Category: ISC

ISC Accounts  Previous Year Question Paper 2013 Solved for Class 12

Maximum Marks: 80
Time allowed: Three hours

• Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II, choosing two questions from Section A, two questions from Section B and one question from either Section A or Section B.
• The intended marks for questions or parts of questions are given in brackets [ ].
• Transactions should be recorded in the answer book.
• All calculations should be shown clearly.
• All working, including rough work, should be done on the same page as, and adjacent to the rest of the answer.

Part -1

Question 1.
Answer each of the following questions briefly: [10 × 2]
(i) Give two differences between Net Profit and Cash from Operations.
(ii) When does loss on Issue of Debentures arise ?
(iii) Give two differences between Authorized Capital and Issued Capital.
(iv) Why is the word Memorandum affixed to the Memorandum Joint Venture Account ?
(v) How is double entry completed in the Journal Ledger when ledgers are kept under the Self Balancing System ?
(vi) What is the accounting treatment of Employees Provident Fund appearing in the Balance Sheet of a partnership firm at the time of its dissolution ?
(vii) Give the formula for computing Price Earning Ratio.
(viii) Give two differences between Reserve Capital and Capital Reserve.
(ix) How will the firm show the amount payable to the retiring partner, if it is not in a position to immediately pay the amount due to him on his retirement ?
(x) What accounting steps are taken by a partnership firm when a new partner is unable to bring the business guaranteed by him ?
Answer:
(i)

(ii) Loss on Issue of Debentures arises when debentures are to be redeemed at a value higher than their face value.

(iii)

(iv) The word Memorandum is affixed to the Memorandum Joint Venture Account because it is not a part of the Double Entry System of Book Keeping. It is just a rough account prepared to calculate the Profit or Loss.

(vi) Employees Provident Fund to be credited to the Realization Account as a liability and it’s payment is also to be debited to the Realization Account.
Employees Provident Fund A/c Dr.
To Realization A/c
(Being employees’ provident fund transferred)
Realization A/c Dr.
To Bank A/c
(Being employees provident fund paid off)

(viii)

(ix) The amount payable to the retiring partner would be transferred to his Loan Account and reflected in the Balance Sheet as a liability .

(x) The deficient amount would be debited to the New Partner’s Capital Account and Credited to the Profit and Loss Appropriation Account.
New Partner’s Capital A/c Dr.
To Profit & Loss Appropriation A/c
(Being deficient amount in the business guaranteed adjusted)

Question 2. [10]
Alex, John and Sam are partners in a firm. Their capital accounts on 1st April. 2011. stood at ₹ 1.00.000, ₹ 80.000 and ₹ 60.000 respectively.
Each partner withdrew ₹ 5.000 during the financial year 2011-12.
As per the provisions of their partnership deed :
(a) John was entitled to a salary of ₹ 1.000 per month.
(b) Interest on capital was to be allowed @ 10% per annum.
(c) Interest on drawings was to be charged @ 4% per annum.
(d) Profits and losses were to be shared in the ratio of their capitals. The net profit of ₹ 75,000 for the year ended 31st March. 2012 was divided equally amongst the partners without providing for the terms of the deed.
You are required to pass a Single Adjusting Journal Entry to rectify the error. (Show the workings clearly)
Answer:

Part – II

Question 3. [14]
Reliable Ltd. was registered with an authorized capital of ₹ 20,00,000 in ₹ 10 per equity share. It invited applications for issuing 1.00.000 equity shares at a premium of ₹ 2 per share. The amount w as pay able as follows:
On application ₹4 per share (including premium)
On allotment ₹ 3 per share
Balance on 1st and Final Call.
Applications were received for 1,30.000 shares. Applications for 10,000 shares were rejected and the application money received on them was refunded. Pro-rata allotment w as made to the remaining applications. Amount overpaid on these applications was adjusted towards the amount due on allotment. Sameer, who had applied for 1,200 shares, failed to pay the allotment and call money. The company forfeited his shares, out of which 800 shares were re-issued to Sanjay at ₹ 9 per share fully paid up.
You are required to:
(i) Pass the Journal Entries in the books of the company through Calls in Arrears Account.
(ii) Prepare the Share Allotment Account.
Answer:

Question 4. [14]
Arthur Ltd. reported a profit of ? 90,000 for the year ended March 31, 2012 after considering the
following : ?
(a) Tax provided during the year — ₹ 3,000
(h) Amortization of goodwill — ₹ 12,000
(c) Profit on sale of land — ₹ 5,000
(d) Writing off preliminary expenses — ₹ 2,000
(e) Machinery costing ₹ 40.000 (accumulated depreciation thereon being ₹ 18.000) was sold during the year at a loss of ₹ 17,000.
Extracts of its Balance Sheets at the beginning and at the end of the year are given below :

You are required to calculate Cash from Operating Activities as per Accounting Standard-3. (Show your working clearly)
Answer:

Question 5.
Following is the Balance Sheet of Ravi and Prakash as on 31st March, 2012 :

The firm was dissolved on 31^st March. 2012 on the following terms :
(a) Ravi took over stock at ₹ 8.000.
(b) Creditors payable after two months w ere paid immediately at a discount of 6% per annum.
(c) Debtors realized ₹ 35,000
(d) Plant and Machinery and Investments realized ₹ 60,000.
(e) An old computer completely written off w as taken over by Prakash at ₹ 1,200.
(f) Realization expenses of ₹ 2,000 were paid by Ravi.
You are required to prepare :
(i) Realization Account.
(ii) Partners’ Capital Accounts.
(iii) Cash Account.
Answer:

Question 6.
Neha and Tara are partners in a firm sharing profits and losses in the ratio of 3 : 2. Their Balance Sheet on 31st March, 2012. stood as follows : [14]

They agreed to admit Prachi into partnership for 1/5th share of profits on 1^st April. 2012 on the following terms :
(a) All debtors to be considered as good and therefore the provision for doubtful debts to be written back.
(b) Value of land and building to be increased to ₹ 18,000.
(c) Value of plant and machinery’ to be reduced by ₹ 2,000.
(d) The liability against Workmen’s Compensation Fund is determined at ₹ 2,000 which is to be paid later in the year.
(e) Prachi to bring in her share of Goodwill of ₹ 10,000 in cash.
(f) She will further bring in cash so as to make her capital equal to 20% of the total capital of the new firm. (Show your workings clearly)
You are required to prepare:
(i) Revaluation Account
(ii) Partners’ Capital Accounts.
(iii) Balance Sheet of the reconstituted firm.
Answer:

Question 7.
(a) The following information is available from the books of Greg Foods Limited : [14]
Equity Share Capital — ₹ 1,00,000
8% Preference Share Capital — ₹ 40,000
Reserves and Surplus — ₹ 60,000
Investments — ₹ 30,000
Current Assets — ₹ 70,000
Proprietary Ratio is 0.8 : 1
Assuming that there are no fictitious assets, calculate the value of the fixed assets of the company.
(b) The following figures have been extracted from the records of Allen Cosmetics Limited :
Cost of goods sold — ₹ 4,00,000
Current liabilities — ₹ 90,000
Profit margin is equal to 20% on selling price.
Working Capital Turnover Ratio is equal to 10 times.
Determine the value of the Current Assets of the company.
(c) The following details are available from the books of Simon Gadgets Limited :
Sales — ₹ 8.00.000
Opening Stock — ₹ 40.000
Closing stock — ₹ 50.000
Gross Profit Ratio is 20%
Calculate the Stock Turnover Ratio of the company (up to two decimal places).
(d) The following data is available from the records of Johnson and Company Limited : Particulars ?
Stock — ₹ 50,000
Sundry debtors — ₹ 40,000
Bills receivable — ₹ 10,000
Advances paid — ₹ 4000
Cash in hand — ₹ 30,000
Sundry creditors — ₹ 60,000
Bills pay able — ₹ 40,000
Bank overdraft — ₹ 4,000
Reserves — ₹ 70,000
10% Preference Share Capital — ₹ 5,00,000
Equity Share Capital — ₹ 7,00,000
Net profit after tax — ₹ 1,40,000

Calculate the following (up to two decimal places):
(i) Current Ratio.
(ii) Quick Ratio.
(iii) Return on Equity Shareholders’ Fund.
Answer:

Question 8.
Andrew and Roger entered into a joint venture and agreed hare profits and losses in the ratio of 3 : 2 respectively. [14]
Andrew purchased goods worth ₹ 1,00,000 in cash. He spent ₹ 10,000 on freight and insurance and dispatched the goods to Roger.
Roger got the goods released from-the transport company and paid ₹ 5.000 on carriage up to the warehouse and ₹ 10.000 as rent of the warehouse.
Roger sold 80% of the goods for ₹ 3,00,000. He was entitled to receive commission a 6% of the sales. He later informed Andrew that the remaining goods were desroyed by fire. Since the goods in the warehouse were not insured. Roger agreed to bear the entire loss which was valued at original cost plus proportionate expenses.
The accounts were settled between the co-venturers by means of a bank draft.
You are required to prepare in the books of Andrew :
(i) Joint Venture Account.
(ii) Roger’s Account.
Answer:

Question 9.
Sim. Tim and Jim are partners sharing profits and losses equally. Their Balance Sheet as on 31st March, 2012 stood as follows:

From April 1st 2012, the partners decide to share profits and losses in the ratio 3:2:1 and for that purpose the following revised value of assets were agreed upon :
Building ₹ 2,75,000; Plant and Machinery ₹ 90,000; Patents and Copyrights ₹ 1,32,500; Stock ₹ 2,00,000: Prepaid Insurance ₹ 5,000 and Debtors ₹ 1,42,500. Goodwill of the firm was valued at ₹ 60,000.
Partners decide not to disturb the reserves. Also, they decide not to record the revised values of assets in the books of Accounts.
You are required to prepare:
(i) Partner’s capital accounts.
(ii) Balance Sheet of the re-constituted firm.
(Show your workings clearly)
Answer:

Question 10.
Peter’s books show the following details for the month of April. 2012. [14]

You are required to prepare Journal Ledger Adjustment Account in the Creditors’ Ledger.

ISC Class 12 Accounts Previous Year Question Papers

ISC Biotechnology Previous Year Question Paper 2015 Solved for Class 12

Maximum Marks: 80
Time allowed: Three hours

• Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II, choosing two questions from Section A, two questions from Section B and one question from either Section A or Section B.
• The intended marks for questions or parts of questions are given in brackets [ ].
• Transactions should be recorded in the answer book.
• All calculations should be shown clearly.
• All working, including rough work, should be done on the same page as, and adjacent to the rest of the answer.

Part-1
(Answer all questions)

Question 1.
(a) Mention any one significant difference between each of the following : [5]
(i) Prokaryotic genome and Eukaryotic genome
(ii) Purine and Pyrimidine
(iii) Centrifugation and Crystallography
(iv) Glucose and Glycogen
(v) Codon and Cosmid

(b) Answer the following questions : [5]
(i) Why are Flavr Savor tomatoes preferred over natural tomatoes ?
(ii) State one gene – one enzyme hypothesis.
(iii) Why is the amino acid glycine said to be optically inactive ?
(iv) State Chargaff’s Law of DNA bases.
(v) What is electroporation ?

(c) Write the full form of each of the following: [5]
(i) PIR
(ii) SSB
(iii) STS
(iv) BAC
(v) GBB

(d) Explain briefly: [5]
(i) Insertional inactivation
(ii) Microprocessor
(iii) Supramolecular assembly
(iv) Callus .
(v) Cybrid
Answer:
(a) (i) Prokaryotic genome: In prokaryotic genome, a naked DNA is present, equal to single chromosome.

Eukaryotic genome: In eukaryotic genome, DNA is associated with histone proteins and the number of chromosome is 2 to numerous.

(ii) Purine: They are large size double ring structure e.g., Adenine, Guanine.

Pyrimidine: They are small in size, single ring structures e.g., Thymine, Cytosine.

(iii) Centrifugation: A process to separate small molecules by the action of centrifugal force, simply a physical phenomenon.

Crystallography: It is a technique of studying 3-D structure of macromolecules /atomic arrangement / crystal structure (proteins and nuclear acids) by placing in an intense beam of monochromatic X-rays, producing the regular pattern of reflections.

(iv) Glucose: It is a monosaccharide

Glycogen: It is a polymer formed by condensation of large number of glucose monomers.

(v) Codon: It is a sequence of three nitrogen bases in wRNA which determine the incorpo¬ration of a specific amino acid in a polypeptide chain

Cosmid: They are formed by integration of plasmid with bacterial ori, an antibiotic selection marker, and a cloning site with one or more ‘cos’ sites derived from (λ) lambda bacteriophage.

(b) (i) Flavr Savor tomatoes are genetically modified tomatoes characterised by delayed ripening and longer shelf life.

(ii) One gene-oneenzyme hypothesis is the idea that genes act to the production of enzymes with each gene responsible for producing a single enzyme that intum affects a single step in a metabolic pathway. Concept was proposed by George Beadle and Edward Lawric Tatum in 1941.

(iii) Glycine is optically inactive because it does not affect the plane of polarised light.

(iv) (i) Chargaff’s rule states that purines and pyrimidines are equal in amount ;.e.,A+G = C + T
(ii) Molar amount of purine adenine is always equal to molar amount of thymine. Similarly guanine is equal by cytosine
(iii) Sugar deoxyribosome and phosphate occur in equimolar proportion
(iv) The ratio of A + T/ G + Cis constant for a species.

(v) Electroporation: It is the technique of introducing DNA into the cell by a brief exposure to a very high voltage electric pulse.

(c) (i) PIR – Protein Information Resources

(ii) SSB – Single Strand Breaks

(iii) STS – Sequence Tagged Sites

(iv) BAC – Bacterial Artificial Chromosome

(v) GDB-Genomic Data Bank

(d) (i) Insertional inactivation: Harder problem to solve is to determine which of the transformed colonies comprise cells that contain recombinant DNA molecules, and which contain self-ligated vector molecules. Insertional inactivation is the inactivation of a gene by inserting a fragment of DNA into the middle of its coding sequence. Any future products from the inactivated gene will not work because of the extra codes added to it. Recombinants can therefore, be identified because the characteristic coded by the inactivated gene is no longer visible.

pBR322 contains genes which code for ampicillin resistance and tetracycline resistance. BamHI cuts in the middle of the gene which codes for tetracycline resistance. If a gene is inserted here, the plasmid loses its ability to code for tetracycline resistance. Thus, the plasmid containing the recombinant gene is resistant to ampicillin but sensitive to tetracycline. To screen, we use replica plates.

The pUC8 plasmid is ampicillin resistant and contains a gene lac Z’which partially codes for β galactosidase. To make the plasmid capable of coding for the whole protein, we add the missing DNA along with the recombinant gene. The host which contains the plasmid pUC8 is resistant to ampicillin and is also capable of producing β galactosidase.

(ii) Microprocessor: A microprocessor is a programmable digital electronic component that incorporates the functions of a central processing unit (CPU) on a single integrated circuit (IC).

(iii) Supra molecular assembly is based on weak bonds as supposed to covalent bonds. As mentioned weak bond, though harder to control have the advantage of possible reopening. Relying on weak bond in surface organisation, can lead to molecular assemblies and raise the probability of reorganization processes.

(iv) Callus: It is a mass of meristematic undifferentiated unorganized cells produced in a culture,

(v) Cybrids or a cytoplasmic hybrids are cells or plants containing nucleus of one species but cytoplasm from both the parental species.

Part — II
(Answer any five questions)

Question 2.
(a) Explain the general structure of mRNA and tRNA. Mention their functions during protein
synthesis. [4]
(b) Give one application of each of the following in genetic engineering techniques. [4]
(i) Restriction enzymes and DNA ligases
(ii) Shuttle vectors and Expression vectors
(c) What is meant by genetic code ? [2]
Answer:
(a) Formation of RNA over DNA template is called translation. It is meant for taking the coded information from DNA to the site in cytoplasm where it is required for protein synthesis. Only one of the two strands – sense strand transcribes it. mRNA brings instructions from the DNA for the formation of particular type of polypeptide. The instructions are present in the base sequence of nucleotide’s. Formation of polypeptide occurs over the ribosome, mRNA gets attached to the ribosome.

tRNA are induced to bring amino acids in a particular sequence according to the sequence of codons present over mRNA. mRNA has methylated region at 5′ terminus the cap for attachment with ribosomes. Then followed by initiation code (AUG) either immediately or after a small non-coding region. Then there is coding region followed by termination codon (UAA, UGA, UAG). Then there is non-coding region and poly A’ area at the 3′ terminus. mRNA may be monocistronic (Eukaryote) or polycistronic (Prokaryote).

Transfer RNA (tRNA) : It is also called soluble or sRNA. There are over 100 types of tRNAs. Transfer RNA constitutes about 15% of the total RNA. tRNA is the smallest RNA with 70-85 nucleotides and sedimentation coefficient of 4S. The nitrogen bases of several of its nucleotides get modified, causes coiling of the otherwise single- stranded tRNA into L-shaped form (three-dimensional, Klug, 1974) or clover-like form (two dimensional, Holley, 1965).

It has (i) Anti codon: It is made-up of three nitrogen bases for recognizing and attaching to the codon of mRNA.
(ii) AA-Binding Site : It lies at the 3′ end opposite the anti codon and has CCA—OH group (5′ end bears G). Amino acid or AA-binding site and anti codon are the two recognition sites of tRNA.

Functions : (i) tRNA is adapter molecule which is meant for transferring amino acids to ribosomes for synthesis of polypeptides. There are different tRNA’s for different amino acids. Codons are recognized by anti codons of fRNAs. Specific amino acids are recognized by particular activating or aminoacyl synthetase enzymes.
(ii) They hold peptidyl chains over the mRNAs. The initiator tRNA has the dual function of initiation of protein synthesis as well as bringing in of the first amino acids. There is, however, no tRNA for stop signals.

(b) (i) Restriction enzymes recognize and cleaves a specific short DNA sequence at recognition site. They are used in r-DNA technology as molecular scissors. DNA ligases are the enzymes used to join cut ends of vector DNA and the target DNA by their sticky ends.

(ii) Shuttle vectors is a plasmid containing vector, that can replicate in two different organisms- prokaryote and eukaryote, due to the presence of two different origin of replication i.e, Ori Euk, Ori E-coli.

Expression vectors in addition to incorporate desired gene into the host cell, also help to produce high amount of proteins enclosed by the DNA insert, because of presence of promoter sequence and a terminator sequence along with insert.

(c) Though made-up of only four types of nucleotides, nucleotides of DNA can be positioned in a countless way. As a result, single DNA molecule has several thousand nucleotides, a limitless specificity can be incorporated in the DNA.

There is intimate connection between genes and the synthesis of polypeptides. Genes are made- up of nucleotides, arranged in a specific manner. Arrangement of nucleotides or their nitrogen bases is connected with synthesis of proteins by influencing the corporation of amino acids in them. The relationship between the sequence of amino acids in a polypeptide chain and nucleotide sequence of DNA or mRNA is called genetic code. DNA contains only four types of nucleotide or nitrogen bases while the amino acid is 20. It was, therefore, hypothesized, the triplet code (consisting of three adjacent bases for one amino acid) is operative.

Question 3.
(a) With reference to lipids, explain the following: [4]
(i) Any two chemical properties of lipids.
(ii) Chemical structure and any one function of lipids.
(b) Give the causes and the symptoms of the following metabolic disorders : [4]
(i) Albinism
(ii) Sickle cell anaemia
(c) Name two low resolution techniques used in gene analysis. [2]
Answer:
(a) (i) Chemical properties of Lipids: Hydrolysis: On hydrolysis with alkali or lipolytic enzyme lipases, fats are broken down into their components fatty acids and glycerols.

Saponification Value : It is the amount in mg of alkali required to saponify 1 gm of fat or oil. This value is useful for a comparative study of fatty acid chain-length in oils.

(ii) Chemical structure of lipids: Lipids are a heterogeneous group of fats or fat like substances which are insoluble in water but soluble in non-polar solvents like ether, acetone, e.g., ghee, butter, oil, vitamins A, E and K.

Lipids are formed of carbon, hydrogen and often oxygen where oxygen content is very small as compared to other two elements. Lipids require more oxygen for their complete oxidation as compared to carbohydrates. Some lipids also contain small amount of phosphorus nitrogen and rarely sulfur. Most lipids are formed of fatty acids.

Lipids are water insoluble components of the living cells and are essential for storing surplus food. They provide insulation to heat loss and protect internal organs from abrasion. Most biological membranes contain around 50-40% of lipids. Some lipids act as carrier of some vitamins (vitamin A,D, E and K) and also protect them from oxidation. In animals, the fats produce a shock absorbing cushion around eye balls, gonads, kidneys and other vital organs.

(b) (i) Albinism : It is caused by the absence of the enzyme tyrosinase which is essential for the synthesis of the pigment from dihydroxyphenyalanine. The gene for albinism (a) does not produce the enzyme tyrosinase but its normal allele (A) does. Thus, only homozygous individual (aa) is affected by this disease. Albinos (individuals with albinism) lack dark pigment melanin in the skin, hair and iris. Although albinos have poor vision yet they lead normal life.

(ii) Sickle cell anaemia is an autosomal hereditary disorder due to a mutation of single nitrogen base. It results the formation of an abnormal haemoglobin called haemoglobin S (Hb^s). In this, only one amino acid-6th amino acid of β-chain glutamic acid is replaced by valine. The erythrocytes become sickle shaped under oxygen deficiency as during strenous exercise and at high altitudes. They cannot pass through narrow capillaries. They clog blood capillaries. Blood circulation and oxygen supply is disturbed. Spleen and brain get damaged. Patient feels acute weakness. Homozygotes (Hb^s / Hb^s) usually die before reaching maturity.

(c) (i) AFLP genotyping and fingerprinting
(ii) Enzyme electrophoresis
(iii) PCR – SSP technique

Question 4.
(a) With respect to tissue culture techniques, discuss the following : [4]
(i) Various sterilization techniques used.
(ii) Composition of culture medium.
(b ) Discuss the impact of the following factors on enzyme activity : [4]
(i) Substrate concentration and Enzyme concentration
(ii) Temperature and pH
(c) What is single nucleotide polymorphism 9 [2]
Answer:
(a) (i) Various Sterilization Technique :
Maintenance of Aseptic Environment: Dining in vitro culture maintenance of aseptic environment is the most difficult task, because the cultures are easily contaminated by fungi and bacteria present in the air. The contaminants produce toxic metabolites which inhibit growth of cultures plant tissues. Therefore, each step must be handled aseptically and with great care. Following are some of the sterilization methods for aseptic manipulation of plant tissues.

(a) Sterilization of glassware : Glassware (Petri plates, vials, culture tubes, flasks, pipettes, etc.), metallic instruments are sterilized in a hot air oven at 160-180° C for 2-4 hours.

(b) Sterilisation of instruments : The metallic instruments (e.g., forceps, scalpels, needles, spatulas, etc.) are flame sterilised i.e., dipping them in 25% ethanol followed by flaming and cooling. It is called incineration.

(c) Sterilisation of culture room and transfer area: Floor and walls of culture room are washed first with detergent then 2% sodium hypochlorite or 95% ethanol. Larger surface area is sterilised by exposure to UV light. The cabinet of laminar airflow is also sterilised by exposing UV light for 30 minutes and 95% ethanol 15 minutes before beginning of work inside the cabinet of laminar airflow.

(d) Sterilization of nutrient media : Culture media are properly dispensed in glass container, plugged with cotton or sealed with plastic closures and sterilized by autoclaving (steam sterilization) at 15 psi (that gives 121°C) for 30 minutes.

During autoclaving vitamins, plant extracts, amino acids and hormones are denatured. Therefore, the solution of these compounds are sterilized by using millipore filter paper which has 0.2 pm pore diameter.

(e) Sterilization of plant materials : Surface of all plant materials has microbial contaminants. Therefore, disinfectants (e.g., sodium hypochlorite, hydrogen peroxide, mercuric chloride, or ethanol) should be used to make plant materials sterile. Then the chemicals must be washed 6-8 times using sterile distilled water. Then ex plants are transferred aseptically on nutrient medium inside the cabinet of laminar airflow.

(ii) Composition of Nutrient Media: Composition of nutrient media governs the growth and morphogenesis of plant tissue in vitro. Depending on the type of plant cells or tissue used for culture the composition of nutrient media vary. The principal constituents of tissue culture media are inorganic nutrients, carbon sources, organic supplements, growth regulators and gelling agent.

(a) Inorganic nutrients: Several minerals (i.e., macro-and micro-nutrients) are required by the plants. Minerals dissolved in water are dissociated and ionized. For example, in MS medium NH₄N0₃ contributes NO^-3 and KNO₃ contributes K⁺ ions. There are six major macro-nutrients such as nitrogen, phosphorus, potassium, calcium, magnesium and sulfur. But the essential or micro-nutrients are required in low amount. These are boron, molybdenum, cobalt, zinc, manganese, iron and copper.

(b) Carbon and energy sources: Mostly sucrose is required as carbon source followed by glucose. These carbon sources enhance cell proliferation and tissue regeneration.

(c) Organic supplements : There is a large number of organic supplements used for best growth of tissues. Vitamins (riboflavin, folic acid ) Amino acids (casein hydrolysate, L-glutamine, L-asperagine, L-glycine, L-arginine, L-cysteine) are commonly used as nitrogen source and enhancers of cell growth. Besides, culture media are also supplemented with casein, coconut milk, yeast and malt extracts, ground banana, orange juice and tomato juice. Activated charcoal added to culture media is known to stimulate plant growth. If required antibiotics (streptomycine or kanamycin) may be added to culture medium to avoid systemic infection of micro-organisms.

(d) Growth regulators : For proliferation of cultured tissues four classes of growth regulators (e.g., auxins, cytokinins, gibberellins and abscisic acid) are used. For induction of root or shoot the ratio of hormones varies considerably. For example, auxins (e.g., indole acetic acid, 1-naphthaleneacetic acid) induce cell division and cause elongation of stem, and intemodes. Cytokinins (e.g., 6-benzylaminopurine, 6-benzyladenine, zeatin) induce cell division and shoot differentiation of cultured tissues. Different ratios of auxins and cytokinins are important in morphogenesis of callus. High ratio of auxin to cytokinin promotes embiyogenesis, callus and root initiation. But high ratio of cytokinin to auxin leads to axillary and shoot promotion.

(e) Solidifying agents : Most commonly agar is used as solidifying or gelling agent. Agar gels do not react with constituents of media and not digested by plant enzymes. Generally 0.5 -1% agar is used to form gel.

(b) (i) Substrate concentration : It depends on the type of enzyme reaction. For a competitive enzyme reaction, the increase in substrate concentration can have an inverse effect on the activity, but for a normal enzyme reaction, as long as the & substrate concentration isn’t saturated, in general it will increase activity. At lower concentrations, the active sites on most of the enzyme molecules are not filled because there is not much substrate. Higher concentrations cause more-collisions between the molecules. With more molecules and collisions, enzymes are more likely to encounter molecules of reactant. The maximum velocity of a reaction is reached when the active sites are almost continuously filled. Increased substrate concentration after this point will not increase the rate. Reaction rate, therefore, increases as substrate concentration is increased but it levels off.

Enzyme Concentration : If there is insufficient enzyme present, the reaction will not proceed as fast as it otherwise would because all of the active sites are occupied with the reaction. Additional active sites could speed up the reaction. As the amount of enzyme is increased, the rate of reaction increases. This is because when more enzyme molecules are present,more substrate molecules can be acted upon at the same time. This means that the total substrate molecules are broken down quickly. If there are more enzyme molecules than are needed, adding additional enzyme will not increase the rate. Reaction rate therefore increases as enzyme concentration increases but then its levels off.

(iii) Temperature : Higher temperature generally causes more collisions among the molecules and therefore, increases the rate of a reaction. More collisions increase the likelihood that substrate will collide with the active site of the enzy me, thus increasing the rate of an enzyme-catalyzed reaction.

Above a certain temperature, activity begins to decline because the enzyme begins to denature. The rate of chemical reactions, therefore, increases with temperature but then decreases as enzymes denature.

Optimum pH : Every enzyme has an optimum pH when it is most effective. A rise or fall in pH reduces enzyme activity by changing the degree of ionization of its side chains. A change in pH may also start reverse reaction. Fumarase catalyses fiimarate → malate at 6.2 pH and reverse at 7.5 pH. Most of the intracellular enzymes function near neutral pH with the exception of several digestive enzymes which work either in acidic range of pH or alkaline, e.g., 2.0 pH for pepsin, 8.5 for trypsin.

(c) Single Nucleotide Polymorphisms (SNPs): SNPs are the variations in a nucleotide at genomic DNA in different individuals at a population which occur due to change even in a single base (e.g.. A, G, T or C). Therefore, certain sites of the sequence nucleotide bases of different
individuals differ as below :
First person — …ATGCTACG…
Second person — …TATCTACG…

In human genome, SNPs occur at 1.6-3.2 million sites. According to changes in bases SNPs affect the gene function. DNA fingerprinting of individuals is possible due to these genetic variations in non-coding parts of genome. This technique is used in search of criminals, rapists, solving parentage problem, confirming identity of individuals, etc.

On average, SNPs occur at every 500-1,000 nucleotides in human DNA, SNPs can help to

• associate sequence variation with heritable phenotypes,
• facilitate studies in population, and
• evolutionary biology, and add in positional cloning and physical mapping.

Question 5.
(a) List the functions of the following bioinformatics tools : [4]
(i) Taxonomy Browser
(ii) BLAST
(iii) ENTREZ
(iv) EMBL
(b) Explain the principle and applications of the following biochemical techniques : [4]
(i) Gel permeation
(ii) Electrophoresis
(c) Give two reasons for germplasm conservation. [2]
Answer:
(a) (i) Taxonomy browser: This search tool provides taxonomic information on various species. The TAXONOMY database of NCBI has information (including scientific and common names) about all organisms for which some sequence information is available (over 79,000 species). The server provides genetic information and the taxonomic relationship of the species in question. TAXONOMY has links with other servers of NCBI e.g., structure and PubMed.

(ii) BLAST (Basic Local Alignment Search Tool) : BLAST is a family of user-friendly sequence similarity search tools on the web. The BLAST server is supported through NCBI (National Center for Biotechnology Information) U.S.A. This tool is designed to identify potential homologous for a given sequence. It can analyse both DNA and protein sequences. A local alignment finds the optimal alignment between subregions or local regions of specified sequences.

(iii) ENTREZ: Integrated information database retrieval system of NCBI. Using Entrez system you can access literature, sequences (both proteins and nucleotides) and structures (3D).

(iv) EMBL (European molecular Biology Laboratory- Nucleic Acid (DNA sequence) databases.

(b) (i) Gel permeation or gel filtration : Size exclusion chromatography (SEC) is a cinematographic method in which particles are separated based on their size, or in more technical terms, their hydrodynamic volume. The name gel permeation chromatography is used when an organic solvent is used as a mobile phase. The main application of gel permeation chromatography is used to analyse the molecular weight distribution of organic-soluble polymer.

Theory and method : The underlying principle of SEC is that particles of different sizes will elute (filter) through a stationary phase at different rates. This results in the separation of a solution of particles based on size, provided that all the particles are loaded simultaneously or near simultaneously.

Particles of the same size should elute together. This is usually achieved with an apparatus called a column which consists of a hollow tube tightly packed with extremely small porous polymer beads designed to have pores of different sizes. These pores may be depressions on the surface or channels through the bead. As the solution travels down the column some particles enter into the pores. Larger particles cannot enter into as many pores. The larger the particles, the less overall volume to traverse over the length of the column and the faster the elution.

The filtered solution that is collected at the end is known as the elute. The void volume includes any particles too large to enter the medium and the solvent volume is known as the column volume.

(ii) Electrophoresis : It is the method of moving charged particles through a medium under the influence on an electric field. It is also used to separate molecules with different physical characteristics using electrical charges.

Types :

• Capillary electrophoresis — commonly used to separate biomolecules by their charge and frictional forces.
• Gel electrophoresis — a technique used by scientists to separate molecules based on physical characteristics such as size, shape, or isoelectric point. It can be used as a preparative technique to partially purify- molecules prior to use of other methods such as mass spectrometry. PCR, cloning, DNA sequencing, or immuno-blotting for further characterization.

Examples of specific techniques include :

• DNA electrophoresis — a specific type of gel electrophoresis used to analyse DNA.
• Protein electrophoresis — a specific type of gel electrophoresis used to analyse proteins.
• Two-dimensional gel electrophoresis — a specific type of gel electrophoresis commonly used to analyse proteins which involves two separation mechanisms to separate molecules.
• SDS PAGE, (sodium dodecyl sulphate polyacrylamide gel electrophoresis) — commonly used to analyse proteins.

(c) Germplasm Conservation : The sum total of all the genes present in a crop and its related species constitutes its germplasm; it is ordinarily represented by a collection of various strains and species. Germplasm provides the raw materials (= genes), which the breeder uses to develop commercial crop varieties. Therefore, germplasm is the basic indispensable ingredient of all breeding programmes, and a great emphasis is placed on collection, evaluation and conservation of germplasm.

Question 6.
(a) Explain the principle and procedure of the PCR technique
(b) Discuss the following innovations in Biotechnology-:
(i) Oil eating bacteria
(ii) Recombinant insulin
(c) What is distant hybridization ?
Answer:
(a) Polymerase chain reaction (PCR) technique was originally invented by Kary Mullis (1985). It results in the selective amplification of a specific region of DNA molecule (up to billion copies). It can generate micro-gram (pg) quantities of DNA copies. The PCR process has been completely automated and compact thermal cycles are available in market.

Principle : The basic principle underlying this technique is that when a double strand DNA molecule is heated to a high temperature, the two DNA strands separate, giving rise to a single stranded DNA molecules (templates). If these single stranded molecules are copied by a DNA polymerase, it would lead to the duplication of original DNA molecule and if these events are repeated many times, multiple copies of the original DNA sequence can be regenerated.

The PCR is carried out in vitro. It utilises the following:

• a DNA preparation containing the desired segment to be amplified (target sequence),
• two nucleotide primers (about 20 bases long) specific, i.e., complementary, to the two 3′-borders (the sequences present at or beyond the 3′-ends of the two strands) of the desired segment,
• the four deoxynucleoside triphosphates, viz. TTP (thymidine triphosphate, dCTP (deoxycytidine triphosphate), dATP (deoxyadenosine triphosphate) and dGTP (deoxyguanosine triphosphate), and
• a heat stable DNA polymerase, e.g., Taq (isolated from the bacterium Thermus acquaticus), Pfu (from Pyrococcus furiosus) and Vent (from Thermococcus litoralis) polymerases. Pfu and Vent polymerases are more efficient than the Taq polymerase.

Procedure of PCR:
At the start of PCR, the DNA from which a segment is to be amplified, an excess of the two primer molecules, the four deoxyriboside triphosphates and the DNA polymerase are mixed together in the reaction mixture that has appropriate quantities of Mg²⁺. The following operations are now performed sequentially (Fig.)

Denaturation:
The reaction mixture is first heated to a temperature between 90-98°C (commonly 94°C) that ensures DNA denaturation. This is the denaturation step. The duration of this step in the first cycle of PCR is usually 2 min at 94°C.

Annealing:
The mixture is now cooled to a temperature (generally 40-60°C) that permits annealing of the primer to the complementary sequences in the DNA; these sequences are located at the 3′-ends of the two strands of the desired segment. This step is called annealing. The duration of annealing step is usually 1 min during the first as well as the subsequent cycles of PCR. Since the primer concentration is kept very high relative to that of the template DNA, primer-template hybrid formation is greatly favored over reannealing of the template strands.

Primer Extension:
The temperature is now so adjusted that the DNA polymerase synthesizes the complementary strands by utilizing 3′-OH of the primers; this reaction is the same as that occurs in vivo during replication of the leading strand of a DNA duplex. The primers are extended towards each other so that the DNA segment lying between the two primers is copied; this is ensured by employing primers complementary to the 3 -ends of the segment to be amplified. The duration of primer extension is usually 2 min. at 72°C. It has been shown that in case of longer target sequences, best results are obtained when the period of extension is kept at the rate of 1 min per kb of the target sequence and the extension is carried out at 68°C in the place of usual 72°C. Taq polymerase usually amplifies DNA segments of upto 2 kb; special reaction conditions are necessary’ for amplification of longer DNA segments.

In case of Taq polymerase, the optimum temperature for synthesis is between 70° and 75°C ; the temperature of reaction mixture is, therefore, adjusted to this temperature.

The completion of the extension step completes the first cycle of amplification; each cycle may take few’ (ordinarily 4-5) minutes. It should be noted that extension of the primer continues till the strands are separated during the denaturation step of the next PCR cycle.

The next cycle of amplification is initiated by denaturation (Step 1), which separates the newly synthesised DNA strands from the old DNA strands. Synthesis of new strands takes place, which doubles the number of copies of the desired DNA segment present at the end of first amplification cycle. This completes the second cycle.

Thus at each cycle, both new and old strands anneal to the primers and serve as templates for DNA synthesis. As a result, at the end of each cycle, the number of copies of the desired segment becomes twice the number present at the end of the previous cycle. Thus at the end of n cy cles 2” copies of the segment are expected; the real values are quite close to the expectation. Usually 20-30 cycles are carried out in most PCR experiments.

In case of automated PCR machines, called thermal cyclers, the researcher has to only specify the number and duration of cycles, etc. after placing the complete reaction mixture for incubation, and the machine performs the entire programme of operations precisely. After PCR cycles, the amplified DNA segment is purified by gel electrophoresis and can be used for the desired purpose.

PCR is of immense value in generating abundant amount of DNA for analysis in the DNA fingerprinting technique used in forensic science to link a suspect’s DNA to the DNA recovered at crime scene, to solve murder and rape cases etc.

Applications of Polymerase Chain Reaction Technology :

• PCR enables rapid amplification of template DNA for screening of uncharacterised mutation
• PCR permits rapid genotyping for polymorphic markers.
• A wide variety of PCR based methods can be used to assay for known mutation.
• Degenerate oligonucleotide primers and primers specific for ligated linker sequences permit co-amplification of sequence families.
• Anchored PCR uses a target specific primer and a universal primer for amplifying sequences adjacent to a known sequence.
• PCR is used in molecular diagnostics.

(b) An oil eating bacteria: Pseudomonas capacia, P. putida and other spp. Acinetobacter sp. Efficient degraders have been prepared through genetic engineering and they need to be established in the environment at a required density.

Production of Human Insulin (Humulin): Human insulin is a dimer comprising one chain of 21 amino acids (A chain) and the other of 30 amino acids (B chain), the C chain that links A and B chains. Chains A and B become linked by two disulphide bridges. This is followed by cleavage of the leader and the C chain sequences leaving the mature insulin molecule. Insulin is the first genetically engineered hormonal drug ever marketed anywhere in the world. It was produced first in 1980 by Eli Lilly (U S A.) with the name Humulin by transferring the insulin gene into E.coli.

The genes (= DNA sequences) for chains A and B of insulin were synthesized separately as early as 1978. The genes for A and B chains were integrated separetely in pBR322 type vector. The purified chains A and B were then attached to each other by disulphide bonds induced in vitro; this, however turned out to be an inefficient reaction. Subsequently, a gene representing B, C and A chains was synthesized and expressed in E. coli; in this case, the intervening chain is removed proteolytically following spontaneous folding of the proinsulin molecule.

(c) Distant hybridization : It implies crosses of species, subspecies, breeds and strains for the purpose of obtaining marketable hybrids of the first generation.

Importance of distant hybridization:
Distant hybridization is a combination of valuable features of parental forms in hybrids without noticeable increase in viability and, with intermediate growth rate.

They comprise both heterosis hybrids and hybrid forms with a favorable combination of parental features.

Abortion of embiyos at one or the other stage of development is a characteristic feature of distant hybridization, e.g., the crossing of two species or varieties often fails when using distant parents who do not share many chromosomes. Embryo rescue is the process when plant breeders rescue inherently weak, immature or hybrid embryos to prevent degeneration. Common in lily, hybridizing to create new inter specific hybrids between the various lily groups (such as Asiatic, Oriental, Trumpet, etc ).

Question 7.
(a) Given below is a list of four biomolecules. For each of them, write the class of biomolecules they belong to and their location in a living cell. [4]
(i) Cellulose
(ii) Histones
(iii) rRNA
(iv) Cholesterol
(b) What is freeze preservation ? Discuss any three types of freeze preservation. [4]
(c) Name any four important equipment used in cell culture technology. [2]
Answer:
(a)

Name	Class	Location
(i) Cellulose	Polysachharide	Cell wall
(ii) Histone	Basic proteins	Chromosome (Eukaryotes)
(iii) rRNA	Nucleic Acid	Ribosome
(iv) Cholestrol	Steroids (Derived lipids)	Produced in liver in human beings animals and some plants (e.g., potato)

(b) Freeze Preservation: In this approach, cells and tissues are stored at -196°C in liquid nitrogen. Theoretically, the cells and tissues can be stored in live state indefinitely, and cells/tissues recovered after thawing should be unchanged and live. But in practice, viability generally declines with the duration of cryopreservation, and thawed cells/tissues show variable degrees of damage, which they may be able to repair under appropriate media and culture conditions. It is desirable to preserve organised tissues like shoot-tips, and somatic and zygotic embryos to minimize the risk of genetic instability associated with unorganized tissues like cell suspensions and protoplasts.

(c) Equipment used in Cell Culture Technology :

• Washing and storage facilities.
• Media preparation room.
• Transfer area (Inoculation chamber / Laminar airflow, a closed plastic box).
• Culture room (Controlled system of light and temperature).

Note: Data collection: Cultures are monitored at regular intervals for growth and development of cultured tissue.

Question 8.
(a) Enumerate the process of DNA replication in living cells. Why is the DNA replication called semi-discontinuous ? [4]
(b) Explain how cell culture technology has been helpful in developing following traits in plants :
(i) Pest resistance
(ii) Drought resistance [4]
(c) What are the basic criteria in selecting an organism for its genome sequencing ? [2]
Answer:
(a) Mode of DNA Replication
DNA replication is a multi step complex process which requires over a dozen enzymes. It begins at a particular spot called origin of replication. Bacterial and viral DNA has a single origin of replication but in eukaryotic DNA there are a number of origin of replication because of the large size as well as association with proteins. Replication takes place as follows :

Activation of deoxyribonucleotides : Deoxyribonucleotides or deoxyribonucleoside monophosphates occur freely inside the nucleoplasm. They are first phosphorylated and changed to active forms which have three phosphate residues instead of one. Enzymes phosphorylase is required alongwith energy. The phosphorylated nucleotides are cfeATP. (deoxyadenosine triphosphate), deGTP (deoxyguanosine triphosphate), deCTP (deoxycytidine triphosphate) and deTTP (deoxythymidine triphosphate).

Exposure of DNA strands : Enzy mes topoisomerases are specialized to cause nicks (or breaks) and reseal the same in one strand of DNA. Helicases (unwindases) unwind the DNA helix and separate the two strands. In prokaryotes topoisomerases and helicases are replaced by DNA gyrases. The separated strands are stabilized by helix destabilizing (HD) or DNA binding proteins (DNP). They become open for replication. However, whole of DNA does not open in one stretch but the point of separation proceeds slowly from one end to the other. It gives the appearance of Y-shaped structure called replication fork.

RNA primer. It is essential for initiation of new DNA chains. RNA primer is a small strand of RNA which is synthesized at the 5′ end of new DNA strand with the help of enzyme called primase. It is specific. RNA primer is formed on the free end of one strand and fork end of the other strand. After start of nucleotide chain, RNA primer is removed and the gap is filled.

Base pairing: The two separated DNA strands in the replication fork function as templates. Deoxyribonucleoside triphosphates come to lie opposite the nitrogen bases of exposed DNA templates – deTPP opposite A, deCYP opposite G deATP opposite T and deGTP opposite C. With the help of enzyme pyrophosphatase the two extra phosphates present on the deoxyribonucleotides separate. Energy is released in the process. The energy is used in establishing hydrogen bonds between the free nucleotides and nitrogen bases of templates.

Chain formation : It requires DNA polymerase III (Komberg, 1956). In the presence of Mg²⁺, ATP (GTP), TPP and DNA polymerase III, the adjacent nucleotides present attached to nitrogen bases of each template DNA strand establish phosphodiester bonds and get linked to form replicated DNA strand. As replication proceeds new areas of parent DNA duplex unwind and separate so that replication proceeds rapidly from the place of origin towards the other end. RNA primer is removed that the gap filled with complementary nucleotides by means of DNA polymerase I. Because of sequential opening of DNA double chain and its replication to form two chains. DNA replication is also called Zipper duplication. However, DNA-polymerase can polymerise nucleotides only in 5′ direction because it adds them at the 3′ end. Since the two strands of DNA run in antiparallel directions, the two templates prov ide different ends for replication. Replication over the two templates thus proceeds in opposite directions. One strand is formed continuously because its 3′ end is open for elongation. It is called leading strand.

Replication is not continuous on the other template because only a short segment of DNA strand can be built in 5′ → 3′ direction due to exposure of a small stretch of template at one time. Short segments of replicated DNA are called Okazaki fragments. An RNA primer is also required every time a new Okazaki fragment is to be built. After replacing RNA primer the deoxv ribonucleotides and their polymerization. Okazaki fragments are joined together by means of enzyme. DNA ligase. DNA strand built-up of Okazaki fragments is called lagging strand.

Proof-reading and DNA repair: A wrong base is sometimes introduced during replication. The frequency is one in ten thousand. DNA polymerase is able to sense the same. It goes back, removes the wrong base, allows addition of proper base and then proceeds forward. However, even DNA polymerase III is unable to distinguish uracil from thymine so that it is often incorporated in place of thymine. Such a mismatching is corrected by means of a number of enzymes. DNA replication is semi-conservative. One half of the parent structure passes up to each replica while the second half is built a new.

(b) (i) Pest resistance : There is a large number of mites and insects that attack crop plants and cause great loss in quality and yield. To reduce the loss by the way of killing insects, farmers apply insecticides (i.e., synthetic pesticides) on the crop plants. However, the synthetic insecticides pose a serious threat to the health of plants, animals and humans. The alternative and novel ways of rescue from damages of insects are the use of transgenic technology. It is eco-friendly, cost-effective, sustainable and effective way of insect control. The cry genes of Bacillus thuringiensis (commonly called Bt gene) was found to express proteinaceous toxin inside the bacterial cells. When specific insects (species of Lepidoptera, Diptera, Coleoptera, etc.) ingest the toxin, they are killed. Toxin denatures the epithelium of gut by creating many holes at alkaline pH (7.5 to 8).

Using biotechnological approaches many transgenic crops having cry gene i.e., Bt-genes have been developed and commercialised. Some examples of Bi-crops are brinjal, cauliflower, cabbage, canola, com, cotton, egg plant, maize, potato, tobacco, tomato, rice, soyabean, etc.

(ii) Production of drought resistance : The level of water is gradually going down due to low rains and high temperature. Moreover, the plants requiring substantial amount of water suffer from drought conditions. This leads to the development of severe drought condition in that area. Consequently the herbivores such as humans and other animals suffer a lot resulting in famine condition. Such situation is spreading in several third world countries.

There are some plants that resist drought conditions. The property of resistance against water loss from the surface of plants is naturally checked by the plants. The special feature is controlled by a specific gene called ‘drought resistance (DR) gene’.

Plant biotechnology offers the introduction of DR gene from drought resistant plants into the staple crops for the benefit of enhanced crop yield.
The promising GM technology includes the use of techniques for increasing drought tolerance. Research works on these aspects are being investigated at the International Maize and Wheat Improvement Centre, Mexico and individual countries itself.

Wheat plants, that have been genetically modified to withstand drought, are now being tested in bio-safety greenhouse at the International Maize and Wheat Improvement Centre. Most of the plants produced have shown high tolerance to extreme low-water conditions. This research illustrates how recent advances in both molecular genetics and genetic engineering can be applied to enhance drought tolerance in plants. Progress h effects of drought on plants.

(c) The organisms selected for genome, projects were those that are mostly used in genetic and other scientific investigations. Thus, they may be regarded as model organisms. A model organism is an organism about which is a large amount of scientific knowledge is already available. These organisms include both prokaryotic and eukaryotic microorganisms as well as animals and plants. These organisms include E. coli, Bacillus subtilis, Archaeoglobus fulgidus, yeast {Saccharomyces cerevisiae), Arabidopsis thaliana, roundworm (Caenorhabditis elegans) and the fruitfly (Drosophila melanogaster). In addition, human genome project focussed on sequencing of the whole human genome.

E. coli is without any doubt, the best studied microorganism. Many of the technological tools available today were developed for E. coli genome project. The E. coli genome sequencing was completed in 1997. B. subtislis is a Gram-positive bacterium that colonizes leaf surfaces.

It is much used in industrial processes for both enzyme production and food supply fermentation. It is generally regarded as safe (GRAS).

S. cerevisiae is perhaps the most important fungal species used in biotechnological processes. Its name derives from the fact that it can ferment saccharose (sugar). S. cerevisiae genome sequencing project began in 1989, and the sequencing was completed in 1999. Arabidopsis thaliana is a small plant belonging to the Cruciferae family. It was recognized as a good organism for genetic studies in 1907, and has become a model plant for genetic studies.

Since it has the smallest genome among higher plants.

Further, its genome has a low amount of repetitive DNA. Arabidopsis genome sequencing project began in 1990 and was completed in 2000. The fruitfly, D. melanogaster, is fondly regarded the Queen of Genetics. Drosophila genome sequencing was completed in 2000. It has 180 x 106 bp and -16,000 genes.

Thus, the number of genes in Drosophila is less than four-times as many as in the bacterium E.coli.

Question 9.
(a) Mention the chief characteristics of stem cells. Give any two uses of such cells. [4]
(b) List the steps involved in the Sanger’s method for determining the amino acid sequence of proteins. State any one limitation of this method. [4]
(c) Name four centers or funding agencies which deal with Biotechnology and Bioinformatics in India. [2]
Answer:
(a) Embryonic stem cells : These are derived from embryos. Most embryonic stem cells are derived from embryos that develop from eggs that have been fertilized in vitro. The embryos from which human embryonic stem cells are derived are typically four or five days old and are a hollow microscopic ball of cells called the blastocyst. The blastocyst includes three structures: the trophoblast, which is the layer of cells that surrounds the blastocoel, a hollow cavity inside the blastocyst; and the inner cell mass, which is a group of cells at one end of the blastocoel that develop into the embryo proper.

Chief characteristics of stem cells : Embryonic stem cells differ from other kinds of cells in the body. Embryonic stem cells have three general properties:

• they are capable of dividing and renewing themselves for long periods,
• they are unspecialized; and
• they can give rise to specialized cell types.

Embryonic stem cells are capable of dividing and renewing themselves for long periods. Unlike muscle cells, blood cells, or nerve cells which do not normally replicate themselves; Embryonic stem cells may replicate many times, or proliferate.

Embryonic stem cells are unspecialized. One of the fundamental properties of a stem cell is that it does not have any tissue-specific structures that allow it to perform specialized functions. For example, a stem cell cannot work with its neighbors to pump blood through the body (like a heart muscle cell), and it cannot carry’ oxygen molecules through the bloodstream (like a red blood cell). Embryonic stem cells, can give rise to specialized cells, including heart muscle cells, blood cells, or nerve cells.

Uses of Embryonic stem cells: Studies of human embryonic stem cells will yield information about the complex events that occur during human development A primary goal of this work is to identify how undifferentiated stem cells become the differentiated cells that form the tissues and organs.

Embryonic stem cells could also be used to test new drugs. For example, new medications could be tested for safety on differentiated cells generated from human pluripotent cell lines. Perhaps the most important potential application of human embryonic stem cells is the generation of cells and tissues that could be used for cell-based therapies.

(b) Protein sequencing is a technique to determine the amino acid sequence of a protein as well as which conformation the protein adopts and the extent to which it is complexed with any non-peptide molecules. Discovering the structures and functions of proteins in living organisms is an important tool for understanding cellular processes. It is also possible to generate an amino acid sequence from the DNA or mRNA sequence encoding the protein, if this is known. A protein sequencer is a machine that is used to determine the sequence of amino acids in a protein. They work by tagging and removing one amino acid at a time, which is analysed and identified. This is done repetitively for the whole polypeptide, until the whole sequence is established.

Determination of amino acid sequences :
Prior to amino acid sequence determination, it is essential to know the protein’s purity, molecular weight and its amino acid composition. A pure protein, if multimeric must be dissociated into its individual polypeptide chains and the molecular weight of the chains is determined. The molecular weight of a protein roughly tells about the number of amino acid residues contained in it. Each amino acid residue has an average molecular weight of 110 D. So if the molecular weight of a protein is 11000 D, we can predict that 100 amino acid residues are present. The amino acid composition tells the protein chemist about the strategies which could be employed in protein sequencing.

The following protein sequencing techniques are employed :
The first protein to be sequenced was the hormone ‘insulin’ whose deficiency leads to the disease diabetes. The Nobel Laureate, Fred Sanger invented a method of protein sequencing using a stepwise release and identification of amino acids starting from the N-terminal amino acid. The reagent employed by Sanger, known as fluoro-dinitro-benzene (Sanger’s reagent) reacted specifically with the free NH₂ group of the N-terminal amino acid and on acid hydrolysis, it yielded a yellow colored dinitro phenyl (DNP) derivative of the original N-terminal amino acid.

The polypeptide was subsequently, shortened by one amino acid. The DNP-amino acid was identified by comparison with other standard DNP amino acids using chromatography techniques. This procedure was repeated on the shortened polypeptide. In order to complete the sequence of insulin, Sanger used more than a gram of the hormone purified from a large number of pancreatic glands. However Sanger’s method has become obsolete and historical. The following steps summarise the Sanger’s method for determining the amino acid sequence.

• Hydrolysis by heating a sample of protein in 6M hydrochloric acid.
• Separation of polypeptide chains by ion – exchange chromatography.
• Fragmentation of the polypeptide chain by
  • Enzymatic methods using proteolytic enzyme, highly selective in hydrolyzing peptide bond,
  • Chemical methods using cyanogen bromide (CNBr) cleaves selectively the peptide bond following a methionine residue.
• Identification of N-terminal amino acid using Sanger’s reagent (fluoro-dinitrogen-benzene).
• Identification of DNP amino acid by comparison using chromatography by interpreting chromatogram.
• Repeating the procedure on the shortened polypeptide to identify rest of amino acids one by one.

Limitation : The method cannot be used in case the sample material is less in amount.

(c) (i) Institute (IARI) New-Delhi
(ii) National Diary Research Institute (NDRI) Kamal.
(iii) Indian Veterinary Research Institute (IVRI) Izat Nagar (Near Bareily U P.)
(iv) Centers for Plant Molecular Biology (CPMB) in various universities such as Delhi University, National Botanical Research Institute Lucknow.

ISC Class 12 Biotechnology Previous Year Question Papers

ISC Economics Previous Year Question Paper 2014 Solved for Class 12

Maximum Marks: 80
Time allowed: 3 hours

• • Candidates are allowed additional 15 minutes for only reading the paper.
  • They must NOT start writing during this time.

• Answer Question 1 (Compulsory) from Part I and five questions from Part II.
• The intended marks for questions or parts of questions are given in brackets [ ].

Part – I (20 Marks)
Answer all questions.

Question 1.
Answer briefly each of the following questions (i) to (x).
(i) State the components of compensation of employees.
(ii) Explain the shape of the Average Cost Curve.
(iii) Explain the demand curve for a necessary commodity.
(iv) Explain any two causes of disequilibrium in the balance of payment in an economy.
(v) What is meant by high powered money?
(vi) The demand for a commodity at 4 per unit is 100 units. The price of the commodity rises and as a result, its demand falls to 75 units. Find the new price if the price elasticity of demand for that commodity is I.
(vii) Justify the following as price-takers/price-makers:
(a) An oligopoly market.
(b) A perfectly competitive e-market.
(viii) If the value of the multiplier is 4, what will be the value of MPC and MPS?
(ix) Distinguish between intended supply and actual supply.
(x) What is meant by deficit financing?
Answer:
(i) It includes all payments and benefits made by employers to their employees both in cash and kind in lieu of their production services. It is also known as income from work. It includes:

• Wages and salaries paid in cash or kind.
• Employer’s contribution to social security schemes.
• Payment of pension to retired persons.

(ii) AC curve is ‘U’ shaped because:
(a) In the initial stage, because of the increasing returns to a factor, MP tends to rise and (its inverse) MC tends to fall. Falling MC causes fall in AC as well.

(b) When there is a constant return to a factor this will imply a situation of constant MP and constant MC. Because of stable MC, AC also tends to stabilise.
(c) When there are diminishing returns to a factor MP starts declining (and its inverse) MC starts rising. Rising MC causes AC to rise. In brief, AC assumes its ‘U’ shape in accordance with the law of variable proportions.

(iii) Demand Curve for a Necessity good:
It is a perfectly inelastic demand curve. When quantity demanded does not change at all in response to change in price of the commodity, demand for that commodity is said to be perfectly inelastic. The Demand curve is a straight line parallel to Y-axis.

(iv) (a) The imbalance between exports and imports because of large scale development expenditure which causes large imports, high domestic prices which leads to imports and cyclical fluctuations like recession or depression.
(b) Political instability and disturbances cause large capital outflows and hinder inflows of foreign capital.

(v) High powered money: It refers to the money produced by RBI and Government of India. The total liability of monetary authority of the Country and RBI is called High Powered Money (H) or monetary base. It consists of (a) currency (notes and coins) in the hands of the public (C), (b) Cash reserves of commercial bank (R), (c) Other deposits of RBI (OD).
Symbolically: H = C + R + OD

(vi) Q = 100, P1 = X
P = 4, Q1 = 75
Ed = 1

(vii) (a) An oligopoly market-Price maker.
Justification: An oligopoly is a market structure dominated by the small number of large firms and several of these firms are large enough to influence the market price, hence they are Price Maker.

(b) A perfectly competitive market-Price taker.
Justification: Every firm in perfect competition is very small compared to the overall size of the market. Only those firms which can cover their cost can survive. The market price will allow only for normal profits, which means that the individual firms cannot lower its prices to attract the customers. The individual firms also cannot raise their prices, because it will lose its customers to the competition. With each firm selling identical products, there is no customer loyalty. The customers will migrate to firms with lower price. Hence, all the firms in a perfectly competitive market are a price taker.

(ix)

Intended Saving	Actual Saving
(a) The saving which is intended (planned) to be made by all the household in an economy during a period or at the beginning of the period is called intended (planned ) saving.	(a) It is the actual amount of saving that took place measured after the fact.
(b) It is also called ex-ante saving.	(b) It is also called ex-post saving.
(c) The amount of intended (planned) saving is given by saving function.	(c) Realised saving of a period (say, a year) is called actual saving.

(x) Deficit financing: When a government spends more than what it currently receives in the form of taxes and fees during a fiscal year, it runs into a deficit budget. When the budget deficit is financed by borrowing from the public and banks, it is called deficit financing.

Part – II
(Answer any five questions)

Question 2.
(a) Study the diagram given below and answer the questions that Y follow:

(i) Pe is the equilibrium price. What would prompt the government to fix the price at P1?
(ii) What would be the effect of fixing the price at P1?
(b) Discuss the effect of elasticity of demand on:
(i) a commodity which has many substitutes.
(ii) a small part of the individual’s income spent on a commodity.
(c) (i) Study the schedule given below and identify how much of commodity A and commodity B will a utility-maximizing consumer buy:

Units of A	M.U. of A	Units of B	M.U. of B
1	10	1	30
2	8	2	24
3	6	3	20
4	4	4	16
5	2	5	14
6	1	6	8

(ii) Explain the Law of Equi Marginal Utility, using the above schedule.
Answer:
(a) (i) P1 is the price floor. Price floor refers to the minimum price (above the equilibrium price)
fixed by the government, which the producer must be paid for their produce.
When the government feels that the price fixed by the forces of demand and supply is not remunerative from the producer ‘s point of view, then it fixes a price (known as price floor) which is more than the equilibrium price.
Most well-known examples of imposition of price floor are agricultural price support programmes and minimum wage legislation.
(ii) This will lead to a situation of excess supply.

(b) (i) Demand for a commodity with a large number of substitutes will be more elastic. The reason is that even a small rise in its prices will induce the buyers to buy the substitute.
(ii) The proportion of income spent: Proportion of consumer’s income that is spent on a particular commodity also influences the elasticity of demand for it. Greater the proportion of income spent on the commodity, more is the elasticity of demand for it and vice-versa. Demand for goods like salt, needle, soap, matchbox, etc. tends to be inelastic as consumers spend a small proportion of their income off such goods. When prices of such goods change, consumers continue to purchase almost the same quantity of these goods. However, if the proportion of income spent on a commodity is large, then demand for such a commodity will be elastic.

(c) (i) The consumer will buy 2 units of A and 4 units of B. The marginal utility derived from A and B are equal, therefore this is called the law of equi-marginal utility.
(ii) Law of Equi-marginal utility: This law states that the consumer maximizing his total utility will allocate his income among various commodities in such a way that his marginal utility of the last rupee spent on each commodity’ is equal.
Explanation of the law when the prices of different commodities are unequal:
In reality, we find that the prices of different commodities the consumer wants to purchase are unequal or indifferent.

Units of A	M.U. of A	Units of B	M.U. of B
1	10	1	30
2	8	2	24
3	6	3	20
4	4	4	16
5	2	5	14
6	1	6	8

Since, marginal utility curves of goods slopes downwards, curves depicting MUx/Px and will also slope downward.
As the income of the consumer is given, let the marginal utility of money be constant at OM utils.
MUX/PX is equal to OM. when OH amount of good X is purchased. MUY/PY is equal to OM. w hen OK quantity of good Y is purchased. Thus, when the consumer is buying OH of X and OK of Y then MUX/PX = MUY/PY = MUM.
Therefore, the consumer is in equilibrium when he is buying OH of X and OK of Y. No other allocation of money expenditure will yield greater utility, when he is buying OH of X and OK of Y.

Question 3.
(a) Discuss how the supply of labour is an exception to the law of supply.
(b) According to the Law of Variable Proportions, in which stage would a producer like to operate? Explain why.
(c) Explain how a producer can attain equilibrium using TR and TC approach.
Answer:
(a) The rise in the price of a good or service sometimes its lead to falling in its supply. For eg. the supply of labour. A higher wage rate enables the worker to maintain his existing material standard of living with less work and he may prefer extra leisure to more wages. The supply curve in such a situation will be backward bending sloping SS1.

At WN wage rate, the supply of labour is ON. But beyond NW wage rate, the worker will reduce rather than increase his working hours. At MW1. wage rate the supply of labour is reduced to OM.

(b) The producer will like to operate in stage II where TP increases at a diminishing rate, MP falls but remains positive. In this phase. AP is maximum and MP is zero, TP rises at a diminishing rate.

(c) A firm attains the stage of equilibrium when it maximizes its profits i.e. when he maximizes. the difference between TR and TC. After reaching such a position, there will be no incentive for the producer to increase or decrease the output and the producer will be said to be at equilibrium.

According to TR – TC approach, producer’s equilibrium refers to a stage of that output level at which the difference between TR and TC is positively maximized and total profits fall as more units of output are produced. Two essential conditions of producer’s equilibrium are:

• The difference between TR and TC is positively maximized.
• Total profits fall after that level of output.

The first condition is an essential condition. But, it must be supplemented with the second condition. So, both the conditions are necessary to attain the producer’s equilibrium.
Producer’s equilibrium (when prices remain constant): When price remain same at all output levels, each producer aims to produce that level of output at which he can earn maximum profits, i.e., when the difference between TR and TC is maximum.

Output (unit)	Price (₹)	TR (₹)	TC (₹)	TR – TC (profit remarks)
0	10	0	5	-5
1	10	10	8	2
2	10	20	15	5
3	10	30	21	9
4	10	40	31	9
5	10	50	42	8
6	10	60	54	6

According to the table, the maximum profit of ₹ 9 can be achieved by either producing 3 units or 4 units. But the producer will be at equilibrium at 4 units of output because at this level both the conditions of producer’s equilibrium are satisfied:
(i) A producer is earning a maximum profit of ₹ 9.
(ii) Total profit falls to ? 8 after 4 units of output.

Producer’s equilibrium will be determined at the OQ level of output at which the vertical distance between TR and TC curves is the greatest. At this level of output, tangent to TC curve (at point G ) is parallel to the TR curve and the difference between y both the curves (which is shown by GH) is £ maximum.

At quantities smaller or larger than OQ, such as OQ1 and OQ2 units, the tangent to the TC curve A would not be parallel to TR curve. So the q producer will be at equilibrium at OQ units of output.
Producer’s equilibrium (when Price falls with a rise in the level of output)
When the price falls with rise in the level of output, each producer aims to produce at that level of output where he can earn maximum profits i.e., the difference between TR and TC is the maximum.

Output (unit)	Price (₹)	TR (₹)	TC (₹)	TR – TC (profit remarks)
0	10	0	2	-2
1	9	9	5	4
2	8	16	9	7
3	7	21	11	10
4	6	24	14	10
5	5	25	20	5
6	4	24	27	-3

The producer will be at equilibrium at 4 units of output because, at this level, both the conditions. of producer s equilibrium are satisfied.

A producer is earning maximum profit at ₹ 10. Total profits fall to ₹ 5, after 4 units of output. Producer’s equilibrium will be determined at the OQ level of output at which the vertical distance between the TR and TC curve is greatest. At this level of output, tangent to TR curve (at point H) is parallel to a tangent to TC curve ( at point G ) and the difference between both the curves (shown by GH) is maximum.

Question 4.
(a) Explain the relationship between AC and MC with the help of a diagram.
(b) Highlight any three differences between monopolistic competition and oligopoly.
(c) A perfectly competitive firm can continue producing even if it is incurring losses in short-run equilibrium. Justify the given statement with the help of a diagram.
Answer:

(a) (i) When MC is less than AC, AC falls with an increase in output. i.e. till 3 units of output.
(ii) When MC ¡s equal to AC, i.e., when MC and AC curves intersect each other at point A, AC is constant and it’s a minimum point.
(iii) When MC is more than AC, AC rises with an increase in output, i.e., from 5 units of output.
(iv) Thereafter, both AC and MC rise, but MC increases at a faster rate as compared to AC. As a result, the MC curve is curved.
(b)

Monopolistic Competition	Oligopoly Competition
It is a market structure containing a large number of relatively small firms.	It is a market structure containing the small number of relatively large firms.
There are free entry and exit of other firms.	The entry is not free.
A demand curve is downward sloping.	The exact behaviour of the demand curve is difficult to predict.

(c) Shut Down Point: Simple question is why firms continue producing the product if they are making losses. In the short run, the firms cannot go out of the industry by disposing of the plant. Why do they not down? It is because they cannot change the fixed factors and they have to face fixed costs even if the firm is shut down. The firm can avoid only variable costs but it has to bear the fixed costs whether to produce or not. The firm will continue producing till the price covers the average variable cost. If the price covers some part of the o average fixed costs besides the variable cost, the producer will continue producing. Thus the firm will continue producing so long as price exceeds the average variable cost. The shutdown point can be shown with the help of a diagram:

In the diagram, equilibrium is at E where MR = MC and MC cuts MR from below. The price is EQ and OQ is the output. This price covers the average variable cost and some portion of AFC M NE but still per unit loss is AE but the form will continue production as if it stops production loss per unit will form AN i.e. difference between AC & AVC/.e, AFC (AO – NQ = AN). If the market price falls to OP1 only AVC is covered i.e. E1Q1 = OP1, Now there will not be any use to continue production and so E1 will be shut down point.

Question 5.
(a) Differentiate with the help of diagrams, contraction in supply and decrease in supply.
(b) Identify the market where a firm is not required to reduce the price to sell more. Explain the behaviour or TR and MR.
(c) Explain how a consumer attains equilibrium using the indifference curve analysis.
Answer:

(b) The market where the firm is not required to reduce the price to sell more is “perfect competition” because under perfect competition, price is fixed and it is same for every firm. Relationship between TR and MR (When price remains constant)
When price remains constant, firms can sell any quantity of output at the price fixed by the market. As a result, the MR curve (and AR curve) is a horizontal straight line parallel to the X-axis. Since MR remains constant, TR also increases at a constant rate (see table). Due to this reason, the TR curve is a positively sloped straight line (see fig.) As TR is zero at zero levels of output, the TR curve starts from the origin.
Table: TR and MR (When price remain constant)

(c) A consumer shall be in equilibrium where he can maximise his satisfaction, subject to his budget constraints. It refers to a situation in which a consumer with his given income and given prices, purchases such a combination of goods which gives him maximum satisfaction and he does not want to bring any change in it.
Conditions of Consumer’s Equilibrium:
According to indifference curve approach, a consumer will be in equilibrium. when the following two conditions are satisfied:
(i) Budget line or Price line should be tangent to indifference curve i.e.,
MRSXY = or Slope of IC = Slope of PL

(ii) Indifference curve should be convex to the point of origin at equilibrium point or we can say MRS is declining.
The point where these two conditions are fulfilled simultaneously represents eqm. for the consumer because that relates to the highest indifference curve that consumer can reach within his available budget. It can be shown with the help of the following diagram: It is clear from the figure that ‘Q’ is the only eqm. point where both the conditions of eqm. are fulfilled. Where the consumer buys ‘OM’ of X Commodity and ‘OH’ of Y Commodity. Any other point-like and Q2 cannot be considered as an optimum point because they lie on a lower indifference curve IC. Any point lying on IC3 like ‘Q3’ is beyond the reach of the consumer and no eqm. condition is satisfied.

Thus on Price line AB, ‘Q’ is on the highest IC, that gives maximum satisfaction to the consumer. At point ‘Q’ both the conditions of eqm. are satisfied.

Question 6.
(a) Discuss two contingent functions of money.
(b) Explain the role of the Reserve Bank of India with respect to:
(i) Custodian of foreign exchange.
(ii) Promotional and developmental functions.
(c) Discuss how the exchange rate is determined under a flexible exchange rate system.
Answer:
(a) Facilitates Credit: Money facilitates the functioning of credit instruments such as cheques, promissory notes, bills of exchange, etc. Such credit instruments facilitate the transfer of value from one person to another.
Liquidity: Money is the most liquid form of all the assets and wealth. Gold, silver, land, cheques are not as liquid as money. If the need arises, then these assets need to be converted into money, but on the other hand, money need not be converted into any other form as it is readily acceptable. Apart from being liquid, money also provides a guarantee of liquidity/solvency to other forms of wealth and assets. This implies that money can be converted into any type of asset and on another hand, any type of asset can be converted into money.

(b) (i) Reserve Bank keeps a close watch on the external value of its currency and undertakes exchange management control. All the foreign currency received by the citizens has to be deposited with the reserve bank and if citizens want to make payment in foreign currency, they have to apply to reserve bank. It also keeps gold and billion reserves.
(ii) Promotional and developmental functions: The RBI has been a promoter since its inception. Various promotional and developmental functions of RBI are:

• By encouraging commercial banks to expand their branches in semi-urban and rural areas, the reserve bank helps:
  To reduce the dependence of the people in these areas on the defective unorganized sector of indigenous bankers and money lenders. To develop the banking habits of the people.
• By establishing the Deposit Insurance Corporations.
• Through the Institutions like Unit Trust of India, the Reserve Bank helps to mobilize saving in the country.
• Since its inception, Reserve Bank is making efforts to promote institutional agricultural credit by developing cooperative credit institutions.
• It also helps to promote the process of industrialization in the country by setting up specialized institutions for industrial finance.
• It also takes measures for developing the bill market in the country.

(c) The flexible exchange rate is determined by the interaction of the forces of demand and supply.
The equilibrium exchange rate is determined at a level where the demand for foreign exchange is equal to the supply of foreign exchange. This will be clear from As seen in the diagram, demand and supply of foreign exchange are measured on the X-axis whereas the rate of foreign exchange on the Y-axis. DD is the downward sloping demand curve of foreign exchange and SS is the upward-sloping supply curve of foreign exchange. Both the curves intersect each other at point ‘E The equilibrium exchange rate is determined at OR and the equilibrium quantity is determined at OQ.

Any exchange rate (other than OR) is not the Equilibrium Exchange Rate
(i) If the exchange rate is more than equilibrium rate.
If the exchange rate rises to OR2, then demand for foreign exchange will fall to OQ2 and supply will rise to OQ1. It will be a situation of excess supply. As a result, the exchange rate will fall till it again reaches the equilibrium level of OR.

(ii) If the exchange rate is less than the equilibrium rate.
If the exchange rate falls to OR1, then demand will rise to OQ1 and supply will fall to OQ2. It will be a case of excess demand. It will push up the exchange rate until it reaches OR.

Question 7.
(a) Explain how public expenditure can be used as a tool to attain economic stability.
(b) Differentiate between degressive taxation and regressive taxation.
(c) Explain the various components of the budget.
Answer:
(a) Public expenditure helps to attain economic stability in following ways:
Production and Employment:
It depends on:
The capability of the people to work, save and invest.
The will of the people to work, save and invest.
Transfer the resources to different uses and regions.

Government Expenditure and Economic Stability: The activities of the market economy are never alike. Sometimes, there is brisk in economic life while on other occasions, the business life faces sluggish behaviour. Thus after 1930‘s Great Depression, the economist is stressing upon economic stabilization. According to Keynes, economic crisis rose because AD was less than AS and lower MPC along with lower MEC played their role. Therefore, he stressed upon increasing consumption and investment for the sake of economic stability.

Public Expenditure and Economic Growth: The public expenditure can be used to remove unequal income distribution. The facilities of health, education and communication can be made available. All such means that government expenditure can be used for economic growth and development. Moreover, because of government expenditure, the incomes of the people through the multiplier process will increase. When income will increase, the saving will also increase, which can be used for investment. This shows that an increase in government expenditure can play a vital role in the economic growth of the country.

(b)

Degressive Taxation	Regressive Taxation
It is a type of tax in which people with high incomes pay less tax as a percentage of their income than those people with low income.	It is a tax imposed in such a manner that the tax rate decreases as the number of taxation increases.
Those tax take place when a tax is just vaguely progressive. For e.g., when the speed of development is not sufficiently spiky.	In terms of individual income and wealth, a regressive tax imposes a greater burden on the poor than on the rich.
Those tax might take place when the uppermost proportion is laid down for that particular kind of revenue on which it is projected to put forth most weight, and from this position onwards, taxes are implied rationally on upper-income groups and decreasingly on lesser incomes, declining to zero on poorest income group.	These taxes tend to reduce the tax -incidence of people with higher ability to pay tax, as they shift the incidence disproportionately to those with lower ability to pay.

(c) Components of Budget: The budget has two broad components
(1) Revenue budget
(2) Capital budget.
(1) Revenue budget includes revenue receipts and expenditure of the government.
(a) Revenue Receipts: It refers to those receipts of the government which neither create a liability nor leads to a reduction in assets.
Tax Revenue: It consists of the proceeds of taxes and other duties levied by the government.
Non Tax Revenue: It includes receipts from sources other than tax.
(b) Revenue Expenditure:

• It refers to all those expenditures of the government which do not result in the creation of physical assets.
• Capital Budget includes capital receipts and expenditure of the government.
• Capital Receipts: It is defined as any receipts of the government which either create liability or reduce assets.
• Capital Expenditure: An expenditure which either creates assets or reduce liabilities.

Question 8.
(a) Discuss the mechanism of investment multiplier with the help of a numerical example.
(b) Distinguish between marginal propensity to consume and marginal propensity to save. What is the relationship between the two?
(c) Explain the determination of the equilibrium level of output with the help of saving and investment curves. If savings exceed planned investment, what changes will bring about equality between them?
Answer:
(a) Increase in investment in an economy generates a multiplier effect on its national income. The extent of multiplier effect (and therefore, the extent of the total increase in income) depends on the marginal propensity to consume (MPC). Higher the MPC, greater would be the multiplier effect and vice-versa.
Illustration: Let us assume that Increase in investment = ₹ 100 crore
MPC = 0.90
\(\begin{array}{l}{\mathrm{K}=\frac{\Delta \mathrm{Y}}{\Delta \mathrm{I}}} \\ {\mathrm{K}=\frac{1}{1-\mathrm{MPC}}} \\ {\mathrm{K}=\frac{1}{1-0.90}=2}\end{array}\)
Putting value of K in equation (ii)
\(\begin{aligned} 10 &=\frac{\Delta Y}{100} \\ 1000 &=\Delta Y \end{aligned}\)

(b) APC can be > 1 in situation when C > Y

Average Propensity to Consume (APC)	Marginal Propensity to Consume (MPC)
1. It refers to the ratio of consumption expenditure (C) to the corresponding level of income (Y) at a point of time. APC = C/Y	2. When income increases APC falls but at a rate less than that of MPC.
1. It refers to the ratio of change in consumption expenditure (DC) to change in total income (DY) over a period of time. MPC = DC/DY	2. When income increases, MPC falls but at a rate more than that of APC.

(c) Saving-Investment Approach (S-1 Approach)
According to this approach, the equilibrium level of income is determined at a level, when planned saving (S) is equal to planned investment (I).

In Fig, Investment curve (I) is parallel to the X-axis because of the autonomous character of investments. The Saving curve (S) slopes upwards showing that as income rises; saving also rises.
The economy is in equilibrium at point ‘E’ where saving and investment curves, intersect each other.
At point ‘E\ ex-ante saving is equal to ex- ante investment.
OY is the equilibrium level of output corresponding to point E.

When Saving is more than Investment
If planned saving is more than planned investment, i.e., after point ‘E’ in Fig., it means that households are not consuming as much as the firms expected them to. As a result, the inventory rises above the desired level.
To clear the unwanted increase in inventory, firms would plan to reduce the production till saving and investment become equal to each other.

When Saving is less than Investment
If planned saving is less than planned investment, i.e. before point ‘E’ in Fig., it means that households are consuming more and saving less than what the firms expected them to. As a result, planned inventory would fall below the desired level.
To bring the inventory back to the desired level, firms would plan to increase the production until saving and investment become equal to each other.

Question 9.
(a) How can personal disposable income be derived from private income?
(b) Explain any three precautions which should be taken while estimating national income by income method.
(c) Calculate national income and operating surplus from the following data:

(i) Government final consumption expenditure	800 crores
(ii) Net factor income earned from abroad	-110 crores
(iii) Private final consumption expenditure	900 crores
(iv) Net domestic capital formation	200 crores
(v) Profits	220 crores
(vi) Rent	90 crores
(vii) Net exports	-25 crores
(viii) Interest	100 crores
(ix) Net indirect taxes	165 crores

Answer:
(a) Personal disposable income is that part of personal income which is available to the households for disposal as like.
Personal Disposable Income – Personal Tax Payments – Non-tax Payments.

(b) (i) Only factor incomes which are earned by rendering productive services are included. All types of transfer income are excluded.
(ii) Sale and purchase of secondhand goods are excluded since they are not part of the production of the current year. Likewise, sale proceeds of shares and bonds are not included.
(iii) Imputed rent of owners occupied dwellings and value of production for self-consumption are included but the value of self-consumed services is not included.

(c) Operating surplus = Rent + Interest + Profit = 90 + 100 + 220 = 410
National Income = Government final consumption expenditure + Private final consumption expenditure + Net domestic capital formation + Net exports + Net factor income earned from abroad
National Income = 800 + 900 + 200 + (- 25) + (-110) = 1900+ (-135) = 1765

ISC Class 12 Economics Previous Year Question Papers

ISC Accounts  Previous Year Question Paper 2014 Solved for Class 12

Maximum Marks: 80
Time allowed: Three hours

• Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II, choosing two questions from Section A, two questions from Section B and one question from either Section A or Section B.
• The intended marks for questions or parts of questions are given in brackets [ ].
• Transactions should be recorded in the answer book.
• All calculations should be shown clearly.
• All working, including rough work, should be done on the same page as, and adjacent to the rest of the answer.

Part -1

Question 1.
Answer the following questions very briefly and to the point: [2 × 15]
(i) Name the two accounts prepared to show the results of a joint venture when each co-venturer records all transactions.
(ii) Give any two differences between fixed capital method and fluctuating capital method.
(iii) What is the accounting treatment when debentures are issued as a collateral security ?
(iv) Give any two differences between Revaluation Account and Realization Account.
(v) State with reason their a company can issue a share having a face value of ₹20 at ₹17.
(vi) Give the adjusting and closing entry for interest on calls in arrears due from a share holder.
(vii) State the provisions of the Indian Partnership Act, 1932, regarding charging of interest on drawings from a partner when :
(a) The firm has a partnership deed.
(b) The firm does not have a partnership deed.
(viii) What is meant by number of years purchase in the valuation of firm’s goodwill ?
(xi) List any four items that may have to be deducted from a deceased partner’s captial account while computing the amount payable to his legal representatives.
(x) Why is premium received on the issue of debentures considered a capital profit ?
Answer:
(i) (a) Memorandum Joint Venture Account.
(b) Joint Venture with Account.

(ii) The differences between fixed capital and fluctuating capital are :

(iii) Debentures issued as collateral security may be accounted for in the following two ways :
(a) No entry may be passed in the books, or
(b) The following entry may be passed.
Debenture Suspense AJc Dr.
To Debentures A/c
(Being debentures @ ₹ ………. issued as collateral security)

(iv) Two differences between revaluation Account and Realization Account are:

(v) Normally a company cannot issue shares at a discount of more than 10% of the face value of shares.
However, a higher rate may be permitted subject to a special resolution and prior sanction of the Company Law Board. Hence, in this case prior sanction of Company Law Board is required as the rate of discount is exceeding 10%.

(vi) Sundry Members A/c Dr.
To Interest on Calls in Arrears A/c
(Being interest due)
Interest on Calls in Arrears A/c Dr.
To Statement of Profit and Loss A/c

(vii) (a) When a firm has a partnership deed, interest on drawings may be charged at the specified rate.
(b) When a firm does not nave a partnership deed, interest on drawings is not to be charged.

(viii) Number if year’s purchase in the valuation of goodwill represents an estimated number with which average profit or super profit is to be multiplied for the purpose of calculating the value of goodwill.
It may also specify the number of y ears a firm may be expected to earn the same amount of profits in the coming years.

(ix) The following items may be deducted from a deceased partners’ capital account:
(a) Profit & Loss (Debit balance)
(b) Drawings
(c) Interest on drawings
(d) Old goodwill written off

(x) Premium received on the issue of debentures as a capital profit because it is not received in the normal course of business or it is not relating to the day to day operations of a business.

Part—II
Answer any four questions.

Question 2.
Ronnie and Annie entered into a Joint Venture to sell coal, sharing profits and losses in the ratio of 1:1. Annie purchased 100 tonnes of coal @ 5,400 per tonne and paid ₹ 30,000 as freight for sending the coal to Ronnie to the sold joint account.
During transit, 10 tonnes of coal was lost due to breaking in bulk (normal loss). Ronnie received the remaining tonnes of coal and paid ₹ 6,000 as landing charges. He accepted a bill drawn by Annie for ₹ 2,00,000.
Ronnie then sold 60% of the coal received by him for ₹ 4,21,200. His selling expenses amounted to ₹ 12,000.
The remaining stock, valued at original cost plus proportionate direct expenses, was shared equally by both the co-ventures. They settled their accounts by means of a bank draft.
(i) Total sales were ₹ 1,80,000 of which 50% were sold on credit and the remaining 50% were sold for cash.
(ii ) Expenses amounted to ₹ 1,500 towards go down rent and advertisements.
(iii) Bad debts were ₹ 1,500.
You are required to :
(i) Memorandum Joint Venture Account.
(ii) Ronnie’s Account in the books of Annie.
Answer:



Question 3.
Mitra Ltd. invited applications from the public for the issue of 60,000 shares of
₹ 10 each, at a discount of 10%, payable as ;
₹ 3 per share on application.
₹ 5 per share on allotment.
Balance on call.
The public subscribed for 50,000 shares ₹ 2,49,000 were received by the company on allotment and ₹ 49,400 on call. The company forfeited those shares on which both, allotment and call money was not received. 7% of the forfeited shares were reissued at ₹ 7 per share, hilly called up.
The company had ₹ 45,000 in its Security Premium Reserve Account which it used to write off any miscellaneous expenditure incurred during the year.
You are required to pass the necessary journal entries to record the above transactions. [12]
Answer:

Question 4.
Angad, Kunal and Nitin were partners sharing profit and losses in the proportion of 2 : 2 : 1 respectively. The Balance Sheet of their firm as on 31^st March, 2013, stood as follows :

Kunal retires on 1^st April, 2013, subject to the following adjustments :
(a) Provision for bad and doubtful debts to be increased by ₹ 975.
(b) Stock to be appreciated by 20% and Building by 10%.
(c) Machinery to be depreciated by 10% and Motor Van by 15%.
(d) Goodwill of the firm to be valued at ₹ 9,000.
(e ) The capitals of the continuing partners are to be adjusted according to the new profit sharing ratio which is agreed between Angad and Nitin as 3 : 2 respectively.
(f) Excess or shortfall in Angad’s and Nitin’s Capital Accounts to be transferred to their respective Current Accounts.
You are required to prepare
(i) Revaluation Account.
(ii) Partners’Capital Accounts.
(iii) Balance Sheet of the reconstituted firm. [12]
Answer:

Question 5.
Rahim and Sudesh, the two partners of a business firm, agreed to appropriate the profits of their firm on the following terms :
(a) Interest is payable on capital @ 5% pcr annum.
(b) Rahim will be entitled to a salary of ₹ 500 per month.
(c) Interest on loan to be given by the firm to the partners @ 10% per annum.
(d) Interest on drawings to be charged from the partners @ 5% per annum.
(e) Sudesh will get commission @ 1% on the sales made during the year.
(f) Rahim is entitled to a tent of ₹ 25,000 per annum for allowing the firm to carry on the business in his premises. [12]
The net profit of the firm for the year ended 31st March, 2013, was ₹ 1.80,000 before taking into account any of the above terms.

Answer:
Profit and Loss Appropriation Account for the year ended 31^st March, 2013

Question 6.
You are required to pass journal entries for the issue of debentures in the following conditions :
(a) Ben Ltd. issued 5,000, 12% Debentures of ₹ 100 each at par. redeemable at 5% premium after five years.
(b) Rex Ltd. issued ₹ 2,00,000. 12% Debentures of ₹ 100 each at a discount of 2%. redeemable at a premium of 5% after 10 years.
(c) Josh Ltd. issued 6,000 12% Debentures of ₹ 100 each at a premium of 5%, redeemable at a premium of 10% after 6 years.
(d) Oxygen Ltd. issued ₹ 30.000. 7% debentures of ₹ 100 each to a Creditor for ₹ 25,000 in lull satisfaction of his claim. The company had purchased machinery from him.
Answer:

Question 7.
(a) Sharp Ltd. was formed on 1st December, 2013, with a capital of ₹ 5,00,000 divided into shares of ₹ 10 each. It offered 80% of the shares to the public. [5]
The issue price was payable as follows :
30% of the face value per share was payable with application.
20% of the face value per share was payable with allotment.
The balance as and when required. The company did not call for the balance during the year. All the shares offered by the company were subscribed for. The company did not receive the allotment money on 3000 shares.
You are required to:
(i) Show the Share Capital in the Balance Sheet of the Company (prepared as per Revised Schedule VI of the Companies Act, 1956) at the end of the financial year.
(ii) Prepare Notes to Accounts.
(b) Under which heads and sub heads will the following items appear in the Balance Sheet of a company as per Revised Schedule VI of the Companies Act, 1956: [5]
(i) Bills Receivable
(ii) Interest accrued and due on debentures (ii0 Trade Creditors
(iv) Provision for Taxation
(v) Stores and Spares
Answer:

(b) (i) Current Assets – Trade Receivables
(ii) Current Liabilities – Other Current Liabilities
(iii) Current Liabilities – Trade Parables
(iv) Current Liabilities – Short term Provisions
(v) Current Assets – Inventories

Question 8.
Aman and Harsh were partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than Cash and Bank) and third party liabilities have been transferred to Realisation A/c. [10]
(a) There was furniture worth ₹ 50,000. Aman took over 50% of the furniture at 10% discount and the remaining furniture was sold at 30% profit on book value.
(b) Profit and Loss Account was showing a credit balance of ₹ 15,000 which was distributed between the partners.
(c) Harsh’s loan of ₹ 6,000 was discharged at ₹ 6,200.
(d) The firm paid realization expenses amounting to ₹ 5,000 on behalf of Harsh who had to bear these expenses.
(e) There was a bill for ₹ 1,200 under discount. The bill was received from Soham who proved insolvent and a first and final dividend of 25% was received from his estate.
(f) Creditors, to whom the firm owed ₹ 6,000, accepted stock of ₹ 5,000 at a discount of 5% and the balance in cash.
(h) The loss on dissolution was ₹ 8,000.
Answer:

Section-B
Answer any two questions.

Question 9.
(a) How does the quality of Ratio Analysis of a business depend upon the accuracy of its financial statements ? [2]
(b) From the following information, calculate Trade Receivables Turnover Ratio : [2]
Particulars
Credit Revenue from Operations ₹ 9,60,000
Gross Debeotrs ₹ 1,90,000
Bills Receivable ₹ 50,000
Provision for Doubtful Debts ₹ 10,000
(c) From the following information, calculate the following ratios up to two decimal (faces) : [6]
(i) Debt-Equity’ Ratio
(ii) Interest Coverage Ratio
(iii) Proprietary Ratio

Equity Share Capital — ₹ 2,00,000
5% Preference Share Capital — ₹ 60,000
General Reserve — ₹ 1,20,000
Fixed Assets — ₹ 5,05,000
Current Assets — ₹ 1,20,000
Current Liabilities — ₹ 40,000
Loan @ 10% interest — ₹ 5,00,000
Tax paid during the year — ₹ 30,000
Profit for the current year after interest and tax (available for the shareholders) — ₹ 90,000
Answer:
(a) Ratios are based on the figures and items provided in the Balance Sheet and Statement of Profit and Loss. Hence, if the figures and items are not accurate the Ratio Analysis will also not be of good quality.

Question 10.
From the following data prepare a Common Size Balance Sheet of Teak Wood Ltd. [10]
(Note : Current year’s figures appear in the first column and the previous year’s figures are in the second column.)


Answer:


Question 11.
(a) State with reason whether the following would result in inflow, outflow or no flow of cash : [10]
(i) Charging depreciation on furniture.
(ii) Cash withdrawn for bank for office use.
(b) From the following extracts of a company’s Balance Sheets, calculate for the year ending 31st March, 2013 :
(i) Cash from investing activities
(ii) Cash from financing activities.
(Note : Current year’s figures appear in the first column and the previous year’s figures are in the second column.)

Additional information:
(i) The loan installment and interest on loan was paid at the end of the financial year.
(ii) During the year 2012-13 :
(a) Dividend of ₹17,000 was proposed.
(b) The company provided depreciation on plant and machinery amounting to ₹ 13,500.
(c) The company sold 70% of its non-current investments which it held at the beginning of the year, at a profit of 20% on its book value.
Answer:
(a) (i) It would not result in any flow of cash as it is a non-cash transaction or item.
(ii) It would not result in any flow of cash as it is the movement between two items of cash and cash equivalents itself.

(b) (i) Calculation of cash from investing activities

Section-C
Answer any two questions.

Question 12.
(a) Mention any two demerits of using electronic spreadsheets.
(A) Write a formula in spreadsheet for calculating the “Take Home Pay” under the given condition:
Salary is more than ₹ 50,000 then the “Take Home Pay ” is 80%.
(c) How would you create a filter for data stored in a column in a spreadsheet ?
(d) State the steps involved in merging two cells in a spreadsheet.
(e) What is the difference between the functions AVERAGEA () and AVERAGEIFS () ?

Question 13.

(a) Write the expression to calculate GROSS PROFIT & NET PROFIT in the Cells (B5, B9), for the Year 2010.
(A) Write the expression to calculate the average GROSS PROFIT for year 2010, 2011 and 2012.
(c) Write a function to select the maximum Value of NET PROFIT for the years 2010, 2011 and 2012.
(d) Write a suitable expression to calculate the following for 2013 (Estimates) where :
(i) Sales of goods in Cell E2 where Sales of Goods have decreased 10% over 2012.
(ii) Sales of Services in Cell E3 where Sales of Services have increased 10% over 2011.
(iii) Income from other sources in cell E4 where Income From Other Sources have increased 25% over 2010.
(iv) Gross Profit in Cell E5.

Question 14. [10].
(a) What is the use of Data dictionary in RDBMS ?
(A) What is SQL?
(c) What is a Unique Key ?
(d) Define SQL update statement.
(e) What is meant by normalization of a database system ?

ISC Class 12 Accounts Previous Year Question Papers

ISC Biotechnology Previous Year Question Paper 2014 Solved for Class 12

Maximum Marks: 80
Time allowed: Three hours

• Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II, choosing two questions from Section A, two questions from Section B and one question from either Section A or Section B.
• The intended marks for questions or parts of questions are given in brackets [ ].
• Transactions should be recorded in the answer book.
• All calculations should be shown clearly.
• All working, including rough work, should be done on the same page as, and adjacent to the rest of the answer.

Part-I
(Answer all questions)

Question 1.
(a) Mention any one significant difference between each of the following : [5]
(i) RNA polymerases and Tag DNA polymerases
(ii) ln-situ conservation and Ex-situ conservation
(iii) Micronutrients and Macronutrients
(iv) mRNA and tRNA
(v) Essential amino acids and Non-essential amino acids

(b) Answer the following questions : [5]
(i) Why is primer essential during DNA replication ?
(ii) Name a pest resistant crop developed using biotechnology techniques.
(iii) Why are glucose and lactose referred to as reducing sugars ?
(iv) What is the role of dcMTP during DNA sequencing ?
(v) How is the disease alkaptonuria caused ?

(c) Write the Ml form of the following: [5]
(i) BLAST
(ii) ESTS
(iii) MOD
(iv) RAM
(v) SNP

(d) Explain briefly: [5]
(i) Splicing
(ii) Mitotic arrest
(iii) Reverse transcription
(iv) Interferon
(v) Activation energy of enzymes
Answer:
(a) (i)RNA Polymerase: It is an enzyme found in both prokaryotic and eukaryotic cells. It catalyzes the transcription of DNA to synthesize precursors of tmRNA.

Taq DNA Polymerase: It is a thermostable DNA polymerase, originally isolated from bacterium, Thermus aquaticus. It is used in polymerase chain reaction.

(ii) In-situ conservation: It means on-site conservation. It is the process of protecting an endangered plant or animal species in its natural habitat either by protecting or cleaning up the habitat itself, or by defending the species from predators.

Ex-situ conservation: It means literally, “off-site conservation”. It is the process of protecting an endangered species of plant or animal by removing part of the population from a threatened habitat and placing it in a new location, which may be a wild area or within the care of humans e.g., Zoos, Botanical garden, etc.

(iii) Micronutrients: Micronutrients are essential elements required by organisms in small quantities. They include microminerals and vitamins.

Macronutrients: Macronutrients include carbohydrates, proteins and fats required in larger quantities than micronutrients in the body

(iv) mRNA: mRNA is present in nucleus and functions in cytoplasm. It carries messages from DNA.

tRNA: tRNA is an adapter present in cytoplasm. It recognizes and brings amino acids near ribosomes for protein synthesis.

(v) Essential amino acid: The essential amino acids cannot be synthesized by the human body and are obtained from food.

Non-essential amino acid: The non-essential amino acids can be synthesized by the human body. They can be produced from other amino acids and substances in the diet and metabolism.

(b) (i) A primer is a strand of short RNA that functions as a starting point for DNA replication. It is required because the enzymes DNA polymerases that catalyze replication, can only add new nucleotides to an existing strand of DNA.

(ii) Bt crop is a pest resistant crop developed by using biotechnology techniques.

(iii) Glucose and lactose are the reducing sugars as they have an open chain with a free aldehyde or a ketone group.

(iv) ddNTP’s are a form of nucleotide that inhibit extension of the primer in DNA sequencing. Once a ddNTP has been incorporated into the DNA chain, it halts the process.

(v) Alkaptonuria (black mine disease or alcaptonuria): It is a rare, inherited recessive genetic disorder of tyrosine metabolism, caused due to mutation of gene.
Symptoms : Black urine, ochronosis, leading to osteoarthritis, kidney stones.

(c) (i) BLAST : Basic Local Alignment Search Tool

(ii) EST : Expressed Sequence Tag

(iii) MGD : Mouse Genome Database

(iv) RAM : Random Access Memory

(v) SNP : Single Nucleotide Polymorphism.

(d) (i) Splicing is the process by which introns(Non-coding) are removed from heteronuclear RNA to produce mature functional messanger RNA by uniting exons.

(ii) The process by which the mitotic cell cycle is stopped during one of the normal phases G1S, G2,M) of cell cycle.

(iii) It is the process by which DNA is synthesized from RNA template by reverse transcriptase enzyme. This process may be particularly helpful in treating diseases like HIV.

(iv) Interferon is a protein released by animal cells, generally in response to the presence of a virus. It inhibits virus replication.

(v) Activation energy of enzyme is the amount of energy required to bring substrates together to the point where they can react.

Part-II
(Answer any five questions)

Question 2.
(a) What are polysaccharides ? Name any three naturally occurring polysaccharides and give their structural units. [4]
(b) State one important use of each of the following in biotechnology : [4]
(i) Genomic DNA library and cDNA library
(ii) Transfection and Transformation
(c) What are single cell proteins ? [2]
Answer :
(a) Polysaccharides are the complex polymeric carbohydrate molecules composed of long chains of monosaccharide units linked together by glycosidic bonds. They vary in structure from linear to highly branched. Examples include storage polysaccharides such as starch and glycogen, and structural polysaccharides such as cellulose and chitin. Starch, glycogen and cellulose are the natural polysaccharide and their structural units are glucose.

(b) (i) Genomic Library: This is a collection of clones that represent the complete genome of an organism. For construction of a Genomic library the entire genomic DNA is isolated from host cells or tissues, purified and broken randomly into fragments of correct size for cloning into a suitable vector.

The major use of Genomic library is hierarchichal shotgun sequencing.
cDNA Library : The library made from complementary or copy DNA (cDNA) is called cDNA library. The library represents the DNA of only eukaryotic organisms, not the prokaryotic once.

cDNA library’ is used to express eukaryotic gene in prokaryotes. cDNA libraries are most usefirl in reverse genetics where the additional genomic information is of less use. It is also useful for subsequently isolating the gene that codes for that mRNA.

(ii) Transformation : In the Biotechnology, Transformation means introduction of rDNA molecules into a living cell. It is the method of transfer of recombinants into the host cells. The DNA molecule comes in the contact of the cell surface and then it is taken up by the host cells.

Transfection : Transfection is the transfer of foreign DNA into cultural host cells mediated through chemicals. This method is used for the transfer of foreign DNA in the host cell. The recipient host cells are overlayed by this mixture. Consequently, the foreign DNA is taken up by the host cell.

(c) Single cell protein : The SCP is basically a non-pathogenic, fast growing microbial biomass rich in high quality of protein and can be commercially produced throughout the year and independent of climate (except algal process).
Example : Mushrooms and yeasts are good source of vitamin B complex.

Question 3.
(a) Name any four vectors used in gene cloning technique. Also, state the unique properties of each of them. [4]
(b) With reference to tissue culture, explain the importance of: [4]
(i) Triploid plants
(ii) Haploid plants
(c) Give two uses of site directed mutagenesis. [2]
Answer:
(a) Vectors are tools used by molecular biologists to insert genes or pieces of foreign DNA into host cells. The four main types of vector commonly used include plasmids, bacteriophages, cosmids and yeast artificial chromosomes (YAC’s).

Plasmid: It is an extra chromosomal circular DNA molecule that independently replicates inside the bacterial cell and some yeasts; cloning limit: 100 to 10,000 base pairs or 0.1-10 kilobases (kb).

Phage : Designed bacteriophage lambda (λ) and M13 ; linear DNA molecules, whose region can be replaced with foreign DNA without disrupting its life cycle; cloning limit: 8-20 kb. M13 is a filamentous phage which infects E-coli. cloning limit: 10 kb.

Cosmids: A constructed extrachromosomal circular DNA molecule that combines features of plasmids and (cos) sites of phage; cloning limit: 45 kb.

Yeast Artificial Chromosomes (YAC): An artificial chromosome that contains telomeres, origin of replication, a yeast centromere, restriction enzymes sites and a selectable marker for identification in yeast cells ; cloning limit: 1Mb.

(b) (i) Applications / Importances of triploid plants :

• Autotriploidy induces gigas effect i.e., large-sized leaves, flowers, fruits and seeds.
• Autotriploids are sterile (with faulty pairing and distribution of chromosomes and abnormal gametes) and reproduce vegetatively only. They are useful for the production of seedless plants.

(ii) Applications / Importances of haploid plants :

• Haploid plants have been used in breeding programmes of rice, wheat, barley, Brassicaspps, tobacco, potato, etc.
• A doubled haploid strain are produced in only two years a net saving of 4 years for the production of homozygous lines by selfing or close breeding of both self and cross pollinated crops. They may be released directly as a variety if it performs well in yield trials.
• Haploid plants are most suitable for the study of recessive mutations.

(c) Uses of Site-directed mutagenesis

• To study the protein structure, gene expression, gene regulation and function relationships.
• To make specific and intentional changes to the DNA sequence of a gene and any gene products.

Question 4.
(a) Discuss the following innovations in biotechnology : [4]
(i) Recombinant hepatitis B vaccine
(ii) Tomato fruit with delayed ripening
(b) Explain the method used for DNA sequencing by chemical degradation technique. [4]
(c) Mention the principle involved in the freeze preservation of germplasm. [2]
Answer:
(a) (i) In July of 1986, the food and drug administration (FDA) approved the first genetically engineered vaccine for humans : Hepatitis B vaccine. Hepatitis B vaccine is developed for the prevention of hepatitis B virus infection. A microorganism, e.g., yeast for expression of hepatitis B surface antigen (HBsAg) is used as vaccine against hepatitis B virus.

The vaccine contains one of the viral envelop proteins (HBsAg). The gene coding this protein is identified and integrated into a suitable expression vector and introduced into a suitable host where the protein is produced in large quantity. Protein is then isolated and purified from host cell and used in preparation of vaccine.

(ii) A plant with delayed fruit ripening
‘Flavr Savr’ variety of tomato:
In transgenic tomato, the expression of gene for the production of polygalacturonase was blocked as this enzyme degrade pectin. In the absence of enzyme, pectin degradation is stopped and the fruit remains fresh for long time. It retains flavour, has superior taste and higher quantity’ of total soluble solids.

(b) The structure of DNA (e.g., gene insert, a recombinant plasmid or entire genome) can be analysed by determining the nucleotide sequences. In molecular cloning, the information of nucleotide sequences are essential. In 1965, Robert Holley and his research group at Cornell University completely sequenced nucleotides of tRNAala (tRNA for yeast alanine). In 1977, the following two methods were developed.

Allan Maxam and Walter Gilbert developed a chemical method of DNA sequencing. In this method, end-labelled DNA is subjected to base specific cleavage reaction before gel separation. In routine sequencing of DNA this method is not commonly followed. In the same year (1977) Frederick Sanger and co-workers developed an enzymatic method of DNA sequencing. It is also called dideoxynucleotide chain termination method because dideoxynucleotides are used as chain terminator to produce a ladder of molecules.

Maxam and Gilbert’s Chemical Degradation Method
In this method, DNA sequencing involves the following steps :

• Labelling of 3 ’ends of DNA with isotopic phosphorus (32P).
• Separation of two strands labelled at 3 ’ ends.
• Separation of mixture in four sets, each treated with a different reagent which can degrade only G or C, or A and G or T and C.
• Electrophoretic separation of each sample in four different gel.
• Autoradiography of gels and determination of the sequence from position of bands in four lanes of gel.

(c) Freezing: When cells or whole tissues are preserved by cooling to low sub-zero temperatures, such as (typically) 77 K or -196°C (the boiling point of liquid nitrogen). At these low temperatures, any biological activity, including the biochemical reactions that would lead to cell death, is effectively stopped.

Storage : The frozen cells and tissues are stored in a liquid nitrogen refrigerator, the temperature must not be rise above -130°C otherwise ice crystals may be formed.

Thawing: Thawing of the frozen materials is achieved by plunging the vials into water at 37-40°C (thawing rate of 500°-700°C/min) for 90 seconds. The material is then transferred into an ice bath till it is recultured.

Reculture : Materials subjected to cryopreservation may show some special requirements during reculture. For example, shoot-tips preserved seedlings of tomato required GA3 for developing into shoots. Similarly survival of carrot plantlets was generally improved by activated charcoal.

Question 5.
(a) Explain the principle and any two uses of each of the following biochemical techniques : [4]
(i) Partition Chromatography .
(ii) X-Ray Crystallography.
(b) Enumerate the steps involved in Southern blotting technique. Also, write two applications of this technique. [4]
(c) Mention any two methods used in the isolation of single cells from plant organs. [2]
Answer:
(a) (i) Partition Chromatography: Partition chromatography is the process of separation whereby the components of the mixture get distributed into two liquid phases due to differences in partition coefficients during the flow of mobile phase in the chromatography column.

Here the molecules get preferential separation in between two phases, i.e., both stationary phase and mobile phase are liquid in nature. So molecules get dispersed into either phases preferentially. Polar molecules get partitioned into polar phase and vice-versa. This mode of partition chromatography applies to liquid-liquid, liquid-gas chromatography and not to solid-gas chromatography. Because partition is the phenomenon in between a liquid and liquid or liquid and gas or gas and gas. But not in solid involvement.
Uses:

• It is used to separate the amino acids.
• It is extensively used for the study of lipid-soluble substances.

(ii) The technique of single-crystal X-ray crystallography has three basic steps :
The first and often most difficult step is to obtain an adequate crystal of the material under study. The crystal should be sufficiently large (typically larger than 100 microns in all dimensions), pure in composition and regular in structure.

In the second step, the crystal is placed in an intense beam of X-rays, usually of a . single wavelength (monochromatic X-rays), producing the regular pattern of reflections.

As the crystal is gradually rotated, previous reflections disappear and new ones appear; the intensity of every spot is recorded at every orientation of the crystal. Multiple data sets may have to be collected, with each set covering slightly more than half a lull rotation of the crystal and typically containing tens of thousands of reflection intensities.

In the third step, these data combined computationally with complementary chemical information to produce and refine a model of the arrangement of atoms within the crystal. The final, refined model of the atomic arrangement now called a crystal structure is usually stored in a public database.

Uses:

• It is used to determine the atomic and molecular structure of a crystal.
• It is also used in X-ray diffraction to rotate the samples.

(b) Southern blotting is a technique for transfer of DNA molecules from an electrophoresis gel to a nitrocellulose or nylon membrane, and is carried out prior to detection of specific molecules by hybridization probing.

In this technique, DNA is usually converted into conveniently sized fragments by restriction digestion and separated by gel electrophoresis, usually on an agarose gel. The DNA is denatured into single strands by incubation by alkali treatment.

The DNA is transferred to a nitrocellulose filter membrane which is a sheet of special blotting paper. The DNA fragments retain the same pattern of separation they had on the gel. This process is called blotting.

The nitrocellulose membrane is now: removed from the blotting stack.

The blot is incubated with many copies of a radioactive probe which is single-stranded DNA. This probe detect and identify base pairs with its complementary DNA sequence and bind to form a double-stranded DNA molecule. The probe cannot be seen but it is either radioactive or has an enzyme bound to it (e.g., alkaline phosphatase or horseradish peroxidase). This step is known as hybridization reaction.

The location of the probe is revealed by incubating it with a colorless substrate that the attached enzyme converts to a coloured product that can be seen or gives off light which will expose X-ray film. If the probe was labelled with radioactivity, it can expose X-ray film directly. The images of radioactive probe are revealed as distinct bands on the developed X-ray film.

Applications of Southern blotting

• It is used in DNA fingerprinting.
• Identify mutation, deletion and gene rearrangement.
• Prognosis of cancer and prenatal diagnosis of genetic disease.

(c) Methods of single cell isolation from plant organ: Leaf mesophyll tissue and callus are the most suitable materials to isolate a single cell. Leaf mesophyll tissue contains a homogeneous population of cells. There are two methods described for isolation of a single cell:

Mechanical Method: Mechanical isolation involves tearing of surface sterilized explants to expose the cells followed by scrapping of the cells with a fine scalpel to liberate the single cells without any damage. These cells are dipped in liquid medium.
About 10 grams of leaves are macerated in 40 ml of buffered medium using pestle and mortar. The homogenate is filtered through muslin cloth. Cells are w ashed by centrifugation at low speed. Cells are collected and debris are removed.

Enzymatic Method : Using this method, maximum amount of cells can be isolated with minimum damage and injury in the cells. It is accomplished by providing osmotic protection to the cells. The enzyme (pectinase/macerozyme) degrades the middle lamella and cell walls of the parenchy matous tissue as a result, individual cells are set free. Osmotic protection is provided to the cells while the enzyme macerozyme degrades the middle lamella and cell w all of the paranchymatous tissues.

Question 6.
(a) State the role of any four enzymes involved in the process of DNA replication. [4]
(b ) Outline the basic steps involved in the in vitro regeneration of a complete plant from a single cell. [4]
(c) Name any two biochemical techniques based on solubility. [2]
Answer:
(a) Enzymes taking part in Replication
Four different enzymes have been reported which are given below :

Exonuclease : This enzyme breaks down the hydrogen bonds coupling nitrogenous bases in DNA molecules so that both the chains get apart during replication.

Endonuclease: This enzyme breaks down the chain or chains of DNA molecule. Whenever it appears, it results in dispersive type of replication.

Polymerase or replicase enzyme: It catalyses the formation of one polynucleotide chain that is a copy of another (complementary chain). This new chain is synthesized from the raw material already present in nucleoplasm.

Ligase: This enzyme is used in the formation of bonds between the nitrogenous bases such as A = T and C = G. Whenever the appearance of the enzyme is delayed, conservative type of replication results.

(b) Steps involved in in vitro regeneration of a complete plants.
Regeneration refers to the development of organised structures like roots, shoots, flower buds, somatic embryos (SE’s), etc. from cultured cells/tissues; the term organogenesis is also used to describe these events. Root regeneration occurs quite frequently, but it is useful only in case of shoots and embryo germination. Only shoot and SE regeneration’s give rise to complete plants, which is essential for applications of tissue culture technology in agriculture and horticulture. Regeneration may occur either directly from the explant or may follow an intervening callus phase.

Basic technique of Plant Tissue Culture: The basic technique of plant tissue culture involves the following steps :
Preparation and Sterilisation of Suitable Nutrient Medium: Suitable nutrient medium as per objective of culture is prepared and transferred into suitable containers. Culture- medium is rich in sucrose, minerals, vitamins, and hormones. Yeast extract, coconut milk, are also added. The culture is completely sterilized in an autoclave.

Selection of explants : Selection of explants such as shoot tip should be done.

Sterilisation of explants: Surface sterilisation of the explants by disinfectants (eg., sodium hypochlorite or mercuric chloride) and then washing the explants with sterile distilled water is essential.

Inoculation: Inoculation (transfer) of the explants into the suitable nutrient medium (which is sterilised by autoclaving to avoid microbial contamination) in culture vessels under sterile conditions is done.

Incubations : Growing the culture in the growth chamber or plant tissue culture room, having the appropriate physical condition (i.e., artificial light; 16 hours of photoperiod), temperature (- 26°C) and relative humidity (50-60%) is required.

Regeneration : An unorganized mass of cells developing from explants is called callus. The callus gives rise to embryoids which can develop into whole plant if the medium is provided with proper concentration of hormones. This property of developing every somatic cell into a full fledged plant is called totipotency. Regeneration of plants from cultured plant tissues is carried out.

Hardening: Hardening is gradual exposure of plantlets to an environmental conditions.

Plantlet transfer : After hardening, plantlets are transferred to the greenhouse or field conditions following acclimatization (hardening) of regenerated plants.

(c) Biochemical techniques based on solubility :

• Salt precipitation
• Precipitation with organic solvent.

Question 7.
(a) Explain the operon concept of gene regulation with the help of an example. [4]
(b) Enumerate the secondary and tertiary structures of proteins. Also, mention any two important functions of proteins. [4]
(c) Mention any two potential uses of cloned stem cells. [2]
Answer:
(a) Operon is a regulatory gene system, often encoding a coordinated group of enzymes involved in a usually by interaction with and inactivation of a repressor, of trancription of the genes encoding the enzymes. Lac-operon is type of inducible pathway as the operon is switched on in response to the presence of chemical (lactose, a subtrate) called Inducer, which after coming in contact with repressor, form a non-DNA binding complex so as to free the operator gene for transcription. The enzymes formed in response to the presence of its subtrate are called Inducible enzymes.
Lac-operon of E.coli has following components.

• There are three structural genes Z, Y, A, which transcribe polycistronic /mRNA.
• Promoter gene is the site where RNA polymerase binds for transcription.
• Operator gene function as a switch for the operon. In absence of lactose, repressor binds to operator gene and the RNA polymerase cannot move from promoter gene and thus there is no transcription.
• i-gene is a regulator gene and synthesises a repressor protein. In the presence of lactose (inducer), the repressor bind to it and become inactive repressor, which does not bind to operator gene and RNA polymerase from promoter gene move to structural genes to help transcription.

Example: The lactose operon is an example of negative regulation. When E. coli cells are growing in a medium containing lactose as the only carbon source, some of the lactose is converted to allolactose. Allolactose acts as an inducer and turns on the lac-operon. In the presence of glucose and the absence of lactose, allolactose is not produced and the lac operon is turned off. Since glucose is a readily available energy source, cells won’t use lactose until they consume all the glucose. When both glucose and lactose are present in the medium, the operon is also turned off. In this case, the operon is regulated by catabolite repression.

(b) Secondary Structure (2° structure) : It is development of new stearic relationships amongst the amino acids for protecting their peptide bonds through formation of intrapolypeptide and interpolypeptide hydrogen bonds. Secondary structure is of three types—a-helix, p-pleated and collagen helix. The prefixes a and p signify the first and second types of secondary structure discovered by Pauling and Corey (1951).

α-Helix: The polypeptide chain is spirally coiled, generally in a clockwise or right-handed fashion (Fig.). There are 3.6 amino acid residues per turn of the spiral. The spiral is stabilized by straight hydrogen bonds between imide group (-NH-) of one amino acid and carbonyl group (—CO—) of fourth amino acid residue. In this way, all the imide and carbonyl groups become hydrogen bonded. R-groups occur towards the outer side of a-helix. a-helix is the final structure in certain fibrous proteins, e.g., keratin (hair, nail, horn), epidermis (skin).

β-Pleated Sheets : Two or more polypeptide chains come together and form a sheet. Condensation is little. However, twisting does occur. The same polypeptide may fold over itself to form two strands for β-pleating. Adjacent polypeptide chains may occur in parallel (e.g., p-keratin) or anti-parallel (e.g., silk fibrin). Straight hydrogen bonds occur between imide (-NH-) group of one polypeptide and carbonyl (-CO-) group of adjacent polypeptide. Cross-linkages help in stabilization of β-pleated sheets.

Collagen Helix : Collagen has a large amount of glycine (25%) and proline (and hydroxyproline, 25%). It cannot form a-helix due to them. Three of its polypeptide each having about 1000 amino acid residues, come together with each forming an extended left-handed helix. They run parallel, form a right-handed super-helix that is stabilised by hydrogen bonds amongst the three. The triple helix of collagen is often called tropo- collagen. Its one end is stabilised by -S-S- linkages amongst the three chains. Collagen occurs in those tissues where extensibility is limited, e.g., connective tissue, tendons, bones.

Tertiary Structure (3° Structure) :
Tertiary (3°) structure is bending and folding of secondary strand (2°) of polypeptide (a-helix or β-pleated sheet) in such a way as to form a compact structure with functional sites being established over its surface by coming together of polar regions of specific amino acids. Hydrophobic parts of amino acids generally pass into the interior of protein. When both a-helix and β-pleating occur in the same polypeptide, tertiary structure segregates them into specific areas. Tertiary structure is stabilised by five types of bonds :

1. Disulphide Bonds : Between hydrogen sulphide groups of two cysteine or methionine amino acids.
2. Hydrogen Bonds : They occur between hydrogen and oxygen atoms of various groups like -NH OC- or -OH OC-.
3. Ionic Bonds : They appear between oppositely charged ionised groups of two amino acids, e.g., NH3+ and -COO .
4. Hydrophobic Interactions: They are not true bonds but involve coming together of non-polar R-groups of two amino acids. Hydrophobic interactions are important in compaction of protein as they exclude water molecules in the area of their occurrence.
5. van derWaals Interactions : They develop between two closely placed polar groups through charge fluctuations between the two.

Functions of Proteins:

• Some proteins as hormones regulate many body functions. For example, the hormone insulin is a protein. It regulates sugar level in the blood.
• Some proteins as enzymes catalyse or help in biochemical reactions. For example, pepsin and trypsin.

(c) (i) Stem cells can be modified to bone, muscle, cartilage and other specialized types of cells, they have the potential to treat many diseases, including Parkinson’s, Alzheimer’s, diabetes and cancer.
(ii) New medications could be tested for safety on specialized cells generated in large numbers from stem cell lines.

Question 8.
(a) What is bioinformatics ? Mention its significant applications.
(b) Name the first bio technologically created mammalian clone and also explain the methodology involved in it.
(c) Define the term semi-gamy.
Answer:
(a) Bioinformatics is the application of computer technology to the management of biological information. Computers are used to gather, store, analyze and integrate biological and genetic information which can then be applied to gene-based drug discovery and development. Bioinformatics uses many areas of computer science, statistics, mathematics and engineering to process biological data.

Applications of Bioinformatics:

• It is used to search the genome of thousands of organisms, containing billions of nucleotides. These programs would compensate for mutations (exchanged, deleted or inserted bases) in the DNA sequence, in order to identify sequences that are related, but not identical.
• It is used for measuring biodiversity.
• The expression of many genes can be determined by this process.
• Bioinformatic techniques have been applied to explore various steps in the analysis of regulation.
• In order to trace the homology of newly identified protein.

(b) Dolly (sheep) is the first cloned sheep. The methods involved in creation of dolly are :
To Isolate donor nucleus: Firstly isolate the nucleus from a somatic (non-reproductive) cell of a adult donor sheep. The nucleus contains the complete genetic material of the organism. A micropipette is used to capture the nucleus and remove it from the cell.

Recovery of unfertilized eggs: Remove some unfertilized egg cells (reproductive) from a female sheep. Many eggs are needed since not all of them will survive the various steps of cloning.

Remove the egg’s nucleus: Nucleus is removed from egg which contains only one-half of the sheep’s genetic material.

Insert donor nucleus : Insert the nucleus, with its complete genetic material, isolated from the donor mammal in Step 1 into the egg cell that has no nuclear material. The egg’s genetic material now contains all traits from the donor adult. This egg is genetically identical to the donor adult.

Place the egg into womb : Transplant the eggs into a female sheep’s womb. Those eggs that survive will continue to develop into embryos. The egg matures in the womb. The offspring dolly is born, a clone (genetically identical) of the donor sheep.

After cloning was successfully demonstrated through the production of Dolly, many other large mammals have been cloned, including horses and bulls. The attempt to clone argali (mountain sheep) did not produce viable embryos. The reprogramming process cells need to go through during cloning is not perfect and embryos produced by nuclear transfer often show abnormal development.

(c) Semigamy: It is a type of facultative apomix in which the male sperm nucleus does not fuse with the egg nucleus after penetrating the egg in the embryo sac. Subsequent development can give rise to an embryo containing haploid chimeral tissues of paternal and maternal origins. In cotton, the semigametic phenomena was first reported by Turcotte and Feaster (1963), who developed the Pimaline 57-4 that produced haploid seeds at a high frequency.

Question 9.
(a) Write short notes on : [4]
(i) Protein databases
(ii) Hardware and Software of computers
(b) Name any four resources obtained from NCBI and give their uses. [4]
(c) Mention any two types of sequence analysis used in bioinformatics. [2]
Answer:
(a) (i) Protein Databases: The protein database is a collection of sequences from several sources, including translations from annotated coding regions in GenBank, RefSeq and TPA, as well as records from SwissProt, PIR, PRF, and PDB. Protein sequences are the fundamental determinants of biological structure and function. Protein databases are more specialized than primary sequence databases. They contain information derived from the primary sequence databases.
Example : PIR, TIGR, PFam, PRINTS, ProDom, ProSite, ALIGN, SWISS-PROT & TREMBL, etc.

(ii) Hardware and Software of computers
Hardware: Hardware is the collection of physical components that constitutes a computer system including peripherals such as the monitor, mouse, keyboard, computer data storage, hard drive disk (HDD), system unit (graphic cards, sound cards, memory motherboard and chips), etc., all of which are physical objects that can be touched. In contrast, software is instructions that can be stored and ran by hardware.

Software: Written programs or procedures or rules and associated documentation pertaining to the operation of a computer system and that are stored in read/write memory. Bases on their goals, they could be Application software, System software, Malicious software or malware, etc.

(b) The NCBI located at National library of Medicine was established in Bethesda, Maryland in 1988 through legislation sponsored by Senator Claude Pepper.
Useful resources:

• Genome sequencing data in GeneBank.
• An index of biomedical research articles in PubMed Central and PubMed.
• Entrez search engine, used to access literature (abstracts), sequence and structure databases.

(c) PDB (Protein Data Bank): This database has sequence of those protein whose 3 -D structures are known.
Source : NCBI-U.S.A.; EBI, UK.
Blast (Basic Local Alignment Search Tool): Blast is a family of user-friendly sequence similarity search tools on the web. The Blast server is supported through NCBI (National Centre for Biotechnology Information) U.S.A. This tool is designed to identify potential homologues for a given sequence. It can analyse both DNA and protein sequences. A local alignment finds the optimal alignment between subregions or local regions of specified sequences.

ISC Class 12 Biotechnology Previous Year Question Papers

ISC Accounts Previous Year Question Paper 2010 Solved for Class 12

Maximum Marks: 80
Time allowed: Three hours

• Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II, choosing two questions from Section A, two questions from Section B and one question from either Section A or Section B.
• The intended marks for questions or parts of questions are given in brackets [ ].
• Transactions should be recorded in the answer book.
• All calculations should be shown clearly.
• All working, including rough work, should be done on the same page as, and adjacent to the rest of the answer.

Part – I

Question 1.
Answer each of the following questions briefly : [10 × 2]
(i) State two differences between Bin Card and Stores Ledger.
(ii) What is a cost unit ?
(iii) Name the two accounts which are prepared, when each co-venture keeps a record of his own transactions only in his books.
(iv) State two differences between Sectional Balancing and Self Balancing.
(v) How will you deal with the following items in the absence of a partnership deed :
(a) Interest on Capital
(b) Interest on Drawings
(c) Interest on Partner’s Loan to the firm
(d) Share in Profit and Loss
(vi) State two differences between a revaluation account and a realization account.
(vii) What is a ‘fictitious asset’ ? Give one example.
(viii) What is meant by ‘issue of debentures as collateral security’ ?
(ix) Give four examples of tangible fixed assets as per Schedule VI, Part I of the Companies Act. 1956.
(x) What is meant by ‘Cash equivalents’ ?
Answer:
(i) Difference Between Bin Card and Store Ledger.

Bin Card	Store Ledger
1. A record of quantities only.	1. A record of both quantities and values.
2. Normally posted just before the transaction takes place.	2. Maintained by the Costing Department.
3. Usually kept inside the stores.	3. Always posted after the transaction takes place.

(ii) It is a unit of product or service for which cost is computed. Cost units are selected to allow for comparision between actual cost and standard cost, or between different actual costs.

(iii) Memorandum Joint-Venture Account
Joint Venture with Co-venture Account

(iv)

Basis of difference	Self Balancing	Sectional Balancing
(a) Double entry system     (b) Separate total balance	In this system, double entry system is fully implemented in all the ledgers. In this system separate total balance can be prepared for each ledger.	In this system, accounts are maintained on double entry system only. In this system, separate trial balance can be prepared only for general ledger.

(v) (a) Partner is not entitled to interest on capital.
(b) No interest is charged on partner’s drawings.
(c) A partner is entitled to interest at the rate of 6% p.a. on any loan given to the firm.
(d) Profits and losses are shared equally.

(vi) Difference between Realization Account and Revaluation Account.

Basis of Difference	Realization Account	Revaluation Account
(i) Time	This account is prepared at the time of dissolution of firm	This account is prepared at the time of admission/retirement or death of a partner.
(ii) Purpose	This account is prepared to find out the profit or loss on realization of assets and payment of liabilities.	This account is prepared to find out the profit or loss on revaluation of assets and liabilities
(iii)Amount	The amount of assets and liabilities are shown in this	The amount of increase or decrease in the value of assets and liabilities are show n in this account.

(vii) Fictitious assets are those assets which are not tangible in nature. For example-preliminary expenses, debit balance of P& L account.

(viii) Whenever a company takes loan from bank or any financial institution it may issue its debentures as secondary security which is in addition to the principal security. Such an issue of debentures is know n as issue of debentures as collateral security.

(ix) (a) Land.
(b) Buildings,
(c) Plant and Equipment,
(d) Furniture and Fixtures,

(x) An asset that is so easily and quickly convertible to cash that holding it is essentially equivalent to holding cash. A Treasury bill is considered a cash equivalent.

Question 2. [10]
Lucy, Rahul and Sanjay are partners sharing profits and losses in the ratio of 1 : 2 : 3, Arun is admitted as a partner who brings in Rs.20,000 as his capital for 1/5th share in the profit. Goodwill of the firm is to be valued at an average of the last three years profits which were Rs. 25,000, Rs. 28,000 and Rs. 37,000 respectively. Arun is unable to bring in cash towards his share of premium for goodwill.
Give the journal entries if goodwill already appears in the books at Rs. 24,000.
Answer:

Working Notes :

= Rs 30,000
Goodwill already in the books = Rs 24,000
Goodwill to be increased by Rs 6,000

Part – II

Question 3. [14]
Anita, Kiran and Mina were partners sharing profits and losses in the ratio , of 3:2: 1. They decided to dissolve the partnership due to insolvency of all the partners. Their Balance Sheet as on 31st December, 2009 was as follows :

The assets were realized as follows :
Machinery — Rs. 5, 000 and
Stock — Rs 3,000
Realization expenses were Rs. 1,000.
Prepare necessary accounts to close the books of the firm.
Answer:

Question 4. [14]
Prepare a Cost-Sheet from the following particulars :
Particulars:
Opening stock of raw material — Rs. 2,500
Opening stock of work in progress — Rs. 3,600
Opening stock finished goods (800 units) — Rs. 12,900
Purchase of raw material — Rs. 20,000
Productive wages — Rs. 27,000
Factor} expenses — Rs. 14,400
Establishment expenses — Rs. 6,400
Depreciation on delivery van — Rs. 9,000
Sales (.3000 units) — Rs. 90,000
Closing stock of raw material — Rs. 4,500
Closing stock of work in progress — Rs. 5,400
Closing stock of finished goods (1000 units) — ?
Answer:

Question 5. [14]
Andrew and Rohan entered into a joint venture and agreed to share profits and losses in the ratio of 4:3. Andrew supplied goods worth Rs. 13,000 from his own stock. He spent Rs. 900 on freight and insurance and drew a bill on Rohan for Rs. 9,000 for three months. Rohan accepted the bill which was discounted by Andrew @ 12%p.a. Rohan paid Rs.600 tow ards clearing charges and Rs.700 for rent. Goods were sold by Rohan for Rs.21,000. Rohan was entitled to a commission of 6%. Rohan sent the draft to Andrew towards settlement of his account
Prepare in the books of Andrew :
(a) Joint Venture Account
(b) Rohan’s Account
Answer:

Question 6.
Given below are the extracts from the books of Greg Steels Limited :
Particulars:
Opening balance of debtors — Rs. 23,000
Opening balance of creditors — Rs. 17,000
Credit sales — Rs. 9,500
Credit purchases — Rs.10,500
Paid to creditors — Rs. 12,000
Transfer from sales ledger to purchases ledger — Rs. 250
Bills receivable received — Rs. 4,750
Sales returns — Rs. 425
Purchases — Rs. 250
Cash received from debtors — Rs. 15,500
Bills payable accepted — Rs. 2,500
Bad debts — Rs. 850
Interest charged to customers — Rs. 320
From the above details prepare the Sales Ledger Adjustment Account and the Purchases Ledger Adjustment Account in the General Ledger.
Answer:

Question 7. [14]
Raman Ltd, issued 20,000 shares of Rs 10 each at a discount of 10% payable as follows :
(i) Rs 2.50 on application payable on 1^st May, 2009
(ii) Rs 1.50 on allotment payable on 1^st July, 2009
(iii) Rs 2 on first call payable on 1^st Oct, 2009
(iv) Balance on second call payable on 1^st Feb.2010
All these shares were subscribed and amounts received.
Shareholder ‘A’ who had been allotted 200 shares, paid the amount of the first and second calls with allotment.
Another shareholder ‘B’ holding 100 shares did not pay the final call till the date of the Balance Sheet. According to the Articles of Association of the company, interest at the rate of 4% p.a. is payable by the company on any calls in advance. The interest was paid by the company to the shareholder on 1^st Feb.2010.
Pass the necessary Journal Entries (including interest) in the books of the company.
Answer:

Question 8. [14]
Calculate the following Ratios from the Financial Statements of Annie Foods Limited:
(i) Gross profit ratio
(ii) Net profit ratio
(iii) Working capital turnover ratio
(iv) Stock turnover ratio
(v) Quick ratio
(vi) Proprietary ratio
(viii) Current ratio
Profit & Loss Account of Annie Foods Limited for the year ending 31^st March 2009



Note : All calculations are to be made to two places of decimal
Answer:

\(=\frac{68,000}{65,000}=1.05\)
Working Capital = Current Assets – Current Liabilities
Current Assets = Rs. 40,000 + Rs. 20,000 + Rs. 10,000 + Rs. 25,000 = Rs. 95,000
Current Liabilities=Rs. 10,000+Rs. 20,000 = Rs. 30,000
Working Capital = Rs. 95,000 – Rs. 30,000 = Rs. 65,000



Question 9. [14]
Given below is the Balance Sheet of M/s Victor Limited.

Additional Information :
(a) Loan was paid in the beginning of the year 2007.
(b) Depreciation provided on Plant during the year was Rs. 20,000.
From the above information prepare a cash flow statement as per Accounting Standard – 3.
Answer:

Question 10. [14]
Mehra Brothers has two petrol pumps, one in Kerala and the other in Punjab. The method of valuation of closing stock followed by both the pumps are FIFO and LIFO, respectively A periodic inventory of petrol is taken when the books are closed at the end of each month.
The following information is available for the month of December, 2009.

From the above information, prepare a Trading account to calculate the profit made by the above petrol pumps for the month of December. 2009.
Answer:

Value of Closing stock = Rs. 40,000+Rs. 6,45,000 =Rs. 6,85,000

Stock of Material as per Computation (petrol) = 8,000 +12,000 = 20,000 liter.
Value of Closing stock (i) 8,000 × 43 = Rs.3,44,000
(ii) 2,000 × 48 = Rs 96,000 = Rs. 4,40,000

ISC Class 12 Accounts Previous Year Question Papers

ISC Economics Previous Year Question Paper 2010 Solved for Class 12

Maximum Marks: 80
Time allowed: 3 hours

• Candidates are allowed additional 15 minutes for only reading the paper.
• They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II.
• The intended marks for questions or parts of questions are given in brackets [ ].

Part – I (20 Marks)
Answer all questions.

Question 1.
Answer briefly each of the questions (i) to (xv): [15 × 2]
(i) What is micro economics? Give an example.
(ii) How is exante demand different from expost demand?
(iii) Draw two supply curves, the first one showing elasticity of supply greater than one and the second one showing elasticity of supply less than one.
(iv) Define marginal revenue. How can we get marginal revenue from total revenue?
(v) Explain two advantages of international trade.
(vi) What is meant by actual earning of a factor?
(vii) How is Net National Product at factor cost obtained from Net National Product at market price?
(viii) Distinguish between productive debt and unproductive debt citing an example of each.
(ix) Mention two similarities between perfect competition and monopolistic competition.
(x) Define Balance of Trade.
(xi) Differentiate between consumer goods and producer goods. Give one example of each.
(xii) Identify whether the costs stated below are implicit costs or explicit costs. Justify your answer for each:
(a) Rent for self owned land.
(b) Payment made for advertising.
(xiii) What is meant by a balanced budget?
(xiv) Define proportional tax and show it graphically.
(xv) When can the equilibrium price remain unaffected by a change in demand? Show with the help of a diagram.
Answer:
(i) Microeconomics, the study of the economic behaviour of small economic groups such as firms and families, is one of the largest subfields in economics. These resources will help you ace your test, get a good mark on your microeconomics term paper, and help you understand how economic decisions are made.

(ii) Demand may be viewed ex-ante or ex-post: Ex-ante demand is the intended demand and ex-post demand is what is already purchased. The former denotes potential demand, while the latter refers to the actual magnitude purchased.

(iv) Marginal revenue is the additional revenue added by an additional unit of output, or in terms of a formula:
Marginal Revenue = (Change in total revenue) divided by (Change in sales)

(v) Advantages:

• International trade brings in different varieties of a particular product from different destinations.
• Promotes efficiency in production as countries will try to adopt better methods of production to keep costs down in order to remain competitive.
• Brings foreign exchange to the exporting countries. It makes the foreign currency reserves healthy.

(vi) Actual earnings of a factor tell you how healthy that factor is and if it may pay dividends or grow through capital appreciation (higher price).

(vii) Net national product at factor cost can be obtained from Net National Product at market price in the following manner.
Net National Product at Factor Cost = Net National Product at Market Price – Indirect Taxes + Subsidies.
Or
Net National Product at Factor Cost = Net National Product at Market Price – Net Indirect Taxes

(viii) Productive debt is used to purchase a productive asset: i.e.. one that will produce a profit while serv icing the debt. Debts used for the purchase of a rental property, equipment for a business, or perhaps dividend-paying stocks can be considered “productive” if they earn a profit. Unproductive debt is the debt used to finance activities that did not increase productivity.
Unproductive debt is that debt which is incurred to cover any budgetary deficits or for such purposes as do not yield any income to the government in times of war for example. The interest and sinking fund, if any, on this type of debt must be obtained from some other source of public income, generally from taxation and, since there is no corresponding asset created, there is no rule regarding the period of repayment.

(ix) Similarities between perfect and monopolistic competition.

• Many numbers of sellers and buyers in both type of markets.
• Free entry and exit of the firms.

(x) Trade account of the balance of payments includes exports and imports of goods in a year. The difference between the value of exports of goods and value of imports of goods is called the balance of trade. For example, if the value of the exports of goods is Rs. 10,000 in a year and the value of imports in the same year is Rs. 6,000, then the balance of trade is (+) Rs 4,000. It is a surplus balance of trade as exports are greater than imports.

(xi) Any tangible commodity purchased by households to satisfy their wants and needs. Consumer goods may be durable or non-durable. Durable goods (e g., autos, furniture, and appliances) have a significant life span, often defined as three years or more, and consumption is spread over this span. Non-durable goods (e.g., food, clothing, and gasoline) are purchased for immediate or almost immediate consumption and have a life span ranging from minutes to three years.
Goods manufactured and used in further manufacturing, processing or resale. Producer goods either become part of the final product or lose their distinct identity in the manufacturing stream.

(xii) (a) Implicit Cost.
A cost that is represented by a lost opportunity in the use of a company’s own resources, excluding cash is an implicit cost.
(b) Explicit cost
A business expense that is easily identified and accounted for is taken under explicit costs.

(xiii) A budget in which revenues equal or exceed expenditures. A balanced budget is thought to be positive for a company, as it means that the company is not taking on any (additional) debt in order to conduct its operations; if revenues exceed expenditures, it results in a profit.

(xiv) Proportional is a tax system in which the rate of taxation (percentage) remains constant at all levels of income (regardless of how much an individual earns.).

(xv) If the supply of the goods is perfectly elastic, change in demand would not affect the equilibrium price.

Part – II
(Answer Any Five Questions)

Question 2.
(a) In a straight-line demand curve touching the two axes, show the different degrees of elasticity of demand. [4]
(b) The price of a commodity falls from Rs. 50 to Rs. 30, resulting in an increase in the purchase of the commodity from 200 units to 220 units. Calculate the price elasticity of demand. [4]
(c) State the Law of Demand with two assumptions. Briefly discuss two exceptions to the Law of Demand.
Answer:
(a)

Three degrees of elasticity of demand are possible when the demand curve touches two axes

• Inelastic demand
• Unit elastic demand
• Elastic demand (greater than unit)

(b)

(c) The law of demand is stated as “other things being equal, the quantity demanded increases with a fall in price and diminishes with a rise in price”. According to this law other things being equal, demand varies inversely with the price that is, at a higher price less will be demanded and at a lower price more will be demanded.
Assumptions to the Law of Demand
(i) Tastes and preferences of the consumer are the same regardless of the income group.
(ii) All consumers have a fixed income and there is no change in income over a period of time.
(iii) Thirdly, the prices of the related goods do not change and they are fixed.

The law of demand states that, if all other factors remain equal, the higher the price of a good, the fewer people will demand that good. In other words, the higher the price, the lower the quantity demanded. The amount of a good that buyers purchase at a higher price is less because as the price of a good goes up, so does the opportunity cost of buying that good. As a result, people will naturally avoid buying a product that will force them to forgo the consumption of something else they value more.

Exceptions to the Law of Demand
Giffen goods: These are those inferior goods on which the consumer spends a large part of his income and the demand for which falls with a fall in their price.
Articles of snob appeal: Goods which serve status symbol do not follow the law of demand. These are goods of conspicuous consumption. These goods give their possessor utility in the sense of their ownership. Articles like diamond are purchased by the rich irrespective of their price hike as their possession is prestigious. When their price rises the prestige value goes up.

Question 3.
(a) Discuss two differences between micro and macroeconomics. [4]
(b) With the help of diagrams, show the shift and movement on the demand curves. [4]
(c) Using the utility’ approach, discuss how a consumer attains equilibrium. [6]
Answer:
(a) Microeconomics is the study of economics from a more individual point of view (consumers and their spending habits and firms in how they make profits) and how the economy affects people in their daily lives. Macroeconomics is economics from a ‘big picture’ perspective, such as how our country’s economy affects the world as a whole, etc.
Macroeconomics deals with large-scale economic decisions. It focuses on countries or continents and large regions, and it generally has applications for government policymakers. In contrast, microeconomics focuses on small-scale economic decisions, between individuals and firms. It examines how businesses can be the most successful and why individuals make the economic decisions that they do.

(b) Movement
A movement means a change along a curve. On the demand curve, a movement denotes a change in both price and quantity’ demanded from one point to another on the curve. The movement implies that the demand relationship remains consistent.
Therefore, a movement along the demand curve will occur when the price of the good changes and the quantity demanded changes in accordance to the original demand relationship. In other words, a movement occurs when a change in the quantity demanded is caused only by a change in price and vice versa.

Shift
A shift in a demand or supply curve occurs when a good’s quantity’ demanded or supplied changes even though price remains the same. Shifts in the demand curve imply that the original demand relationship has changed, meaning that quantity demand is affected by a factor other than price.

(c) A consumer will attain equilibrium if he allocates his given income on the purchase of goods X and Y in a manner that gives him maximum satisfaction.
He will get maximum satisfaction if he buys only that quantity of each good that gives him the same utility from the last rupee spent on each good.

Question 4.
(a) Distinguish between monopoly and monopolistic competition on the basis of average revenue curves and entry of firms. [4]
(b) What is meant by returns to scale? Differentiate between short-run production function and long-run production function. [4]
(c) Show how a firm in a perfectly competitive market earns normal profit in the long run. [6]
Answer:
(a) The distinction between Monopoly and Monopolistic Competiton On the basis of Average Revenue:
Under monopoly, average revenue and marginal revenue curves are two separate curves.
AR curve represents the price of different units and MR curve represents the marginal revenue of different units. Both the curves are downward sloping, meaning thereby that if the monopolist intends selling more units, he will have to lower the price per units.

Under monopolistic competition also, AR and MR curves are two separate curves. The slope > downward from left to right. But both these curves are more elastic than the curves under monopoly.

On the basis of Entry of Firms:
Under monopolistic competition, there are no restrictions on the new firms to enter into and the old ones to leave the group. However, this entry and exit are not so easy in the short-period. It is possible in the long-run only. But under a monopoly, there are restrictions on the entry of new firms.

(b) The quantitative change in the output of a firm or industry resulting from a proportionate increase in all inputs. If the quantity of output rises by a greater proportion e.g. if output increases by 2.5 times in response to a doubling of all inputs-the production process are said to exhibit increasing returns to scale. Such economies of scale may occur because greater efficiency is obtained as the firm moves from small to large-scale operations.

The short-run is defined in economics as a period of time where at least one factor of production is assumed to be in fixed supply i.e., it cannot be changed. We normally assume that the quantity of capital inputs (e g., plant and machinery) is fixed and that production can be altered by suppliers through changing the demand for variable inputs such as labour, components, raw materials and energy inputs. Often the amount of land available for production is also fixed. The time periods used in textbook economics are somewhat arbitrary because they differ from industry to industry. The short-run for the electricity generation industry or the telecommunications sector varies from that appropriate for newspaper and magazine publishing and small-scale production of foodstuffs and beverages. Much depends on the time scale that permits a business to alter all of the inputs that it can bring to production.

Long-run production – returns to scale
In the long run, all factors of production are variable. How the output of a business responds to a change in factor inputs is called return to scale.
Increasing returns to scale occur when the % change in output > % change in inputs.
Decreasing returns to scale occur when the % change in output < % change in inputs.

(c) In the long run, all inputs of a firm are variable. If the demand increases or decreases, all the firms have sufficient time to adjust their production according to the market conditions. In the long run, a firm can earn only normal profits because in case of continued abnormal profits new firm will enter into the market and supply will increase to meet the demand. In case of continued losses, certain firms will reduce their products or a few may leave the industry. In this case, the supply shall be reduced and the price will come up to its normal level. When a firm is, earning a normal profit in the long run, it will express the following equation. Marginal revenue (MR) = Marginal Cost (MC) = AC = AR = Price. So MR = MC = AC = AR = Price.

All the competitive firms, in the long run, earn normal profit and there is so tendency for the new firms to enter or leave the industry; they are in equilibrium when all the firms in the industry are in the state of lull equilibrium equating price, marginal revenue, marginal cost, average total cost, to the industry itself is also in equilibrium. When the industry is also in the long equilibrium there is an optimum allocation of resources. The consumers will get the commodity at a lower price because goods are produced at normal profit in the long run.

Question 5.
(a) Show the circular flow of income in a two-sector model with leakages and injections. [4]
(b) Discuss the problem of double counting in the estimation of national income. [4]
(c) Calculate national income and gross domestic product at factor cost from the following data: [6]

Answer:
(a) An Economy can be classified in various ways. One such way is purely theoretical. In this context, there are four sectors of an economy. These are households, firms, government and the rest-of-the-world. If we consider only the first three sectors, it becomes a closed economy. Inclusion of the last sector (also called the foreign sector) makes it an open economy. Considering only the first two sectors, it becomes a two-sector model;

Circular flow of income model is a model used to show the flow of income through an economy. Through showing the leakages in the economy and the injections, the different factors affecting the economic activities are apparent. Just like leakage in a fish tank, a leakage in the economy. leads to a decrease in economic activity.

And just like an injection into a fish tank where the water level rises, an injection in an economy leads to an increase in economic activity. To understand how the circular flow of income can be used to show disequilibrium in the economy you must first understand what disequilibrium is. Disequilibrium is the state where economic activity is not equal, that is where leakage > injections or when leakages < injections. whereas the state of equilibrium is when leakages = injections. Hence disequilibrium is when the savings are either greater or less than the investment.

(b) To calculate national income overall value of goods and services produced by the country is taken into account. However, this method suffers from ‘double counting. ’ Since the output of a production unit can be the input for another unit, it leads to double counting of a single variable.

Only final goods are included when measuring national income. If intermediate goods were included too, this would lead to double counting; for example, the value of the tires would be counted once when they are sold to the car manufacturer, and again when the car is sold to the consumer.

(c) GDP = Wages and Salaries + Rent Paid + Interest Paid + Dividend Paid
= 120 + 60 + 25 + 15
= 240
National Income = GDP – Depreciation + Net Factor Income + Mixed-Income + Undistributed Profits – Corporation Tax
= 240 – 5 + 10 + 20 – 30
= 225

Question 6.
(a) The following table shows the production of two commodities A and B, manufactured by Country 1 and Country 2, using one labour each. [4]

(i) Draw the opportunity cost curves for Country 1 and Country 2.
(ii) Name the country which will specialise in commodity A. Give reasons.
(b) Mention one difference between devaluation and depreciation of currency. How can depreciation of a currency be a measure to correct disequilibrium of Balance of Payment? [4]
(c) Explain the components of the current account of the Balance of Payment. [6]
Answer:
(a) Opportunity cost is measured by the slope of the production possibilities curve. In particular, the slope of the production possibilities curve is the opportunity cost of the good measured on the horizontal axis.
Opportunity cost is measured by the slope of the production possibilities curve. In particular, the slope of the production possibilities curve is the opportunity cost of the good measured on the horizontal axis.
(i)

(ii) The country 1 will specialize in commodity A. By using specialization, a country can concentrate on the production of one thing that it can do best, rather than dividing up its resources to produce another thing.

(b) Devaluation of Currency: Currency devaluation takes place when one country’s currency is reduced in value in comparison to other currencies. After currency devaluation, more of the devalued currency is required in order to purchase the same amount of other currencies.
For a currency to be devalued means that the issuing government has mandated that the price of the currency (in foreign dollars) is lower than it was before.

Depreciation of Currency: A decline in the value of one currency relative to another currency. Depreciation occurs when, because of a change in exchange rates, a unit of one currency buys fewer units of another currency.
The deprecation of currency is made in order to promote exports and discourage imports, as when a currency is depreciated exports become cheaper because while imports become more expensive.

(c) Components of Current Account of the Balance of Payment: The current account shows the net amount a country is earning if it is in surplus, or spending if it is in deficit.
It is the sum of the balance of trade (net earnings on exports – payments for imports), factor income (earnings on foreign investments-payment made to foreign investors) and cash transfers.

Entries under Current account might include:
Trade – buying and selling of goods and services
Exports – a credit entry
Imports – a debit entry
Trade balance – the sum of Exports and Imports
Factor income – repayments and dividends from loans and investments
Factor earnings – a credit entry
Factor payments – a debit entry
Factor income balance – the sum of earnings and payments.

Question 7.
(a) Define gross profit. How is net profit different from the gross profit? [4]
(b) Explain the components of gross interest. [4]
(c) Discuss four differences between rent and quasi rent. [6]
Answer:
(a) Gross Profit: Gross profit is calculated as sales minus all costs directly related to those sales. These costs can include manufacturing expenses, raw materials, labour, selling, marketing and other expenses.
Net Profit: Net Profit is the amount of money earned after all expenses, including overhead, employee salaries, manufacturing costs, and advertising costs, have been deducted from the total revenue.
Gross Profit is showed in the debit side in the Trading Account. Net Profit is showed in the debit side in the Profit and Loss Account.

(b) Gross interest rate: This is the total interest payable before any deductions such as tax and charges.
Components of Gross Interest:
1. Net interest: Net interest is that, which is paid for the use of the services of money alone.

2. Reward for Risk: Creditor has to take the risk in lending his money. He feels sceptical about the return of money to him. This risk can be of two types

• Business Risk: This risk arises because of the uncertainties of the business. When the business of the debtor is met with failure, then despite his good intentions, he is unable to repay the debt. Thus, the creditor runs a risk in giving loans.
• Personal Risk: It refers to the economic condition, character and integrity of the debtor. When a debtor is in a position to repay his debt but he willfully refuses to do so or he becomes bankrupt, the moneylender runs a personal risk.

3. Reward for Management: Creditor has to maintain proper account books showing different transactions regarding paying of loans, receipts of interest, balance due or repayment of the principal amount, etc. He may have to engage an account clerk for this purpose. He may have to make repeated requests to the debtor for the recovery of his dues. The expenses incurred on all these items must be adequately compensated. Thus the creditor includes his reward for management of accounts in the gross interest

4. Reward for Inconvenience: Parting with money involves several inconveniences on the part of the creditor. He may not get back money when needed and he himself may have to borrow from someone else. Or he may get his money back in small instalments. The reward for inconvenience thus figures in gross interest.

(c) (i) Rent is earned by the free gifts of nature such as land. But Quasi-rent is the excess income earned by the man-made factors.
(ii) Rent is earned both in short-run and long run. While Quasi-rent occurs only in short-run because, in the long run, man-made factors have their perfectly elastic supply.
(iii) Rent is permanent earning while Quasi-rent is transitory. In other words. Quasi-rent is not a cost in a short period.
(iv) Rent is never zero. But Quasi-rent becomes zero when the price is equal to average variable costs.
(v) Rent is the difference between total earnings and total costs. But Quasi-rent is the difference between total earnings and variable costs.

Question 8.
(a) Draw the average variable cost and average total cost curves. Do they intersect each other? Give one reason for your answer. [4]
(b) Discuss two exceptions to the Law of Supply. [4]
(c) ‘If more variable factors are employed with fixed factors, the total product increases at an increasing rate and finally, it falls’. Explain the three stages of the Law with the help of TP, AP and MP curves. [6]
Answer:
(a)

The Average Variable Cost Curve and Average Total Cost Curve do not intersect each other. There is a gap between the two average curves, which is the average fixed cost.
(i) Exceptions to the Law of Supply
The law of supply does not apply in the following cases:

1. In the case of agricultural products whose supply is affected by natural factors.
2. In the case of perishable goods like food. In the case of these goods, the seller is willing to sell more units at decaying prices.
3. In the case of goods having a social distinction. The supply of goods will remain limited even if their prices are high.

(c) The AP curve and its relationship to the MP and TP curves
The average product at each point on the TP curve is given by the slope of the line joining this point to the origin. Consider the point A on the TP curve. Average product is output/labour input = AB/OB = slope of the line OA.

The three stages of production
Based on the behaviour of MP and AP, economists have classified production in three stages:
Stage I: MP > 0, AP rising. Thus, MP > AP.
Stage II: MP > 0, but AP is falling. MP < AP but TP is increasing (because of MPO).
Stage III: MP < 0, In this case, TP is falling.

Question 9.
(a) Explain two effects of deficit financing. [4]
(b) Differentiate between fiscal deficit and primary deficit. [4]
(c) Discuss four characteristics of a good tax system. [6]
Answer:
(a) Effects of deficit financing

• Deficit financing in a developing country is inflationary. It hikes the prices of the goods.
• Deficit financing for development, like depression deficit financing, provides stimulus to economic growth by financing investment, employment and output in the economy. It helps rapid capital formation for economic development.

(b) Primary deficit is one of the parts of fiscal deficit. While the fiscal deficit is the difference between total revenue and expenditure, the primary deficit can be arrived by deducting interest payment from fiscal deficit. The interest payment is the payment that a government makes on its borrowings to the creditors.

(c) Economic efficiency: The tax should not prevent the efficient allocation of resources.

Administrative simplicity: The tax should be easy and inexpensive to administer.

Flexibility: The tax system should respond easily to changes in economic conditions.

Transparency: Individuals should be able to ascertain their tax burdens so that burdens can be politically tailored to what society considers desirable.

Fairness: The tax system should be fair in its treatment of different individuals.

ISC Class 12 Economics Previous Year Question Papers

ISC Economics Previous Year Question Paper 2017 Solved for Class 12

Maximum Marks: 80
Time allowed: 3 hours

• Candidates are allowed additional 15 minutes for only reading the paper.
• They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II.
• The intended marks for questions or parts of questions are given in brackets [ ].

Part – I (20 Marks)
Answer all questions.

Question 1.
Answer briefly each of the following questions (i) to (x): [10 × 2]
(i) What is meant by ex-ante demand and ex-post demand?
(ii) What is the short-run production function? Explain how is short-run production function different from the long-run production function.
(iii) Explain one main feature of each:
(a) Monopsony market.
(b) Monopoly market.
(iv) How is the elasticity of supply different from supply of a commodity?
(v) What is a direct tax?
(vi) Give two differences between a time deposit and demand deposit.
(vii) Explain with the help of an example, the problem of double-counting while calculating national income.
(viii) Give a reason for each of the following:
(a) The demand for a good increase when the income of the consumer increases.
(b) X and Y are substitute goods. A rise in the price of X results in the rightward shift of the demand curve of Y.
(ix) Write any two differences between the balance of trade and balance of payment.
(x) Explain the shape of the MC curve.
Answer:
(i) Ex-ante and Ex post Demand: Ex ante demand refers to the number of goods that consumers want to or willing to buy during a particular time period. It is the planned or desired amount of demand. Ex post demand, on the other hand, refers to the amount of the goods that the consumers actually purchase during a specific period. It is the number of goods actually bought. The number of goods actually bought is not the same as the amount that the consumers want (desire) to purchase. If the commodity is not available in adequate quantity, the quantity actually purchased (ex-post demand) will be less than the quantity that the consumers desire to purchase (ex-ante demand). Thus, consumers may end up buying more, or lesser quantity of goods that they had planned to buy.

(ii) Short-run is a period of time when production can be increased only by increasing the application of variable factor(s). Fixed factor, by definition, remains constant.
When one factor is a fixed factor and the other is a variable factor, production function may be specified as under:
Qx = f(L, K)
Here, Qx = Output of Good – X
L = Labour, a variable factor
K = Capital, a fixed factor
Difference:
1. Short run production function is ‘variable proportions type production function’ while the long period production function is ‘constant proportions type production function’.
2. Short run production function exhibits constant scale of output, while long run production function exhibits change in the scale of output.

(iii) (a) Single Buyer: Monoposony is a market structure where there is only one buyer of a commodity, service or input. It is a case of only one firm purchasing the entire product or factor service.
(b) Single Seller: Monopoly is a market situation where there is only one seller or producer, called monopolist of a commodity. It is a case of one firm or producer controlling the supply of the product. Since there is only one seller, any change in the amount of output produced by the monopolist would have significant influence over the market price. Because there is only one firm in monopoly, therefore the difference between the firm and the industry disappears.

(iv) Supply refers to the quantity of a commodity that a seller is willing to sell corresponding to a given price, at a given point of time. On the other hand, elasticity of supply measures the degree of responsiveness of the quantity supplied of a commodity to a change in its price. It measures the sensitivity of the quantity supplied to a change in the price.

(v) Direct taxes refer to taxes that are imposed on property and income of individuals and companies and are paid directly by them to the government.

• They are imposed on individuals and companies.
• The ‘liability to pay’ the tax (i.e. impact) and ‘actual burden’ of the tax (i.e, incidence) lie on the same person, i.e. its burden cannot be shifted to others.
• They directly affect the income level and purchasing power of people and help to change the level of aggregate demand in the economy.
• Examples: Income tax, Corporate tax, Interest tax, Wealth tax, Death duty, Capital gains tax, etc.

(vi) Demand deposits and time deposits:

• Demand deposits can be withdrawn at any time, whereas the time deposits can be with-drawn only after the expiry of a specific period.
• There is no interest rate on demand deposits, whereas the time deposits carry a higher interest rate.
• Demand deposits are chequeable and can be withdrawn through cheques, whereas time deposits are not chequeable.

(vii) To calculate national income overall value of goods and services produced by the country is taken into account. However, this method suffers from ‘double counting’, since the output of a production unit can be the input for another unit, it leads to double counting of a single variable. Only final goods are included when measuring national income. If intermediate goods were included too, this would lead to double counting; for example, the value of the tires would be counted once when they are sold to the car manufacturer, and again when the car is sold to the consumer. .

(viii) (a) The income of the consumer determines the purchasing power of the consumer. There is a direct relationship between the income of the consumer and his demand for a product. The demand for good increases when the income of the consumer increases because purchasing power of the consumer increases. Now he has more income to spend on different goods and services.
(b) X and Y are substitute goods. A rise in the price of X result in a rightward shift of the demand curve of Y because substitute goods are those goods which satisfy the same type of need and hence can be used in place of one another to satisfy the given want. If price of good X rise, the consumer will shift his demand from X to Y good because they can be used in place of one another.
(ix)

Balance of Trade (BOT)	Balance of Payment (BOP)
1. Balance of Trade refers to the difference between amounts of exports and imports of visible items.	1. It is an accounting statement that provides a systematic record of all economic transactions, between residents of a country and the rest of the world in a given period of time.
2. BOT includes only visible items.	2. BOP includes visible items, invisible items, unilateral transfers and capital transfers.
3. It does not record any transactions of capital nature.	3. It records all transactions of capital nature.

(x) MC curve is U-shaped. As output increases, MC curve slopes downward (up to OQ units), reaches the minimum (at point A) and then starts sloping upward beyond OQ level of output. (See Fig.) The U-shape of MC curve is because of the law of ( variable proportions. It is negatively sloped in the initial stage of production due to increasing returns to the variable factor and is positively sloped thereafter due to decreasing returns to the variable factor.

Part-II (60 Marks)
Answer any five questions.

Question 2.
(a) Explain with the help of a diagram the relationship between total utility and marginal utility. (3)
(b) Find the elasticity of demand of x and y on the basis of the demand schedule given below and specify which one is more elastic: (3)

Good x		Good y
Px(₹)	Dx (units)	Py(₹)	Dy (units)
8	10	8	10
4	12	6	25

(c) Explain any four reasons for the demand curve to be downward sloping. (6)
Answers:
(a) (i) Total utility increases with an increase in consumption as long as MU is positive.

(ii) When TU reaches its maximum, MU becomes zero. This is known as point of satiety.
(iii) When consumption is increased beyond the point of satiety, TU starts falling as MU become negative.
(iv) MU curve has a negative slope, while TU curve has a positive slope upto point ‘B’.

(b) For Good x


Elasticity of Demand in case of Good y is more elastic.

(c) Reasons for downward sloping demand curve:

• Law of Diminishing Marginal Utility: According to this law, as consumption of a commodity increases, marginal utility of each successive unit goes on diminishing to a consumer. Accordingly, for every additional unit to be purchased, the consumer is willing to pay less and less price.
• Income Effect: Income effect refers to change in quantity demanded when real income of the buyer changes owing to change in price of the commodity. With a fall in price, real income increases. Accordingly, demand for the commodity expands.
• Substitution Effect: Substitution effect refers to substitution of one commodity for the other when it becomes relatively cheaper. Thus, when own price of commodity-X falls, it becomes cheaper in relation to commodity-Y. Accordingly, X is substituted for Y. Tea and coffee are substitutes. With a fall in the price of tea, it is substituted in place of coffee. It is expansion of demand due to the substitution effect.
• Size of Consumer Group: When price of a commodity falls, many more buyers can afford to buy it. Accordingly, demand expands.
• Different Uses: A good may have several uses. Milk, for example, is used for making curd, cheese and butter. If the price of milk reduces it will be put to different uses. Accordingly, the demand for milk expands.

Question 3.
(a) The difference between AC curve and AVC curve decreases with increase in output but the two curves never touch each other. Justify the statement with the help of a diagram. [3]
(b) Explain any two characteristics of an indifference curve. [3]
(c) Discuss producer’s equilibrium in perfect competition, using MR and MC approach. [6]
Answers:
(a) The distance between the average total cost curve and the average variable cost curve gets smaller as production t increases. ATC curve is far above the AVC curve at early levels of output because the average fixed cost is a high percentage of the average total cost. But ATC curve tends o to come closer to AVC at higher levels of output because § the average fixed cost accounts for a relatively small percentage of the average total cost now. Notice that ATC curve never touches AVC curve because the average fixed cost is always positive. Thus, the distance between the 0 ATC curve and the AVC curve gets smaller as the level of output increases.

(b) (i) An indifference curve (IC) always slopes downward: This characteristic implies that to increase the consumption of X-good, the consumer has to reduce the consumption of Y-good, so as to remain at the same level of satisfaction as shown in i the given diagram:

To increase the quantity of ‘X’ good from OX to OX1 the consumer has to reduce quantity of good ‘Y’ from OY to OY1.
(ii) Indifference curves are convex to the origin: This property is based on the principle of diminishing marginal rate of substitution. It implies that as the consumer substitutes X for Y, the marginal rate of substitution between them goes on diminishing as shown in the following figure.
AB > CD > EF or Diminishing MRS

(c) In order to know the position of maximum profit, a firm compares the marginal cost with marginal revenue. So, the first condition of a firm’s equilibrium is that marginal cost must be equal to marginal revenue (MC = MR). It is necessary, but not sufficient condition of equilibrium. A firm may not get maximum profit even when its marginal cost is equal to marginal revenue. So, it must fulfil the second condition of equilibrium as well, i.e., marginal cost curve must cut marginal revenue curve from below or the slope of MC curve must be steeper than the slope of MR curve. According to marginal analysis, a firm would, therefore, be in equilibrium when the following two conditions are fulfilled:
1. MC = MR.
2. MC curve cuts the MR curve from below.

Both these conditions of firm’s equilibrium are explained with the help of Fig. In this figure, PP is average revenue (price per unit) as well as marginal Q revenue curve. It is clear from this figure, that MC curve is cutting MR curve PP at two points ‘A’ and a; ‘E’. Point A cannot indicate the position of equilibrium of the firm as at point A marginal cost of the firm is still falling or we can say MC is not cutting MR from below.

On the other hand, point E shows that firm is producing OM units of output. If the firm produces more than OM units of output, its marginal cost (MC) will exceed marginal revenue (MR) and it will have to incur losses. Thus, point ‘E’ will represent the equilibrium of the firm. At this point, both the conditions of equilibrium are being fulfilled:
(1) Marginal cost is equal to marginal revenue (MC = MR) and
(2) The marginal cost curve is cutting the marginal revenue curve from below. At point ‘E’ i.e., equilibrium position, firm is getting maximum profit. In case, the firm produces more or less than OM output, then its profits will be less than the maximum. So the firm, at OM level of output, will have no tendency either to increase or decrease its output from this level. It will, therefore, be in equilibrium at point E.

Question 4.
(a) Fill the blank in the table given below: [3]

No.of Workers	T.P.	A.P.	M.P.
1	—	150	—
2	230	—	—
3	—	—	120

(b) What is meant by floor price? Explain its impact on producers. [3]
(c) Explain any four features of an oligopoly market. [6]
Answers:
(a)

No.of Workers	T.P.	A.P.	M.P.
1	150	150	150
2	230	115	80
3	350	116.67	120

(b) Government intervenes in the process of price determination through Price Floor. Price Floor refers to the minimum price (above the equilibrium price), fixed by the government, which the producers must be paid for their produce.

• Many a time government feels that the price fixed by the market forces of demand and supply is not remunerative from the producer’s point of view, then it fixes a price (known as price floor) which is more than the equilibrium price.
• The minimum support price is one of the examples of a price ceiling.
• Indian Government maintains a variety of price support programmes for various agricultural products like wheat, sugar cane etc. and the floor is normally set at a level higher than the market-determined price for these goods.
  
  As seen in the diagram, equilibrium is determined at point E when demand curve DD and supply curve SS of wheat intersect each other. The equilibrium price of OP is determined.
• Suppose, to protect the producer’s interest and to provide an incentive for further production, , government declares OP2 as the minimum price (known as Price Floor) which is more than the equilibrium price of OP.
• The higher price lures the producers to produce more. This helps the government to maintain a buffer stock for exports.

(c) The principal features of oligopoly are as under:
(1) Small Number of Big Firms: Oligopoly market is the one in which a small number of big firms dominate the market for a product. Market dominance is retained through intense advertising. Advertising generates brand loyalty. Established brand loyalty enables the producer to exercise partial control over price. It makes demand for the product as relatively less elastic. Accordingly, firms are able to generate extra-normal profits.

(2) Difficult to Trace Firm’s Demand Curve: It is not possible to determine firm’s demand curve under oligopoly. This is because of high degree of interdependence among the competing firms. Thus, when a firm lowers its price, demand for its product may not increase, because the rival firms may lower the price more, because of which the buyers shift to the rival firms. Implying that there is no specific response of quantity demand to change in price. This makes it impossible to draw any specific demand curve for a firm under oligopoly.

(3) Entry Barriers: There are barriers to the entry of new firms. These are created largely through patent rights. Because of these barriers, the existing firms are not much worried about the entry of new firms in the market. They continue to earn extra-normal profits even in the long run.

(4) Non-price Competition: Under oligopoly, firms tend to avoid price competition. Instead, they focus on non-price competition. Example: In India, both Coke and Pepsi sell their product at the same price. But, in order to increase its share of the market, each firm takes to the aggressive non-price competition. Coke and Pepsi sponsor different games and sports; they also offer lucrative schemes (like of maintenance of school garden) if their product is patronised.

Question 5.
(a) Explain two causes of increasing returns to a factor. [3]
(b) Differentiate between real cost and money cost with the help of examples. [3]
(c) Discuss four determinants of supply of a commodity. [6]
Answers:
(a) Increasing returns to a factor occur because of the following factors:
1. Fuller Utilisation of the Fixed Factor: In the initial stages, fixed factor (such as machine) remains underutilised. Its fuller utilisation calls for greater application of the variable factor (Labour). Hence, initially (so long as fixed factor remains underutilised) additional units of the variable factor add more and more to total output, or marginal product of the variable factor tends to increase.

2. Division of Labour and Increase in Efficiency: Additional application of the variable factor (Labour) enables process based division of labour. Specialised workers may be used for different processes of production. This increases efficiency or productivity of the variable factor. Accordingly, marginal productivity tends to rise.

3. Better Coordination between the Factors: So long as fixed factor remains underutilised, an additional application of the variable factor tends to improve the degree of coordination between the fixed and variable factors. As a result, marginal product (MP) increases and total product (TP) increases at the increasing rate.

(b)

Real Cost	Money Cost
1. Real cost refers to the efforts and sacrifices made by the owners of factors of production used in the production of a commodity.	1. Money cost refers to money expenses which the firm has to incur in purchasing or hiring the factor services.
2. It includes the pain, sacrifice, discomfort and disutility involved in providing factor services required to produce a commodity.	2. These expenses include the money expenditures of a firm on wages and salaries paid to labour, payment of interest on borrowings, rental payments, payment for raw material.
3. The concept of real cost has no practical significance because it is a subjective concept that makes it difficult to estimate real cost.	3. Accounting books of a firm record these actual money expenses made by the firm on the factors of production as the cost of production.

(c) (i) Price of the Commodity: There is a direct relationship between price of a commodity and its supply. Generally, higher the price, higher the quantity supplied, and lower the price, lower the quantity supplied.

(ii) Price of Related Goods: The supply of a good depends upon the price of related goods. For example: Consider a firm selling tea. If price of coffee rises in the market, the firm will be willing to sell less tea at its existing price. Or, it will be willing to sell the same quantity only at a higher price.

(iii) Number of Firms: Market supply of a commodity depends upon number of firms in the market. If there is increase in the number of firms market supply will increase and if the number of firms decreases market supply will fall.

(iv) Goal of the Firm: If goal of the firm is to maximise profits, more quantity of the commodity will be offered at a higher price. On the other hand, if goal of the firm is to maximise sales (or maximise output or employment) more will be supplied even at the same price.

Question 6.
(a) Explain how fiscal policy measures can be used to reduce excess demand in an economy. [3]
(b) Define marginal propensity to consume. How is it different from marginal propensity to save? [3]
(c) Explain how equilibrium level of income can be determined with the help of aggregate demand curve and aggregate supply curve. [6]
Answer:
(a) Excess demand refers to a situation in which aggregate demand exceeds aggregate supply corresponding to fall employment. The two fiscal measures to reduce excess demand are as follows:

(i) Government Expenditure: It is the principal component of fiscal policy. When there is excess demand government expenditure on public works, education, defence, maintenance of law and order should be reduced. A reduction by government will reduce pressure on aggregate demand and which will shift downward.

(ii) Increase in taxes: The Government should levy new taxes and enhance the rate of the existing ones. This will reduce disposable income of the people and hence reduction in aggregate demand.

(iii) Public Borrowing/Public Debt: By borrowing from the public, the government creates public debt. When there is a situation of excess demand (or when AD needs to be reduced), the government steps up public borrowing by offering attractive rate of interest. This reduces liquidity with the people. Accordingly, aggregate expenditure also reduces.

(b) Marginal Propensity to Consume refers to the ratio of change in consumption to change in income.
Symbolically,
\(\mathrm{MPC}=\frac{\Delta \mathrm{C}}{\Delta \mathrm{Y}}\)
where ΔC refers to change in total consumption
ΔY refers to change in income.
Marginal Propensity to Save, on the other hand, is the ratio of the change in total desired saving to change in total income.
Symbolically,
\(\mathrm{MPC}=\frac{\Delta \mathrm{S}}{\Delta \mathrm{Y}}\)
where ΔS refers to change in total desired saving
ΔY refers to a change in income.

(c) According to the modern theory of income and employment determination, in any economy at any given time, income and employment are determined at that level where aggregate demand is equal to aggregate supply.
AD = AS
(i) In the given figure AS represents Aggregate Supply Curve. It forms 45 0 angles, signifying that each point on it expresses the equal value of income and receipts whereas AD represents Aggregate Demand.
(ii) Both i.e., AD and AS intersect each other at point E which is known as the equilibrium point.
(iii) Point E shows that in eqbm. position level of employment/output/income is OQ and expected receipts are OP.
(iv) When AD > AS
Now suppose the economy is operating at any point before (left of) the equilibrium point.

As the planned spending (AD) is more than planned output (AS) this means consumers and firms together would be buying more goods than the firms are willing to produce.
As a result, the planned inventory would Ml below the desired level.
Firms would be induced to increase production which will lead to an increase in the level of employment/output/income.
The firms will keep on increasing production till AD=AS.

(v) When AS > AD
Under such a situation the economy will be operating beyond E.
As the planned spending is less than planned output (AS) this means consumers and firms together would be buying fewer goods than the firms are willing to produce.
As a result, the planned inventory would rise.
Finns would be induced to decrease production which will lead to decrease in the level of emploxtnentOutput/income.
The firms will keep on decreasing production until AD = AS.

Question 7.
(a) What is meant by budget of tire government ? Give two differences between revenue expenditure and capital expenditure. [3]
(b) Discuss the following methods of debt redemption: [3]
(i) Refunding
(ii) Debt conversion
(c) Explain four measures fo correct disequilibrium in the balance of payment. [6]
Answer:
(a) Budget is a statement of expected receipts and expenditue of the governmentover the period of financial year(i.e, April 1st to 31st March).

Basis	Revenue Expenditure	Capital Expenditure
Meaning	Revenue expenditure neither creates any asset nor reduces any liability of the government.	Capital expenditure either creates an asset or reduces the liability of the government.
Purpose	It is incurred for normal running of government departments and provision of various services.	It is incurred mainly for acquisition of assets and granting of loans and advances.
Nature	It is recurring in nature as such expenditure is spent by government on day-to-day activities.	It is non-recurring in nature.
Example	Salary, pension, interest etc.	Repayment of borrowings, expenditure on acquisition of capital asset, etc.

(b) (i) Refunding: Refunding is the process by which the government raises new bonds to pay off the maturing bonds. Thus, the government takes a fresh loan to repay an old loan. In this case, the money burden of the debt is not liquidated but is postponed to some future date. Hence, the total burden of the debt continues to accumulate. Usually, this method is adopted when the government is not in a position to repay its outstanding loans at present.

(ii) Debt Conversion: Conversion of public debt means exchange of new debt for the old debt. In this method, the loan is actually not repaid, but the form of debt is changed. The process of conversion consists of converting a high-interest debt into a low-interest debt. The government might have borrowed at a time when the rate of interest was high. But if the market rate of interest falls, it may convert old high-interest loan into a new low-interest loan. The government is able to reduce the burden of debt thereby. This is possible only when the government enjoys good credit worthiness.

(c) A number of steps can be taken to solve the problem of deficits in the balance of payments. The main methods of correcting the adverse balance of payments are:

(i) Depreciation: Under the flexible exchange rate system, changes in the rate of exchange will automatically adjust the balance of payments. Depreciation of the country’s currency will wipe out deficits in the balance of payments. Depreciation of currency means rise in the price of foreign currency or, which is the same thing, fall in the price of domestic currency.

(ii) Devaluation: A country can devalue its currency to wipe out deficit in the balance of payments. This makes imports expensive to domestic consumers and its exports cheaper in foreign countries. If demand and supply elasticities are fairly high, this will definitely lead to a fall in imports and a rise in exports and thereby an elimination or reduction of balance of payments deficit.

(iii) Import Control: I reports may be kept in check through fhe adoption of a wide variety of import control measures such as quotas and tariffs. Quotas limit the volume of imports by applying quantitative restrictions. The government may for example, decide that only 90 per cent of last year’s volume of imports can be imported this year. The government may also increase the import duties or tariffs. This will raise the prices of imported goods and reduce imports. As a consequence, balance of payments deficit is reduced.

(iv) Production of Import Substitutes: Steps may be taken to encourage the production of import substitutes. This will save foreign exchange in the short- run by replacing the use of imports by their import substitutes. If the industries producing import substitutes develop ultimately because of various incentives provided to these industries, they may turn out to be export earners as well.

Question 8.
(a) What is meant by repo-rate and reverse repo-rate?
(b) Explain the following contingent functions of money
(i) Employment of factor inputs
(ii) Basis of the credit system.
(c) Discuss four qualitative measures of the Central Eiank to control credit in the economy. [6]
Answers:
(a) Repo rate, or repurchase rate, is the rate of interest at which RBI lends to the Commercial Banks for short periods against government bonds. This is done by RBI by buying government bonds from banks with an agreement to sell them back at a fixed rate. If RBI wants to make borrowing it more expensive, it increases the repo rate. Similarly, if RBI wants to make it cheaper for banks to borrow money from RBI, it reduces the repo rate.

Reverse repo rate is the rate of interest at which the RBI borrows from commerical banks for short period. This is done by selling government bonds to banks. Banks utilises the reverse repo rate facilities to deposit their short term excess funds with the RBI and earn interest on it.

(b) (i) Employment of Factor Inputs: Every producer aims at maximisation of his profits while employing various factors of production. A profit-maximising entrepreneur will equate marginal productivity (expressed in value terms) of a factor with its price (rate of remuneration). Since the rates of remuneration such as wage rate are expressed in money terms, it is money which helps the producer to arrive at decisions with regard to the units of a factor of production to be employed.

(ii) Basis of Credit System: Credit plays a crucial role in the modem credit system. In fact, commercial and business activities are highly dependent upon the credit system of a country. It is money which provides the basis of the entire credit system. Without the existence of money, important credit instruments like cheques, bills of exchange, etc. cannot be used.

(c) Qualitative methods of credit control aim at regulating and controlling the allocation of credit among various users rather than influencing the general availability of credit.
We discuss below the main selective credit control instruments:

(i) Margin Requirement: The margin requirement refers to the difference between the current value of the security offered for loan (called collateral) and the value of loan granted. Suppose, a person mortgages his house worth ₹ 1 crore with the bank for a loan of ₹ 80 lakh. The margin requirement in this case would be ₹ 20 lakh. The margin requirement is raised when the supply of credit needs to be curbed. The margin requirement is lowered when the supply of credit is to be increased. Often the margin requirement is kept high for speculative (trading) activities.

(ii) Rationing of Credit: Rationing of credit refers to fixation of credit quotas for different business activities. Rationing of credit is introduced when the flow of credit is to be checked particularly for speculative activities in the economy. The central bank fixes credit quota for different business activities. The commercial banks cannot exceed the quota limits while granting loans.

(iii) Moral Suasion: Sometimes, the central bank makes the member banks agree through persuasion (or pressure) to follow its directives. The member banks generally do not ignore the advice of the central bank. The banks are advised to restrict loans during inflation, and be liberal in lending during deflation.

(iv) Direct Action: Direct action refers to various directives issued by the central bank to commercial bank from time to time to regulate their lending and investment activities. The central banks in all countries pursue direct action against commercial banks. This policy may not be used against all banks, but against erring banks which do not follow the policies of the central bank. These direct actions may take the form of refusal of discounting facilities or refusal of loans from the central bank, charging of penal rate of interest, etc.

Question 9.
(a) Distinguish between real GDP and nominal GDP. Which of these is a better indicator of economic welfare and why? [3]
(b) Draw a diagram to show the circular flow of income in a two-sector model with leakage and injection. [3]
(c) Calculate GNP at FC from the following data by using income method and expenditure method: [6]

Item	₹ in crores
(i) Operating surplus	600
(ii) Exports	30
(iii) Imports	60
(iv) Private final consumption expenditure	1000
(v) Net indirect tax	60
(vi) Compensation of employees	900
(vii) Mixed-income of self-employed	160
(viii) Gross domestic capital formations	330
(ix) Depreciation	30
(x) Net factor income from abroad	-20
(xi) Govt, final consumption expenditure	450

Answers:
(a)

National Income at Current Price (Nominal GDP)	National Income at Constant Price (Real GDP)
Under this, GDP is calculated at current prices prevailing in the market. For example, if we measure India’s National Income of 2011-12 at the same year’s prices then it is national income at the current price.	Under this, GDP is calculated at a base year price. For example, if we measure India’s National income of 2009-10 at 2001-2002 prices, then it is national income at a constant price.
This may give a misleading picture of economic growth of a country because an increase in National Income may be because of an increase in price rather than any physical output goods and services.	On the other hand, this gives true picture of economic growth of a country as it is affected by the change in only the physical quantities.
National Income at current price = P1 × Q1 Where P1 – Current Price and Q1 – Current Quantity	National Income at Constant Price = P0 × Q1 Where P0 – Base Year Price Q1 – Current Quantity

Real GDP is considered as an index of the welfare of the people. Welfare of the people is measured in terms of the availability of goods and services per person. Increase in real GDP means an increase in the level of output in the economy. Other things remaining constant, this means greater availability of goods per person. This leads to a higher level of welfare.

(b) The following diagram shows the circular flow of income in the two-sector model. Savings are leakages and investment is injection.

(c) Income Method:
GNPFC = Compensation of employees + Operating Surplus + Mixed incomes + Net factor income from abroad + Depreciation.
= 900 + 600 + 160 + (-20) + 30
= 1670

Expenditure Method:
GNPFC = Private final consumption expenditure + Govt, final consumption expenditure + Gross domestic capital formation + Net export (Export – Import) + Net factor income from abroad – Net Indirect tax
= 1000 + 450 + 330 + (30 – 60) + (-20) – 60
= 1670

ISC Class 12 Economics Previous Year Question Papers

ISC Geography Previous Year Question Paper 2010 Solved for Class 12

PART-I (Compulsory)
Answer all questions.

Question 1. [20]
(i) Give two reasons to explain why India is called a subcontinent.
(ii) The figure given below represents a section through the Himalayas, from the Kunlun Mountains to the Ganga Plains.

Identify the four relief features marked.
(iii) (a) Mention one difference between the Konkan and the Malabar coast.
(b) Why are there more ports along the Western coast than along the Eastern coast ?
(iv) Mention two reasons to explain why there is a higher percentage of forest cover in Northeast India.
(v) What is the difference between metro cities and mega cities ? Give one example of each type of city.
(vi) Explain the difference between crop rotation and double cropping.
(vii) Why are synthetic fibers widely used for manufacturing a large variety of fabrics ?
(viii) Explain how industrial inertia is a factor affecting the location of industries. Give two examples.
(ix) What was the need for the construction of the Jawaharlal Nehru Port ? Mention an important characteristic of this port.
(x) Mention two detrimental effects of tourism on the surrounding environment.
Answer:
(i) India is separated from the rest of Asia in the north by a chain of lofty mountains, oceans and season all the three sides. The entire region comes under the influence of the tropical monsoons giving it a distinctive climatic pattern. Due to the vastness and diversities, India is considered to be a sub-continent.

(ii) A – Outer Himalayas as Shiwalik range.
B – Duns or Duars.
C – Middle or Lesser Himalayas or Himanchal.
D – Inner Himalayas or Himadri.
E – Tibetian Plateau.

(iii) (a) Konkan Coast is characterized with estuaries while the Malabar Coast is characterized with lagoons and backwaters,
(b) The Eastern coastal plains have more or less a straight coast where good ports are lacking while the Western coastal plains have indented coast which supports many ports.

(iv) The forests in Northeast India are found in hot humid areas with an average annual rainfall of above 200 cm and the relative humidity is more than 70%. The average temperature is 24°C. Hilly topography, favourable climate specially rainfall and temperature are responsible for the high concentration of forests. Moreover, NE India is relatively undeveloped and lack industrialisation and population density is also low. As a result, mass falling or cutting down of trees has not taken place.

(v) Metro cities have the population of about 1 million, e.g. Kanpur, Pune. Megacities have the population of about 5 million, e.g. Kolkata, Mumbai.

(vi) Crop Rotation: Crops are grown in rotation one after the other to maintain fertility of the soil. Pulses or leguminous crops are grown after cereal crops or cotton or sugarcane.

Double Cropping : Growing of two or more crops in the same land in one year. It requires the use of chemical fertilizers, pesticides and a steady water supply.

(vii) Synthetic fibers are widely used for manufacturing a large variety of fabrics because of their special qualities like strength, durability, liability, workability, washability and resistant to wrinkles and shrinkage.

(viii) Industries tend to develop at the place of their original establishment though the original cause has already disappeared. A good example the Lock industry at Aligarh and Bidi industry at Jabalpur.

(ix) The main purpose of Jawaharlal Nehru Port is to relieve pressure on Mumbai Port. The main characteristics of this port are :

1. Most of the operations are conducted with the help of computers. It has a container terminal also.
2. The sea is quite deep near the port and there will be no need for dredging in this port.

(x) The unplanned and unchecked growth of tourist centers deprive them of their original charm and beauty and prove detrimental for places like Shimla, Darjeeling and Mussoorie. Even drinking water is not available to cater for the tourists.

The areas around the tourist spots are covered by commercial constructions and industries. Such unplanned growth tarnishes the image of the concerned spot, e.g. Taj Mahal, Meenakshi Temple.

Question 2. [10]
On the outline map of India provided :
(a) Shade and name one area prone to floods.
(b) Shade and name the hinterland of Kolkata port.
(c) Locate and name the thermal power station in Orissa f*
(d) Mark and name the largest center of electronic goods.
(e) Locate and name the diesel locomotive manufacturing center in central India.
(f) Locate and name a tea exporting port in South India.
(g) Trace the course of an east flowing river in South India.
(h) Shade and name the state which is the first to experience the southwest monsoon.
(i) Draw the railway route between Chennai and Kolkata.
(j) Locate and name of oli refinery belonging to the private sector
Answer:

PART-II
Answer any four questions.

Question 3.
(a) With reference to the Western Ghats, answer the following questions : [2]
(i) What is another name for them ?
(ii) Give two characteristic features of this relief division.
(b) (i) What is the El Nino? [2]
(ii) How does it affect the climate of India ?
(c) (i) What is meant by the variability of rainfall ? [2]
(ii) How does this variability affect agriculture?
(d) Give a reason for each of the following : [2]
(i) Delhi has rain in December-January.
(ii) Kolkata has a little rain in April.
(e) Mention any four aims of the revised Forest Policy of 1988. [2]
Answer:
(a) (i) Another name for Western Ghats is Sahyadris.
(ii) 1. It stands like a continuous wall and can be crossed through passes only.
2. The western slope of this range is step¬like.

(b) (i) El Nino is a narrow warm current which sometimes appears off the coast of Peru in South America during December. It is a temporary replacement of the cold Peru current which normally flows along this coast.
(ii) This warm current can increase the surface water temperature of the sea by 10°C. Warming of tropical pacific waters affects the global pattern of pressure and wind system including the monsoon winds in the Indian Ocean.

(c) (i) There are large variations in the amount of rainfall received in different parts of India. The highest amounts is received by the Northeastern states and Western Ghats and the rainfall is below 20 cm in Western Rajasthan. These large variations in actual amount of rainfall from year to year is known as variability of rainfall.
(ii) Agriculture is not possible without water. Large parts of India suffer from high rainfall variability. Without sufficient rainfall, agriculture in India is reduced to a gamble in the hands of monsoon. Kharif crops like rice and jute cannot be grown without sufficient rainfall. Productivity of agriculture is high with less variability of rainfall and vice versa.

(d) (i) Delhi experiences rain in December- January due to western disturbances which originate in areas near the Mediterranean Sea. The western disturbances move under the influence of westerly jet stream and bring rain in northern and northwestern parts of India during this time.
(ii) Kolkata has little rain in April due to Norwesters thunderstorms. The sudden contact between dry and moist air causes this storm condition also known as Kalbaisakhi in the month of April-May.

(e) 1. To maintain environmental stability though massive afforestation and social forestry programmes.
2. To check on soil erosion in the catchment areas of the rivers, lakes and reservoirs and also check on extension of sand dunes in the desert areas.
3. Steps to meet requirement of fuel wood, fodder, minor forest produce and soil timber of rural and tribal population.
4. Steps to create massive people movement with involvement of women to achieve the objectives and minimize pressure on the existing forest.

Question 4.
(a) (i) Name two cities in India which have grown rapidly due to migration. [3]
(ii) What are the two factors that led to the decreasing growth rate of population from 1981 to 2001?
(b) Mention four effects of a rapidly growing population on development. [2]
(c) Give reasons for the low sex ratio in India. [3]
(d) The dependency ratio is higher in rural areas than in urban areas. Give two reasons to explain why. [2]
Answer:
(a) (i) Mumbai and Delhi.
(ii) Two factors that led to decline in population growth:

1. Population stabilization programmes of the government which includes family planning and inverted red triangle policy.
2. Increasing consciousness among people about the ill-effects of population growth.

(b) 1. Fast growing population has its own implications because it nullifies all achievements in economic and social spheres and is largely responsible for environmental degradation.
2. It is a Herculean task to provide food, clothing, shelter, health, education and other facilities to a population which grows at a rapid pace.
3. More than one fourth of our population is living below poverty line. There are 179 million houses for 192 million families. Over 5 million families still depend on rivers and ponds for drinking water.
4. A large percentage of population suffers from hunger, starvation and malnutrition and does not have access to proper healthcare.

(c) The sex ratio means “The number of females per 1,000 males in the popula-tion. According to the census of 2001, India has 933 females per 1,000 males in the population. Thus, the sex ratio is 933.
The reasons for the low sex ratio in India are :

• The male child receives a preferential treatment while the female child is neglected.
• Many women die at delivery time because of the lack of medical facilities.
• There has been a steady rise in women’s suicide rate due to the social evils like dowry.
• Abortion of female child is also a major reason for the low sex ratio in India.

(d) The following are the reasons for higher dependency ratio in the rural areas as compared to urban areas:

1. Birth rates are higher in the rural areas as compared to those in the urban areas.
2. Large number of adults migrate from rural areas to urban areas in search of jobs and better facilities of life. Adults who migrate to urban areas in search of jobs come back to their rural homes in old age.

Question 5.
(a) Explain how the type of crops grown determines the need for irrigation. [3]
(b) Mention two different ways by which modern methods of irrigation are an improvement over the primitive methods. [2]
(c) (i) Name two canal systems in Uttar Pradesh. [4]
(ii) Give three reasons to explain why canal irrigation is a popular form of irrigation in Uttar Pradesh.
(d) Well irrigation is still practiced in many parts of the country. Give two reasons to explain why. [1]
Answer:
(a) Rainfall in India is confined to a short duration of three to four months in the rainy season. India has a long growing period which extends throughout the year. Provision of irrigation can make multicropping possible. However, Kharif crops like rice, jute, etc. need more than 150 cm of regular moisture and can hence be grown in areas of low rainfall with the help of irrigation. Multiple crops of rice can be grown within the duration of one year only with the help of appropriate irrigation. Crops such as Sugarcane require 100-150 cm and are grown in large quantities in Deccan India in areas of low rainfall with the help of irrigation. Cotton is another example of a crop which requires plenty of water during its growth period and hence this crop is largely grown in western and northwestern parts of India with the help of irrigation.

(b) Modern methods of irrigation are an improvement over the primitive methods. The following two points will highlight the same :

1. They are perennial and provide regular irrigation.
2. They are easier to operate.

(c) (i) 1.Upper Ganga Canal
2. Lower Ganga Canal
(ii) Canals can be an effective source of irrigation of low relief, deep fertile soil.
Canal irrigation is a popular form of irrigation in Uttar Pradesh because :

1. The topography consists of low level deep fertile plains.
2. Large number of perennial rivers provide constant water supply.
3. Extensive command area.

(d) 1. A well is by far the simplest and cheapest source of irrigation and the poor Indian farmers can afford it.
2. A well is an independent source of irrigation and can be used as and when the necessity arises. Canal irrigation is controlled by other agencies and cannot be used at will. The farmer has to pay no tax for well irrigation unlike canal irrigation.

Question 6.
(a) (i) With reference to the Kharif crops, name the months when they are : [2]

1. Sown
2. Harvested

(ii) Give an example of one cereal crop and one cash crop.
(b) Give three reasons to explain why Japan occupies a leading position among the fishing nations of the world. [3]
(c) (i) Which sector is a major consumer of coal as a source of power? [2]
(ii) Mention two problems faced by the coal mining industry.
(d) (i) With which crop is ratooning associated? [3]
(ii) What are the types of soil that suit the cultivation of this crop?
(iii) Why is ratooning practiced?
Answer:
(a) (i) 1. Sown-June -July
2. Harvested-October-November
(ii) One cereal crop – Rice, One cash crop – Cotton, Groundnuts

(b) Japan is a country of islands whose coast is dotted with four thousand villages of fishermen with several safe ports which help in fishing.

Japan has large continental shelf which is ideal for the growth and reproduction of fish. Warm Kuroshio current from the South meets the cold Oyashio current from the north near the coast of Honshu. It provides favourable conditions for the growth of plankton which is the ideal food for the fish.

There are big corporations with modernized ships and equipments which organize the fishing. The big ships go in the open oceans and send back their catch to the large ships. These big ships are floating factories as the fish is packed and exported from the ship itself.

(c) (i) Power generation or thermal power stations.
(ii) Coal mining industries face a number of problems:

1. Collapse of the roof of the mines and flooding;
2. Occurrence of poisonous gases, lack of oxygen and light.

(d) (i) Sugarcane.
(ii) Sugarcane grows well on the loams and clayey loams and also on black cotton soil.
(iii) Ratoon crops have the advantage of maturing earlier. Ratoon crop is the second crop which is attained from the roots left on. So, it saves time and labour of fresh sowing and it cuts the cost of cultivation.

Question 7.
(a) (i) Mention three factors that affect water transport. [5]
(ii) Give one advantage and one disadvantage of water transport.
(b) (i) Give one disadvantage of air transport. Why is it still a popular means of transportation in India ? [3]
(ii) Name the international airlines carrier of India. What is the name of the international airport of Mumbai ?
(c) How does the Golden Quadrilateral differ from National Highways ? [2]
Answer:
(a) (i) The rivers and canals should have a regular flow of sufficient water. Diversion of water for irrigation purposes reduces the quantity of water.
The presence of waterfalls or cataracts and sharp bends in the course of the river hinder the development of waterways.
Silting of the river bed reduces the depth of the water and creates problems for navigation. De- silting of river beds is a costly affair.

(ii) Advantage : Waterways are the cheapest means of transport and are most suitable for carrying heavy and bulky materials having low specific cost.
Disadvantage : Water transport cannot compete with the speed of road and rail transport.

(b) (i) Disadvantage : Air transport is the costliest mode of transport, which many people cannot afford.
Air transport is very essential for a vast country like India where distances are large, and the terrain and the climatic conditions are so diverse. It is also important for our links with other countries. ‘
(ii) The Air India.
Sahara International Airport at Mumbai.

(c) The Golden Quadrilateral are roads like National Highways connecting Delhi – Mumbai-Chennai-Kolkata-Delhi by a six lane highway while National Highways are roads connecting capitals, big cities and important ports.
Golden quadrilateral is maintained by NHDP whereas the National Highways are maintained by CPWD.

Question 8.
(a) What is an agro-based industry? [1]
(b) (i) Which is the largest agro-based industry in India? [4]
(ii) Give two reasons to explain why this industry is important to India.
(iii) Name one industry which is dependent on the industry that you have named.
(c) Explain how the following have played a part in the location of the Tata Iron and Steel Company: [4]
(i) Raw materials.
(ii) Transport.
(d) Name two industrial products of the Gujarat Industrial Region. [1]
Answer:
(a) Agro-based industries depend on the raw materials produced in the agricultural sector. These are mostly consumer goods industries. e.g, sugar, textiles, vegetables.

(b) (i) Cotton textile industry.
(ii) 1. About 16% of industrial capital and 20% of industrial labour in India is engaged in the cotton textile industry.
2. Nearly 10 lac industrial workers earn their livelihood from this industry. It contributes . substantially to the export trade of India.
(iii) Readymade garment industry.

(c) The Tata Iron and Steel Co. The Iron and Steel Industry is primarily a raw-material oriented industry using cheap and weight loosing raw materials.
(i) Raw Materials : High grade haematite iron ore is available from Badampahar and Noamundi mines of Singhbhum in Jharkhand and Gurumahisani mines of Mayurbhanj in Orissa. They are located at a distance of 75-100 kms from Jamshedpur.

Coal is available from Jharia and Raniganj.
Manganese comes from Joda mines of Keonjhar district in Orissa.
Dolomite and limestone comes from Sundergarh in Orissa.

(ii) Transport : Jamshedpur is well connected with Kolkata, Mumbai and Chennai by road and rail and enjoys good transport facilities.
Kolkata located at a distance of 240 kms, provides port facilities.

(d) Textiles (cotton, silk and synthetic fibres) and petrochemicals are the most important industrial products of the Gujarat industrial region.

Question 9.
(a) Discuss the importance of the Haldia Planning Region under the following headings : [4]
(i) Location of the main centre.
(ii) Reason for construction.
(iii) Two important industries located in the region.
(iv) Extent of hinterland.
(b) (i) Name two important minerals forming the resource base of the Chhattisgarh region. [4]
(ii) What is sericulture ? Why is this important to the people of the above mentioned region ?
(iii) Name two varieties of silk produced in Chhattisgarh.
(c) What is the difference between a micro-planning region and a meso-planning region? [2]
Answer:
(a) (i) Haldia is located at the confluence of rivers Hooghly and Haldia about 105 kms downstream from Kolkata.
(ii) Haldia port has been developed to release congestion at the Kolkata port.
(iii) Petrochemical industry and Fertilizer industry.
(iv) The hinterland of the Haldia port includes the whole of eastern and northeastern India. The main areas are West Bengal, Bihar, Jharkhand, UP, Uttarakhand, Sikkim, Assam, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Meghalaya, Tripura and Northern parts of Chhattisgarh.

(b) (i) . Iron ore, bauxite, limestone and dolomite,
(ii) The technique of silk production is called sericulture. Sericulture is a labour intensive industry and provides employment to a large number of people. Silk is produced by small units usually by individual families. Chhattisgarh is a densely populated region with mainly rural population. Cheap skilled labour is easily available. So, sericulture has become an important industry to this region.
(iii) Tussar silk and Mulberry silk.

(c) Micro-planning regions are the smallest of all planning regions and have the potential for developing at least one specialization of production cycle of great significance. A region that possesses great potentialities for development and production of any single specialization can be treated as micro-region. e.g. agriculture in Punjab.

Meso-planning regions combine in themselves a few micro-regions and lie at the middle of the hierarchy of planning regions. The microregions which form the meso-regions must have something common in terms of their natural background, their problems and prospects or their socio-cultural bond. Unlike micro-regions, meso-regions are multipurpose regions, e.g., Damodar Valley Basin.

ISC Class 12 Geography Previous Year Question Papers

ISC Economics Previous Year Question Paper 2011 Solved for Class 12

Maximum Marks: 80
Time allowed: 3 hours

• • Candidates are allowed additional 15 minutes for only reading the paper.
  • They must NOT start writing during this time.
  • Answer Question 1 (Compulsory) from Part I and five questions from Part II.

• The intended marks for questions or parts of questions are given in brackets [ ].

Part – I (20 Marks)
Answer all questions.

Question 1.
Answer briefly each of the questions (0 to (xv): [15 × 2]
(i) State any two assumptions of Law of the Diminishing Marginal Utility.
(ii) What is meant by macroeconomics?
(iii) If demand increases by 50% due to an increase in income by 75%, calculate the income elasticity of demand.
(iv) Draw the supply curve of a perishable commodity. Give a reason for the shape of the supply curve.
(v) What is meant by increasing returns to a variable factor?
(vi) What would be the elasticity of demand for a commodity when:
(a) Price and total expenditure move in the same direction?
(b) Price and total expenditure move in the opposite direction?
(vii) Identify the type of market which has a characteristic of perfect substitutes. Give one reason for your answer.
(viii) What is meant by supernormal profit?
(ix) How is personal income calculated from private income?
(x) What is the variable cost? Give two examples.
(xi) Differentiate between economic and non-economic services.
(xii) Is deficit financing inflationary? Justify your answer.
(xiii) What is a trade union?
(xiv) How can an increase in public expenditure create more employment in the country?
(xv) What is meant by an unfavourable balance of payment?
Answer:
(i) Two assumptions of Law of the Diminishing Marginal Utility are:
(a) Every unit of a commodity must be same in-all respects-in size, colour, quality, design etc. For example, if the quality of the second apple is superior to the first, the consumer may desire to mix utility from the second apple than from the first.
(b) The unit of the good must be standard, E.g. a cup of water, a bottle of cold drink, a pair of shoes, a full orange, a glass of lime juice. The units of the commodity should not be too small or too large. Otherwise, the law will not be applicable.

(ii) Macroeconomics is the study of the behaviour of the economy as a whole. Macroeconomics deals with national income, employment, savings, investment, exports and imports of a country etc.

(iii) \(\frac { 50 }{ 75 }\) = 0.67

(iv) Individual supply of schedule of Good X


The positively sloping supply curve SS shows the direct relationship between the price and the quantity supplied.

(v) When a firm increases only one variable factor of production keeping other factors unchanged and if the rate of change of output becomes more than that of the variable factor, we call it increasing returns to the variable factor.

(vi) (a) Inelastic (ep < 1) (b) Elastic (ep > 1)

(vii) Perfectly competitive market. .

(viii) When revenue is more than costs (including normal profits) is what we call pure profits or economic profits in economics. Pure profit is also known as ‘super normal profit’.

(ix) Private income is the total of factor income from all sources and current transfers from the government and the rest of the world added to the private sector. Personal disposable income is that part of the personal income which is available to the individuals to be used the way they like for consumption and savings.

(x) Variable cost is that cost which is incurred on variable factors.
Example: expenditure on raw materials, wages and salaries paid to workers who are not permanent.

(xi) Economic services are services rendered to create earning and non-economic services are services which do not create earnings.

(xii) When the process of deficit financing is undertaken, the supply of money increases. In fact, the supply of cash money increases. In India, for example, if the Govt, decides to issue new money, it will print one rupee notes and/or issue small coins. This increases the cash money supply. If the Government decides to borrow from the Reserve Bank of India (which is India’s central bank) it transfers its securities to the Reserve Bank. On the weight of securities, the Reserve Bank issues currency notes of ₹ 2/- or higher denomination. This is how the Govt, gets the extra money. In both cases, the amount of cash money is the economy and, therefore, the total money supply (i.e. cash plus demand deposits in banks) increases. It means extra purchasing power in the hands of the general people. This may create excess demand conditions in the economy. So there will be upward pressure on the general price level.

(xiii) A trade union or labour union is an organization of workers that have bonded together to achieve common goals such as better working conditions. The trade union through its leadership, bargains with the employer on behalf of union members and negotiates labour contracts with employers.

(xiv) Public Expenditure increases the level of employment: Public expenditure leads to increase in the level of employment in the country; especially in the underdeveloped countries like India. For example, Rural Public Works Programmes have been launched to provide employment in rural areas like irrigation scheme, construction work and flood control etc. In this way through public expenditure, the government can create additional employment opportunities and increase the level of income also.

(xv) Usually, in the accounting sense, the total receipts in the balance of payments account must be equal to the total payments. Thus the balance of payment is always balanced. But this account may or may not be balanced. If total autonomous receipts exceed the total spendings of foreign exchange in a given year, there arises a ‘surplus’ in the transaction account of the balance of payments. On the other hand, if receipts fall short of spending, there occurs a ‘deficit’ in the autonomous account of the balance of payments. In both cases, the balance of payments is out of equilibrium, i.e., there will be an unfavourable balance of payment.

Part – II
(Answer Any Five Questions)

Question 2.
(a) Discuss two reasons for the downward slope of the demand curve. [4]
(b) Complete the demand schedule for commodity X: [4]

In the graph above, DD is the demand curve and SS is the market supply curve.
(i) On the y-axis, mark any price P, showing excess demand.
(ii) How will equilibrium be restored from a situation of excess demand?
(iii) Show how equilibrium price will be affected when the increase in demand is equal to the decrease in the supply of a commodity.
Answer:
Two reasons for the downward slope of the demand curve are:
(a) Demand schedule: Tabular representation of price and demand relationship is called demand schedule.

This table depicts that as the price of sugar increases, its demand decreases continuously. Explanation of the law of demand with the help of a graph.

This graph shows the inverse relationship between price and demand. A, B, C, D are the points showing the relationship between price and demand. By joining these points we can draw the demand curve DD.
A demand curve is the graphic presentation of the demand schedule.
DD demand curve has a negative slope which shows the inverse relationship between price and demand.
In brief the law of demand states.
D = f(P)
D = Demand
f = Function
p = Price
Demand is a function of price. If other things remain constant, with an increase in price the demand falls and with fall in price the demand increases.
Two reasons for the downward slope.
1. The law of diminishing marginal utility.
2. Income effect


(ii) If the supply and demand of units are brought to the same levels.
(iii) Price rises

Question 3.
(a) Explain the supply function. [4]
(b) State the Law of Supply. Discuss how a change of technology affects the supply of a commodity. [4]
(c) Discuss the relationship between Average product and Marginal product with the help of a diagram. [6]
Answer:
(a) The supply function is a statement which states the relationship between the quantity supplied of a commodity and its determinants. The supply function may be written as
\(\mathrm{S}_{n}=f\left(\mathrm{P}_{n}, \mathrm{P}_{1}, \ldots \mathrm{P}_{n}-1 . \mathrm{Cu}_{f}, \mathrm{F}_{i} \ldots \mathrm{F}_{n}, \mathrm{T} . \text { E. } \mathrm{Cu}_{\ldots}, \mathrm{N}, \mathrm{N}_{-} \ldots\right)\)
where Sn is the quantity, supplied of a commodity ‘n’; If is a symbol showing the relationship between the supply of a commodity ‘n’ and all its determinants, Pn is the price of commodity ‘n’ : P1 … Pn-1 are the prices of commodities other than n. Cuf is the goal of the firms; Fi … Fn; is an expression of prices of different factors of production; T is the technique of production; E is a symbol of expectation of future prices, Cu+ is the taxation policy of the government; N is the natural factors and N- stands for means of transportation.

(b) The Law of supply states a positive relationship between the price of the commodity and the quantity supplied. It is indicated by a positively sloping curve. It rests on the celeries paribus’ (i.e., other things affecting the supply function remain unchanged) assumption. So the normal supply curves are called the ceteris paribus’ supply curve.
This Law assumes that.

• Prices of the factors of production remain unchanged.
• Production technology remains the same.
• The policies of the government (sav the tax and subsidy policy) remain unchanged.
• The goals of the firm remain unattended.
• The number of firms in the industry remains the same.

Improvement in techniques of production results in an increase in supply (rightward shift of supply curve) and use of inferior techniques of production results in a decrease in supply (leftward shift of supply curve.

(c) The relationship between Average (AP) product and Marginal product (MP) is as follows:

The relationship between MP and AP is as follows:

1. When MP > AP, this means that AP is rising. This is the care up to 4 units of labour in the above table.
2. When MP = AP, this means that AP is constant. This occurs in our example when 5 workers are employed.
3. When MP < AP, this means that AP is falling. This phase starts from 6th worker.

Diagrammatically, the relationship between the MP curve and the AP curve is as follows:

1. So long as the MP curve lies above the AP curve the AP curve is the positively sloping curve. This can be seen in the diagram before point A.
2. When the MP curve intersects AP curve, this is the maximum point on the AP curve, where AP is at maximum. This happens at point A in the diagram.
3. When the MP curve is below the AP curve, the AP curve slopes downwards. This happens after point A.

Question 4.
(a) Explain one cause each for increasing and diminishing returns to scale. [4]
(b) A cost function is given below: [4]

Calculate:
(i) Total Fixed Cost
(ii) Total Variable Cost
(iii) Marginal Cost
(c) Discuss four determinants of elasticity of demand. [6]
Answer:
(a) One cause for increasing returns to scale is greater degree of specialisation of labour and machinery. As the scale of production increases the efficiency of labour increases due to division of Labour and specialisation of labour. Similarly, when the scale of production increases it becomes possible to use specialised machines and the services of specialised and efficient management. This occurs in the rise in productivity of inputs leading to increasing returns to scale. One cause for decreasing returns to scale is a rise in the scale of production beyond a point may create the problem of efficient management leading to decrease in managerial efficiency. A large scale of production causes the problem of lack of proper coordination, inverse bureaucracy, red-tapism, the long chain of communication and command between the higher management and on the production line. As a result of all this, the total efficiency of management diminishes.

(c) 4 determinants of elasticity of demand are:
(i) Nature of the commodity:
An important determinant of the elasticity of demand for a good is the nature of the goods itself. If the goods is a necessity, its demand will remain unchanged with price changes. There will be a low elasticity of demand. In our country, the demands for rice, salt, edible oil are relatively inelastic. The demands for luxury items on the other hand, elastic. When the price of the air conditioner increases, people can do in the absence of air conditioner. The demand for the air conditioner will, therefore, fall sharply. The. elasticity of demand will, therefore, be high.

(ii) The elasticity of demand for a commodity also depends on the existence of substitute commodities. If substitutes exist, these will be used in place of the commodity in question when its price rises. The demand for this commodity will come down. In other words, demand will be elastic. This shows how the existence of tea makes the demand for coffee elastic.

(iii) No. of uses: The demand for a commodity which can be used for a no. of uses will be relatively elastic. For example, electricity can be used for cooking, heating, lighting, washing etc. When the price of electricity rises, the consumers can reduce some uses of electricity. The demand for electricity will be elastic.

(iv) Income of the purchaser: The elasticity of demand is also influenced by the income of the purchaser. A rich purchaser will not be bothered by small changes in prices. Such changes will lead to his demands being unaffected. The demands of this consumer for different types of commodities will be relatively inelastic. A not so rich consumer will be affected by lesser changes in prices. His demand, therefore, will be elastic.

Question 5.
(a) Using diagrams, distinguish between the shapes of the Total Revenue curve under perfect and imperfect competition. [4]
(b) Discuss the shape of the Average Fixed Cost Curve. [4]
(c) Explain how a perfectly competitive firm in equilibrium incurs losses in the short run. [6]
Show the same with the help of a diagram.
Answer:
(a) Total Revenue explained numerically in Table (1) and graphically in fig. (1).

Total Revenue under Perfect Competition
Total revenue changes with a change in output. Since price under perfect competition is constant it follows that the total revenue varies in direct proportion to output. Column 3 in Table (1) shows that the total revenue is increasing all through at all levels of output, and it is increasing at a constant rate. Figure (2) shows that the TR curve is a straight line from the origin and its slope is constant as determined by the price. The curve must pass through the origin because at zero output TR is zero. It is a straight line with a constant slope.

(b) TFC is constant at all levels of Q, so with a gradual increase in Q, there will be a continuous fall in AFC. Thus AFC will be much closer to zero (0) but it will never be zero (0). It is to be noted that AFC. Q = TFC = Constant. Here, the AFC curve will be a rectangular hyperbola. This is shown in Figure (1).

As AFC ≠ So the AFC curve will never touch or cut the horizontal axis.

(c) A firm incurring a loss: In the short run firm may continue production even if it is incurring losses because it cannot leave the industry. In the situation of a loss, a firm would be in equilibrium at the level of output where it gets minimum losses. This can be shown with the help of a diagram.

In the fig. short-run marginal cost curve cuts the marginal revenue from below at point E. At OQ level of output firms, AR is EQ and Average cost is KQ. It is clear from the diagram that AR is less than average cost. Hence the firm’s per unit loss is equal to KE (KQ – EQ). The firm’s total loss will be KEPM.

Question 6.
(a) With the help of a well-labelled diagram, show the circular flow of income in a three-sector model. [4]
(b) Define compensation of employees and mention its components. [4]
(c) From the data given below, calculate Gross Domestic Product at market price and National Income (NNPFC) using the Value Added Method: [6]

(i) Gross Value of output in the primary sector (at factor cost)	950 Crores
(ii) Gross Value of output in the secondary sector (at factor cost)	470 Crores
(iii) Gross Value of output in the tertiary sector (at factor cost)	500 Crores
(iv) Value of intermediate product in the primary sector	360 Crores
(v) Value of intermediate product in the secondary sector	200 Crores
(vi) Value of intermediate product in the tertiary sector	175 Crores
(vii) Depreciation	20 Crores
(viii) Indirect tax	35 Crores
(ix) Subsidy	10 Crores
(x) Net Factor Income from Abroad	4 Crores

Answer:
(a)

(b) Compensation of employees is also known as labour income, is income from work for others.” It is the remuneration to the workers for their labour. It is the payment made by producers to their employees in the form of wages and salaries and other payments in cash and kind and social security benefits.
Its components consist of:
(i) Wages and salaries in cash, including bonus, commission, dearness allowance, house rent allowance, travelling allowance, leave travel concession, sick leave allowance etc.

(ii) Supplementary labour income in the form of employer’s contribution (not of employees) towards social security schemes for employees, such as provision for pension, product field, group insurance, gratuity etc. The contributions made by employees towards social security schemes are not included in the social security contribution while education compensation of employees since they are paid out of wages and salaries.

(iii) Payment to employees in kind like rent-free accommodation, free medical, free educational facilities, free or subsidised food, uniform, free transport, recreation, creches for children of employees, free provision of goods and services produced by the employees.
Thus:

(c) NVA (at factor cost value of gross output)
The gross value of output in the primary sector (at factor cost) = 950
The gross value of output in the secondary sector (at factor cost) = 470
The gross value of output in the tertiary sector (at factor cost) = 500
Total = 1920
Less value of the intermediate product in the primary sector + secondary sector + tertiary sector
= 360 + 200 + 175
= 735
Less depreciation = 20
Less net indirect tax
Direct tax = 35
Less subsidy = 10
NVA = 1145
National Income = NVA + Net Factor Income from abroad = 1145 + 4 = 1149 (in crore)

Question 7.
(a) What is meant by selling cost? Which kind of market does not need selling cost and why? [4]
(b) Define interest. In calculating gross interest, what is payment for risk? [4]
(c) Discuss how under perfect competition, a firm is a price taker and an industry a price maker.
Answer:
(a) Selling cost is any selling expenses incurred by the firm (particularly expenses for advertisement) under monopolistic competition. The firm desires to accentuate the differences between its own brand and other brands of the product available through its advertising and selling expenses. Thus selling cost have a positive role in strengthening the preferences of the consumers for the advertised product and making the demand for the product relatively inelastic.

(b) Interest is the price paid to the owner of capital for using the services of capital per period. Often the lender has to bear several other costs. He will lose if the borrower does not return the money in time. This may happen for several reasons-the borrowers may become bankrupt or he may try to deceive the lender. For these reasons the borrower may due, he may become bankrupt on be may try to decide the lender. For these reasons, the lender has to take a risk. As a price for this risk-taking, he extracts an amount from the borrower. This is added to the net interest.

(c) There are a large number of buyers and sellers of the commodity under perfect competition each too small to influence the price of the commodity by his actions. Under perfect competition a firm produces such a small part of the total market output that a change in its output will have no significant effect on the market supply and hence price of the commodity. A firm under perfect competition cannot influence the market price by increasing or decreasing the quality of output it produces.

Question 8.
(a) Balance of Payment always balances in the accounting sense. Explain briefly. [4]
(b) Discuss two causes of disequilibrium of the balance of payments. [4]
(c) “A country which has an absolute disadvantage in the production of any two goods can still have a comparative advantage in the production of one of those goods, which it can produce efficiently and export.’’ Explain the underlying theory with an example. [6]
Answer:
(a) The total receipts in the BOP account are equal to the aggregate payments. Hence, there is neither any surplus nor any deficit in the BOP account. In fact, the bookkeeping or accounting sense every credit. Entry must have a corresponding ‘debit’ entry. The golden rule of double-entry bookkeeping is Debit what comes in and Credit what goes out. The aggregate ‘credit balance’ of all credit accounts must be equal to the aggregate ‘debit balance’. So in the accounting sense, the BOP account is always balanced.

(b) Two causes of disequilibrium of the balance of payments are:
(i) Lack of development of production system: In an underdeveloped country where the production system is not developed enough all the necessities of life have to be imported. There are very few things that such a country can export and that too in small quantities. These countries encounter an adverse balance of payment.
(ii) When a backward economy tries to develop it takes the balance of payments difficulties again. The various development schemes usually necessitate the imports of machines, raw material. These push up the import bill. Exports can be raised only when these schemes are completed and output in the country increases. Until then the balance of payments remains adverse.

(c) International trade based on the principle of Ricardian comparative advantages:
According to this theory, a country has a comparative advantage in the production of one commodity, will produce that commodity and export conversely import that commodity in which the country has comparative disadvantages.
Country A and B. Suppose country A produces cotton and wheat. Another country B also produces cotton and wheat. Let country A produce 100 units of cotton by 10 days of labour, also country A produce wheat by 100 units of wheat by 10 days of labour. Country B produces 60 units of cotton.
Or
120 units of wheat by using 10 days of labour.
In-country A: the cost ratio is 100 units of cotton =100 units of wheat.
Or
1 unit of cotton = 1 unit of wheat
In-country B: the cost ratio is 6d units of cotton = 120 units of wheat.
Or
1 unit of cotton = 2 units of wheat
These differences in cost ratio will enable the two countries benefits from trade.
In the above example country A has a comparative advantage of cotton and country A has a disadvantage of wheat.
Similarly, country B has a comparative advantage in wheat and disadvantage in cotton. So country A exports cotton and imports wheat from country B. In this way, international trade takes place between countries.

Question 9.
(a) What is a Performance Budget? Differentiate between Revenue Expenditure and Capital Expenditure. [4]
(b) In a situation of income inequality, give two ways in which Fiscal Policy can be used to bring about equity. [4]
(e) Discuss four methods of repayment of public debt. [6]
Answer:
(a) Since 1973-74 the idea of Performance Budget was introduced by the fiscal authorities in India. Performance budgeting aims at monitoring the progress of projects in terms of their actual physical achievements against the given goals. Hence, evaluation of the expenditure involves the assessment of the progress of the programmes included in the project.
The expenditure which does not result in the creation of assets is revenue expenditure. The capital expenditure consists of expenditure on acquisition of assets like land, buildings, machinery, equipment, investment in shares, loans and advances granted by Central / Union Govt, to states and Union Territories.

(b) In a situation of income inequality two ways in which Fiscal Policy can be used to bring about equity are:
(i) The types of income and other taxes designed by the Govt should be such that an equitable distribution of the society’s income and wealth occurs.
(ii) The regional balance should be maintained. If particular regards of the country are not taken into account in the process of development, this will accentuate the problem of inequality’ of income distribution in a society. The public projects must be distributed over all the regions in the country is a fairway.

(c) Four methods of repayment of public debt are:
(i) Terminable annuities: Government may pay the bondholders a certain fixed amount for a number of years to meet his debt obligations. These annual payments are called annuities.
(ii) Purchase of Government bonds in the security market. The Government may also purchase its own stock in the security market.
(iii) Budgetary surplus: A surplus increased in the Government surplus of aggregate revenue exceeds aggregate expenditure of the Government during any particular year. This budgetary surplus can be used by the Govt, to meet its debt obligation.
(iv) Export Surplus: If the export income of a country becomes more than its import payments then an export surplus is created. This leads to greater inflow of foreign exchange into the exchequer of the Govt. The Govt can use this foreign exchange reserves to meet its external debt obligation.

ISC Class 12 Economics Previous Year Question Papers

ISC Business Studies Previous Year Question Paper 2010 Solved for Class 12

Maximum Marks: 80
Time allowed: Three hours

• Candidates are allowed additional 15 minutes for only reading the paper. They must NOT start writing during this time.
• Answer Question 1 (Compulsory) from Part I and five questions from Part II, choosing two questions from Section A, two questions from Section B and one question from either Section A or Section B.
• The intended marks for questions or parts of questions are given in brackets [ ].

Part-I
(Answer all questions)

Question 1.
Answer briefly each of the questions (i) to (xv): [15 × 2]
(i) State two merits of internal recruitment.
(ii) ‘Training helps in reducing supervision of employees’. Justify.
(iii) List any two work conditions where time rate system of remuneration is more suitable than the piece rate system.
(iv) Mention four indicators of low morale amongst employees of an organisation.
(v) How does challenging work motivate employees ?
(vi) State two limitations of Maslow’s Theory of the hierarchy of human needs.
(vii) ‘Transfer is a mild form of punishment’. Explain.
(viii) What are the functions of a telephone recording and an answering set?
(ix) List the steps involved in report writing.
(x) What is meant by casting vote ?
(xi) Explain the term Point of Order.
(xii) Why is a histogram called a two dimensional graph?
(xiii) How does a business reply card help a business concern?
(xiv) Explain the term adjournment in the context of company meetings.
(xv) Write the expanded forms of the following:
(a) N.B.
(b) PABX
Answer:
(i) (a) It helps in minimizing labor turnover.
(b) It helps in boosting the morale of existing employees.

(ii) Training increases the knowledge and skills of the employees. They get expertise in their related jobs. Therefore, it helps in reducing supervision of employees.

(iii) (a) When number of units cannot be counted or work cannot be measured.
(b) When quality of production has to be given weight age over quantity of production.

(iv) (a) High rate of wastage and spoilage.
(b ) High rate of absenteeism.
(c) High rate of labor turnover.
(d) High rate of strikes.

(v) Challenging work certainly motivates employees. By giving a challenging work to the capable employees increases the sense of faith for their institution. Challenging work helps the employees in building their reputation in the institution. They are trusted by the other employees. This motivates the employees.

(vi) Recent research challenges the order that the needs are imposed by Mas low’s pyramid. As an example, in some cultures, social needs are placed more fundamentally than any others. Further, Mas low’s hierarchy fails to explain the “starving artist” scenario, in which the aesthetic neglects their physical needs to pursuit of aesthetic or spiritual goals. Little evidence suggests that people satisfy exclusively one motivating need at a time, other than situations where needs conflict.

(vii) Transfer is a mild form of punishment. It is true. When the employee neglects work or conflicts with other employees or does the act of misconduct, the management can transfer the erring employee to a new place. Transfer from one place to another (unimportant place) is a very common practice while punishing the employees.

(viii) A telephone recording and answering set has a remote listening facility whereby the answerphone owner can ring their home number and, by either sending a tone down the line using a special device, or by entering a code on the remote telephone’s keypad, can listen to messages when away from home. The owner may record his or her message that will be played back to the caller, or an automatic message will be played if the owner does not record one. Answering machines can usually be programmed to take the call at a certain number of rings.

Many devices offer a “toll saver” function, whereby the machine answers only after several rings (typically four) if no messages have been left, but answers after a smaller number of rings (usually two) if there are messages. This allows the owner to know whether there are messages waiting; if there are none, he or she can hang up the phone on the third ring without incurring a call charge.

(ix) Steps involved in report writing are :

• Clarity purpose and expectations
• Decide on appropriate structure for report
• Drafting
• Circulating the draft
• Integrating Comments
• Writing Executive Summary
• Circulating Final Draft
• Editing
• Layout

(x) The vote that gives one group a majority when the other votes are equally divided. The person in charge of a committee, for example, often has the right to give a casting vote.

(xi) Point of order: This is a motion for expressing any objection or complaint by a member against – the speech maker. Point of order can be raised on the following conditions.

• Incorrect procedure of meeting.
• Irrelevant issues are raised by any member;
• If a member uses some unpleasant language;
• Infringement of the rules of the society;
• When a member passes defamatory or insulting remarks on some other member.
• When a quorum has fallen due to the early leaving of some member or members and a member objects to it.

(xii) A histogram is a bar chart representing a frequency distribution; heights of the bars represent observed frequencies. Histogram is prepared using X and Y axis of a chart. Therefore, it is called two dimensional graph.

(xiii) Business reply card is helps a business concern to procure mail orders, suggestions on its products, survery reports, etc. Business reply card is a prepaid card in which the sender does not need to affix postage stamps. Postage is borne by the business concern.

(xiv) In the case there is any difficulty in holding any annual general meeting (except the first annual meeting), the registrar may, for any special reasons shown, grant an extension of time for holding the meeting by a period not exceeding 3 months provided the application for the purpose is made before the due date of the annual general meeting.

However generally delay in the completion of the audit of the annual accounts of the company is not treated as “special reason” for granting extension of time for holding its annual general meeting Generally. In such circumstances, an AGM is convened and held at the proper time all matters other than the accounts are discussed. All other resolutions are passed and the meeting is adjourned to a later date for discussing the final accounts of the company. However, the adjourned meeting must be held before the last day of holding the AGM.

(xv) (a) NB means: Nota Bene.
(b) PABX means: Private Automatic Branch Exchange

Part-II
(Answer any five questions)

Question 2.
(a) Why is induction training important in an organization ? [4]
(b) Discuss any five methods of raising staff morale in an organization. [ 10]
Answer:
(a) Induction and training have vital importance in today’s business world. A good induction and training program can greatly improve well being and productivity throughout a company, whilst bad one can not only cause confusion, but also to large decreases in productivity through staff not knowing their function, or their place in the company.

(b) Methods of Raising Morale
Monetary Incentives: Monetary incentives like good salaries and wages help to encourage the employees for greater productivity. The management should evolve such a wage/salary structure which enables the workers to earn at a reasonable level and to live a decent life. Assurance of a sound wage structure builds up morale of workers.

Non-Monetary Incentives: Non-monetary incentives are also helpful in boosting the morale of employees. These incentives may be provided to them in the form of medical aid, recreational facilities, holiday homes, creche facility to the children of working couples, etc.

Job Security: Security of job boosts the morale of the employees. The management should follow a good labour policy that ensures the security of the job to its employees. The workers should also be assured that in case their services are not required in their present jobs, they will be absorbed in alternative jobs sooner or later or immediately.

Sound Promotion Policy: A sound promotion policy is a must to boost the morale of the employees. Promotion policy should be so adopted by the management that it gives proper weightage to merit and seniority. If only one base either seniority or merit is adopted, it will not be good for the morale of the employees.

Healthy Working Conditions: The working conditions in the organisation play a crucial role in boosting the morale of the employees. Working conditions should be healthy so that employees may work with best efforts and attain organisational objectives.

Redressal of Grievances: Employees’ morale remains high if there is a proper redressal system of grievances of the employees. The employeess should be convinced that there is fairness and the impartiality in dealing with their grievances. The morale of the employees is high if their grievances are redressed properly and quickly.

Effective Leadership: The morale of the employees is also influenced.

Question 3. .
(a) Explain Laissez-Faire leadership. Discuss its advantages and disadvantages. [6]
(b) Define promotion. Explain three advantages and three disadvantages of seniority based promotion. [8]
Answer:
(a) The laissez faire style is sometimes described as a “hands off’ leadership style because the leader provides little or no direction to the followers.
The characteristics of the laissez faire style include.

• Allows followers to have complete freedom to make decisions concerning the completion of their work or ask questions of the leader.
• The leader provides the followers with the materials they need to accomplish their goals and answers questions to the follower’s questions.

In this style the leader lets the employees manage themselves and there is no delegation taking place from the management. This style is often called “hands off” leadership as the leader evades his duties and does not direct the employees.

Advantages: This kind of style is positive only in the case when the employees are very responsible and in case of creative jobs where* a person is guided by his own aspirations. In these cases, less direction is required so this style can be good.

Disadvantages : This style has more disadvantages because usually it is the result of the lack of interest of the leader that leads to his adopting this style. It proves poor management and makes the employees lose their sense of direction and focus. The disinterest of the management and leadership causes the employees to become less interested in their job and their dissatisfaction increases.

(b) Promotion means placing an employee on a higher post which involved greater responsibility, higher status, higher pay and perks, higher satisfaction. Some people merely think that promotion only means increase in pay scale, but it is not so. Pay scale increases even in the same cadre. This is called salary increment. Promotion means higher responsibilities. It may or may not increase salary of the employee.

Sometimes salary of the employee also increases with the promotion and sometimes not. However, it is a general practice to allow salary increase to the promoted employee.

Definition of Promotion:
“A promotion involves a change from one job to another that is better in terms of status and responsibilities.” -Edwin B. Flippo

“A promotion is the transfer of an employee to a job that pays more money or that enjoys some better status.” -Scott and Spriegal

Advantages of Seniority Based Promotion
Promotions are preferred on seniority basis by the trade unions on the basis of following features :

• The seniority process is simple. To measure the ability standards is difficult.
• All employees are assured promotion. They feel happy that promotion will automatically come in their way when it is due.
• The process of promotion by seniority is very economical. The management has to spend nothing on such a process. Otherwise in deciding the ability the management might have to conduct a test/examination.
• This promotion policy is conducive for both labor management relations.
• Senior employees remain satisfied, frustration transaction level is not present among them. They are assured promotion at their turn.
• Seniority’ system provides an optimum utilization of the existing work force.

Demerits of Seniority Based Promotion
The system of promotion by seniority suffers from the following demerits :

• Continuous promotion on seniority basis may upset the working strength of the organisation. Merit has nothing to do in this process and there may be a number of inefficient employees in higher posts. .
• Junior but highly meritorious employees get frustrated with this promotion process.
• Overall productivity of the employees may not be as high as required. In terms of energy, a senior or old employee may be much behind that of a young employee. When the promotions are offered only on the basis of seniority, average productivity may not be good.
• In present scenario, technology is changing very fast. It is not very easy for the senior employees to put themselves in the main stream of technology. In such a case, it becomes necessary to induce fresh blood in the form of young and talented employees.
• The merit of an individual is not appreciated. He is not given due recognition. Frustration level becomes high and young and meritorious employees leave the organisation. Therefore, rate of employee turnover is very high under such system of promotion in an organisation.

Question 4.
In the context of staff remuneration, explain Halsey Plan and Rowan Plan of incentive wage payment with the help of appropriate examples. [14]
Answer:
Halsey Premium Plan-This method was developed by F. A. Halsey.
In this method, a standard time is fixed for completion of a job. A worker who completes his work in a time less than the standard time, is paid at hourly rate for the actual time spent on the work plus a bonus for the time saved. The bonus is calculated on a certain percentage for the total time saved by the worker. The worker who does not complete his job within the stipulated standard time is not penalized but is guaranteed minimum wages.

Illustration : Standard time for producing 25 units of an item is fixed at 10 hours. A worker takes 8 hours to produce 25 units of that item. Bonus is given at 50%. Calculate the wages to be paid to that worker for 8 hours if the rate of wages is Rs. 10 per hour.

Solution:
Under Halsey Premium Plan
Bonus = Time saved × Rate per hour
Bonus = 50% of (time save × Rate per hour)
Time saved = 10 – 8 = 2
= 1/2 × 2 × 10
= Rs. 10
Wages for 8 hours = 8 × 10 = Rs. 80
Total wages for 8 hours = Rs 80 + Rs 10 = Rs 90

Features of Halsey Premium Plan:-
The following are the features of Halsey Premium Plan :

• Standard time of production is pre-determined.
• The efficient workers who complete the work in lesser time are entitled to get bonus. They get bonus for the save time.
• Standard rate of wages is also determined.
• The rate of hour may be 1/3 or 1/2 of the standard rate of wages.
• There is no provision of penalty for the workers who do not complete the work within the standard time.

Merits of Halsey Premium Plan — The following are the merits of Halsey Premium Plan :

• Every worker is entitled to get minimum wages.
• Efficient workers are encouraged to do more and more work to earn bonus.
• This system is suitable both for employer and workers.
• This system helps in proper and maximum utilization of time.
• This system is easy and convenient to use.
• Workers are fully satisfied.

Demerits of Halsey Premium Plan — This system suffers from the following demerits :

• The method of payment of wages is not scientific. It is based upon prejudice.
• Due to minimum guarantee of wages, workers become ignorant.
• It depends on the workers whether to do more work or not.
• The efficient workers do not get full benefit of the saved time. This does not encourage them.

Rowan Premium Plan:
This system of incentive wages w as introduced by James Rowan. Standard rate and time is determined in the same manner as in the Halsey Premium Plan.

The workers who finish their job within standard time get the wages at the standard rate. The workers who complete their work in less than standard time are given some bonus also in addition to standard rate.
The bonus in this method is calculated as follows :
\(\text { Bonus }=\frac{\text { Time Saved }}{\text { Standard Time }} \times \text { Actual Time } \times \text { Rate per hour }\)

Illustration:
Standard time for doing a work is fixed at 10 hours. A worker takes 8 hours to finish it. Rate of wages is Rs. 10 per hour. Calculate total wages earned by the worker.
Solution :
Standard Time= 10 hours
Actual Time = 8 hours
Time saved = 10 — 8 = 2 hours
Rate per hour = Rs. 10
\(\text { Bonus }=\frac{\text { Time Saved }}{\text { Standard Time }} \times \text { Actual Time } \times \text { Rate per hour }\)
\(\text { Bonus }=\frac{2}{10} \times 8 \times 10=\mathrm{Rs} .16\)
Actual wages for 8 hours = 10 × 8 = Rs. 80
Total wages of the worker = Rs. 80 + Rs. 16 = Rs. 96

Question 5.
(a) Discuss the importance of feedback in communication. [2]
(b) What is meant by face to face communication ? [2]
(c) Explain any five advantages and five disadvantages of face to face communication. [10]
Answer:
(a) Feedback—After receiving the message, the receiver derives the meaning from the message and responds to the sender. The return flow of communication is called Feedback.

The process of communication is successful when the sender receives the feedback from the receiver.

Feedback helps the sender to know whether the message communicated to the receiver has been understood by the receiver properly. Feedback depends upon the type of communication.

In case of oral communication or face-to-face the communication feedback is immediately available and the sender can judge the effectiveness of his message communicated to the receiver immediately .

In case of written communication, the feedback is not immediately available to the sender. The receiver may take time in sending response to the sender. Moreover, the sender cannot see the face expressions of the receiver.

(b) Face-to-face communication is the most common form of communication. It is an interaction between two persons. In such communication, one participant plays the role of speaker and the other of listener interchangeably. This form of communication takes place everywhere; individuals in office, business deals, common persons. Face-to-face communication is prompt and the communication can be made clear to the listener.

(c) Advantages of face to face communication
Prompt communication – This communication takes place between two persons and is very prompt since both the listeners and receivers are listening and responding to each other.

Effectiveness – This communication is very effective. If the listener has any doubt, he can get clarification from the speaker at the spot. The solution of the problem can be obtained immediately.

Flexibility – Face to face communication is flexible. The speaker can adjust his message according to place, time. He can explain his message and modify or withdraw the comments.

Immediate Feedback – Immediate feedback and suggestions are available interchangeably to the listener and speaker. The speaker can make the judgement about the effect of communication on the listener.

Secrecy – This communication takes place between two persons, secrecy can be maintained by the persons.

Disadvantages of face to face communication
No Record – This communication takes place between two persons orally. There is no record of such communication.

Legal Validity – This communication suffers from lack of legal validity. Court of law does, not accept this communication as a proof of evidence.

Poor Retention – A listener may not retain the message in his memory for long. The impact of the message is lost after a passage of time.

Responsibility – No responsibility can be fixed on the part of speaker or listener as there is no record available for such communication.

Not Suitable for Lengthy Communication – It is not suitable for lengthy messages. Lengthy explanations are difficult to explain to the listener.

Question 6.
(a) What is an agenda ? Why is it an essential part of notice? [4]
(b) Explain any five ways in which the sense of a meeting can be ascertained. [10]
Answer:
(a) Agenda means a list of issues, plans, mattress, etc. to be considered at a meeting. It is a part of formal notice for a meeting. Without an agenda a notice is treated to be invalid and proposed meeting becomes invalid. Agenda is drafted before meeting.

(b) One of the most important duties of the chairman of a meeting is to ensure that the sense of the meeting is properly and accurately ascertained. It is the duty of the chairman to ascertain the sense of the meeting. Sense of the meeting can be ascertained:

• by conducting the first instance, voting by show of hands.
• by poll, if it is demanded or ordered by him of his own motion.
• Every member or a proxy is given opportunity of exercising the right of voting.

Question 7.
(a) Discuss the procedure for handling the outgoing mail in a big business concern. [12]
(b) Mention any four mechanical aids associated with the above procedure. [2]
Answer:
(a) Outgoing mail means letters which are sent from the office to other departments or persons. Outgoing letters follow the procedure mentioned below :

(A) Drafting of Letters : Drafting is a very important aspect of handling the outgoing mail. An outgoing letter reflects the nature and type of the office. An outgoing letter in itself is an advertisement of the institution. Therefore, it is very important to draft the letter carefully.

Drafting of letters is done after carefully studying the letters to which the reply is to be sent. Drafting of . such letters which are to be sent first time on a particular subject, should be very proper.

While drafting the letters, the following points should be taken proper care of:

• Language of the letters should be clear and humble. Difficult words or confusing words should not be used in the letters.
• Subject matter should be very clear so that it can indicate in a simple line what the letter wants to say.
• Letters should not be unnecessary long. In case of responding letters, it should be noted that necessary contents should not be left out.
• In case of official letters, personal matters should be avoided.
• The draft of the letters (if required) should be got approved from the higher authorities.

(B) Typing of Letters: Once the draft of the letter is approved, it is given to the typist or stenographer for typing the letter. The typist types the letter. While typing the letter(s), the following points should be taken care of:
(i) Typing mistakes should be avoided in the letters. If there is any mistake in the typed word, the wrong word should be erased with the typing eraser or white correcting fluid should be applied on the wrong word and then the correct word should be typed on it. Today in computerised environment in the offices, it is very easy to rectify’ the spelling mistakes in the documents.

(ii) The number of duplicate/carbon copies of the letters should be taken as directed by the drafting official.
drafting official.

(iii) The letters should be typed with proper date; address and alignment of lines and paragraphs.

(iv) Good paper should be used for typing the letter.

(v) Ink of the ribbon of the typewriter should be good so that the main copy of the letter should appear very attractive.

If possible for the office, it should purchase a computer which can be very helpful in typing the letters. A computer is helpful in typing due to its following features :
(i) Multiple copies of the letter can be printed by a single command on the printer installed with the computer.

(ii) There are various word-processing programmes available on the computer which provide facility of:

• Spell checker to remove the typing mistakes. Grammatical improvement is also possible in these programs.
• Paragraph alignment (right, left, centre or justify alignment) can be done in the letters.
• Line spacing in the paragraphs can be done.
• Formatting of letters is possible. Formatting includes highlighting of word/text, italicising and underlining of text or words or selected lines. Size of the characters (called font size) can be increased or decreased as per requirement of the letter.
• Even objects and pictures can be inserted in the documents being typed on the computer.
• The keyboard of a computer is just similar to the key-board of type writer. There is no difficulty for learning the keys of the key-board for a typist.
• The letter or document can be saved on the hard-disk (storage medium) of the computer for future use. In case of need the same letter or document can be retrieved again.

(C) Filing of Letters : After typing of letters, the drafter of the letter reads it and matches with the drafted letter. If there is any mistake in the letter, he erases it with the typing eraser or correcting fluid and marks the proper character or word. Then he puts (files) the letter in the proper file. He puts his initials on the letter and in case the letter is to be dealt at his own end, he puts full signatures on the letter in his official capacity. In case the letter is to be signed by the higher authority, he puts his initials and sends the file to the higher authority or employer.

(D) Signatures on the Letter: After filing the letters, the concerned file is sent to the higher authority for his signatures on the letter. If the contents of the letter are found in order, the higher authority puts full signatures on the letter.

(E) Entering Letters in Register: After the above process the letters are sent to the dispatch clerk who enters the letters in the dispatch register.
There may be different dispatch registers for :

• Ordinary letters.
• Registered letters.
• Courier letters.

The letters are entered in the register according to the format of dispatch register. If the letter is being sent through ordinary post, it is entered in the ordinary dispatch register by mentioning the date of dispatch, subject matter, etc. Postage stamps consumed on the letter are also entered in the register. The dispatch serial number is mentioned both on the main letter (to be sent) and office copy. This dispatch number is mentioned at the place of Reference Number of the letter.

(F) Dispatch Procedure: After entering the letters in the respective dispatch registers, these letters are dealt very carefully.
Ordinary letters are kept separate after entry and the address of the destination is mentioned on the envelope. The letter is inserted inside the envelope and properly sealed. Proper postage stamps are applied on the envelope according to the weight of envelope.

Presently the charges of ordinary mail are as under :
Envelope up to first 20 grams Rs. 5
Next 20 grams and parts thereof Rs. 5

This means that a letter of 21 gms of weight will bear Rs. 10/- postage stamps.
All the ordinary letters are affixed proper stamps and handed over to the dispatch peon for putting them in the letter box.

Registered letters are also entered in the dispatch register and postage stamps affixed on them are mentioned in the dispatch register. All the registered letters are separately handed over to the dispatch peon to get them registered from the post office. Post office issues separate receipts for all registered letters. The peon brings these receipts from the post office and these receipts are.pasted in the dispatch register as a proof of sending the letters through registered post.

Courier letters are also separated by the dispatch clerk. Courier letters are those letters which have to be reached in a short time to the destination. The letters are handed over to the courier service office or they are picked by courier boys from the office itself. Courier boy issues receipts for courier letters. These receipts are preserved by the dispatch clerk.

(b) Mechanical Aids : Various types of mechanical aids are used in the mail room. These aids are described below :

Stapling Machines: Staplers are used in the mail room to sealing (closing) the envelops.

Letter Typing Machines: With the help of typing machine letters (bunch of letters) can be tied together. Letters are kept inside the machine and a thin wire passes around the letters and ties them.

Franklin Machine: Franklin machine is issued by the post office. The postal authorities put a certain value in it (as requested by the office). This machine puts the stamp on the envelope. The value put (entered) in the machine goes on decreasing as more and more stamps are affixed on the envelopes. At one stage the value inserted in the machine is exhausted and the office has to again request the post office to issue a certain limit.

Dating Machines: Dating machines are used to put the dates on the letters. When there is number of letters, these dating machines are very helpful on putting the dates on these letters.

Weighing Machines: A weighing machine is used to ascertain the weight of letters. Post Office charges the postal rates according to the weight of letters. After ascertaining the weight of letters, postage stamps are affixed accordingly.

Serial Numbering Machines: These machines are used to put serial numbers on the letters, despatch register and office copy of the letter. Respective serial numbers can be given on respective places. After putting a serial number as many number of times, the next serial number automatically changes.

Addressograph: It is another mechanical device which is used to print address of the addressees on envelopes and wrappers. This device is very useful in cases where the number of letters are sent regularly. Names and address of the persons are embossed on metallic stencils. The different stencils of addressees are placed in the machine. The machine automatically selects the stencil and prints the address of person on the envelope.

Question 8.
(a) What are memos ? State two situations in which they can be used effectively. [4]
(b) What are circulars ? Give any two situations in which they are effective. [4]
(c) On behalf of a multinational corporation, draft an interview letter for the post of a management trainee. [6]
Answer:
(a) Meaning — Memorandum in short is known as Memo. Memorandum means a note to assist memory.
Purpose — Memo is used for internal communication between managers and subordinates. It is not used outside the organisation. Memo is used-

• to issue instructions to the staff members.
• to give / seek suggestions from the employees.
• to communicate policy matters and changes to the staff members.
• to seek explanation from an employee to explain his conduct.
• to intimate grant of permission to do something.
• to intimate grant of permission to withhold something.

(b) A circular letter is one which is sent out to many people at the same time used both within organization and for sending out information from organizations. The letter may be prepared once only and then duplicated. With modem technology, however, it is more likely that each letter could be personalized to look like an original also called an open letter.

Situations that need Circulars: Situations that need circulars introduce a new product/service, opening of new branch, change of address, seasonal discounts, increase in price, etc. obtaining an agency, change in constitution of the firm.

(c)

ISC Class 12 Business Studies Previous Year Question Papers

ISC Geography Previous Year Question Paper 2013 Solved for Class 12

PART-I (30 Marks)
Answer all questions

Question 1. [20]
(i) Although the time of sunrise varies between Arunachal Pradesh and New Delhi, the watches show the same time. Explain why.
(ii) Compare the land area of India with that of China.
(iii) In the diagram given below, A represents the path of an upper atmospheric air movement in the cold weather season.

(a) Name A
(b) Explain how A influences the weather of India during winter season.
(iv) State any two ways in which Himalayas affect the Indian climate.
(v) Name the two streams which unite at Devaprayag to form into river Ganga.
(vi) Mention the Period of Stagnant Population and Period of Population Explosion in India.
(vii) State any one use of aluminium. Name a centre for aluminium industry in India.
(viii) What is a port ? What advantage does the Mumbai port have over the other ports of India in international trade?
(ix) Distinguish between a major industrial region and a minor industrial region.
(x) Define the term micro-region. Name any one micro-region in India.
Answer:
(i) The time of sunrise varies between Arunachal Pradesh and New Delhi by 72 minutes because it lies to the east with a difference of about 18° of longitude but the watches show the same time because all places in India follow the same time that is recorded in Allahabad (82.5 °E) which is the Indian Standard Time. This is done to avoid confusion in time in the entire country.

(ii) China has a total land area of 95.97 lakh sq.km. India has a total land area of 32.87 lakh sq. km. Thus, China is three times larger than India in terms of land area.

(iii) (a) A is the Westerly Jet stream.
(b) During the winter season in India, this jet stream has a great influence on the weather of India as it attracts the western disturbances, which originate in Mediterranean Sea and give a light rain in winter. Hail storm in the north-western plains and occasional heavy snowfall in the hilly regions also takes place.

(iv) The two ways in which Himalayas affect the Indian climate are :

1. It acts as a barrier to the cold winds of Northern Asia from blowing into India and protecting India from severely cold winters.
2. It traps the monsoon winds forcing them to shed their moisture within the subcontinent.

(v) The two streams that unite at Devaprayag to form into the river Ganga are Alaknanda and Bhagirathi.

(vi) Period of stagnant population —1901-1921 Period of population explosion —1951-1981.

(vii) Aluminium is used in making aeroplanes and ships. Renukoot in Uttar Pradesh is a centre for aluminium industry in India.

(viii) A port is that place on the coast or shore, with docks, wharves and berthing facilities, where cargo in large quantities is received from oceanic routes and sent to the interior of the country through land routes and vice versa.

Mumbai port is the biggest port of India and handles approximately one-fifth of India’s foreign trade with pre-dominance in dry cargo and mineral oil from the Gulf countries. It handles foreign trade with the Western countries and East African countries. It’s biggest advantage over other ports of India, in international trade is that it is closest to the Gulf countries, East Africa and Europe.

(ix)

Major Industrial Region	Minor Industrial Region
1. It is the region with a minimum daily factory working force of 1-5 lakh.	It is the region with a minimum daily factory working force of 25,000.
2. For example – Gujrat Industrial Region, Mumbai-Pune Industrial Region.	For example – Jaipur-Ajmer Indus­trial Region.

(x) A micro-region is defined as a territorial area smaller than the state to which it belongs but larger than a municipality and also has the potential for developing at least one specialisation of production of cycle. Agriculture in Punjab and the Hilly region in U.P. is an example of a micro-region.

Question 2. [10]
On the outline map of India provided :
(a) Mark and name a mountain range situated between the two west flowing rivers of Peninsular India.
(b) Mark and name the highest peak of the Himalayan range in India.
(c) Trace the course and name the river which has the largest extent in Peninsular India.
(d) Mark and name the state which has the highest literacy rate according to census 2001.
(e) Mark and name the main groundnut producing state in India.
(f) Trace the shortest arm of the Golden Quadrilateral. Name any one of its terminal towns.
(g) Mark and name the Nuclear Power Station located to the north of Tropic of Cancer.
(h) Shade an area of tropical evergreen vegetation in Northeast India.
(i) Shade the region of Chhattisgarh.
(J) Mark the port city ofVisakhapatnam.
Answer:

PART-II (40 Marks)
Answer any four questions.

Question 3.
(a) (i) State the location and extent of Bhabar. Mention any two differences between Bhabar and Tarai. [3]
(ii) Name the country with which India shares the longest land boundary. Mention the length of the boundary in kilometres.
(b) (i) Give two reasons as to why Western Rajasthan is a desert. [3]
(ii) Name any two Himalayan drainage systems of India.
(c) Briefly explain the geological formation of the Peninsular Plateau. [2]
(d) State the climatic conditions of the tropical evergreen forests in India. [2]
Answer:
(a) (i) Bhabar is a plain situated along the foot of the Shiwaliks from the Indus to the Tista.

Bhabar	Tarai
It lies along the foot of the Shiwaliks from Indus to Tista, about 8 to 16 kms. wide.	It lies to. the south of the Bhabar and runs parallel to it, about 20 to 30 kms. wide.
It comprises pebble-studded rocks in the shape of porous beds so it is not suited for agriculture.	It is composed of comparatively finer alluvium and is reclaimed for agri­culture.

(ii) India shares the longest land boundary with Bangladesh. Length of the boundary is 4,096 kms.

(b) (i) Western Rajasthan is a desert because it lies ‘ in the rain shadow area of the Aravalli Hills in
the Bay of Bengal branch of the southwest monsoons coming from the east. These winds when strike the Garo Khasi Hills, are diverted west and northwest along the Ganga plain. As these winds advances, imparting rain, they become less humid and are dry when they reach the Indus Basin in the extreme northwest.
(ii) The two Himalayan drainage systems of India are:
1. The Indus drainage system.
2. The Ganga drainage system.

(c) During the Pre-Cambrian era, there was a large depression in which the sediment was deposited and a block of crystal rocks known as the Peninsular Plateau came out and never submerged again. It is made up of crystalline, hard, igneous and metamorphic rocks. Most geologists believe that the Indian Peninsula is a part of the global Gondwanaland which broke away about 250 million years ago and started drifting northwards, striking the Central Asiatic plate raised up to form the high Himalayas out of the Tethys Sea.

(d) The climatic conditions of the tropical evergreen forests in India are :
1. Rainfall-above 200 cms.
2. Temperature – 24°C average, 24°C – 27°C.
3. Humidity 70%.

Question 4.
(a) With reference to percentage of world population, compare India’s position with China and Australia. [3]
(b) What are the two main causes for an increase in the number of high population density areas in the Indian region ? [1]
(c) Explain any three reasons for in-migration to the urban city of Lucknow. [3]
(d) With reference to the circular rural settlement pattern, answer the following: [3]
(i) How does this pattern develop ?
(ii) Name any two areas where this pattern is found in India.
Answer:
(a) India is one of the most populous countries of the world. India supports and sustains 16.8 percent of the population of 6,055 million (census of India 2001). India became the second largest country in the world after China to officially cross the one billion mark. Its population is more than about 55 times the population of Australia. India adds every year one Australia to her population. The population of Australia is negligibly small, about 0.3 per cent, compared to the world population.

(b) The two main causes for an increase in the number of high population density areas in the Indian region are :
1. The large scale migration of people from the surrounding areas, in search of livelihood and better amenities of life.
2. People migrate to urban areas because of availability of better educational facilities especially those higher education.

(c) The three reasons for immigration to the urban city of Lucknow are :

1. Urban centres like Lucknow provide vast scope for employment in industries, transport, trade and other services.
2. It also has a provision for better and higher educational facilities so that there are a number of schools, colleges and university. Hence, the flock of students moves to Lucknow from the neighbouring villages.
3. Urban centres also offer hospital facilities, healthcare centres, legal advice and also other services that can be availed.

(d) (i) When the houses are constructed along the banks of a pond, tank or a lake, the settlement takes the shape of a circle. People prefer to build houses near the source of water. In this pattern the houses, offices, business centres, are in the centre. As you move out there are garden plots, surrounded by cultivated land, pastures, woodland, in successive rings.
(ii) The two areas where this pattern is found in India are :

1. The upper Ganga-Yamuna Doab region.
2. In the parts of Madhya Pradesh, Gujarat and Maharashtra.

Question 5.
(a) (i) Why is there a need for environmental management ? [2]
(ii) What is meant by sustainable development ?
(b) What are the two reasons for the arable land degradation in India ? [2]
(c) Mention three ways in which modern means of irrigation are more advantageous than the ancient methods of irrigation. [3]
(d) (i) Mention two ways in which tube-vsells are better than ordinary wells as a form of irrigation. [3]
(ii) Name any two alternative methods of irrigation.
Answer:
(a) (i) There is a need for environmental management because environmental problems are becoming serious due to increasing population, industrialisation, urbanisation and poor management procedures. In the process of development, the natural resources are used by mankind in thoughtless and indiscriminate manner for their immediate gain. This process results in overall degradation of the environment and increases complexity.
(ii) Sustainable development may be defined as the development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

(b) The two reasons for the degradation of arable land area in India are :
1. Soil erosion.
2. Excessive use of chemical fertilizers.

(c) The modern methods of irrigation are more advantageous than the ancient methods of irrigation because:
1. It is easy to operate.
2. They provide irrigation to a much larger area. e.g. Tube wells use electric motors to pump up water and they can irrigate a much larger area than an ordinary well.
3. Regular irrigation throughout the year e.g. perennial canals.

(d) (i) Tube wells are better form of irrigation than the ordinary wells because :
1. It is capable of irrigating more area, about 2 hectares per day while ordinary wells irrigate 0.2 hectares of area per day.
2. It is operated by an electric motor or by a diesel engine so water can be easily lifted from greater depths and most suitable in those areas where canal irrigation is not available.
(ii) The two alternative methods of irrigation are:

1. Sprinkler irrigation.
2. Trickle-drip irrigation.

Question 6.
(a) (i) Name any two methods of fishing. [4]
(ii) Mention the leading state for fish production in the Western Coast of India.
State two reasons for the development of the fish industry in India.
(b) What is understood by the term market gardening? State a reason for its development in India. [2]
(c) Compare tea production of India with Sri Lanka. [2]
(d) State any four conditions essential for the generation of hydroelectric power. [2]
Answer:
(a) (i) The two methods of fishing are :

1. Drifting
2. Trawling

(ii) Kerala is the leading state for fish production in the western coast of India. The fishing industry has developed in India as it has a long, indented coastline dotted with a large number of lagoons and some of the coast remains calm for a long time which is quite convenient for fishing operations.

(b) Market gardening is a section of agriculture in which fruits and vegetables are grown mainly for market purpose. It is relatively a small- scale production and directly sold to consumers and restaurants.
India has developed market gardening as it has a wide variability of climate and soil and produces a large range of horticultural crops like fruits, vegetables, ornamental crops, medicinal crops and aromatic plants.

(c) India is the largest producer of Tea whereas Sri Lanka is the third largest producer. India’s contribution of tea production in the world is about 35% and Sri Lanka accounts for about 12% of the total world production of tea. Sri Lanka is the third largest exporter of tea in the world after India and China.

(d) The four essential conditions for the generation of hydroelectric power are :

1. There should be a perennial flow of large volumes of water.
2. The water should fall from a sufficient height. It may be in the form of a natural waterfall or a fall obtained by constructing a dam across the river. It may also be obtained by diverting the water from one river basin to another.
3. A readily available market is an essential requirement for generating hydro-electric power as electricity cannot be stored.
4. It also requires a huge capital investment as it is a capital intensive activity.

Question 7.
(a) (i) What is the importance of transport as an infrastructural resource to industrial economy ? [3]
(ii) Briefly discuss any two natural factors that govern the distribution of roads in India.
(b) Mention any one disadvantage of airways and any one disadvantage of pipelines as a mode of transport. [2]
(c) Name a recently developed port of Tamil Nadu. What is its main purpose? [2]
(d) State three ways in which radio and television are useful means in mass communication. [3]
Answer:
(a) (i) The importance of transport as an infrastructural resource to industrial economy are :

1. It is the basic economic arteries and provides an important link between production and consumption. It plays a key role in the origin and growth of industrial economy.
2. Transport plays a vital role in production and distribution. Production is facilitated as raw materials are brought to the factory site by quick transport.
3. The location of a manufacturing plant, its production and distribution, the growth of cities, towns and ports, domestic and foreign trade all are influenced by transport. Transport and industry are closely related to each other.
4. Cheap and efficient transport is essential for localisation and growth of industries. Transportation facilities are required for carrying raw materials and labour force to the manufacturing site and for carrying manufactured goods to the market.

Thus, transport and industries grow side by side in any area.

(ii) The two natural factors that govern the distribution of roads in India are :

1. Flat level land.
2. High density of population.

(b) One Disadvantage of Airways : It is the costliest mode of transportation and can carry only limited goods and passengers.
One Disadvantage of Pipelines : Underground pipelines cannot be easily repaired and detection of leakage is also difficult. Once it is laid, capacity cannot be increased.

(c) Tuticorin is a recently developed port of Tamil Nadu and handles the traffic of coal, salt, food grains, edible oils, sugar and petroleum products. Its main purpose is to carry on trade with Sri Lanka.

(d) The three ways in which radio and television are a useful means in mass communication are:

1. They provide all sorts of useful information, news, and variety of entertain-ment almost reaching to the entire population.
2. Radio and television both operate in multiple regional languages in order to cater to the entire population most efficiently and effectively.
3. They are the cheapest and widely used medium of communication and the only source of entertainment and information in rural areas and remote places.

Question 8.
(a) On the given sketch map of India :]

(i) Identify the industrial regions A and B. [3]
(ii) Identify any one factor that has contributed to the growth of :
(1) Region A
(2) Region B
(b) State two ways in which Cotton industry in India is influenced by climate conditions. [2]
(c) Name the leading state for sugar industry in Peninsular India. Name its two centres. Why is there a shift of the sugar industry from North India to Peninsular India ? Give two reasons. [3]
(d) (i) What are petrochemicals ? [2]
(ii) Give one reason for slow growth of international tourism in India.
Answer:
(a) (i) A – Gujarat Industrial Region.
B – Hugli Industrial Region.
(ii) 1. Region A: The Gujarat Industrial Region developed due to the presence of cotton growing tracts in the Gujarat plains. The availability of cheap land, cheap skilled labour and other advantages helped the cotton textile industry. The petrochemical industry has developed due to the availability of oil.
2. Region B: The Hugli Industrial Region has developed as Hugli offered the best site for development of inland river port, and well connected by the Ganga and its tributaries. Besides navigable rivers, roads, and railways provided subsequent links to the great benefit of Kolkata port. Jute industry is the most important industry of this region.

(b) The two ways in which Cotton Industry in India is influenced by climatic conditions are:
1. Cotton yam produced in a humid region is finer and more durable.
2. Cotton threads do not easily break in humid climate.

(c) Maharashtra is the leading state of the sugar industry in Peninsular India. The two centres are Ahmednagar and Kolhapur.
The sugar industry has shifted from North India to peninsular India mainly because :
1. The geographical conditions are more . suitable in the south; the soil is well drained
and free from waterlogging. Southern India is free from frost and has high temperatures ideal for sucrose development.
2, The crushing season is also much longer in the south than in the north. For example—
crushing season is nearly four months in the north from November to February whereas crushing season in south is nearly 7-8 months from October and continues till May and June,

(d) (i) Petrochemicals are those chemicals and compounds which are derived from rresources of petroleum and these chemicals are used for manufacturing a large variety of articles such as synthetic fibres, synthetic rubber, plastics, dye stuffs, drags and pharmaceuticals.
(ii) The slow growth of international tourism in India is mainly because of its under-developed infrastructure of highways, railways ports, civil aviation, telecommunications. Inadequacies of infrastructural facilities adverself affect tourism.

Question 9.
(a) How is multi-level planning different from single level planning. [2]
(b) Explain the following levels of planning in the regional economical development: [2]
(i) Block level planning.
(ii) Panchayat level planning.
(c) With reference to mining in Chhattisgarh, name two minerals each mined from the following centres : [2]
(i) Surguja district.
(ii) Bastar and Durg districts.
(d) What is an economist’s contribution to the development of a region ? [2]
(e) With reference to Haldia Port, state the following :
(i) Its location.
(ii) The two main items of trade.
Answer:
(a)

Multi-Level Planning	Single Level Planning
1. Multi-level planning is the planning at different levels like village, block, district, state and nation. The multi-level planning may be defineas‘planning for a variety of regions which together form a system           and subordinate systems’.	Single level planning is done at the national level in which the planning process is centralised.
2.The country is divided into smaller territorial units, depending upon the size of the country, the administration, the geographical and the cultural setting of different parts of the country.	Lower territorial levels come into picture only at the implementation stage.

(b) (i) Block Level Planning : In block level planning, each district is divided into blocks consisting of about 100 villages with a population of about 60,000. This planning was aimed at mobilisation of the local resources and participation of the local people in decision making and implementation of the development scheme. It is initiated under the leadership of a block development officer and a team of various specialists and village level workers.
(ii) Panchayat Level Planning : A Panchayat is an elected body in which villagers, as voters, elect their representatives. The Panchayat Raj system has a three-tier structure, i.e., firstly, the village level is popularly known as Gram Panchayat or Gram Sabha, secondly the block level is Panchayat Samiti and thirdly the district level is called Zila Parishad.

(c) The two minerals mined from the following centres:

1. Surguja District: coal and bauxite.
2. Bastar and Durg Districts : iron ore and limestone.

(d) The largest contribution to the study of development has been made by economists. An economist looks at development in terms of economic progress, which is expressed in terms of enhancement in general productivity level, per capita income, efficiency of a worker, overall improvement in quality of life in general and elimination of poverty in particular. The economists have met with greater success in the formulation of theories and models and have earned greater acceptability in policy formulation.

(e) (i) Location : It is located at the confluence of rivers Hugli and Haldia about 105 km downstream from Kolkata.
(ii) Items of Trade : The main items of trade are mineral oil and petroleum products.

ISC Class 12 Geography Previous Year Question Papers