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"Cheap and affordable… (Class 10 Social Science 2023, Q33B)

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Social ScienceCBSE Class 10 · Board exam 2023, set 32/4/1 · 5 marks · Long answer

CBSE Class 10 Social Science 2023: question 33(B)

Set in the CBSE Class 10 board exam of 2023, paper 32/4/1, section D, question 33(B), for 5 marks. Try it first; the hints and our step-by-step solution are below.

Q33(B) · 5 marks · Long answerMoney and Credit

"Cheap and affordable credit is crucial for the country's development." Justify the statement.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2023 board paper, set 32/4/1.

Hints

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

Hint 1

Think about what happens to a borrower's income when interest is low.

Hint 2

What can people do with loans: farming, trade, industry?

Hint 3

Why is it important that the poor also get formal credit?

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. Cheap and affordable credit raises people's incomes, because borrowers keep more of their earnings after paying low interest.

    1 mark

  2. When credit is affordable, many people can borrow for a variety of needs.

    1 mark

  3. They can grow crops, run businesses and set up small-scale industries, which adds to production and employment.

    1 mark

  4. Banks and cooperatives should increase their lending, especially in rural areas, so that dependence on informal sources such as moneylenders, who charge high interest, falls.

    1 mark

  5. Formal credit must be distributed more equally so that the poor also benefit from cheaper loans. This makes development broad-based and reduces debt traps.

    1 mark

Answer: Cheap credit raises income, encourages investment in farming, trade and industry, reduces dependence on moneylenders and spreads development to the poor.

Where the marks are

  • Cheap credit leads to higher income (1 mark)
  • Many people can borrow for varied needs (1 mark)
  • Crops, business, small industries, trade (1 mark)
  • More formal lending in rural areas reduces dependence on informal sources (1 mark)
  • Equal distribution so the poor benefit (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 32/4/1: 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.