Complete Guide to Sandeep Garg Macroeconomics Solutions for Class 12

Macroeconomics constitutes about 50 - 60% of the Class 12 Economics syllabus. This section requires sufficient revision and practice. Students nearing their board exams can resort to solved question-answers from top solution books. Sandeep Garg Macroeconomics Class 12 Solutions is an ideal reference book which students can follow to score better marks.

What are the Chapters in Sandeep Garg Macroeconomics Class 12 Solutions About?

In this solution material, there are 12 chapters. These chapters detail various Macroeconomic concepts and mechanisms. To make it more accessible to students, a free download option of Sandeep Garg Macroeconomics Class 12 2025-26 PDF has been enabled. This makes it possible for students to study and practice exercise questions at all times.

Have a look at what the Macroeconomics chapters in Sandeep Garg Class 12 Solutions contain:

Chapter 1: Circular Flow of Income

The circular flow of income in an economy includes the following topics:

• Markets for goods and services.

• Households.

• Markets for factors of production.

• Firms or suppliers.

Firms require labour to produce certain products. Thus, they go to the market for factors of production. They hire labour from households and produce goods. After that, they go to the goods and services market to sell their product. The first chapter in Sandeep Garg Macroeconomics Class 12 explains this thoroughly. Other topics in this lesson are stock, flow, real flow, money flow, etc.

Chapter 2: Basic Concepts of Macroeconomics

This lesson details the fundamentals of Macroeconomics. For example, it mentions factors of production along with relevant examples. Following that, you get a brief on current transfers and gross investment. A chart differentiating capital goods and consumer goods is also provided here. Next, in the 2nd chapter of Sandeep Garg Macroeconomics Class 12 Solutions, various reasons are mentioned which cause asset depreciation.

Chapter 3: National Income and Related Aggregate

National Income accounting is one of the most crucial chapters in Class 12 Macroeconomics syllabus. In this chapter, you will learn about the following along with their formulas:

• National Domestic Product (NDP).

• Gross National Product (GNP).

• Gross Domestic Product (GDP).

• Net National Income (NNP).

Chapter 4: Measurement of National Income

The chapter includes:

• Net value addition at market price.

• Gross Value addition (factor cost).

• Intermediate consumption.

• Value of Output.

Chapter 5: Money

Solutions of Sandeep Garg Class 12 Macroeconomics gives an appropriate explanation on barter exchange, characteristics of money, the supply of money, Demand Deposit Account (DDA) and bank money.

Chapter 6: Banking - Commercial Banks and Central Bank

Important topics in this chapter are Cash Reserve Ratio (CRR), Statutory Liquidity Ratio (SLR), margin money, credit creation, functions of RBI, bank of issue, etc.

Chapter 7: Aggregate Demand and Related Concepts

In this chapter of Sandeep Garg Macroeconomics Class 12 Solutions, the following have been discussed:

• Average Propensity to Save.

• Average Propensity to Consume.

• Marginal Propensity to Save (MPS).

• Marginal Propensity to Consume (MPC).

Chapter 8: Income Determination and Multiplier

The numerical solutions in this chapter teach you how to find out multipliers using MPC and MPS.

Chapter 9: Excess Demand and Deficient Demand

Excess demand occurs when there are limited resources in an economy but huge demand. Related topics of this are inflationary gap, deflationary gap, margin requirement, deficient demand, etc.

Chapter 10: Government Budget and the Economy

The budget of an economy is formulated based on:

• Revenue Receipt.

• Revenue Deficit.

• Revenue Expenditure.

• Fiscal Deficit.

• Primary Deficit.

• Capital Expenditure.

• Interest Payment.

Chapter 11: Foreign Exchange Rates

In the foreign exchange market, countries trade their currencies in exchange for another. Chapter 11 in Solution of Sandeep Garg Macroeconomics Class 12 talks about the functions of FOREX market, spot exchange, FOREX institutions and so on.

Chapter 12: Balance of Payments

Balance of Payment is done based on two accounts. They are:

1. Current Account.

2. Capital Account.

This chapter explains the trade deficit, trade surplus, the balance of trade, etc.

You can download the PDF of Sandeep Garg Macroeconomics Class 12 Solutions 2025-26 now. Referring to the answers after reading your textbook, lessons will help a lot. It would increase your efficiency, conceptual knowledge and clarify your doubts.

Class 12 Macroeconomics by Sandeep Garg is a very popular and an easily understandable book for Class 12 Macroeconomics and is recommended by all teachers. Sandeep Garg's book has many questions at the end of each lesson. It is quite useful for revision as well as exam purposes.

For the ease of the students, these books have been curated with the comprehensive solutions of Sandeep Garg Macroeconomics textbooks.

The Sandeep Garg macroeconomics solutions designed by experts have been discussed in detail. It has each and every step related to the problem.

The solutions especially mentioned in all the chapters will also aid students to get an idea about how to solve such national income problems in the CBSE board exam.

Also, Sandeep Garg Macroeconomics Class 12 solutions help the students recognize  their mistakes in the problem sums, and do the correction respectively.

Law of Demand

The law of demand is observed as ‘the quantity demanded of a product comes down if the price of the product goes up, keeping other factors constant.’ This can also be explained as, if the cost of the commodity increases, then the demand of the aggregate quantity reduces. This is due to the opportunity cost of the customer's increases, which leads the customers to choose any other substitute or they may not purchase it. The law of demand and its exceptions are two fascinating concepts

Consumer proclivity theory aids us in understanding the combination of two commodities that a customer will purchase based on the market prices of the commodities and subject to a customer’s budget restriction. The amount of a commodity that a customer actually buys is considered to be interesting. This is duly explained in a simple language in Sandeep Garg textbooks of Microeconomics of Class 12th, utilising the demand function.

Factors

The factors that affect demand are as follows:

1. The price of a product puts an impact on the consumer's demand.

2. The basic income of the consumer or buyer.

3. The price of other related goods also determines the demand.

4. Choice, tastes, and preferences of the consumer.

5. The expectation of the consumer also puts an impact on the demand.

6. The number of consumers there in the market also determines the price.