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'Credit pushes the… (Class 10 Social Science 2023, Q24)

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Social ScienceCBSE Class 10 · Board exam 2023, set 32/2/1 · 2 marks · Very short answer

CBSE Class 10 Social Science 2023: question 24

Set in the CBSE Class 10 board exam of 2023, paper 32/2/1, section B, question 24, for 2 marks. Try it first; the hints and our step-by-step solution are below.

Q24 · 2 marks · Very short answerMoney and Credit

'Credit pushes the borrower into a situation from which recovery is painful.' Examine the statement.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2023 board paper, set 32/2/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

What happens to repayment if the crop fails?

Hint 2

Think about what the borrower may have to sell.

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. Repayment depends on income from the borrower's activity such as farming. If the crop fails, income is lost and the loan cannot be repaid.

    1 mark

  2. The borrower may then fall into a debt-trap, may have to sell part of the land to repay, and ends up worse off than before. Hence recovery is painful.

    1 mark

Answer: Loan repayment depends on uncertain income. Failure leads to a debt-trap and sale of assets, leaving the borrower worse off.

Where the marks are

  • Repayment depends on income and crop failure makes it impossible (1 mark)
  • Debt-trap or sale of land leaves the borrower worse off (1 mark)

Revise the chapter

  • Chapter: Money and Credit (notes, formulas, where marks are lost and every past question)
Practise this chapterBoard-style questions from Money and Credit, one at a time, marked against the answer key and marking points.Back to the full paper2023 board paper, set 32/2/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.