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With reference to the… (Class 12 Economics SQP 2025-26, Q1)

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EconomicsCBSE Class 12 · Sample paper, session 2025-26 · 1 mark · MCQ

CBSE Class 12 Economics sample paper 2025-26: question 1

From the official CBSE sample question paper for 2025-26, section A, question 1, for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q1 · 1 mark · MCQCompetency-basedDetermination of Income and Employment

With reference to the given diagram, which of the following is true at point B? (Choose the correct option)

  1. (A)Slope of Consumption Curve = 0
  2. (B)Average Propensity to Consume = 0
  3. (C)Slope of Saving Curve = 1
  4. (D)Average Propensity to Consume = 1

Figure in the paper: Graph with Income on X-axis and Consumption on Y-axis. A 45° line from the origin and a consumption curve C starting at a positive intercept on the Y-axis with flatter slope intersect at point B. The 45° angle is marked at origin. See it in the official paper.

Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2025-26.

Hints

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

Hint 1

What is true of every point on the 45° line?

Hint 2

At break-even, saving is zero.

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. Point B is where the consumption curve cuts the 45° line, so consumption equals income there (C = Y): the break-even point, where saving is zero.

  2. At B, APC = C/Y = 1. (The slope of the consumption curve is the MPC, which is positive but less than 1, and the saving curve's slope is the MPS, also less than 1.) Option (D).

    1 mark

Answer: (D) Average Propensity to Consume = 1

Where the marks are

  • At break-even C = Y, so APC = 1 (1 mark)

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 2025-26: 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.