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ECO401 : Economics

Course Overview

Course Synopsis

This course mainly focuses on Microeconomics and Macroeconomics. Microeconomic theory focuses on the behavior of consumers, firms and resource suppliers. We will develop an understanding of how markets work to allocate limited resources to their most highly-valued uses. Macroeconomic theory focuses on the economy as a whole. One of the goals of this course is to help you develop a basic understanding of how the macro economy works in particular the extent to which different policies can be used to achieve specific macroeconomic objectives. This course also highlights the areas of international trade, money and banking etc.

Course Learning Outcomes

At the end of the course, you should be able to:

Explain basic economic concepts pertaining to the market system and demonstrate the ability to comprehend terminology used in news media, national debates over issues, and daily conversation.
Describe the functioning of market forces, i.e. demand and supply in competitive market system.
Give reasoning, evaluation of the national and international economic issues in and out of the classroom.
Apply the basic principles of economics in your own life.

Course Calendar

Topic	Lecture	Resource	Page
Branches of Economics	1	Handouts	1
Factors of Production	1	Handouts	1
Economic System	1	Handouts	2
Rational Choice and Cost-Benefit Analysis	2	Handouts	4
Opportunity Cost	2	Handouts	4
Production Possibility Frontier	2	Handouts	5
Goods Market and Factor Market	3	Handouts	10
Shortage and Surplus	3	Handouts	10
Law of Supply	4	Handouts	13
Equilibrium	4	Handouts	14
Role of Government in Price Determination and Equilibrium Analysis	5	Handouts	16
Price Elasticity of Demand	6	Handouts	26
Elastic and Inelastic Demand	6	Handouts	27
Determinants of Elasticity of Demand	7	Handouts	32
Effects of Advertising on Demand Curve	7	Handouts	32
Price Elasticity of Supply	7	Handouts	33
Income Elasticity of Demand	8	Handouts	34
Cross-Price Elasticity of Demand	8	Handouts	35
Cardinal and Ordinal Utility Approach	9	Handouts	40
Law of Diminishing Marginal Utility	9	Handouts	40
Law of Equi-Marginal utility	9	Handouts	41
ASSIGNMENT 01
Consumer Behaviour	10	Handouts	42
Uncertainty and Risk	10	Handouts	42
Indifference Curve Approach	11	Handouts	44
Budget Line	11	Handouts	45
Optimum Consumption Point for Consumer	12	Handouts	46
Income Consumption Curve	12	Handouts	46
The Price Consumption Curve	12	Handouts	47
Firm	13	Handouts	53
Production Function	13	Handouts	53
The Law of Diminishing Marginal Returns	13	Handouts	54
Theories of Production	14	Handouts	56
The Scale of Production	14	Handouts	56
Economies of Scale	14	Handouts	56
Optimim Combination of Factors	14	Handouts	57
Isoquant	15	Handouts	58
Marginal Rate of Technical Substitution	15	Handouts	58
Isocost	15	Handouts	59
Optimal Combination of Factors	15	Handouts	59
Sunk Cost	15	Handouts	59
Cost	16	Handouts	60
Revenues	17	Handouts	63
Profit Maximization	17	Handouts	64
Profit Maximization	18	Handouts	71
Market Structures	18	Handouts	72
Perfect Competition	18	Handouts	72
Allocative Efficiency and Productive Efficiency	19	Handouts	74
Monopoly	19	Handouts	74
Limit Pricing	20	Handouts	76
Monopoly and the Public Interest	20	Handouts	76
Government Regulations	20	Handouts	77
Price Discrimination	21	Handouts	78
Monopolistic Competition	21	Handouts	79
Oligopoly	22	Handouts	80
Collusive and Non-Collusive Oligopoly	22	Handouts	81
MID TERM EXAMS
Kinked Demand Curve	23	Handouts	90
Welfare Economics	23	Handouts	91

Market for Factors of Production	24	Handouts	93
The Economics of Information Products	24	Handouts	94
Aggregate Demand and aggregate Supply	25	Handouts	103
Classical Economics	25	Handouts	103
Classical Views about Great Depression	25	Handouts	104
Keynesian Views about Great Depression	25	Handouts	104
Differences between Classical and Keynesian Economics	26	Handouts	106
Aggregate Demand and Supply: The Classical View	27	Handouts	110
Aggregate Demand and Supply: The Keynesian View	27	Handouts	110
Different School of Thoughts	27	Handouts	112
GRADED DISCUSSION BOARD 02
National Income Accounting	28	Handouts	117
Methods to Measure GDP	28	Handouts	118
National Income Accounting (Continued)	29	Handouts	120
Price Deflator	29	Handouts	121
Purchasing Power Parity	29	Handouts	122
Leakages and Injections	30	Handouts	124
Macroeconomic Equilibrium	30	Handouts	125
Consumption and Consumption Function	30	Handouts	125
The Saving Function	30	Handouts	126
Investment and Investment Demand Curve	31	Handouts	128
Determination of National Income	31	Handouts	129
Multiplier	31	Handouts	130
ASSIGNMENT 02
Keynes Paradox of Thrift	32	Handouts	134
The Accelerator	32	Handouts	135
Unemployment	33	Handouts	142
Inflation	34	Handouts	148
The Balance of Payments	35	Handouts	152
Devaluation and Revaluation	36	Handouts	154
Appreciation and Depreciation	36	Handouts	154
Equilibrium in Foreign Exchange Market	36	Handouts	155
Determinants of Capital Account	37	Handouts	158
Interest Parity Condition	37	Handouts	159
Current Account Deficit	37	Handouts	160
Economic Growth	38	Handouts	161
Exogenous Growth Theory	39	Handouts	165
Endogenous Growth Theory	39	Handouts	167
Macro Economic Issues and Their Inter-Relationship	40	Handouts	170
Fiscal Policy	40	Handouts	170
Concept of Money	41	Handouts	186
Monetary Policy	42	Handouts	189
Money Market Equilibrium	43	Handouts	193
Goods Market Equilibrium	43	Handouts	194
Fiscal-Monetary Policy Interaction	43	Handouts	196
International Trade	44	Handouts	203
Problems of Lower Income Countries	45	Handouts	207
Development Strategies	45	Handouts	208
FINAL TERM EXAMS

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ECO401 : Economics

Course Overview

Course Synopsis

Course Learning Outcomes

Course Calendar