 1949.

36. The Coldwar1. The end of the second World War saw the rise of the U.S.A. and USSR as super powers.2. The strained relationship between these two countries till the collapse of the USSR is

known as the Cold war.3. The term ‘Cold war’ was used for the first time by Bernard Baruch.

37. John Calvin1. The French protest reformer John Calvin was born in Franch.2. He subscribed to the doctrine of the absolute fore - knowledge and determining power of god.3.He became the head of the Church in Geneva.

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38. Bloody Sunday1. The striking workers went on a procession to Tsars palace to present a petition to redress their grievances.2. They were led by Father Gapon.3. This event is known as Bloody sunday in 1905.

39. NATO - 19491. The U.S.A had created a militany alliance to prevent further spread communism into Western Europe2. A beginning in this direction was made by the signing of the Brussels Tready in March 1948.3. Britain, France, Holland, Belgium and Luxeuberg signed this tready in 1949.

40. Global Terrorism1. The term terriorism means politically motivated violence carried out aganist mostly unarmed civilian

Population by group of terrorists.2. The term international terrorism means terrorism involving citizens of more than one country.3. The most violent terrorist attack was made on the twin towers of the world trade centre, Newyork

on september 11, 2001.

41. World trade organization (WTO)1.The origin of Wrorld Trade Organization could be traced from the Bretton Woods conference of 1944.2. The Head quarters is in Geneva.3. There are 149 members in the organization.

6 Marks1. Discuss the main provisions of the Regulating Act

Page No. 5, 62. Main features of subsidiary Alliance.

Page No. 25, 263. Write the Judicial reforms of Lord Cornwallis.

Page No. 194. What are the causes of the Defeat of Maratha?

Page No. 41.5. Point out the sailert features of the permanent Land Revenue settlement.

Page No. 67, 686. Write a note on the Role of “Maruthu brothers in South Indian Rebellion.

Page No. 91, 927. Analyse the Results of the Great Revolt of 1857.

Page No. 108, 1098. Write a note on Famine policy followed by Lord Lytton

Page No. 114, 1159. Discuss the Importance of Local Self Govt.?

Page No. 117

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10. Bring out the Importance of the Swadeshi movement.Page No. 152

11. Discuss the principles of Saint RamalingaPage No. 133

12. Discuss the Role of V.O.C. in the Indian National movement.Page No. 178

13. What are the Education Reforms of Justice Party.Page No. 188, 189

14. Discuss the Salient features of the Indian Constitution.Page No. 207

15. Results of the First World War.Page No. 291

16. Examine the causes for the Industrial RevolutionPage No. 275

17. Results of the Second World War.Page No. 332

18. State the Aims of the UNO.Page No. 344

19. Describe the important organs of the League of Nations.Page No. 304, 305, 306

20. Write a note on Mao Tse TungPage No. 337, 338

21. Result of the Renaissance.Page No.

22. Causes for the Decline of Handi Craft Industries.Page No. 72

23. What are the Main demands of Moderates.Page No. 143

24. Analise the causes for the Geographical Discoveries.Page No. 234

10 Marks1. Give an account of the reforms of Warren Hastings.

Page No. 2 from 3rd para, Page No. 3 Full, Page No. 4 - 2nd para2. ‘Bentinck inagurated an ora of social reforms’-comment

Page No. 51 full, Page No. 52 first para only3. Estimate the reforms of Lord Dalhausie

Page No. 59 3rd para, Page No. 60 Full, Page No. 61 first 3 paras4. Examine the causes for the Revolt of 1857

Page No. 103 3 para, Page No. 104 4 paras5. Examine the causes for the rise of Nationalism in India.

Page No. 139, Page No. 140, Page No. 141 First 2 paras

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6. Estimate the role of Mahatma Gandhi in the Indian Freedom struggle.Page No. 159 - 4th para, Page No. 160 stI Para, Page No. 161 2nd para point fullPage No. 162 3rd para only, Page No. 165 2nd, 3rd para, Page No. 168 2nd Para, Page No. 169 3rd,4th para, Page No. 171 3rd para, Page No. 172 First 2 paras

7. Jawaharlal Nehur is the architect of Modern Inida - DiscussPage No. 209 - 3rd Para, Page No. 211 - 4th para, Page No. 212 - 1st, 2nd, 3rd, ParasPage No. 214 - 2nd Para, Page No. 216 - 3rd Para

8. Examine the role of Tamil Nadu in the Indian Freedom StugglePage No. 177 - 2nd Para, Page No. 178 - 2nd, 3rd, 4th para, Page No. 179 fullPage No. 180 - 3rd, 4th Para, Page No. 181 full

9. Estimate the role of UNO in maintaining the world peace.page No. 347 - last para, Page No. 348 - Full, Page No. 349 - First 3 Paras

10. Enumerate the various causes of the First World War.Page No. 287 - full, Page No. 288 1st to 4th Paras, Page No. 289 4th para Page No. 290 - first paraonly

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c demand

b quantity

subsidies d

d none5

d none6

d none18

supply curve d

demand curve b shifts