Introductory Microeconomics

Paper Code: 
CECO 111
Credits: 
6
Contact Hours: 
90.00
Max. Marks: 
100.00
Objective: 
  1. To orient the students with the basics of economics
  2. To examine the interactions of supply and demand and characteristics of    perfect and imperfect markets
  3. To describe the various concepts of input markets
18.00
Unit I: 
Exploring the Subject Matter of Economics

·       Scope and method of economics

·      The economic problem: scarcity and choice; the question of what to produce, how to produce and how to distribute output

·       Science of economics; the basic competitive model

·       Incentives and information- prices, property rights and profits

·       Rationing; opportunity sets

·       Economic systems

·       Reading and working with graphs

18.00
Unit II: 
Supply and Demand

·         Determinants of individual demand/supply

·         Demand/supply schedule and demand/supply curve

·         Market versus individual demand/supply

·         Shifts in the demand/supply curve, demand and supply together

·         Elasticity of demand-types

·         Measurement of price elasticity of demand, and its application

·         Consumer’s surplus

·         Producer’s surplus and the efficiency of the markets

18.00
Unit III: 
The Households

·         The consumption decision – cardinal utility approach; TU and MU

·         Law of diminishing Marginal utility, law of equi marginal utility

·         Derivation of demand curve

·         Budget constraint

·         Ordinal Utility Approach - representing preferences with indifference curves properties of indifference curves; consumer‘s optimum choice

·         Income, price and substitution effects (Hicksian approach)

18.00
Unit IV: 
The Firm and Market Structure

·         Perfect Competition: characteristics of perfect competition; Behaviour of profit maximizing firms and the production process; short run costs and output decisions; costs and output in the long run

·         Imperfect Competition: Monopoly- meaning and equilibrium of monopolist, government policies towards monopoly; imperfect competition- meaning and characteristics of monopolistic and oligopoly markets

18.00
Unit V: 
Input Markets

·         Basic concepts-derived demand, productivity of an input, marginal productivity, value of marginal product and marginal revenue product of labour

·         Demand for labour; input demand curves; shifts in input demand curves

·         Supply of labour and backward bending supply curve of labour

            Competitive labour markets

Essential Readings: 
  1.  Karl, E. C. and Ray C. F., Principles of Economics, Pearson Education      Inc., 8th Edition, 2007
  2. Mankiw, N. G., Economics: Principles and Applications, Cengage, Learning India Private Limited, 4th edition, 2007
References: 

Stiglitz, J. E. and Walsh, C. E,  Economics, W.W. Norton & Company, Inc., New York, 4th Edition, 2007

Academic Session: 
2023-24
  • Printer-friendly version
  • PDF version