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Chapter: 7th Social Science : Economics : Term 1 Unit 1 : Production

Exercises Questions with Answers

7th Social Science : Economics : Term 1 Unit 1 : Production : Text Book Back Exercises Questions with Answers, Solution



I. Choose the correct answer


1. Production refers to

a) destruction of utility

b) creation of utilities

c) exchange value

d) none of these

Answer: b. creation of utilities


2. Utilities are in the nature of

a) form utility

b) time utility

c) place utility

d) all of these

Answer: d. all of these


3. _______  is carried out by extractive industries.

a) secondary production

b) primary production

c) tertiary production

d) service production


4. Primary factors are

a) land, capital

b) capital, labour

c) land, labour

d) none of these

Answer: c. land, labour


5. The entrepreneur is also called

a) exchanger

b) Agent

c) organizer

d) communicator

Answer: c) organizer


II. Fill in the blanks


1. Utility means want satisfying power of a product.

2. Derived factors are Capital and organisation.

3. Land is a fixed in supply.

4. Labour is the human input into the production process.

5. Capital is the man made physical goods used to produce other goods and services.


III. Match the following


1. Primary production - Adamsmith

2. Time utility - fishing, mining

3. Wealth of nation - eentrepreneur

4. Human capital - stored for future

5. Innovator - education, health

Answer: 1) fishing, mining 2) stored for future 3) Adam Smith 4) education, health 5) entrepreneur

Primary production : fishing, mining

Time utility : stored for future

Wealth of nation : Adam Smith

Human capital : education, health

Innovator : entrepreneur


IV. Give short answer :


1. What is production?.

Production is a process of combining various material inputs and immaterial inputs in order to make something for consumption (the output). It is the act of creating an output, a good or service which has value and contributes to the utility of individuals.

2. What is utility?.

Utility means want satisfying power of a product. Utilities are in the nature of form utility, time utility and place utility.

3. Name the types of utility.

Form utility, Place utility, Time utility.

0. Name the types of production.

4. What are the factors of production?

1. Primary Factors and

2. Derived Factors.

Primary factors are land and labour. These are naturally given and without them no goods can be produced.

Derived factors are Capital and Organization. These derived factors, when combined with the primary factors of production, raise total production.

5. Define Labour

Labour is the human input into the production process. Alfred Marshall defines labour as, 'the use of body or mind, partly or wholly, with a view to secure an income apart from the pleasure derived from the work'.

6. Define Division of labour.

Division of labour means dividing the process of production into distinct and several component processes and assigning each component in the hands of a labour or a set of labourers, who are specialists in that particular process.

7. Write the forms of capital.

1. Physical Capital or Material Resources

Ex. Machinery, tools, buildings, etc.

2. Money capital or Monetary resources

Ex. Bank deposits, shares and securities, etc.

3. Human capital or Human Resources

Ex. Investments in education, training and health.

0. Who is the changing agent of the society?.

8. Write the three characteristics of entrepreneur?.

Identifying profitable investible opportunities.

Deciding the location of the production unit.

Making innovations.

Deciding the reward payment.



X. Give brief answer.


1. Explain the types of production?

There are three types of production

1. Primary Production           

2. Secondary Production

3. Tertiary or Service Production

1. Primary Production :

Primary production is carried out by 'extractive' industries like agriculture, forestry, fishing, mining and oil extraction. These industries are engaged in such activities as extracting the gifts of nature from the earth's surface, from beneath the earth's surface and from the oceans.

2. Secondary Production :

This includes production in manufacturing industry, turning out semi-finished and finished goods from raw materials and intermediate goods, conversion of flour into bread or iron ore into finished steel. They are generally described as manufacturing and construction industries, such as the manufacture of cars, furnishing, clothing and chemicals, as also engineering and building.

3. Tertiary Production :

Industries in the tertiary sector produce all those services which enable the finished goods to be put in the hands of consumers. In fact, these services are supplied to the firms in all types of industry and directly to consumers. Examples cover distributive traders, banking, insurance, transport and communications. Government services, such as law, administration, education, health and defence, are also included.

2. What is land ? what are the characteristics of land?

Land as a factor of production refers to all those natural resources or gifts of nature which are provided free to man. It includes within itself several things such as land surface, air, water, minerals, forests, rivers, lakes, seas, mountain, climate, and weather. Thus, land includes all things that are not made by man.

Characteristics of land :

1. Land is a Free Gift of Nature : Man has to make efforts in order to acquire other factors of production. But to acquire land no human efforts are needed. Land is not the outcome of human labour. Rather, it existed even long before the evolution of man.

2. Land is fixed in supply : The total quantity of land does not undergo any change. It is limited and cannot be increased or decreased with human efforts. No alteration can be made in the surface area of land.

3. Land is imperishable : All man-made things are perishable and these may even go out of existence. But land is indestructible. Thus it cannot go out of existence. It is not destructible.

4. Land is a Primary Factor of Production : In any kind of production process, we have to start with land. For example, in industries, it helps to provide raw materials, and in agriculture, crops are produced on land.

5. Land is Immovable : It cannot be transported from one place to another. For instance, no portion of India's surface can be transported to some other country.

6. Land has some Original Indestructible Powers : There are some original and indestructible powers of land, which a man cannot destroy. Its fertility may be varied but it cannot be destroyed completely.

7. Land Differs in Fertility : Fertility of land differs on different pieces of land. One piece of land may produce more and the other less.

As a gift of nature, the initial supply price of land is zero. However, when used in production, it becomes scarce. Therefore, it fetches a price accordingly. 

3. Explain the merits and demerits of division of labour.

Merits of division of labour :

It improves efficiency of labour when labour repeats doing the same tasks.

Facilitates the use of machinery in production, resulting in inventions. Ex. More's Telegraphic Codes.

Time and Materials are put to the best and most efficient use.

Demerits of division of labour :

Repetition of the same task makes labour to feel that the work is monotonous and stale. It kills the humanity in him.

Narrow specialization reduces the possibility of labour to find alternative avenues of employment. This results in increased unemployment.

Reduce the growth of handicrafts and the worker loses the satisfaction of having made a commodity in full.

4. Describe the characteristics of capital.

Capital is a passive factor of production.

Capital is man-made

Capital is not an indispensable factor of production.

Capital has the highest mobility.

Capital is productive.

Capital lasts over time

Capital involves present sacrifice to get future benefits.

5.  What are the functions of entrepreneur?.

• Identifying profitable investible opportunities

• Deciding the location of the production unit

• Making innovations

• Deciding the reward payment

• Taking risks and facing uncertainties


VI. Activity and Project


1. Students are asked to prepare a chart containing dummy images of primary, secondary and tertiary sectors images.

2. Students are asked to visit some local farmers and to discuss about the land and its characteristics. Collect some photographs of land and make a album.


VII. Life skills:


1. Students to know about the characteristics of entrepreneur , Set up your classroom like a industry. Some Students are asked to  act like a businessman , Do the industries activities. Teachern and studentstogether discuss about the entrepreneur and their important of development of society.


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