Unit 1: Introduction (6 hrs)
Concept and types of microeconomics and macroeconomics
Distinction between microeconomics and macroeconomics
Goals and instruments of macroeconomics
Unit 2: Elasticity of Demand and Supply (6 hrs)
Concept and types of price, income and cross elasticity of demand
Measurement of price, income and cross elasticity of demand: Total outlay method and Point method
Uses of price, income and cross elasticity
Concept of elasticity of supply and its measurement (Numerical exercise using excel)
Unit 3: Theory of Consumer Behavior (6 hrs)
Concept of cardinal and ordinal utility analysis
Cardinal utility analysis: assumptions, consumer's equilibrium, criticisms and derivation of demand curve
Ordinal utility Analysis: Concept, properties of Indifference curve, marginal rate of substitution, Price Line and consumer's equilibrium, Price effect: Derivation of PCC, Income effect: Derivation of ICC, Substitution effect, Decomposition of price effect into income and substitution effect, Derivation of demand curve (Hicksian approach) (Numerical exercise)
Unit 4: Cost and Revenue Curves (6 hrs)
Concept of cost: actual cost and opportunity cost, implicit cost and explicit cost. accounting and economic cost.
Derivation of short run and long run cost curves (total, average, marginal) and shape of short run and long run average cost curves.
Relationship between short run and long run AC and MC curves
Concept of revenue: total revenue, average revenue, and marginal revenue, revenue curves under perfect and imperfect competition, relation between average and marginal revenue
(Numerical exercise using excel)
Unit 5: Market Structure (9 hrs)
Perfect competition- meaning and characteristics of perfect competition, short run and long run equilibrium of the firm and industry(TR-TC approach and MC-MR approach),derivation of short run and long run supply curve of a firm and industry.
Monopoly: Meaning and characteristic of monopoly; pricing under monopoly: equilibrium of firm in short run and long run (TR-TC approach and MC-MR approach); Price discrimination and degree of price discrimination.
Monopolistic Competition: Meaning and characteristics of monopolistic competition; Pricing under monopolistic competition: equilibrium of firm in short run and long run; equilibrium of firm under product variation and selling expenses
Oligopoly: Meaning and characteristic of oligopoly; Pricing under cartel (aiming at joint profit maximization)
(Numerical exercise using excel)
Unit 6: National Income Accounting (6 hrs)
Circular flow of income and expenditure in two sector, three sector and four sector economy
Meaning and different concept of national income: GDP, NDP, GNP, NNP, national income at factor cost (NI), personal income (PI), disposable personal income (DI), per capita income (PCI)
Real and nominal GDP, GDP deflator
Computation of National income: Product, Income and Expenditure method
(Numerical exercise using excel)
Unit 7: Money, Banking and International Trade (6 hrs)
Concept and functions of money- value of money-money supply —components of money supply (MI, M2, etc.)
Inflation : Types, causes and effects of inflation
Banking: role and functions of commercial banks , role and functions of central bank with reference to Nepal Rastra Bank
International Trade: Distinction between internal and international trade, balance of trade and balance of payment.