MATHEMATICAL METHODS FOR ECONOMIC ANALYSIS

Paper Code: 
ECO 123
Credits: 
4
Contact Hours: 
60.00
Max. Marks: 
100.00
Objective: 

To understand the application of mathematics in economic theory.

12.00
Unit I: 
Terminology, Concepts and tools

Constants, variables, parameters, intercepts Coefficients-Functions-inverse, general and specific functions-Equations-Applications-Demand and supply functions-Cost and revenue functions-Consumption function-IS & LM functions-Multivariable functions-Market equilibria.

12.00
Unit II: 
Differential Calculus

Rules of differentiation-slopes-linear and non linear functions-partial derivatives-higher order derivatives-Young’s Theorem- Constrained & unconstrained optimization- Lagrangian Multiplier-Interpretation-Use of derivatives in economics –Maximization, minimization, elasticities – Utility function – production function – revenue, cost and profit functions (simple problems).

12.00
Unit III: 
Integral Calculus

Concept-simple rules of integration-application to Consumer’s surplus & producer’s surplus-Costs & revenues.

12.00
Unit IV: 
Matrices & Determinants

Fundamentals of matrix algebra; solving equations- Crammer’s rule & inverse of a matrix; properties of determinants; Application: Input-output analysis.

12.00
Unit V: 
Linear Programming

Basic Concepts, formulation of an LP problem-feasible, basic and optimal solution-graphic and simplex methods-formulation of the dual of a programme and its interpretation-Applications of LP technique.

Essential Readings: 
  1. Yamane, Taro (1975), Mathematics for Economists, PHI, New Delhi.
  1. Allen, R.G.D.(1974), Mathematical Analysis for Economists, Macmillan Press, New Delhi.
  1. Gupta, S.C.(1993), Fundamentals of Applied Statistics., S.Chand, NewDelhi.
  1. Chiang, A.C. (1986), Fundamental Methods of Mathematical Economics, McGraw Hill,New York.
  1. Handry, A.T.(1999), Operations Research, PHI, New Delhi.

      6.   Salvatore, Dominick (1992), Mathematics for Economists, Schaum Series.

Academic Session: 
2016-17
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