RBSE Class 11 Economics Important Questions Chapter 1 Introduction to Statistics for Economics

Rajasthan Board RBSE Class 11 Economics Important Questions Chapter 1 Introduction to Statistics for Economics Important Questions and Answers. 

RBSE Class 11 Economics Important Questions Chapter 1 Introduction to Statistics for Economics

Statistics For Economics Class 11 Chapter 1 Extra Questions And Answers Question 1.
Define economics.
Answer:
Economics is a study of how individuals and society make use of scarce resources to fulfill their needs.

Class 11 Statistics For Economics Chapter 1 Important Questions Question 2. 
List the economic agents who undertake the ordinary business of life.
Answer:
The economic agents who undertake the ordinary business of life are:
(i) Consumer    
(ii) Seller    
(iii) Producer
(iv) Service-holder    
(v) Service-provider

Class 11 Statistics Chapter 1 Important Questions With Answers Question 3. 
What is meant by scarcity?
Answer:
Scarcity is a situation when demand for a good exceeds its supply even at a zero price. Scarcity occurs when there are limited resources in relation to unlimited wants.
 
Introduction To Statistics Class 11 Important Questions Question 4. 
Give two reasons for the problems of choice.    
Answer:
Following are the two reasons for the problems of choice:    
(i) Unlimited wants    
(ii) Limited means    

Important Questions Of Economics Class 11 Chapter 1 Question 5. 
What is meant by economic problem?
Answer:
Economic problem is the problem arising from the necessity of choice.

Statistics Chapter 1 Class 11 Important Questions Question 6. 
What are the central problems of an economy?
Answer:
Every economy faces three central problems:
(i) What to produce and in what quantities
(ii) How to produce
(iii) For whom to produce

Introduction To Microeconomics Class 11 Important Questions Question 7. 
Name the three parts in which economics is often discussed.
Answer:
Economics is often discussed in the following three parts:
(i) Production    
(ii) Consumption    
(iii) Distribution

Important Questions Of Chapter 1 Microeconomics Class 11 Question 8. 
Define GDP.
Answer:
GDP (Gross Domestic Product) is the market value of all the final goods and services produced within the domestic territory of a country during one year.

Statistics For Economics Class 11 Chapter 1 Important Questions Question 9.
Name the two distinct senses in which statistics is used.
Answer:
Statistics in two distinct senses:
(i) Singular - science of collecting, classifying and using statistics
(ii) Plural - numerical facts collected systematically

Class 11 Statistics Chapter 1 Extra Questions Question 10.
How is statistics defined in singular sense?    
Answer:
In singular sense, statistics is defined as the techniques or methods which relate to the collection, E classification, presentation, analysis and interpretation of quantitative data.    

Important Questions Of Statistics Class 11 Chapter 1 Question 11.
How is statistics defined in plural sense?    
Answer:
In plural sense, statistics imply systematically collected numerical facts, or simply ‘data’.    

Central Problems Of An Economy Class 11 Important Questions Question 12.
Define data.
Answer:
Economic facts in terms of numbers are called data.

Class 11 Microeconomics Chapter 1 Important Questions Question 13. 
Give an example each of quantitative and qualitative feet used in economics.
Answer:
Quantitative Fact: The population of India increased from 100 crores in 2000 to 130 crores in 2013.
Qualitative Fact Categorising individuals on the basis of their marital status 

Microeconomics Class 11 Important Questions With Answers Question 14. 
List the stages of statistical study.
Answer:
Stages in statistical study are:
(i) Collection of Data    
(ii) Classification of Data 
(iii) Presentation of Data
(iv) Analysis of Data    
(v) Interpretation of Data

Statistics For Economics Class 11 Important Questions Question 15. 
Write two techniques of collection of data.
Answer:
Two techniques of collection of data are:
(i) Sampling
(ii) Census

Class 11 Statistics Ch 1 Important Questions Question 16.
Name the statistical tools used to present the data.
Answer:
The statistical tools used to present the data are diagrams, graphs and tables.

Chapter 1 Microeconomics Class 11 Important Questions Question 11. 
Write any two functions of statistical methods.
Answer:
Statistical methods:
(i) help analyse economic problems: and
(ii) formulate policies to solve them.

Short Answer Type Questions

Microeconomics Class 11 Chapter 1 Important Questions Question 1.
What are the benefits of studying economics?
Answer:
The following are the benefits of studying economics:
(i)  It provides knowledge of basic economic principles such as demand, supply, production and costs.
(ii) The study of economics deepens the understanding of world economic events and how they impact the domestic economy.
(iii) It provides advanced understanding of government policies and its effects.

Economics Class 11 Chapter 1 Extra Questions Question 2.
Explain the various agents who undertake the ordinary business of life.
Answer:
The various agents who undertake the ordinary business of life are:
(i) Consumer: Consumer is a person who buys goods to satisfy his own or family’s needs and wants.
(ii) Seller: A seller is someone who sells goods to earn a profit. 
(iii) Producer: A farmer or manufacturer who produces goods is the producer.
(iv) Service-holder: A service-holder works for some other person and gets paid for it
(v) Service-provider: A service-provider provides service to others in exchange for a payment.

Question 3. 
Explain the relationship between scarcity and choice.
Answer:
Scarcity occurs because there are limited resources in relation to unlimited wants. The resources used for producing goods and services are not only limited but they also have many competing usages. As a result, an individual has to face the problem of making a choice among the available alternatives. Economics is a science of human behaviour concerned with the problem of efficient allocation of scare resources. It is about making choices in the presence of scarcity.

Question 4. 
Why is economic problem regarded as a problem of choice?
Answer:
Human wants are unlimited and it is impossible to satisfy all the wants. The individual, therefore, is required to make a choice between his or her wants. Economic problem arises the moment the problem of choice arises.

Question 5. 
Distinguish between microeconomics and macroeconomics.
Answer:
Following are the points of distinction between microeconomics and macroeconomics:

Microeconomics	Macroeconomics
1. Microeconomics facilitates decisions of individual households, firms or other	Macroeconomics focuses on the economy as a whole.
2. Microeconomics focuses on market forces of demand and supply and determines equilibrium price levels.	Macroeconomics focuses on increasing economic growth. It studies the changes in the national income and various other national level aggregates.
3. Microeconomics deals with smaller degree of aggregation such as study of an industry, which is an aggregate of all the firms producing a particular commodity.	Macroeconomics deals with a larger degree of aggregation such as National Income, which is an aggregate of income of all the factors of production in the economy.

Question 6.
Define statistics.
Answer:
In the words of Seligman, “Statistics is the science which deals with the methods of collecting, classifying presenting comparing and interpreting numerical data collected to throw some light on any sphere of enquiry.”

Question 7. 
Explain in brief the stages of statistical study.
Answer:
There are five stages of statistical study:
(i) Collection of Data: It is the process of gathering information in order to arrive at an effective solution to an economic problem.
(ii) Organisation of Data: It is the process of classifying the raw data to facilitate further statistical analysis.
(iii) Presentation of Data: It is the process of putting the voluminous data in compact and presentable form
(iv) Analysis of Data: It is the process of examining, modifying and modelling data with the objective of drawing useful information, suggesting inferences and supporting decision-making.
(v) Interpretation of Data: It is the process of making sense of numerical data that has been collected, presented and analysed.

Question 8. 
What are statistical tools? Name the statistical tools used in the different stages of statistical study. 
Answer:
Statistical tools refer to the techniques or methods used for the collection, organisation and presentation, analysis and interpretation of the data as well. The statistical used in the different stages of statistical study are shown in the table below:

Stage of Studies	Statistical Study	Statistical Tool
Stage 1	Collection of Data	Sampling and Census
Stage II	Classification of Data	Tally Line, Array of Data
Stage III	Presentation of Data	Diagrams, Graphs, Tables
Stage IV	Analysis of Data	Correlation, Regression, Averages and Percentages
Stage V	Interpreation of Data	Magnitude of Average and Percentage

Question 9.
Differentiate between qualitative data and quantitative data.
Answer:
The following are the points of distinction between qualitative data and quantitative data:

S.No.	Qualitative Data	Quantitative Data
1. 2.	Qualitative data are those data which cannot be measured in numerical terms. Examples: beauty, gender, attitude and intelligence, etc.	Quantitative data are those data which can be measured and expressed in numerical terms. Examples: height, weights, income, price and distance, etc.

Question 10. 
Write down the limitations of statistics.
Answer: 
Following are the limitations of statistics:
(i) Statistics study only numerical facts.
(ii) Statistics study only aggregate of facts, not individual data.
(iii) Statistics require only homogeneous data
(iv) Statistics results are true only on the basis of average.
(v) Drawing conclusions without references in statistics increase the possibilities of errors.
(vi) Statistics can only be used by the experts.
(vii) Statistics can be misused. 

Question 11. 
State the characteristics of statistics.
Answer: 
Characteristics of statistics:
(i) Statistics are aggregate of facts.
(ii) Statistics are numerically expressed.
(iii) Statistics are enumerated or estimated according to reasonable standards of accuracy.
(iv) Statistics are facts affected by multiplicity of causes.
(v) Statistics are placed in relation to each other.

Question 12. 
How does statistics help in economic forecasting?
Answer: 
Forecasting in economics implies predicting the nature and impact of economic events on domestic as well as international economy. Statistics provide a scientific base to forecast trends such as price levels, income, employment, interest rates, etc. Accordingly, it uses various statistical tools and techniques to develop solutions to the related economic problems.

Question 13. 
How are economic policies formulated with the help of statistics?
Answer: 
Statistical data are used in framing suitable economic policies. Based on the estimated poverty ratios, the government can determine the areas which require implementation of intensive employment generation programmes. Accordingly, the government can allocate its resources in these areas. Similarly, on the basis of export-import data, the government can make necessary changes in the trade policy. Statistics help the government bring about changes in its fiscal and monetary policy.

Question 14.
What role does statistics play in finding relationship between economic factors?    
Answer: 
Statistics is used in finding relationships between different economic factors. The economists are : usually interested in finding out the impact of change in:    
(i) prices on demand for a commodity;    
(ii) interest rate on savings/ investment;    
(iii) government expenditure on general price level; etc.    
Applying statistical methods to data not only check the existence of relationship between various j economic factors but also help to determine and verify the relationship between them.    

Long Answer Type Questions

Question 1.
Define economic activity. Explain the various kinds of economic activities.
Answer:
Economic activities are those activities which are concerned with the acquisition and use of wealth. The various kinds of economic activities are explained as below:    

(i) Consumption: In the study of consumption, it is essential to understand how the consumer decides what to buy with his given income, when he knows the prices of the various alternative goods to choose from. Thus, consumption is that economic activity which is concerned with the use of economic goods and aid services for the satisfaction of wants.    

(ii) Production: In the process of production, inputs (factors of production) such as land, labour, capital and entrepreneurship are required. These four factors of production and their respective remunerations are as below:

Factor of Production	Remuneration
Land Labour Capital Entrepreneur	Rent  Wage Interest  Profit

In the study of production, it is essential to know how the producer chooses what to produce for the market, when he knows the prices and costs. Thus, production is that economic activity which is concerned with increasing the utility or value of the goods and services.    

(iii) Exchange: Sale and purchase of goods and services in known as exchange. This sale and purchase E is done on the basis of price determination in the market    

(iv) Distribution: The national income or the total income of a country is distributed among the factors of production in the form of rent for land; wages for labour, interest for capital and profit E for entrepreneur. In this part of economic activity, the share of all the factors of production is E distributed on the basis of their contribution in the production process. 

Question 2.
Define statistics in singular and plural form. Write down the main features of statistics.
Answer: 
Singular form: Statistics may be defined as the collection, presentation, analysis and interpretation of numerical data.
Plural form: Statistics mean quantitative data, affected to a marked extent by multiplicity of causes.

Features of Statistics
(i) Aggregate of Facts: Isolated and single value is not called as statistics because a single value cannot be related, compared and conclusion cannot be drawn from it. Aggregate of figures is called statistics due to their comparability.

(ii) Numerically Expressed: Any fact expressed in words cannot be called statistics because it does not provide any information. For instance, the statement ‘He is tall’ is not statistics but ‘He is 7 inches taller than his brother’ is statistics as conclusions can be drawn from it.

(iii) Reasonable Standards of Accuracy: Data is collected or can be calculated purely on the basis of calculations or estimates, which depend on the field of investigation. For instance, if the field is wide then collection can be done on the basis of estimate such as 3 lakh people from Himachal Pradesh and 2 lakh people from Punjab participated in Republic Day parade. However, if the field of investigation is small, data can be collected using calculation. 

(iv) Affected by Multiplicity of Causes: Data which is affected by single reason cannot be called as statistics. The facts or data which are affected by a number of factors are called statistics. In statistics, effect of independent values on dependent values cannot be separated.

(v) Placed in Relation to Each Other: Comparison of data would be feasible only if the data is homogenous. One cannot compare weight of elephant with that of a human.

(vi) Collected for Predetermined Purpose: Data collected without a purpose are just numbers or information but not the statistics. If we collect data regarding the farmers without deciding any purpose then the data would not be able to derive the required conclusions.

Question 3. 
Explain the limitations of statistics.
Answer: 
In today’s machine age, statistics plays an important role in each and every field of study and investigation. However, it still suffers from certain limitations, which can never be removed.  

The limitations of statistics are explained below:
(i) Deals with Only Numerical Facts: Statistics studies only numerical facts of a problem. Qualitative aspects such as beauty, gender, attitude, etc cannot be studied in statistics. In order to study statistics, we need to give a numerical value to qualitative attributes.

(ii) Deals with Aggregates not with Individuals: Statistical data are aggregates of facts and hence, it does not have any place for individual cases.

(iii) Possibility of Misleading Results: There is a possibility to arrive at wrong and misleading conclusions if statistical results are not placed in the proper context

(iv) Can be Misused: The results obtained from a data can be manipulated according to one’s own interest Such manipulated results can misdirect the society.

(v) Results are Only Approximately True: The inferences drawn from statistical analysis are generally approximates. Statistical studies are usually based on sample taken from the universe. Under such circumstances, conclusions are bound to be only approximate.

(vi) Must be used Only by Experts: Since statistics is a technical subject, it is very difficult for an ordinary person to use and apply it Only experienced and skilled people can make correct use of it and derive right conclusions.

Question 4.
Explain in detail the functions of statistics. 
Answer: 
The main functions of the statistics are:
(i) Statistical tools help in establishing relation between various variables. Tool used in establishing the relation is known as correlation and method used for analysis using this tool is known as correlation analysis. For instance, statistics can be used to establish relationship between the income and expenditure of a group of 10 people. Relation can be negative or positive.

(ii) Statistics help in doing comparisons. Objective of collecting data is not fulfilled until conclusions are drawn from them, and conclusion could be drawn only when data is comparable.

(iii) Statistics helps in simple and easy presentation of fact and figures. It is a very difficult task for any person to understand and present complicated data. Statistics performs the task of making presentation of data simple and understandable.

Following techniques are used in this function of statistics:

• Classification    
• Averages    
• Graphs
• Diagrams
• Percentages    
• Ratio

(iv) Statistics help in giving a definite and condensed form to data.
(v) Statistics are used to undertake forecasting. Statistics related to previous trends of a variable help in predicting the value of the variable in near future.
(vi) Statistics helps in increasing the knowledge, expertise and argumentative power. 

Higher Order Thinking Skills 

Question 1. 
‘Statistics does not deal with individual facts’. Explain.
Answer: 
Statistics deals only with the aggregate of facts and figures, hence the study of individual facts lies outside its scope. For example. a rise in Consumer Price Index does not indicate that the price of each commodity in the country has increased.

Question 2. 
What are the causes of distrust of 
Answer: 
Following are the main causes of distrust of statistics
(i) Statistics can be altered to reach pre-deterrnined conclusion.
(ii) Authentic statistics can also be presented in a manner that can mislead the reader.
(iii) When statistics are collected in a partial manner, the results are generally wrong. Consequently. people lose faith in them.

Question 3. 
‘Statistics is no substitute for common sense: Illustrate with an example.
Answer: 
There is a possibilty of misinterpreting the statistical data. Hence, it should not be believed blindly. For example, the average strength of 12 classes in a school was 40. Therefore, the administration department of the school placed an order for 40 chairs for each class. However, there may be classes in which the number of students is more than 40. Thus, one should evaluate the statistical inferences logically and offend them if they violate common sense.

Choose the correct answer:

Question 1.
The Study of individual units the part of which branch of ecomics?
(A) Microeconomics 
(B) Income and Employment Theory
(C) Macro economics 
(D) Price Theory 
Answer:
(A) Microeconomics 

Question 2. 
Why does scarcity occur?
(A) Due to limited resources 
(B) Due to unlimited wants
(C) Both (A) and (B) 
(D) Neither (A) nor (B)
Answer:
(C) Both (A) and (B)

Question 3. 
Statistics is an aggregate of singular and plural:
(A) Nouns 
(B) Facts
(C) Numbers
(D) Non of there
Answer:
(B) Facts

Question 4. 
How many stages are there in the statistical study?
(A) One 
(B) Two
(C) Four 
(D) Five
Answer:
(D) Five

Question 5. 
Which of the following is the first stage of statistical study?
(A) Collection of data 
(B) Classification of data
(C) Presentation of data 
(D) Analysis of data
Answer:
(A) Collection of data 

Question 6. 
Which of the following is an analysis technique of data?
(A) Correlation 
(B) Presentation
(C) Tally 
(D) Sampling
Answer:
(A) Correlation 

Question 7. 
Inter-temporal comparisons are associated with:
(A) Location 
(B) Time period
(C) Quality 
(D) Pictures
Answer:
(B) Time period

Question 8. 
Which of the following is the basis of statistical relations?
(A) Data 
(B) Considerations
(C) Assumptions 
(D) Facts
Answer:
(C) Assumptions 

Question 9. 
Why do we study statistics?
(A) To find causes behind economic problems
(B) To present economic facts in a definite form
(C) To find relationships between various economic factors
(D) All of the these
Answer:
(D) All of the these

Question 10. 
Which of the following is not included in the stage presentation of data?
(A) Tables 
(B) Averages
(C) Graphs 
(D) Diagrams
Answer:
(B) Averages

I. Fill in the blanks with correct answer.

1.  An ............. is a process of production, exchange and consumption of goods and services; and distribution of income in a country or region.
2. Economic activities are the ones that are undertaken for a ............... gain.
3. ............. is the root of all economic problems.
4.  ............. is the act of selecting among restricted alternatives.
5. The total income arising from what has been produced in the country is called the .............
6. Economic facts are also known as .............
7. Sampling is a tool of ............... of data..............
8. The inferences drawn from statistical analysis are generally .............    
9.  Data collected without a purpose are just    ..............
10. Statistics are facts affected by............. of causes.
Answers:    
1. economy    
2. monetary    
3. Scarcity    
4. Choice    
5. GDP
6. data    
7. collection    
8. approximates    
9. numbers    
10. multiplicity

II. State whether the following statements are true or false.    

1. Not only are the resources limited, they have alternative uses also.
2. Statistical methods are no substitute to logics.
3. Unorganised data can be called as statistics.
4. Everyone can use statistics effectively.
5. Statistics can do forecasting.
6. Statistics provide qualitative form to economic problems.
7. Statistics relations are definite.
8. Data is like wet clay.
9. The simple meaning of statistics in singular sense is data.
10. Exact facts are more convincing than vague statements.
Answers:    
1. True    
2. True    
3. False    
4. False    
5. True
6. False    
7. False    
8. True    
9. False    
10. True

III. Match the Following 

Column - I	Column - II
I. Economics 2. Statistics 3. Consumption 4. Production 5. Data Collection 6. Data Presentation 7. Data Analysis 8. Data Interpretation 9. Classification at Data 10. Universe	(A) Gottfried Achenwall (B) Adam Smith (C) Creation of Utility (D) Destruction of Utility (E) 2ndStage (F) 1st Stage (G) 4th Stage (H) 3rd Stage (I) 5th Stage (j) Population

Answer:
1. (B) 2. (A) 3. (D) 4. (C) 5. (F) 6. (H) 7. (G) 8. (I) 9. (E) 10. (J)

IV. Read the following statement- Assertion (A) and Reason (R). Choose one of the correct alternatives given below:

Assertion (A): Statistics solves economic problems.
Reason (R): Statistics is used to understand economic problems and finding the solution with the help
of qualitative and quantitative facts related to the economic problems.

Alternatives:
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
(b) Both Assertion (A) and Reason (R) are true and Reason (R) ¡s not the correct explanation of Assertion (A).
(c) Assertion (A) is true and Reason (R) is false.
(d) Assertion (A) is false and Reason (R) is true.
Answer: 
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)

V. Read the following hypothetical case study carefully and answer the following questions on the base of the same:

Statistics are numerically expressed. Any fact expressed in words cannot be called statistics. Also, Statistics are enumerated or estimated according to reasonable standards of accuracy. This implies that data are collected or can be calculated purely on the basis of calculations or estimates. Further, Statistics are placed in relation to each other. The comparison of data is possible if the aggregate of data are classified into different sections according to their homogeneity since unorganised data cannot provide any conclusion.

1. ___________ is of no use to economics without data. (Statistics/Mathematics)
2. Statistics study only facts. (numerical/theoretical) 
3. Statistics requires only__________ data. (homogeneous/heterogeneous)
4. First stage of statistical study is ___________ of data. (organisation/collection) .
Answers: 
1. Statistics 
2. numerical 
3. homogeneous 
4. collection