SYLLABUS
1. INTRODUCTION
1.1 A Simple Economy
1.2 Central Problems of an Economy
1.3 Organisation of Economic Activities
1.3.1 The Centrally Planned Economy
1.3.2 The Market Economy
1.4 Positive and Normative Economics
1.5 Microeconomics and Macroeconomics
1.6 Plan of the Book
2. THEORY OF CONSUMER BEHAVIOUR
2.1 Utility
2.1.1 Cardinal Utility Analysis
2.1.2 Ordinal Utility Analysis
2.2 The Consumer’s Budget
2.2.1 Budget Set and Budget Line
2.2.2 Changes in the Budget Set
2.3 Optimal Choice of the Consumer
2.4 Demand
2.4.1 Demand Curve and the Law of Demand
2.4.2 Deriving a Demand Curve from Indifference Curves and Budget Constraints
2.4.3 Normal and Inferior Goods
2.4.4 Substitutes and Complements
2.4.5 Shifts in the Demand Curve
2.4.6 Movements along the Demand Curve and Shifts in the Demand Curve
2.5 Market Demand
2.6 Elasticity of Demand
2.6.1 Elasticity along a Linear Demand Curve
2.6.2 Factors Determining Price Elasticity of Demand for a Good
2.6.3 Elasticity and Expenditure
3. PRODUCTION AND COSTS
3.1 Production Function
3.2 The Short Run and the Long Run
3.3 Total Product, Average Product and Marginal Product
3.3.1 Total Product
3.3.2 Average Product
3.3.3 Marginal Product
3.4 The Law of Diminishing Marginal Product and the Law of Variable Proportions
3.5 Shapes of Total Product, Marginal Product and Average Product Curves
3.6 Returns to Scale
3.7 Costs
3.7.1 Short Run Costs
3.7.2 Long Run Costs
4. THE THEORY OF THE FIRM UNDER PERFECT COMPETITION
4.1 Perfect Competition: Defining Features
4.2 Revenue
4.3 Profit Maximisation
4.3.1 Condition 1
4.3.2 Condition 2
4.3.3 Condition 3
4.3.4 The Profit Maximisation Problem: Graphical Representation
4.4 Supply Curve of a Firm
4.4.1 Short Run Supply Curve of a Firm
4.4.2 Long Run Supply Curve of a Firm
4.4.3 The Shut Down Point
4.4.4 The Normal Profit and Break-even Point
4.5 Determinants of a Firm’s Supply Curve
4.5.1 Technological Progress
4.5.2 Input Prices
4.6 Market Supply Curve
4.7 Price Elasticity of Supply
5. MARKET EQUILIBRIUM
5.1 Equilibrium, Excess Demand, Excess Supply
5.1.1 Market Equilibrium: Fixed Number of Firms
5.1.2 Market Equilibrium: Free Entry and Exit
5.2 Applications
5.2.1 Price Ceiling
5.2.2 Price Floor
6. NON-COMPETITIVE MARKETS
6.1 Simple Monopoly in the Commodity Market
6.1.1 Market Demand Curve is the Average Revenue Curve
6.1.2 Total, Average and Marginal Revenues
6.1.3 Marginal Revenue and Price Elasticity of Demand
6.1.4 Short Run Equilibrium of the Monopoly Firm
6.2 Other Non-perfectly Competitive Markets
6.2.1 Monopolistic Competition
6.2.2 How do Firms behave in Oligopoly?
