Part A
Introductory Micro Economics (40 Marks)
Master foundational microeconomics, consumer behavior, production functions, costs, firm behavior under perfect competition, and market equilibrium.
Unit 1: Introduction
A Simple Economy, Central Problems of an Economy, Organisation of Economic Activities, The Centrally Planned Economy, The Market Economy, Positive and Normative Economics, Microeconomics and Macroeconomics.
Central Problems
Market vs Centrally Planned
Positive & Normative Economics
Micro vs Macroeconomics
Unit 2: Theory of Consumer Behaviour
Utility Analysis: Cardinal Utility Analysis, Ordinal Utility Analysis, The Consumer's Budget, Budget Set and Budget Line, Changes in the Budget Set, Optimal Choice of the Consumer.
Demand & Elasticity: Demand Curve and the Law of Demand. Deriving a Demand Curve from Indifference Curves and Budget Constraints, Normal and Inferior Goods, Substitutes and Complements, Movements along the Demand Curve and Shifts in the Demand Curve, Market Demand. Elasticity along a Linear Demand Curve, Factors Determining Price Elasticity of Demand for a Good, Elasticity and Expenditure.
Cardinal & Ordinal Utility
Budget Set & Line
Indifference Curves
Law of Demand
Price Elasticity of Demand
Unit 3: Production and Costs
Production Function: The Short Run and the Long Run, Total Product, Average Product and Marginal Product, The Law of Diminishing Marginal Product and the Law of Variable Proportions, Shapes of Total Product, Marginal Product and Average Product Curves, Returns to Scale.
Costs: Short Run Costs, Long Run Costs.
Production Function
TP, AP & MP Curves
Law of Variable Proportions
Returns to Scale
Short Run & Long Run Costs
Unit 4: The Theory of the Firm under Perfect Competition
Perfect Competition: Defining Features, Revenue and Profit Maximization, The Profit Maximization Problem: Graphical Representation, Supply Curve of a Firm: Short Run and Long Run Supply Curve, Shut Down Point, Normal Profit and Break-Even Point. Determinants of a Firm's Supply Curve: Technological Progress and Input Prices, Market Supply Curve, Price Elasticity of Supply.
Perfect Competition
Profit Maximization
Short & Long Run Supply
Shut Down & Break-Even
Elasticity of Supply
Unit 5: Market Equilibrium
Equilibrium, Excess Demand, Excess Supply, Market Equilibrium: Fixed Number of Firms and Free Entry and Exit; Applications of Ceiling Price and Floor Price.
Market Equilibrium
Excess Demand & Supply
Fixed vs Free Entry/Exit
Price Ceiling & Floor Price
by