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“Saving curve can… (Class 12 Economics SQP 2024-25, Q14A)

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EconomicsCBSE Class 12 · Sample paper, session 2024-25 · 4 marks · Short answer

CBSE Class 12 Economics sample paper 2024-25: question 14(A)

From the official CBSE sample question paper for 2024-25, section A, question 14(A), for 4 marks. Try it first; the hints and our step-by-step solution are below.

Q14(A) · 4 marks · Short answerDetermination of Income and Employment

“Saving curve can be derived from the consumption curve”
Justify the statement, citing valid steps with the help of a well-labelled diagram.

Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2024-25.

Hints

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

Hint 1

At zero income, saving = −autonomous consumption.

Hint 2

At break-even, saving is zero.

Hint 3

S = Y − C.

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. Diagram: income on the X-axis; consumption and saving on the Y-axis. Draw the 45° line and the consumption curve C starting at C (OC = autonomous consumption) on the Y-axis; C cuts the 45° line at B, the break-even point.

    1 mark

  2. Step 1: Mark point A on the negative Y-axis with OA = OC. At zero income, saving = −c̄, so A is the starting point of the saving curve.

    1 mark

  3. Step 2: From B (where C = Y), drop a perpendicular to the X-axis meeting it at B'. At this income, saving = 0, so B' is a second point on the saving curve.

    1 mark

  4. Step 3: Join A and B' and extend the line to S. AS is the saving curve. Since S = Y − C, the saving curve can always be drawn from the consumption curve.

    1 mark

Answer: Start at −OC on the Y-axis, mark the break-even income on the X-axis (S = 0), and join the two points to get the saving curve.

Where the marks are

  • Well-labelled diagram (1)
  • Three steps (1 + 1 + 1)

Revise the chapter

Practise this chapterBoard-style questions from Determination of Income and Employment, one at a time, marked against the answer key and marking points.Back to the full paperSample paper 2024-25: 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.