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Find the missing… (Class 12 Economics SQP 2023-24, Q6)

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EconomicsCBSE Class 12 · Sample paper, session 2023-24 · 1 mark · MCQ

CBSE Class 12 Economics sample paper 2023-24: question 6

From the official CBSE sample question paper for 2023-24, section A, question 6, for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q6 · 1 mark · MCQCompetency-basedMoney and Banking

Find the missing figures and choose the correct alternative:

RoundDepositsLoans (80%)Reserve Ratio (20%)
I1,000800200
II800....(i)....160
......
......
Total...(ii)......(iii)......(iv)...
  1. (A)640,1000,4000,5000
  2. (B)960,5000,4000,1000
  3. (C)640,4000,1000,5000
  4. (D)640,5000,4000,1000

Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2023-24.

Hints

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

Hint 1

Money multiplier = 1/reserve ratio.

Hint 2

Total reserves end up equal to the first deposit.

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. Each round: loans = 80% of deposits, reserves = 20%. (i) Round II loans = 0.8 × 800 = 640.

  2. Totals: deposits = 1,000 × 1/0.2 = 5,000 (ii); loans = 5,000 − 1,000 = 4,000 (iii); reserves = 0.2 × 5,000 = 1,000 (iv) (equal to the initial deposit). So 640, 5,000, 4,000, 1,000. Option (D).

    1 mark

Answer: (D) 640,5000,4000,1000

Where the marks are

  • Money multiplier 1/0.2 = 5 (1 mark)

Revise the chapter

  • Chapter: Money and Banking (notes, formulas, where marks are lost and every past question)
Practise this chapterBoard-style questions from Money and Banking, one at a time, marked against the answer key and marking points.Back to the full paperSample paper 2023-24: 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.