Economics(eco) Syllabus

Course Description

This course covers the basic concepts of microeconomics and macroeconomics. In encompasses basic

economic problems, demand, supply, market equilibrium, elasticity of demand and supply, consumer

choice, production, cost, revenue, market structure, concept of national product and income and its

measurement, monetary and fiscal policies.

Course Objectives

The main objective of this course is to make students familiar with the basic concepts of economics.

1. Economic Issues and Concepts

teaching hours: 8 hrs

Economic Issues and Concepts

Introduction of economics Alfred Marshall (Lipsey, and Lionel Robbins’ definitions

Concept of microeconomics and its scope;

Main characteristics of free market, centrally planned and mixed economic systems; (With examples)

Society’s production possibility curve/frontier and choice, scarcity and opportunity cost.

2. Demand, Supply and Price

teaching hours: 10 hrs

Demand, Supply and Price

Meaning of demand, Law of demand

Individual and market demand, movement along and shift of a demand (with schedule and graph/curve);

Meaning of supply, law of supply,

Individual and market demand, movement along and shift of a demand (with schedule and graph/curve);

Market equilibrium: the interplay of demand and supply; change in market equilibrium due to factors shifting the demand and supply curves;

Defining elasticity of demand (price, income and cross), price elasticity and its measurement (percentage, arc/ midpoint)

Income and cross elasticity of demand and its types and measurement

Concepts of Elasticity of supply, concept of consumer and producer surpluses;

Government intervention in the market through price floor, price ceiling and tax and effect

Numerical Examples

Presentation, Debate and Discussion

3. Consumer Choice: Indifference Theory

teaching hours: 6 hrs

Consumer Choice: Indifference Theory

Concept of utility, total utility and marginal utility; Law of diminishing marginal utility;

Indifference curve analysis: Meaning and assumptions of indifference curve analysis; Derivation

Marginal rate of substitution (MRS); basic properties of indifference curves; right-angled (L-shaped) and linear (straight line) indifference curves

Consumer’s budget line; consumer’s equilibrium

Income consumption curve (ICC) and price consumption curve (PCC) for normal, inferior, and Giffen goods. (Demand curve)

Discussion

4. Production

teaching hours: 6 hrs

Production

Meaning of production, Cobb-Douglas production function

Production with one variable input: the law of diminishing marginal productivity/returns;

Production with two variable inputs: concept of isoquant; Property of isoquants; right-angled(L-shaped) and linear (straight line) isoquants;

Concept of iso-cost curve (meaning, equation, slope); producer’s equilibrium,

Condition for optimum employment of one, two and many inputs/factors of production;

Production in the long run: Concepts of returns to scale with possible causes of each.