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Economics for Class XII Part 2 – Introductory Microeconomics

INTRODUCTION

In this chapter the main key concepts you will be reading are Consumption, Production, Exchange, Scarcity, Production possibilities, Opportunity cost along with you will also learn about Market economy, Centrally planned economy, Mixed economy, Positive analysis, Normative analysis, Microeconomics and Macroeconomics.

THEORY OF CONSUMER BEHAVIOUR

In this chapter the main key concepts you will be reading are Budget set, Budget line, Indifference curve, Marginal Rate of substitution, Monotonic preferences, Diminishing rate of substitution, Indifference map, Utility function Consumer’s optimum Law of demand cost along with you will also learn about Demand curve Substitution effect, Income effect Normal good, Inferior good Substitute, Complement Price elasticity of demand.

PRODUCTION AND COSTS

In this chapter the main key concepts you will be reading are Production function, Short run, Long run, Total product, Marginal product Average product along with you will also learn about Law of diminishing marginal product, Law of variable proportions, Returns to scale, Cost function Marginal cost, Average cost.

THE THEORY OF THE FIRM UNDER PERFECT COMPETITION

In this chapter the main key concepts you will be reading are Perfect competition Revenue, Profit maximisation, Firms supply curve, along with you will also learn about Market supply curve Price elasticity of supply.

MARKET EQUILIBRIUM

In this chapter the main key concepts you will be reading are Equilibrium, Excess demand, Excess supply, Marginal revenue product of labour along with you will also learn about Value of marginal product of labour Price ceiling, Price floor.

NON-COMPETITIVE MARKETS

In this chapter the main key concepts you will be reading are Introducing Positive Costs Monopoly, Monopolistic Competition Oligopoly.

Economics for Class XII Part 2 - Introductory Macroeconomics

INTRODUCTION

In this chapter the main key concepts you will be reading are Rate of interest, Wage rate, Economic agents or units, Great Depression Unemployment rate, Four factors of production, Means of production, Inputs Land, Labour Capital, along with you will also learn about Entrepreneurship Investment expenditure, Wage labour Capitalist country or capitalist economy, Firms Capitalist firms, Output Households, Government External sector, Exports Imports.

NATIONAL INCOME ACCOUNTING

In this chapter the main key concepts you will be reading are Consumption goods, Capital goods, Intermediate goods Stocks, Flows Gross investment, Net investment Depreciation, Circular flow of income Product method of calculating, National Income, Expenditure method of calculating, Income method of calculating, Macroeconomic model Input, Value added Inventories, Planned-Unplanned change in inventories, along with you will also learn about Gross Domestic Product (GDP), Net Domestic Product (NDP), Gross National Product (GNP) Net National Product (NNP), NNP (at factor cost) or Undistributed profits, National Income (NI), Net interest payments made, Corporate tax by households, Personal tax payments Non-tax payments, Personal Disposable Income (PDI) National Disposable Income.

MONEY AND BANKING

In this chapter the main key concepts you will be reading are Barter exchange Double coincidence of wants, Medium of exchange, Unit of account, Store of value, Bonds Rate of interest along with you will also learn about Liquidity trap Fiat money, Legal tender, Narrow money, Broad money, Currency deposit ratio, Reserve deposit ratio, Money multiplier Lender of last resort, Open market operation Bank Rate, Cash Reserve Ratio (CRR) Repo Rate, Reverse Repo Rate.

DETERMINATION OF INCOME AND EMPLOYMENT

In this chapter the main key concepts you will be reading are Aggregate demand & supply, Equilibrium, Marginal propensity to consume, Un-intended changes in inventories, Autonomous change along with you will also learn about Parametric shift Effective demand principle, Paradox of thrift Autonomous expenditure multiplier.

GOVERNMENT BUDGET AND THE ECONOMY

In this chapter the main key concepts you will be reading are Public goods, Automatic stabiliser, and Discretionary fiscal policy along with you will also learn about Ricardian equivalence.

OPEN ECONOMY MACROECONOMICS

In this chapter the main key concepts you will be reading are Open economy, Balance of payments, Current account deficit, Official reserve transactions, Autonomous and accommodating, Nominal and real exchange rate transactions along with you will also learn about Purchasing power parity, Flexible exchange rate, Depreciation Interest rate differential, Fixed exchange rate, Devaluation, Managed floating, Demand for domestic goods, Marginal propensity to import, Net exports, Open economy multiplier.