Reason & Assertion Class XII Economics

Chapter-2 Indian Economy 1950-1990 The answers of the following questions will be based on the following pattern as suggested by CBSE A - Both Assertion (A) and Reason (R) are true and Reason is the correct explanation of Assertion. B - Both Assertion (A) and Reason (R) are true but Reason is NOT the correct explanation of Assertion. C – Assertion (A) is true but Reason (R) is false. D – Assertion (A) is false but Reason (R) is true. Q.1 Assertion: This new Green Revolution is leading to foreign ownership over most of India's farmland, undermining farmers' interests. Reason: New Green Revolution is driven by private (and foreign) interest—notably MNCs like Monsanto. Answer: A - Both A and R are true and R is the correct explanation of A. Q.2 Assertion: The excessive regulation of what came to be called the permit license raj prevented certain firms from becoming more efficient.. Reason: More time was spent by industrialists in trying to obtain a license or lobby with the concerned ministries rather than on thinking about how to improve their products.. Answer: (A)-Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). Assertion (A): the industries became more diversified during 1950-90 as compared to the situation at the time of independence. Reason (R): Excessive government regulation prevented industrial growth during this period. Answer: B-A and R both correct. R is not the correct explanation of A. Q.4 Assertion (A) : Industry provides employment which is more stable than the employment in agriculture. It promotes modernisation and overall prosperity. Reason(R): Economists have found that poor nations can progress only if they have a good industrial sector Answer: A- Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

. Q.5 Assertion (A) : The term modernisation indicates a variety of structural and institutional changes in the framework of economic activity. Reason (R) : An advancement of technology and institutional innovations as well as shift in sectoral composition of production and diversification of activities. Answer: (A)- Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). Q.6 ASSERTION (A) : Modernization includes adaptation of Technology and change in Social Outlook REASONING (R): Modernization raises the standard of living of People. ANSWER- B. Both A and R are true and R is not the correct explanation of A Q.7 Assertion (A) Economic planning rules out the free play of market force. Reason (R) .It does not rule out free play of market forces rather it is dependent on model of economic planning. Answer: D- Assertion is false and Reason is true. Q.8 Assertion (A): The policy of import substitution focuses on saving foreign exchange. Reason (R): Import substitution policy requires that we domestically produce such goods which we are importing from rest of the world . Answer B. Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A) Q.9 Assertion: (A): Tariffs and quotas in the economic policy post-Independence were used to assist domestic industries. Reason ( R): Our planners wanted to use foreign exchange for importing luxury goods. Answer: C- Assertion is true but Reason is false Q.10 Assertion (A): Trade policy relates with protection from imports in two forms: 1 tariffs and quotas. Reason (R): Quotas specify the quality of goods which can be imported. Answer: C- Assertion (A) is true but Reason (R) is false. Q.11 Assertion (A): Modernisation as a planning objective does not create contradiction in the light of employment generation. Reason (R): Modernisation is related not only to modern technique but also relates to change in outlook.

.Answer (B)- Both (A) and (R) are true (R) is not correct explanation of (A) Q.12 Assertion (A): Public sector was given leading role in industrialization during the period of planning. Reason (R): Private sector was not having enough capital and also market was not so big to encourage industrialists to undertake big projects even if they had capital to do so. Answer (A)- Both (A) and (R) are true (R) is correct explanation of (A) Q.13 Assertion (A): In 1955, the Village and Small -Scale Industries Committee, also called the Karve Committee, noted the possibility of using small-scale industries for promoting rural development. Reason (R): A small scale industry is defined with reference to the maximum investment allowed on the assets of a unit. Answer:. B- Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A) Q.14 Assertion (A): The first five year plan gave top priority to industry. Reason(R): Period of 1951 -1978 gave emphasis to agricultural development, removal of poverty and import substitution. Answer: D- Assertion (A) is false but Reason (R) is true. Q.15 Assertion (A): A good indicator of economic growth is steady increase in Gross domestic product (GDP). Reason (R): GDP is the market value of all goods and services produced in a country during a year Answer: B- Both (A) and (R) are true, and (R) is not the correct explanation of (A) Q.16 Assertion (A): Because of India's rapidly growing population the country's traditional agricultural practices yielded insufficient food production. Reason (R): Agricultural technological advancements offered opportunities to increase productivity.[ Answer. B- Both (A) and (R) are true, and (R) is not the correct explanation of (A) Q.16 Assertion (A): The 1956 policy continued to constitute the basic economic policy for a long time. Reason (R) According to this resolution the objective of the social and economic policy in India was the establishment of a socialistic pattern of society

Answer: A- Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). Q.17 Assertion (A): One of the pillars of IPR 1956 was to check concentration of economic power in few individuals, groups or business houses. Reason (R): It established the public sector as epicentre of industrialization. Answer: B- Both (A) and (R) are true, and (R) is not the correct explanation of (A) Q.18 Assertion (A) : Just a year after independence, efforts towards land reforms were introduced. Reason (R): Ownership of land would give incentives to the tillers to invest in making improvements. Answer: A- Both A and R are true and R is the correct explanation of A. Q.19 Assertion (A): Capitalist economies fosters self-interest and pushes economic growth. Reason (R): Market economies makes best use of available resources to economic growth. Answer : B- Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A) Q.20 Assertion (A): GDP indicates the size of an economy. Reason (R): A higher GDP indicates higher economic activity. Answer B. Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of (A) Q.21 Assertion (A): Inward Looking Trade Strategy is called Import Substitution. Reason: Instead of importing vehicles made in a foreign country, industries would be encouraged to produce them in India itself. Answer: A- Both A and R are true but R is the correct explanation of A. Q.22 Assertion (A): The small scale industries generate more employment than the large scale industries. Reason (R): Small scale industries are more 'Capital intensive industries '. Therefore generate more employment. Answer: C- A is true but R is false. Q23. Assertion (A): The need to obtain a license to start an industry was misused by big industrial houses. Reason (R): A big industrialist would get a license not for starting new firm but to prevent competitors from starting new firms. Answer: A- Both A and R are true and R is the correct explanation of A.

Q.24 Assertion (A): Only a handful of states benefited from green revolution in India Reason (R): Success of green revolution depends on policy implementation by state government Answer: A- Both (A) and (R) are true and (R) is the correct explanation of (A) Q.25 Assertion (A): It is believed that small-scale industries are more ‘labour intensive’ i.e. they use more labour than the large-scale industries and, therefore, generate more employment. Reason (R) : These small scale industries cannot compete with the big industrial firms. Answer: B- . Both (A) and Reason (R) are true and (R) is not the correct explanation of (A). . Q.26 Assertion (A): Eliminating subsidies goes against the goal of Equity. Reason (R): It will increase the disparity between rich and poor farmers. Answer : (A) Both A and R are true and R is not the correct explanation of A