Skip to content

How is credit… (Class 10 Social Science 2024, Q28)

questionbuddy.in/q/cbse-10-social-science-2024-32-1-1-q28-how-credit-essential-economic-activities

Social ScienceCBSE Class 10 · Board exam 2024, set 32/1/1 · 3 marks · Short answer

CBSE Class 10 Social Science 2024: question 28

Set in the CBSE Class 10 board exam of 2024, paper 32/1/1, section C, question 28, for 3 marks. Try it first; the hints and our step-by-step solution are below.

Q28 · 3 marks · Short answerMoney and Credit

How is credit essential for economic activities? Explain with examples.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2024 board paper, set 32/1/1.

Hints

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

Hint 1

Why does a producer need money before selling the goods?

Hint 2

Think of a farmer buying seeds, or of Salim's story.

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. Credit supplies working capital and funds, so it helps to set up industries and start businesses. It also generates employment.

    1 mark

  2. In rural areas credit helps farmers buy seeds, fertilisers and pesticides and so develop agriculture. For example, Salim, a shoe manufacturer, took a loan to meet his production costs and earned profit.

    1 mark

  3. It increases income and improves the people's standard of living. However, credit has to be repaid, so it should be used productively.

    1 mark

Answer: Credit finances production, business and farming, creates jobs and raises living standards, as Salim's loan for production shows.

Where the marks are

  • Helps set up industries and businesses and creates jobs (1 mark)
  • Helps agriculture and gives an example (1 mark)
  • Raises income and the standard of living (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 paper2024 board paper, set 32/1/1: 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.