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How can the formal… (Class 10 Social Science 2024, Q28)

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

CBSE Class 10 Social Science 2024: question 28

Set in the CBSE Class 10 board exam of 2024, paper 32/3/1, 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 can the formal sector loans be made beneficial for poor farmers and workers? Explain.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2024 board paper, set 32/3/1.

Hints

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

Hint 1

Compare formal interest rates with moneylenders'.

Hint 2

What is the RBI's role in lending?

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. Formal sector loans (banks and cooperatives) carry a low rate of interest, so credit is cheap and affordable for poor farmers and workers.

    1 mark

  2. They save borrowers from moneylenders' exploitation and from the debt trap.

    1 mark

  3. The RBI supervises formal lending and ensures that banks lend to small cultivators and small borrowers, not only to profit-making businesses and traders.

    1 mark

Answer: Formal loans give cheap credit, prevent exploitation and the debt trap, and are directed to small borrowers under RBI supervision.

Where the marks are

  • Low interest and affordable credit (1 mark)
  • Protection from exploitation and debt trap (1 mark)
  • RBI ensures loans to small borrowers (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 32/3/1: 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.