ISC Class 12 Economics Guess Paper 2027

Sometimes a firm can sell its product at different prices to different buyers at the same time. Which of the following market forms supports this practice? (a) Oligopoly (b) Monopoly (c) Monopsony (d) Monopolistic competition

Which of the following statements is correct in the context of Keynesian break-even point? (a) APC < 1 (b) APS > 1 (c) APS = 0 (d) APC = 0

In the Union Budget for the year 2025-26, Goods and Services Tax (GST) on soaps has been fixed at 18%. Why is this tax regressive in nature?

If aggregate demand exceeds aggregate supply in a situation of full employment, what will be its impact on the economy?

'The RBI delivered its first rate cut since Feb. 2025 on Friday, lowering the policy repo rate by 25 basis points to 5·25%.' (Source: The Times of India, Saturday, December 6, 2025) Which one of the following will MOST LIKELY be the impact of this move on Indian economy? (a) Economic growth will accelerate. (b) Loanable fund will become cheap. (c) Fixed deposit interest rate will fall. (d) Consumers' purchasing power will increase.

Explain how deficit in Balance of Payments can be corrected by raising domestic rate of interest on savings.

Refer to the diagram given below and choose the correct statement. (a) K is the equilibrium point as MC = AC. (b) MC = AVC at T and firm enjoys normal profit. (c) E is the equilibrium point, but the firm stops production due to loss. (d) E is the equilibrium point as both the equilibrium conditions have been satisfied.

The supply of a commodity will be relatively inelastic when: (a) the producer is a risk averter. (b) the product is durable in nature. (c) modern technology is used in production. (d) the product is supplied over a long period.

With reference to the diagram shown above, select the reason for the movement from point M to N from the following options. (a) Increase in the real income of the consumer and rise in relative price of the commodity. (b) Increase in the real income of the consumer and fall in relative price of the commodity. (c) Decrease in the real income of the consumer and rise in relative price of the commodity. (d) Decrease in the real income of the consumer and fall in relative price of the commodity.

Assertion: M₀ is the monetary liability of Reserve Bank of India. Reason: Reserve Bank of India controls credit whereas Commercial Bank can only create credit. (a) Both Assertion and Reason are true and Reason is the correct explanation of Assertion. (b) Both Assertion and Reason are true but Reason is not the correct explanation of Assertion. (c) Assertion is true but Reason is false. (d) Both Assertion and Reason are false.

Observe the bar chart of deficit indicators (as proportion of BE, April to November, FY24-FY26; Source: Economic Survey, 2025-26). Compare the revenue deficit and fiscal deficit for the financial year 2024 (FY24).

'Under Indira Gandhi National Old Age Pension Scheme, a monthly pension of ₹ 200/- is given to elderly aged 60-79 years belonging to BPL category.' (Source: pib.gov.in) This monthly pension scheme contributes to the growth of GDP in India. Defend or refute the statement by giving a valid reason.

The long run average cost curve is U shaped due to the Law of Variable Proportions. Defend or refute the statement with a reason.

State whether the following is True or False. Give one reason for your answer. Change in inventory is a stock concept.

State the Law of Diminishing Marginal Utility.

Briefly discuss whether the image shown above depicts Returns to Scale or Returns to a Factor.

Read the following transactions made by Country X in a year: • Foreign residents working in Country X send 3,00,000 euros to their families abroad. • Country X purchases computer software worth 5,00,000 euros from other nations. • Country X receives 1,00,000 euros as an aid for flood relief from neighbouring nations. If Country X adopts revaluation, it will worsen the situation of Balance of Payments. Defend or refute the statement with a reason.

Agro Gold Wheat Traders supplies wheat in the market. The firm purchases advanced grain storage technology, which reduces wastage and lowers its cost of handling wheat. As a result, Agro Gold is able to supply more wheat at the same price as before. Later, due to a sudden rise in international wheat prices, the market price of wheat increases, leading Agro Gold to supply more wheat. Illustrate these two types of changes in the supply of wheat in separate diagrams.

What type of market structure does the online delivery sector belong to? Explain with a suitable reason.

India has been operating on a managed floating exchange rate regime since March 1993. Explain the statement.

Explain the total cost curve.

State any one difference between each of the following: (a) Gross National Disposable Income (GNDI) and Gross National Product at market price (GNP_mp). (b) Private Income and Personal Income

'Uber and Ola Cabs are two major app-based taxi services that operate in major cities in India. Each closely monitors the pricing strategy of the other. During peak hours, a surge in demand triggers an automatic increase in fares through surge pricing.' (Source (edited): Economic Research Centre, CUHK, 31 May 2022) Identify the market form in the above context. Outline two features of this market form evident in the scenario.

How is High Powered Money different from Broad Money?

[context: Green Field Farm has a fixed 10 acres of land; hiring more workers first raises total output rapidly (division of tasks), then output grows more slowly and finally total output declines] '……… which eventually led to a decline in the farm's total output'. Briefly explain the reasons behind this phenomenon.

How can open market operations help curb deflationary pressure in the economy?

What will be the value of MPS if the change in income is twice the change in investment expenditure?

[context: bar chart 'Deficit indicators — April to November' as proportion of Budget Estimates for FY24, FY25, FY26 (revenue deficit, fiscal deficit, primary deficit; FY26 values 68·2, 62·3 and 78·9)] What is the implication of the trend in primary deficit over the period depicted in the graph?

Mention any one difference between Induced investment and Autonomous investment.

What is sinking fund?

Calculate GNP_mp and National Income using the expenditure method (₹ in crore): (a) Private final consumption expenditure 2750 (b) Government final consumption expenditure 300 (c) Gross domestic fixed capital formation 250 (d) Net factor income from abroad (−)25 (e) Import of goods and services 50 (f) Subsidy 25 (g) Decrease in stock 30 (h) Export of goods and services 45 (i) Consumption of fixed capital 100 (j) Net indirect taxes 100

[context: Green Field Farm has a fixed 10 acres of land; hiring more workers first raises total output rapidly (division of tasks), then output grows more slowly and finally total output declines] With the help of a diagram, explain the law applicable to this situation.

National output or real national income is said to be at equilibrium level when aggregate supply becomes equal to the aggregate demand. Explain this phenomenon with the help of a diagram. Does this equilibrium always take place at full employment level? Explain.

Explain how the following factors affect the price elasticity of demand for a product: (a) Availability of substitutes (b) Proportion of income spent (c) Necessity versus Luxury (d) Short run versus long run

Briefly explain different steps involved in estimation of GDP_mp by Expenditure method.

How does break-even point differ from shut down point? Indicate break-even point in a diagram.

Compare the demand curve faced by a perfectly competitive firm with the one faced by a monopolist. Substantiate your comparison with suitable reasons.

Tata Motors' purchase of iconic British luxury car maker Jaguar Land Rover ($2.3 billion) has proved to be a master stroke. (Source (edited): https://economictimes.indiatimes.com) State whether the above transaction will be recorded under the Debit side or the Credit side of Balance of Payments. Give a reason.

Why are net exports added in the total expenditure in measuring National income by Expenditure method?

Sohail requires ₹ 3 lakhs to meet his business needs. He has ₹ 1 lakh in his current account. He decides to arrange the amount in the following ways: (a) Withdrawing ₹ 1·75 lakhs from his current account. (b) Collecting the remaining amount as cash credit. With reference to subparts (a) and (b), explain the credit facilities enjoyed by Sohail.

[context: passage — fixed deposits promise steady nominal returns, but with 6% interest and 5% inflation, Rs 1 crore grows to 1.79 crore nominally yet only 1.10 crore in real terms after 10 years; inflation erodes purchasing power] Differentiate between Demand pull and Cost push inflation.

[context: TP/AP/MP diagram with stages L₁, L₂, L₃] Producer is reluctant to produce in the stage of production depicted by the range L₂L₃. Defend or refute the statement with a reason.

Cite any two differences between Returns to Factor and Returns to Scale.