Business Economics
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Course Name : BUSINESS ECONOMICS
Code : CUBC2430(4-1-1)
Course Objectives
To expand the students' knowledge in the field of microeconomics and to make them ready to analyze real economic situations and to understand the concept of Macro Economics and its usefulness in the current economic scenario, for a student to comprehend its application in the real-world scenario.
Learning Outcomes
After successful completion of the course, the student will be able to:
• understand the past, present economic conditions of the country
• understand and apply supply and demand analysis to relevant economic issues;
• Apply marginal analysis to the “firm” under different market conditions;
• understand the causes and consequences of different market structures
• apply economic models to examine current economic issues and evaluate policy options for addressing these issues;
• Analyse the causes and effects of changes in real GDP
• Forecast the future course of changes and development through their knowledge of policies and programs set by the governments and other development agencies.
• familiar with the knowledge and application of microeconomics and macroeconomics for the formulation of policies and planning
Course Syllabus
| Microeconomics | |
| Unit 1: | Economics — scope and subject matter. Distinction between Economics and Business Economics.
Tools required – Functional relationships, schedules, graphs, concept of slope and its measurement- etc., Resources-scarcity and efficiency - Production Possibility Frontier-it’s shifting. |
| Unit 2: | Basics of Demand and Supply
The concept of demand and demand function - Derivation of Individual demand curve and Market demand curve– Shifting of the demand curve – The supply function and the supply curve – Derivation of individual supply curve and market supply curve – Shifting of the supply curve- Determination of equilibrium price. |
| Unit 3: | Theory of Consumer Behaviour:
Cardinal analysis – Law of diminishing marginal utility – consumer surplus Ordinal approach – Indifference curve analysis – Budget line – Consumer Equilibrium – Income consumption curve and Price consumption curve – Hicksian decomposition of price effect into substitution effect and income effect – Demand curve for Normal, inferior and Giffen goods Concept of Elasticity of demand – Measurement pf various elasticity of demand – Distinction between slope of a demand curve and the elasticity of demand – Elasticity of supply – Measurement. |
| Unit 4: | Theory of Production
Production Function – The Law of variable proportions – Relationships among TP, AP, and MP. Concept of Isoquant and Isocost – Finding the optimal employment of inputs – Ridge lines: the economic region of production – Output expansion path and homogeneous production function. |
| Unit 5: | Theory of Cost
Cost analysis – Different concepts – Accounting and Economic costs, Opportunity cost, Private and social costs; Short run and long run costs. |
| Unit 6: | Market for Commodities
Revenue concepts under different market conditions: TR, AR, MR and relationship among AR, MR and elasticity of demand, Perfect competition – Short run and long run equilibrium – Supply curve in the short run (shutdown and breakeven point concepts). Monopoly – Short run and long run equilibrium – Concept of Price discrimination. Monopolistic competition, Oligopoly Market – Short run and long run equilibrium. |
| Unit 7: | Factor Price Determination
Theory of Wage Determination - Backward Bending Supply curve of labour; Determination of Rent, Profit and Interest rate. |
| Macroeconomics - Scope and basic concepts | |
| Unit 8: | National Income Accounting
Concepts and measurement of GDP, GNP, NNP, NI and DPI - Circular flow of income – Real and Nominal GDP –Implicit deflator
Theory of Equilibrium Income Determination: Simple Keynesian Model; Consumption, saving and investment functions – National income determination; Investment and Government expenditure multipliers
Commodity market and Money market equilibrium; Derivation of IS and LM curves –Shifts of IS and LM curves-equilibrium in IS-LM model – Effectiveness of monetary and fiscal policies |
| Unit 9: | Money and Inflation
Concept of demand for and supply of money. Quantity theory of money and Keynesian theory of demand for money. Measures of money supply – High powered money – Money multiplier. Concept of Inflation – Demand-pull and cost-push theories of inflation – Monetary and fiscal policies to control inflation – Instruments, objectives and limitations |
Books Recommended:
- Pindyke and Rubinfeld, Micro Economics
- Gould & Ferguson, Micro Economic Theory
- Banerjee & Majumdar, Fundamentals of Business Economics
- Joydeb Sarkhel, Macro Economic Theory
Session Plan
Session 1
Introduction to Business Economics
Session 2
Economics — scope and subject matter
Resources-scarcity and efficiency
Production Possibility Frontier
Introduction to Business Economics pdf
https://www.slideshare.net/rathourvikash/intro-to-business-economics
Session 3
Tools required in Economics
Session 4
Basics of Demand and Supply
Determinants of demand
The concept Supply and its determinants
Session 5
Determination of equilibrium price
Session 6
Concept of Elasticity of demand –Measurement 0f various elasticity of demand
Session 7
Theory of Consumer Behaviour:
Cardinal analysis – Law of diminishing marginal utility
consumer surplus Ordinal approach
Session 8
Indifference curve analysis:
Meaning and concept of Indifference curve
https://www.youtube.com/watch?v=zeHF1x3w8gc
Properties of IC
Session 9
Theory of Production
Production Function – The Law of variable proportions
Session 10
Long Run Production Function
Concept of Isoquant and Iso cost
Finding the optimal employment of inputs.
Ridge Line-the economic region of production
Session 11
Market for Commodities
Revenue concepts under different market conditions
Perfect competition
Session 12
Monopoly – Short run and long run equilibrium
Session 13
Session 14
Cost analysis – Different concepts
Short run and long run costs
economies and diseconomies of scale
Session 15
Factor Price Determination
Theory of Wage Determination
Determination of Rent
Determination of profit and interest
https://www.slideshare.net/WaqarAhmad72/rent-theory
https://www.slideshare.net/luxminy/ricardian-theory-of-rent-46384548
Session 16
Macroeconomics
Scope and basic concepts
Circular flow of income
https://www.youtube.com/watch?v=_T3y8EHnjks
National income determination
Measurement of GDP, GNP, NNP, NI and DPI
Session 17
Money and Inflation
Quantity theory of money and Keynesian theory of demand for money.
Monetary and fiscal policies to control inflation – Instruments
Session 19
Practice Class 1 : Price elasticity of Demand
Problems discussed and solved
Session 20
Practice Class 2 : Income Elasticity and Cross elasticity of Demand
Problems discussed and solved
Session 21
Practice Class 3 : Cost minimization and Profit Maximization
Problems discussed and solved
Session 22
Practice Class 4: Market equilibrium taking demand and supply
Problems discussed and solved
Session 23
Practice Class 5: Price and output determination under perfect competition
Problems discussed and solved
Session 24
Practice Class 6 : Price and output determination under Monopoly
Problems discussed and solved
Session 25
Practice Class 7 : Price and output determination under Oligopoly and Monopolistic Market
Problems discussed and solved
Session 26
Revision of all Units and Doubt Clearing
Session 27
Practice Class 8 : Finding out the output level where different stages of Law of Variable Proportion operates.
Problems discussed and solved
Session 28
Different project Topics will be given to students. Students need to prepare their project report on the given topic and submit it to the department. Students also need give presentation on the project topic.
Case Studies
Our Main Teachers
Sanjukta Mohanty is working as HOD – B.COM (B&A) at Centurion University of Technology and Management, Bhubaneswar. Sanjukta Mohanty is continuing her Ph.D in Management under Utkal University. She has completed her MBA in Finance from Biju Pattnaik University of Technology & Management. She is also having MA in Economics from Ravenshaw University. She has […]
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