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Distinguish between… (Class 10 Social Science 2023, Q27)

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Social ScienceCBSE Class 10 · Board exam 2023, set 32/6/1 · 3 marks · Short answer

CBSE Class 10 Social Science 2023: question 27

Set in the CBSE Class 10 board exam of 2023, paper 32/6/1, section C, question 27, for 3 marks. Try it first; the hints and our step-by-step solution are below.

Q27 · 3 marks · Short answerMoney and Credit

Distinguish between formal and informal sources of credit.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2023 board paper, set 32/6/1.

Hints

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

Hint 1

Who are the lenders in each type?

Hint 2

Compare the interest charged.

Hint 3

Who regulates each?

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. Source: formal credit comes from banks and cooperatives; informal credit comes from moneylenders, traders, relatives and friends.

    1 mark

  2. Interest: formal credit charges a lower rate of interest; informal credit charges a high rate of interest.

    1 mark

  3. Supervision: the RBI supervises formal lenders; no organisation supervises informal lending.

    1 mark

Answer: Formal: banks, low interest, RBI supervision. Informal: moneylenders etc., high interest, no supervision.

Where the marks are

  • Difference in source (1 mark)
  • Difference in interest rate (1 mark)
  • Difference in supervision (1 mark)

Revise the chapter

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 32/6/1: 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.