Class | Subject | Book | Chapter | Session | Questions covered |
|---|---|---|---|---|---|
XI | Economics | Statistics for Economics (NCERT) | 1 – Introduction | 2026-27 | 7 of 7 |
Chapter at a glance
Idea | Key point |
|---|---|
Economics | Study of how people and society choose to use scarce resources having alternative uses to produce goods that satisfy wants, and distribute them |
Economic activity | Activity undertaken for monetary gain (consumption, production, distribution) |
Scarcity | Wants are unlimited but resources are limited; so choice must be made |
Statistics | Collection, presentation, analysis and interpretation of numerical data |
Uses | Describes facts exactly, summarises large data, finds relationships, helps in policy making and prediction |
Exercise Questions
Mark the following statements as true or false.
(i) Statistics can only deal with quantitative data.
(ii) Statistics solves economic problems.
(iii) Statistics is of no use to Economics without data.
Answer
Answer
Part | True / False | Reason |
|---|---|---|
(i) | False | Statistics also deals with qualitative data (such as gender, skill levels, better/worse) which can be recorded and stored systematically |
(ii) | False | Statistics helps to analyse a problem and find its causes; the solution comes from policies framed using it |
(iii) | True | Without data on the factors of a problem, no analysis is possible and no policy can be formulated |
- False (ii) False (iii) True
Make a list of activities in a bus stand or a market place. How many of them are economic activities?
Answer
Answer
An economic activity is one done for monetary gain.
Activity at a bus stand / market | Economic? |
|---|---|
Bus driver and conductor running the bus for wages | Yes |
Shopkeeper selling vegetables or snacks | Yes |
Porter carrying luggage for a fee | Yes |
Taxi and rickshaw drivers | Yes |
Passengers buying tickets or goods (consumers) | Yes (consumption) |
Hawkers, tea-stall owners | Yes |
Traffic police on duty (government job, paid salary) | Yes (employment) |
A person waiting for a friend | No |
Two friends chatting or a family helping an old person with luggage | No |
A volunteer giving water free of cost | No |
Most activities, except those done out of love, friendship or charity, are economic.
Activities done for payment (selling, driving, carrying, buying) are economic; chatting, waiting and free help are not.
‘The Government and policy makers use statistical data to formulate suitable policies of economic development’. Illustrate with two examples.
Answer
Answer
- Poverty: the government counts how many people are below the poverty line and where. On this basis it designs schemes such as employment guarantee and food subsidy.
- Education and employment: data on literacy rates and the number of unemployed or educated youth guide the building of schools and colleges, skill programmes and job creation.
(Another example: data on the price rise and inflation help the government and the central bank to take measures to control prices.)
Statistics on poverty and on literacy/employment help the government to frame suitable development policies.
“You have unlimited wants and limited resources to satisfy them.” Explain this statement by giving two examples.
Answer
Answer
Human wants are never ending. As one want is fulfilled, another arises, but the money, time and other resources to satisfy them are limited, so we face scarcity and have to choose.
- Pocket money: a student wants a bicycle, a new phone, books and a trip, but the limited pocket money can buy only a few. She must choose the wants she needs the most.
- Farm land: a farmer has limited land, labour and water. These can be used to grow food or cash crops like cotton. By growing one, he gives up the other.
Wants are unlimited, resources limited with alternative uses; so scarcity forces choice (pocket money, farmland).
How will you choose the wants to be satisfied?
Answer
Answer
Since all wants cannot be satisfied, we choose by priority:
- Necessities first: food, clothing, shelter and health come before luxuries.
- Urgency and importance: satisfy the want that gives the most benefit or is most urgent.
- Within our means: compare the price of each good with our income.
- Alternative uses: weigh the benefit of one want against what we give up for it (opportunity cost).
By ranking wants according to necessity, urgency and income, and giving up the least important ones.
What are your reasons for studying Economics?
Answer
Answer
- To understand how individuals and society use scarce resources and take decisions of consumption, production and distribution.
- To understand problems of the country such as poverty, unemployment and inequality, and support suitable policies.
- To plan my own life and money better, as a consumer and future producer.
- It helps in careers in business, banking, civil services, teaching, research and policy making.
To understand scarcity and choice, the country’s economic problems, plan personal finances and prepare for careers.
Statistical methods are no substitute for common sense. Comment with examples from your daily life.
Answer
Answer
Statistics only gives numbers and tools; judgement and common sense are needed to use them properly.
- Averages can mislead: if the average marks of a class is 60, it does not mean every student scored near 60. Common sense tells us to look at the range as well.
- Wrong data or sample: a survey of the opinion of only a few friends cannot represent the whole school, and common sense tells us that the sample is biased.
- Correlation is not causation: ice cream sales and heat both rise in summer, but one does not cause the other.
Therefore, statistical results must be interpreted with care and reasoning.
Statistics gives numbers, but common sense is needed to choose, check and interpret them correctly.
Topic checklist
- ☒ Economics, scarcity and choice (Q4 – Q6)
- ☒ Economic activities (Q2)
- ☒ Role of statistics in economics (Q1, Q3, Q7)