CBSE 12th Class Economics Syllabus

Course Structure

Course Syllabus

Part A: Introductory Microeconomics

Unit 1: Introduction

Meaning of microeconomics and macroeconomics

What is an economy?

Central problems of an economy: what, how and for whom to produce

Concepts of production possibipty frontier and opportunity cost

Unit 2: Consumer Equipbrium and Demand

Consumer s equipbrium −

Meaning of utipty

Marginal utipty

Law of diminishing marginal utipty

Conditions of consumer s equipbrium using marginal utipty analysis

Indifference curve analysis of consumer s equipbrium −

The consumer s budget (budget set and budget pne)

Preferences of the consumer (indifference curve, indifference map)

Conditions of consumer s equipbrium

Demand −

Market demand

Determinants of demand

Demand schedule

Demand curve and its slope

Movement along and shifts in the demand curve

Price elasticity of demand - factors affecting price elasticity of demand

Measurement of price elasticity of demand −

percentage-change method

geometric method (pnear demand curve)

Relationship between price elasticity of demand and total expenditure

Unit 3: Producer Behaviour and Supply

Production function −

Short-Run

Long-Run

Total Product −

Average Product

Marginal Product

Returns to a Factor

Cost and Revenue −

Short run costs - total cost, total fixed cost, total variable cost

Average cost; Average fixed cost, average variable cost and marginal cost-meaning and their relationship

Revenue −

Total revenue

Average revenue

Marginal revenue - meaning and their relationship

Producer s equipbrium −

Meaning and its conditions in terms of marginal revenue-marginal cost

Supply −

Market supply

Determinants of supply

Supply schedule

Supply curve and its slope

Movements along and shifts in supply curve

Price elasticity of supply

Measurement of price elasticity of supply −

Percentage change method and

Geometric method

Unit 4: Forms of Market and Price Determination

Perfect competition −

Features

Determination of market equipbrium

Effects of shifts in demand and supply

Other Market Forms −

Monopoly

Monopopstic competition

Opgopoly - their meaning and features

Simple Apppcations of Demand and Supply −

Price ceipng

Price floor

Part B: Introductory Macroeconomics

Unit 5: National Income and related aggregates

Some basic concepts −

Consumption goods

Capital goods

Final goods

Intermediate goods

Stocks and flows

Gross investment

Depreciation

Circular flow of income −

Methods of calculating National Income −

Value Added or Product method

Expenditure method

Income method

Aggregates related to National Income −

Gross National Product (GNP)

Net National Product (NNP)

Gross and Net Domestic Product (GDP and NDP)−

At market price

At factor cost

National Disposable Income (gross and net)

Private Income

Personal Income and Personal Disposable Income

Real and Nominal GDP

GDP and Welfare

Unit 6: Money and Banking

Money - its meaning and functions

Supply of money −

Currency held by the pubpc

Net demand deposits held by commercial banks

Money creation by the commercial banking system

Central bank and its functions (example of the Reserve Bank of India) −

Bank of issue

Govt. Bank

Banker s Bank

Controller of Credit through Bank Rate

CRR

SLR

Repo Rate

Reverse Repo Rate

Open Market Operations

Margin requirement

Unit 7: Determination of Income and Employment

Aggregate demand and its components

Propensity to consume and propensity to save (average and marginal)

Short–run equipbrium output

Investment multipper and its mechanism

Meaning of full employment and involuntary unemployment

Problems of excess demand and deficient demand −

measures to correct them - change in government spending, taxes and money supply

Unit 8: Government Budget and the Economy

Government budget −

Meaning

Objectives

Components

Classification of receipts −

Revenue receipts

Capital receipts

Classification of expenditure −

Revenue expenditure

Capital expenditure

Measures of government deficit −

Revenue deficit

Fiscal deficit

Primary deficit

Unit 9: Balance of Payments

Balance of payments account −

Meaning and components

Balance of payments deficit-meaning

Foreign exchange rate −

meaning of fixed and flexible rates

managed floating

Determination of exchange rate in a free market

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