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LE.S./1.S.5. Examination, 2026 fear DETACHABLE
GENERAL ECONOMICS
Paper II
Time Allowed : Three Hours Maximum Marks : 200
QUESTION PAPER SPECIFIC INSTRUCTIONS
Please read each of the following instructions carefully before attempting questions.
There are SIXTEEN questions divided under THREE Sections.
The ONLY question in Section ‘A’ is compulsory.
In Section B, SIX out of NINE questions are to be attempted.
In Section C, FOUR out of SIX questions are to be attempted.
Candidate should attempt questions/parts as per the instructions given in the sections.
The number of marks carried by a question/part is indicated against it.
Candidates are required to write clear, legible and concise answers and to adhere to word limits,
wherever indicated. Failure to adhere to word limits may be penalized.
Attempts of questions shall be counted in sequential order. Unless struck off, attempt of a question
shall be counted even if attempted partly.
Any page or portion of the page left blank in the Question-cum-Answer (QCA) Booklet must
be clearly struck off.
Answers must be written in ENGLISH only.
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1.(a)
1.(b)
1.(c)
1.(d)
1.(e)
1.(f)
SECTION ‘A’
(Compulsory Section)
Answer the following questions in about 100 words each. 5x6=30
“Marxian Economics is grafted on classical trunk.” Explain. 5
Make distinction between the following :
(i) GDP and GVO
(ii) Private Income and Disposable Personal Income. 5
Examine Adam Smith’s secular stagnation thesis. What are the features of stationary
state mentioned by him ? 3
Explain swap as derivative contract. Mention different kinds of swaps. 5
What is inflationary gap ? Using diagram show that in case the consumers suffer
from money illusion the economy will get convergent inflationary gap. 5
Using suitable diagrams mention the effect of tariff on producers’ and consumers’
surplus. 5
SECTION ‘B’
(Answer any six out of the following nine questions in about 200 words each)
15x6=90
Compare and critically examine the views of Mercantilists and Physiocrats on wealth
creation. How relevant are these ideas in modern times ? 12+3=15
How does the concept of Green GDP negotiate the shortcomings of the conventional
system of national accounting ? Give a preview of green accounting method.
7+8=15
“Technological advancement and product innovation in Fintech industry has
facilitated economic development of India.” Explain. 15
Briefly explain how Schumpeter gives to the entrepreneur ‘place of pride’ and treats
R & D and ‘creative destruction’ as the main engine of growth. Can we regard his
theory as belonging to the species of ‘endogenous growth’ ? 12+3=15
Explain Amartya Sen’s view that neither opulence nor utility adequately represent
well-being and deprivation. Instead, what is required is a more direct approach
that focuses on human functioning(s) and the capability to achieve valuable
functioning(s). 15
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10.
11.
12.
13.
“The India-EU FTA is designed to expand market access, reduce trade frictions, and
improve the predictability of cross-border commerce for businesses on both sides.”
What major hurdles you anticipate in the way of effective implementation of the
agreement ? 10+5=15
Given the following :
C=C,+b(Y-T) = Consumption Function
I=],+aY = Investment Function
M =M,+myY = Import Function
G = Govt. Expenditure, X = Exports, M = Imports, T = Fixed Amount of tax
Consider the example where C, = 200, I, = 90, G = 90, X = 40, M, = 30, T= 50,
b=0-6, a=0-2 andm=0-1.
Find the National Income and Foreign Trade Multiplier. 15
“Realised Investment is always equal to realised saving, but planned investment is
equal to planned saving only at the point of equilibrium.” Explain the statement in
the context of Keynesian theory. 15
Explain the role of G-20 in strengthening multilateralism, international cooperation
and addressing global financial and economic challenges. 15
SECTION ‘C’
(Answer any four out of the following six questions in about 300 words each)
20x4=80
Examine critically Friedman’s quantity theory of money. How far is it correct to say
that Friedman reaches at the same result earlier arrived at by Fisher ? What makes
Friedman argue that quantity theory of money is a theory of demand for money ?
10+5+5=20
Examine Frank and Amin’s development of underdevelopment interpretation of
backwardness and the associated interpretation of unequal development as a pattern
of homogenous growth in the centre and stagnation or highly uneven growth in the
periphery. 20
Critically examine the Prebisch-Singer thesis of secular deterioration in terms of
trade of peripheral countries or LDCs. Do empirical evidences support the thesis ?
15+5=20
3 SNCS-B-GNM
14,
15.
16.
“The success or failure of devaluation in correcting balance of payments deficit does
not depend solely on the Marshall-Lerner condition but is conditioned by the
magnitude of the marginal propensity to absorb.” Discuss. 20
“The recent surge in Regional Trade and Free Trade Agreements have reduced the
efficacy of W.T.O.” — Discuss. Do you feel that this is the only factor responsible for
failure of W.T.O. ? 12+8=20
Discuss derivative market with special reference to future and options. Explain their
role in risk management and price discovery. 12+8=20
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