CISCE Class 12 Economics Syllabus - Free PDF Download
CISCE Syllabus 2025-26 Class 12: The CISCE Class 12 Economics Syllabus for the examination year 2025-26 has been released by the Council for the Indian School Certificate Examinations, CISCE. The board will hold the final examination at the end of the year following the annual assessment scheme, which has led to the release of the syllabus. The 2025-26 CISCE Class 12 Economics Board Exam will entirely be based on the most recent syllabus. Therefore, students must thoroughly understand the new CISCE syllabus to prepare for their annual exam properly.
The detailed CISCE Class 12 Economics Syllabus for 2025-26 is below.
Academic year:
CISCE Class 12 Economics Revised Syllabus
CISCE Class 12 Economics and their Unit wise marks distribution
CISCE Class 12 Economics Course Structure 2025-26 With Marking Scheme
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Syllabus
1: Microeconomic Theory [Revision]
CISCE Class 12 Economics Syllabus
1 Microeconomics and Macroeconomics: Introduction [Revision]
- Branches of Economics
- Introduction
- Types of Economics: Flowchart
- Important Economist: Ragnar Frisch
- Real-Life Example
- Key Point Summary
- Microeconomics
- Introduction
- Definition: Microeconomics
- Scope
- Features: Flowchart
- Importance: Flowchart
- Limitations
- Subject Matter of Microeconomics
- Usefulness of Microeconomics
- Real-Life Application
- Key Point Summary
- Macroeconomics
- Introduction
- Definition: Macroeconomics
- Basic Concepts in Macroeconomics
- Subject Matter of Macroeconomics
- Scope
- Features: Flowchart
- Importance
- Limitations
- Real-Life Application
- Key Point Summary
- Micro Economics VS Macro Economics
- Difference Between Micro Economics and Macro Economics
- Real-Life Application
- Key Point Summary
2 Demand and Law of Demand [Revision]
- Role of Demand and Supply in Economics
- Introduction: The Fundamental Question
- Key Concepts
- Free Goods vs Economic Goods
- Demand, Supply, and Price
- Real-Life Application
- Key Point Summary
- Paul A. Samuelson: Father of Modern Economics
- Introduction
- Life and Milestones
- Samuelson’s Key Theories & Impact
- Key Point Summary
- Concept of Demand
- Introduction
- Meaning
- Definition: Concept of Demand
- Formula
- Features
- Micro View: Individual Demand
- Macro View: Aggregate Demand
- Real-Life Application
- Key Point Summary
- Types of Demand
- Individual or Market Demand
- Ex Ante and Ex Post Demand
- Joint Demand
- Derived Demand
- Composite Demand
- Price Demand
- Income Demand
- Cross Demand
- Direct Demand
- Alternative Demand
- Competitive Demand
- Key Point Summary
- Determinants of Demand
- Major Determinants of Demand
- Types of Goods and Income Effect
- Relation between Income and Demand
- Relation between Price and Demand for Related Goods
- Key Point Summary
- Demand Function
- Meaning
- Algebraic Form of the Demand Function
- Real-Life Application
- Key Point Summary
- Law of Demand
- Introduction
- Statement
- Formula
- Definition: Law of Demand
- Assumptions
- Tabular Representation
- Demand Curve
- Key Point Summary
- Demand Schedule
- Introduction
- Types of Demand Schedules
- Key Point Summary
- Individual Demand Schedule
- Introduction
- Example 1: Apples Demand Schedule
- Example 2: Cotton Demand Schedule
- Real-Life Application
- Key Point Summary
- Market Demand Schedule
- Meaning
- Example: Market Demand for Apples
- Calculation Method
- Real-Life Application
- Key Point Summary
- Demand Curve
- Introduction
- Demand Schedule to Demand Curve
- Application
- Real-Life Application
- Key Point Summary
- Individual Demand Curve
- Introduction
- Key Terms
- Diagram Explanation
- Real-Life Application
- Key Point Summary
- Market Demand Curve
- Introduction
- Derivation of Market Demand Curve
- Real-Life Application
- Key Point Summary
- Reasons for the Downward Slope of the Demand Curve
- Introduction
- Reasons for Downward Slope
- Real-Life Application
- Key Point Summary
- Importance of the Law of Demand
- Introduction
- Importance of the Law of Demand
- Key Point Summary
- Exceptions to the Law of Demand
- Introduction
- Major Exceptions With Examples
- Key Point Summary
- Movement along the Demand Curve and Shift of the Demand Curve
- Introduction
- Real-Life Application
- Key Point Summary
- Change in Quantity Demanded: Movement along the Demand Curve
- Introduction
- Types of Change
- Example Table
- Diagrammatic Explanation
- Real-Life Application
- Key Point Summary
- Change in Demand – Shift in Demand Curve
- Introduction
- Law of Demand vs. Change in Demand
- Types
- Main Causes
- Real-Life Application
- Key Point Summary
- Difference Between Extension and Increase in Demand
- Table: Difference Between
- Explanation
- Real-Life Application
- Key Point Summary
- Difference Between Contraction and Decrease in Demand
- Table: Difference Between
- Factors Affecting Demand Table
- Key Points
- Real-Life Application
- Key Point Summary
3 Theory of Consumer Behaviour: Marginal Utility and Indifference Curve Analysis [Revision]
- Basic Concepts of Microeconomics > Utility
- Introduction
- Definition: Utility
- Features
- Types: Flowchart
- Real-Life Application
- Key Point Summary
- Cardinal Approach (Utility Analysis)
- Introduction
- Key Concepts
- Consumer Equilibrium
- Real-Life Application
- Key Point Summary
- Total Utility and Marginal Utility
- Introduction
- Total Utility vs. Marginal Utility
- Formula
- Types of Marginal Utility
- Real-Life Application
- Key Point Summary
- Relationship Between Total Utility and Marginal Utility
- Relationship between TU and MU
- Example with Mangoes
- Graphical Explanation
- Important Propositions
- Can Utility Be Measured
- Key Point Summary
- Approaches to Consumer Behaviour
- Approaches
- Cardinal Approach (Marshallian View)
- Assumptions of Cardinal Approach
- Key Point Summary
- Law of Diminishing Marginal Utility
- Definitions: Law of Diminishing Marginal Utility
- Statement of the law
- Tabular Representation
- Diagram
- Explanation
- Assumptions
- Importance
- Exception
- Key Point Summary
- Alfred Marshall: Key Contributor to Economics
- Introduction
- Key Concepts
- Key Point Summary
- Consumer's Equilibrium through Cardinal Utility Approach
- Introduction
- Definition: Consumer's Equilibrium
- Assumptions
- Single Commodity with One Use
- Single Commodity with Several Uses
- Several Commodities
- Key Point Summary
- Law of Equi-Marginal Utility
- Introduction
- Explanation
- Assumptions
- Utility Table
- Steps in Consumer Decision-Making
- Stepwise Example: Spending on Mangoes and Oranges
- Diagram-Based Explanation
- The Law in Modern Terms ("Law of Proportionality")
- Key Point Summary
- Importance and Limitations of law of Equi-Marginal Utility
- Introduction
- Major Limitations
- Importance of the Law
- Real-Life Application
- Key Point Summary
- Ordinal Utility Analysis/Indifference Curve Analysis
- Introduction: Ordinal Utility
- Definition: Indifference Curve Analysis
- Origin
- Indifference Schedule
- Indifference Curve
- Indifference Map
- Marginal Rate of Substitution (MRS)
- Assumptions
- Real-Life Application
- Key Point Summary
- Relationship Between Marginal Rate of Substitution and Marginal Utility
- Definition
- Key Formula and Explanation
- Practical Analogy
- MRS vs. Diminishing Marginal Utility
- Real-Life Application
- Key Point Summary
- Properties of Indifference Curves
- Introduction
- Key Properties
- Price Line or Budget Line
- Introduction with Analogy
- Definition: Budget Line
- Example Table
- Graphical Representation
- Formula
- Properties of Budget Line
- Shifts in Budget Line
- Consumer's Equilibrium (Using Indifference Curve)
- Key Point Summary
- Consumer's Equilibrium through Indifference Curve Approach
- Definition
- Key Concepts
- Conditions for Consumer Equilibrium
- Diagram Explanation
- Assumptions
- Real-Life Application
- Key Point Summary
4 Elasticity of Demand [Revision]
- Concept of Elasticity of Demand
- Introduction
- Definition: Elasticity of Demand
- Elasticity Types
- Key Point Summary
- Types of Elasticity of Demand > Price Elasticity
- Introduction
- Definition: Price Elasticity of Demand
- Formula
- Degrees/Types of Price Elasticity
- Importance
- Key Point Summary
- Methods of Measuring Price Elasticity of Demand
- Definition: Price Elasticity
- Total Expenditure Method
- Example: Total Expenditure Method
- Proportionate (Percentage) Method
- Example Table: Proportionate (Percentage) Method
- Point Elasticity Method
- Elasticity at Different Points
- Arc Elasticity Demand
- Example: Arc Elasticity Method
- Revenue Method
- Example: Revenue Method
- Real-Life Applications
- Numerical Problems of Price Elasticity of Demand
- Problem 1
- Problem 2
- Problem 3
- Problem 4
- Problem 5
- Problem 6
- Problem 7
- Factors Affecting Price Elasticity of Demand
- Introduction
- Flowchart
- Importance of Elasticity of Demand
-
Table: Main Importance of Elasticity of Demand and Their Examples
-
- Types of Elasticity of Demand > Income Elasticity
- Introduction
- Definition
- Formula
- Example
- Types of Income Elasticity of Demand
- Importance
- Real-Life Application
- Key Point Summary
- Types of Elasticity of Demand > Cross Elasticity
- Meaning
- Definition
- Formula
- Types
- Limitations
- Importance
- Real-Life Application
- Key Point Summary
5 Supply: Law of Supply and Price Elasticity of Supply [Revision]
- Concept of Supply
- Introduction
- Features
- Types of Supply
- Difference Between Stock and Supply
- Factors Affecting Supply
- Supply Schedule
- Supply Curve
- Distinction: Supply vs. Quantity Supplied
- Real-Life Application
- Key Point Summary
- Determinants of Supply
- Introduction
- Main Determinants of Supply
- Supply Function
- Determinants of Elasticity of Supply
- Importance of Elasticity of Supply
- Real-Life Application
- Key Point Summary
- Law of Supply
- Introduction
- Definition
- Key Points
- Supply Schedule
- Statement of the Law
- Supply Curve
- Assumptions
- Exceptions
- Real-Life Application
- Key Point Summary
- Movements Along and Shifts in Supply Curve
- Supply Curve
- Movement Along Supply Curve
- Shift of the Supply Curve
- Factors Causing Shift in Supply Curve
- Table: Expansion vs Increase in Supply
- Table: Contraction of Supply vs. Decrease in Supply
- Reasons Behind the Shift in Supply Curve
- Real-Life Application
- Key Point Summary
- Price Elasticity of Supply
- Price Elasticity of Supply
- Definition: Elasticity of Supply
- Meaning of Elasticity of Supply
- Formula
- Types of Supply Elasticity
- Distinction Between Contraction of Supply and Decrease in Supply
- Real-Life Application
- Key Point Summary
- Categories (Degrees) of Elasticity of Supply
- Introduction
- Perfectly Elastic Supply (Es = ∞)
- Perfectly Inelastic Supply (Es = 0)
- Unitary Elastic Supply (Es = 1)
- Some Other Types of Elasticity of Supply
- Measurement of Elasticity of Supply
- Introduction
- Percentage Method
- Problem 1
- Problem 2
- Problem 3
- Problem 4
- Problem 5
- Problem 6
- Problem 7
- Problem 8
- Geometric Method
- Time Period and Elasticity
- Real-Life Application
6 Market Mechanism: Equilibrium Price and Quantity in a Competitive Market [Revision]
- Basic Concepts of Equilibrium and Equilibrium Price
- Introduction
- Understanding Equilibrium
- Equilibrium Price
- Demand Side (Buyers)
- Supply Side (Sellers)
- Process of Price Determination
- About George Stigler
- Real-Life Application
- Key Point Summary
- Equilibrium Price and Quantity in a Competitive Market
- Introduction
- Price Determination: Stepwise Illustration
- Effects of Prices Above and Below Equilibrium
- Important Terms and Visuals
- Real-Life Application
- Key Point Summary
- Effect of Simultaneous change in Demand and Supply on Equilibrium Price
- Effects of Demand Shifts (Supply Constant)
- Effects of Supply Shifts (Demand Constant)
- Combined Effects
- Stepwise Clarity
- Real-Life Application
- Key Point Summary
- Effects of Simultaneous Changes (Shifts) in Demand and Supply
- Understanding Simultaneous Demand and Supply Changes
- Both Increase Equally (No Change in Price)
- Demand Increases More Than Supply (Price Rises)
- Supply Increases More Than Demand (Price Falls)
- Real-Life Application
- Some Special Cases of Equilibrium
- Perfectly Elastic and Perfectly Inelastic Demand
- Perfectly Elastic and Perfectly Inelastic Supply
- Real-Life Application
- Key Point Summary
- Applications of Tools of Demand and Supply Price Control
- Price Control
- Price Ceiling (Maximum Price)
- Price Floor (Minimum Price)
- Implications of Price Ceiling Policy
- Effects of Minimum Price (Price Floor)
- Key Point Summary
7 Laws of Returns: Returns to a Factor and Returns to Scale [Revision]
- Basics of Production Theory
- Introduction
- Concept of Production
- Scientific Definitions
- Real-Life Application
- Key Point Summary
- Products
- Products, goods and services
- Classification of products
- Classification based on productive activities
- Classification based on process of production
- Classification based on durability
- Classification based on use of products
- Real-Life Applications
- Key Point Summary
- Factors of Production
- Introduction
- Land
- Labour
- Capital
- Entrepreneurship (Organiser)
- Real-Life Application
- Key Point Summary
- Production Function
- Meaning of Production Function
- Algebraic form of production function
- Important Points
- Short-run and Long-run (time concepts)
- Types of Production Functions
- Table: Short run vs Long run
- Table: Returns to a factor vs Returns to scale
- Economist's Corner: Tjalling Koopmans
- Key Point Summary
- Variation of Output in the Short-Run Returns to a Factor
- Introduction
- Key Concepts
- Table Showing Production
- Real-Life Application
- Key Point Summary
- Relationship between Average Product (AP) and Marginal Product (MP)
- Meaning of AP and MP
- General relationship between AP and MP
- Detailed cases
- Diagrammatic relationship (AP and MP curves)
- Key Point Summary
- Relationship between Total Product (TP) and Marginal Product (MP)
- Key definitions
- Movement of Total Product and Marginal Product
- Compact rule form
- Simple TP–MP table (example)
- Diagram idea (TP and MP curves)
- Real-Life Application
- Key Point Summary
- Changes in Production
- Returns to a Factor
- Returns to Scale
- Table: Stages of Returns to Scale
- Types of Returns to Scale
- Returns to a Factor vs Returns to Scale
- Law of Variable Proportions
- Definition: Law of Variable Proportions
- Key Point Summary
- Law of Variable Proportions
- Meaning
- Definition: Law of Variable Proportions
- Statement of the Law
- Assumptions
- Important Terms
- Table: Example (Applied to Agriculture)
- Stages of the Law
- Real-Life Application
- Key Point Summary
- Three Stages of Production
- Introduction
- Stage I: Increasing Returns
- Stage II: Diminishing Returns
- Stage III: Negative Returns
- Table
- Explanation of the Law of Variable Proportions
- Introduction
- Three Stages with Reasons
- Key Point Summary
- Stages of Operation and the Decision to Produce
- “Stage II as the Ideal Stage of Production”
- Causes behind the law
- Applicability of the law
- Real-Life Application
- Key Point Summary
- Variation of Output in the Long Run - Returns to Scale
- Long run and returns to scale
- Types of returns to scale
- Constant returns to scale
- Increasing returns to scale
- Decreasing returns to scale
- Key Point Summary
- Law of Variable Proportions and Returns to Scale Compared
- Key Concepts
- Table: Returns to a Factor vs. Returns to Scale
- Real-Life Application
- Key Point Summary
- Scale of Production and Concept of Indivisibility
- Introduction to Scale of Production
- Factors Determining Scale of Production
- Concept of Indivisibility
- Real-Life Application
- Key Point Summary
- Economies of Scale
- Introduction
- Internal Economies
- Types of Internal Economies
- External Economies
- Types of External Economies
- Relationship between Internal and External Economies
- Key Point Summary
- Diseconomies of Scale
- Introduction
- Internal Diseconomies
- External Diseconomies
- Real-Life Application
- Key Point Summary
- Significance of Economies of Scale
- Introduction
- Nature of the Industry
- Analysis of Cost of Production
- Real-Life Application
- Key Point Summary
8 Cost and Revenue Analysis [Revision]
- Cost of Production
- Introduction
- Basic Concepts
- Marshall's Distinction
- Real-Life Application
- Key Point Summary
- Theories of Costs: Traditional Theory of Costs/Short Run Cost Curves
- Introduction
- Types of Cost Theories
- Types of Production Cost
- Real-Life Application
- Key Point Summary
- Cost Concepts > Total Costs
- Introduction
- Fixed Costs
- Variable Costs
- Relationship Between Costs
- Key Point Summary
- Cost Concepts > Average Cost
- Meaning of Average Cost
- Average Fixed Cost
- Average Variable Cost
- Average Total Cost
- Tabular Representation
- Causes of the U-Shaped Cost Curves
- Real-Life Application
- Key Point Summary
- Cost Concepts > Marginal Cost
- Meaning of Marginal Cost
- Marginal Cost Formula
- Example
- Table
- Key Characteristics and Relationships
- Real-Life Application
- Key Point Summary
- Costs in Long Run Period
- Introduction
- Long Run Total Cost
- Long Run Average Cost
- Names for LAC
- Relationship: LAC and SAC
- Long Run Marginal Cost
- Relation Between LMC and LAC
- Key Point Summary
- Difference Between Short - Run & Long Run Costs
- Definition
- Comparison Table
- Real-Life Application
- Key Point Summary
- Behaviour of Cost in the Short - Run
- Concept and Importance
- Types of Cost Functions
- Fixed vs. Variable Costs
- Real-Life Application
- Key Point Summary
- Relationship between Average and Marginal Cost
- Key Definitions
- Conceptual explanation with example
- Formal relationship between AC and MC
- Important note on MC's direction
- Easy memory rule (M vs A rule)
- Key Point Summary
- Long-Run Cost Curves
- Short run vs long run
- Long-run total cost (LTC) curve
- Long-run average cost (LAC) curve
- Long-run marginal cost (LMC) curve
- Why LAC is U-shaped: economies and diseconomies of scale
- Key Point Summary
- Revenue Concepts
- Meaning of Revenue
- Total Revenue (TR)
- Average Revenue (AR)
- Marginal Revenue (MR)
- Behaviour under different market structures
- Types of Revenue
- Total Revenue
- Average Revenue
- Marginal Revenue
- Relationship between TR, AR and MR (Table)
- Key Point Summary
- Relation Between Total, Average and Marginal Revenue
- Key Definitions
- Revenue Under Perfect Competition
- Revenue Under Imperfect Competition
- Revenue When AR is Rising
- Key Point Summary
- Relationship between Total, Average and Marginal Revenues under Perfect Competition
- Introduction
- Example Table
- Behaviour and Relationships
- Real-Life Application
- Key Point Summary
- Relationship between Total, Average and Marginal Revenue under Imperfect Competition
- Introduction
- Table Reference
- Total Revenue
- Average Revenue
- Marginal Revenue
- Relationships and Rules
- Diagram
- Real-Life Application
- Key Point Summary
- Relationship Between (Mutual Determination) AR, MR, and Elasticity of Demand
- Introduction
- Core relationship between AR, MR and elasticity
- Interpretation: what elasticity tells us about MR and TR
- Simple numerical example
- Key Point Summary
- Comparative Study of Revenue Curves under Different Markets
- Perfect competition
- Monopoly
- Imperfect competition (including monopolistic competition)
- Oligopoly
- Real-Life Application
- Key Point Summary
- Significance of Revenue Curve
- Equilibrium of the firm (how much to produce)
- Estimation of profits and losses
- Capacity utilisation (full use or idle capacity)
- Factor pricing (use of AR and MR as ARP and MRP)
- Real-Life Application
- Key Point Summary
9 Forms of Market [Revision]
- Concept of Market
- Introduction
- Definition: Market
- Essential Market Conditions
- Types of definition of market
- Features of a market
- Real-Life Application
- Key Point Summary
- Market Structure
- Meaning of Market Structure
- Main types of market structures
- Characteristics of Market Structures
- Key Point Summary
- Classification of Market Structure
- Broad classification of market structure
- Main market forms
- Key Point Summary
- Duopoly
- Meaning of Duopoly
- Core Idea: Interdependence
- Characteristics of Duopoly
- Real-Life Application
- Key Point Summary
- Bilateral Monopoly
- Introduction
- Features of Bilateral Monopoly
- Real-Life Application
- Key Point Summary
- Classification of Market > Based on Competition
- Perfect Competition
- Introduction
- Definitions: Perfect Competition
- Features
- Pure competition vs perfect competition
- Assumptions
- Key Point Summary
- Perfect Competition
- Imperfect Competition
- Monopoly
- Meaning
- Definitions: Monopoly
- Features
- Types
- Price discrimination under monopoly
- Nature of demand and revenue under monopoly
- Costs under monopoly
- Key Point Summary
- Monopolistic Competition
- Introduction
- Definition: Monopolistic competition
- Main Features
- Edward Hastings Chamberlin
- Nature of Demand and Cost Curves
- Real-Life Application
- Key Point Summary
- Oligopoly
- Meaning of Oligopoly
- Definitions: Oligopoly
- Features
- Types
- Classification
- Indeterminacy of Price and Output under Oligopoly
- Reasons for Indeterminate Price and Output
- Real-Life Application
- Key Point Summary
- Concept of Monopsony
- Introduction
- Definition: Monopsony
- Characteristics of Monopsony
- Short Note: Joan Robinson
- Real-Life Application
- Key Point Summary
- Monopoly
- Other Forms of Market
- Based on Time Frame
- Based on Area
- Based on Function
- Based on Quantity
- Based on Legality
- Based on Control
- Based on Transactions
- Real-Life Application
- Key Point Summary
- Factors Determining Market / Extent of Market
- Extent on Market
- Factors That Decide Market Size
- Real-Life Application
- Key Point Summary
- Demand Curves of Firms under Different Market Forms
- Meaning of demand curve of a firm
- Perfect competition
- Monopoly
- Monopolistic competition
- Diagram explanation
- Key Point Summary
- Comparison between different forms of market
- Comparison Table
- Real-Life Application
- Key Point Summary
10 Producer's Equilibrium [Revision]
- Firm : An Economic Entity
- Introduction: Economic activity
- Meaning of a Firm
- Factors of production and factor services
- Main functions of a firm
- Size of firms: Small and large
- Types of firms (by ownership)
- Real-Life Application
- Key Point Summary
- Firm's Equilibrium
- Meaning of Equilibrium
- Meaning of Firm's Equilibrium
- Definitions: Equilibrium of Firm
- Conditions of Firm's Equilibrium
- Approaches to Firm's Equilibrium
- Meaning of Equilibrium Price
- Assumptions of Equilibrium Price
- Real-Life Application
- Key Point Summary
- Profit Maximisation Objective
- Introduction: Profit-maximisation objective
- Definition of Profit
- Normal profit and pure (economic) profit
- Role of profit in resource allocation
- Equilibrium of the firm and profit maximisation rules
- Economist note: Maurice Allais
- Real-Life Application
- Key Point Summary
- Producer's (Firm's) Equilibrium: Total Revenue and Total Cost Approach
- TR-TC Approach
- Behaviour of TR and TC
- Loss region, break‑even points and profit region
- Maximum profit and equilibrium output
- Total Profit (TP) curve and equilibrium
- Limitations of TR–TC method
- Real-Life Application
- Key Point Summary
- Producer's (Firm's) Equilibrium: Marginal Revenue and Marginal Cost Approach
- Producer’s (Firm’s) Equilibrium – MR–MC Approach
- Rule 1 – Short-run decision
- Rule 2 – First-order condition: MR = MC
- Rule 3 – Second-order condition: MC cuts MR from below
- Real-Life Application
- Key Point Summary
11 Equilibrium of Firm and Industry Under Perfect Competition [Revision]
- Concept of Equilibrium in Economics
- Meaning of equilibrium
- Equilibrium in economics
- Consumer equilibrium
- Equilibrium of a firm
- Equilibrium of an industry
- Equilibrium point
- Firm vs Industry
- Key Point Summary
- Firm's Equilibrium
- Meaning of Equilibrium
- Meaning of Firm's Equilibrium
- Definitions: Equilibrium of Firm
- Conditions of Firm's Equilibrium
- Approaches to Firm's Equilibrium
- Meaning of Equilibrium Price
- Assumptions of Equilibrium Price
- Real-Life Application
- Key Point Summary
- Producer's (Firm's) Equilibrium: Total Revenue and Total Cost Approach
- TR-TC Approach
- Behaviour of TR and TC
- Loss region, break‑even points and profit region
- Maximum profit and equilibrium output
- Total Profit (TP) curve and equilibrium
- Limitations of TR–TC method
- Real-Life Application
- Key Point Summary
- Producer's (Firm's) Equilibrium: Marginal Revenue and Marginal Cost Approach
- Producer’s (Firm’s) Equilibrium – MR–MC Approach
- Rule 1 – Short-run decision
- Rule 2 – First-order condition: MR = MC
- Rule 3 – Second-order condition: MC cuts MR from below
- Real-Life Application
- Key Point Summary
- Determination of Short Run Equilibrium of a Firm
- Short-run equilibrium of the industry
- Demand curve of an individual firm
- Short-run equilibrium of the firm
- Three short-run positions of the firm
- Shut-down and break-even points
- Key Point Summary
- Firm is a Price Taker, Not a Price Maker
- Meaning of price taker and price maker
- Price-Taking Behaviour of a Perfectly Competitive Firm
- Demand Curve of a Perfectly Competitive Firm Is Perfectly Elastic
- Price taker vs Price maker
- Real-Life Application
- Key Point Summary
- Determination of Long Run Equilibrium of a Firm
- Long run
- Long-run equilibrium of a firm under perfect competition
- Conditions for long-run equilibrium of a firm
- Diagram: Long-run equilibrium of a firm
- Adjustment process: from super-normal profit or loss to normal profit
- Long-run equilibrium of the industry
- Real-Life Application
- Key Point Summary
- Equilibrium of Industry
- Meaning of industry and firm
- Meaning of equilibrium of industry
- Conditions of industry equilibrium
- Short-run equilibrium of industry
- Long-run equilibrium of industry
- Key Point Summary
- Difference Between Firm and Industry's Equilibrium
- Comparison table: firm vs industry equilibrium
12 Producer's Equilibrium Under Perfect Competition [Revision]
- Producer's Equilibrium
- Meaning of a producer
- Meaning of producer's equilibrium
- Conditions of producer's equilibrium
- Producer's equilibrium
- Key Point Summary
- Concepts of Gross Profits, Net Profits and Producer's Equilibrium
- Gross Profit
- Net Profit
- Relation between Gross Profit and Net Profit
- Link to Producer's Equilibrium
- Key Point Summary
- Revenue and Cost Curves under Perfect Competition
- Revenue and Cost Curves under Perfect Competition
- TR as area under MR (price) curve
- TVC as area under MC curve
- Real-Life Application
- Key Point Summary
- Producer's Equilibrium under Perfect Competition
- Introduction
- Numerical illustration of TVC and MC
- Diagram: TVC as area under MC
- U-Shaped Nature of the Marginal Cost Curve
- Perfect competition and revenue curves
- Conditions of producer’s equilibrium
- Key Point Summary
- Producer's Equilibrium in Short Period and Long Period
- Short period vs long period
- Short-period equilibrium of the firm
- Long-period equilibrium with entry and exit
- Monopoly in short and long period
- Real-Life Application
- Key Point Summary
13 Determination of Equilibrium Price and Output Under Perfect Competition [Revision]
- Classification of Market > Based on Competition
- Perfect Competition
- Introduction
- Definitions: Perfect Competition
- Features
- Pure competition vs perfect competition
- Assumptions
- Key Point Summary
- Perfect Competition
- Price Determination Under Perfect Competition
- Meaning of price determination under perfect competition
- Marshall’s scissors analogy
- Example: Demand and supply schedule for apples
- Diagram: equilibrium price with demand and supply
- Total demand and total supply
- Table: equilibrium between demand and supply
- Equilibrium price of firm and industry under perfect competition
- Key Point Summary
- Changes in Equilibrium
- Meaning
- Effect of shift in demand
- Effect of shift in supply
- Real-Life Application
- Key Point Summary
- Effect of Simultaneous change in Demand and Supply on Equilibrium Price
- Effects of Demand Shifts (Supply Constant)
- Effects of Supply Shifts (Demand Constant)
- Combined Effects
- Stepwise Clarity
- Real-Life Application
- Key Point Summary
- Time Element in the Theory of Price Determination
- Meaning and importance of time element
- Classification of time periods (Marshall)
- Market Period or Very Short Period
- Short Period
- Long Period
- Secular Period
- Key Point Summary
- Determination of Equilibrium Prices
- Market period price determination
- Perishable goods
- Durable goods
- Factors affecting reserve price
- Short Period Price Determination
- Long Period Price Determination
- Key Point Summary
- Normal Price and Law of Returns
- Concept of normal price and laws of returns
- Normal price and law of increasing returns
- Normal price and law of diminishing returns
- Normal price and law of constant returns
- Key Point Summary
- Comparison between Market Price and Normal Price
- Meaning of Market Price and Normal Price
- Main differences between Market Price and Normal Price
- Graphical idea
- Real-Life Application
- Key Point Summary
- Practical Applications of Tools of Demand and Supply Analysis
- Meaning of price control
- Diagram: price control and shortage
- Black market
- Rationing
- Numerical illustration: Kerosene example
- Price support for agricultural produce
- Minimum wage legislation
- Key Point Summary
- Determination of Short Run Equilibrium of a Firm
- Short-run equilibrium of the industry
- Demand curve of an individual firm
- Short-run equilibrium of the firm
- Three short-run positions of the firm
- Shut-down and break-even points
- Key Point Summary
- Determination of Long Run Equilibrium of a Firm
- Long run
- Long-run equilibrium of a firm under perfect competition
- Conditions for long-run equilibrium of a firm
- Diagram: Long-run equilibrium of a firm
- Adjustment process: from super-normal profit or loss to normal profit
- Long-run equilibrium of the industry
- Real-Life Application
- Key Point Summary
14 Price Output Determination Under Monopoly [Revision]
- Imperfect Competition
- Monopoly
- Meaning
- Definitions: Monopoly
- Features
- Types
- Price discrimination under monopoly
- Nature of demand and revenue under monopoly
- Costs under monopoly
- Key Point Summary
- Monopoly
- Determination of Price and Equilibrium Under Monopoly
- Meaning of monopoly and objective
- Price and output behaviour of a monopolist
- Profit maximisation and equilibrium under monopoly
- Two approaches to determine equilibrium price and output
- Real-Life Application
- Key Point Summary
- Total Revenue and Total Cost Approach
- Introduction
- Understanding the TR-TC diagram
- Behaviour across output levels
- "Trial-and-Error" Method
- Key Point Summary
- Marginal Revenue and Marginal Cost Approach
- Short Run Equilibrium Under Monopoly
- Long Run Equilibrium Under Monopoly
- Monopoly Equilibrium and Laws of Costs
- Effect of laws of costs on monopoly equilibrium
- Increasing costs (Law of Diminishing Returns)
- Diminishing costs (Law of Increasing Returns)
- Constant costs
- Price Discrimination or Discriminating Monopoly
- Introduction
- Definitions
- Types of Discriminating Monopoly
- Conditions for Price Discrimination
- Degree of Price Discrimination
- Price and Output under Discriminating Monopoly
- Introduction
- When Price Discrimination is Profitable
- Measures of Monopoly Power
15 Price Output Determination Under Monopolistic Competition and Oligopoly [Revision]
- Imperfect Competition
- Introduction
- Definition: Imperfect Competition
- Economist's contribution
- Conditions leading to imperfect competition
- Real-Life Application
- Key Point Summary
- Monopolistic Competition
- Introduction
- Definition: Monopolistic competition
- Main Features
- Edward Hastings Chamberlin
- Nature of Demand and Cost Curves
- Real-Life Application
- Key Point Summary
- Oligopoly
- Meaning of Oligopoly
- Definitions: Oligopoly
- Features
- Types
- Classification
- Indeterminacy of Price and Output under Oligopoly
- Reasons for Indeterminate Price and Output
- Real-Life Application
- Key Point Summary
- Equilibrium Price and Output under Monopolistic Competition
- Group Equilibrium in Monopolistic Competition
- Product Differentiation
- Peculiarities and Demand Curve Under Product Differentiation
- Equilibrium and Product Differentiation
- Selling Costs
- Introduction
- Definition
- Assumptions and Nature of Selling Cost
- Difference between Selling Cost and Production Cost
- Average Selling Cost
- Equilibrium with Selling Costs (Variable Costs)
- Equilibrium with Selling Costs (Fixed Costs)
- Price and Output Determination under Oligopoly
- Price Rigidity-Sweezy's Kinky Demand Curve Model or Equilibrium under Independent Action
- Introduction
- Assumptions
- Explanation
- Reasons for Price Stability
- Cournot's Model
- Introduction
- Diagrammatic Representation
- Collusive Oligopoly
- Mergers
- Introduction
- Types of Merger
2: Theory of Income and Employment [Revision]
CISCE Class 12 Economics Syllabus
16 Theory of Income and Employment [Revision]
- Basic Concepts of Income and Employment
- Basic Model of Income Determination
- Aggregate Demand and Its Components
- Formula for aggregate demand
- Propensity to Consume or Consumption Function
- Consumption function
- Definitions: Consumption function
- Formula: Average Propensity to Consume
- Formula: Marginal Propensity to Consume
- Graphical meaning: APC
- Graphical meaning: MPC
- Properties of Keynesian consumption function
- Linear consumption function
- Propensity to Save
- Saving function
- Formula: Average propensity to save
- Formula: Marginal propensity to save
- Investment Expenditure
- Introduction
- Private and Public Investment
- Induced and Autonomous Investment
- Determination of Equilibrium Income and Output
- Introduction
- Aggregate Demand-Aggregate Supply Approach
- Saving-Investment Approach
- Saving-investment Approach
- Alternative Presentation
- Investment Multiplier and Its Mechanism
- Definition: Investment Multiplier
- Formula: Investment Multiplier
- Solved Problems on Consumption and Income
- The Concept of Full Employment
- Important Terms of Employment and Unemployment
- Full Employment
- Categories of Unemployment
- Real-Life Application
- Key Point Summary
- Excess Demand
- Concept of Excess Demand
- Measures to Correct Excess Demand
- Fiscal Policy
- Monetary Policy
- Increasing Imports and Increase in Output
- Deficient Demand
- Concept of Deficient Demand
- Measures to Correct Deficient Demand
- Fiscal Policy
- Monetary Policy
- Export Promotion Measures
- Effects of Deficient Demand on Output, Employment and Prices
17 Basic Concepts of Macro Economics [Revision]
- Variables
- Definition: Variables
- Partial and General Equilibrium
- Definition: Partial Equilibrium
- Definition: General Equilibrium
- Static Analysis
- Definition: Static Analysis
- Dynamic Analysis
- Definitions: Dynamic Analysis
- Difference between Static and Dynamic Analysis
18 Aggregate Demand and Supply-Determinants of Equilibrium [Revision]
- Effective Demand
- Meaning
- Definition
- Determinants of Effective Demand
- Introduction
- Effective Demand and Full Employment
- Aggregate Demand Function
- Introduction
- Definitions
- Determinants of Aggregate Demand
- Aggregate Supply Function
- Introduction
- Definitions
- Determinants of Aggregate Supply
- Different Shapes of ASF
- Determination of Effective Demand
- Introduction
- Effective Demand and Full Employment
- Importance of Effective Demand
- Critical Evaluation of Effective Demand
19 Consumption Function (Propensity to Consume) [Revision]
- Propensity to Consume or Consumption Function
- Consumption function
- Definitions: Consumption function
- Formula: Average Propensity to Consume
- Formula: Marginal Propensity to Consume
- Graphical meaning: APC
- Graphical meaning: MPC
- Properties of Keynesian consumption function
- Linear consumption function
- Kinds or Technical Attributes of Propensity to Consume
- Average Propensity to Consume
- Marginal Propensity to Consume
- Properties of MPC
- Relationship between APC and MPC
- Average Propensity to Consume
- Introduction
- Definition
- Tabular Representation
- Diagrammatic Representation
- Marginal Propensity to Consume
- Introduction
- Definition
- Tabular Representation
- Diagrammatic Representation
- Relationship Between APC and MPC
- Propensity to Save
- Saving function
- Formula: Average propensity to save
- Formula: Marginal propensity to save
- Determinants of Propensity to Consume
- Subjective Factors
- Objective Factors
- Psychological Law of Propensity to Consume
- Introduction
- Definition
- Assumptions
- Propositions of the Law
- Implications of Psychological Law
- Measures to Raise Propensity to Consume
20 Concept of Investments-Types and Determinants [Revision]
- Aggregate Demand and Its Components
- Investment
- Meaning
- Definition
- Types of Investment
- Propensity to Invest
- Investment
- Determinants of Induced Investment
- Introduction
- Definition
- Relationship between Marginal Efficiency of Capital and Rate of Interest
- Measures to Stimulate Private Investment
- Importance of Investment
- Source of Public Investment
- Dangers of Public Investment
21 Multiplier - I : Static and Dynamic [Revision]
- Multiplier
- Meaning
- Definitions
- Size of Investment Multiplier
- MPC and Multiplier
- MPS and Multiplier
- Assumptions of Multiplier
- Working of Multiplier
- Static Multiplier
- Dynamic Multiplier
- Static Multiplier
- Forward Multiplier
- Reverse Operation of Multiplier
- Saving - Investment Equality Approach
- Dynamic Concept of Multiplier
- Introduction
- Assumptions
- Explanation of Dynamic Multiplier
- Dynamic Income Expansion with Single Dose of Investment
- Dynamic Income Expansion with Repeated Doses of Investment
- Limitations of Multiplier
- Leakages of Multiplier
- Importance of Multiplier
- Types of Multiplier
- Balanced-Budget Multiplier
22 Full Employment and Voluntary Unemployment [Revision]
- The Concept of Full Employment
- Classical View on Full Employment
- Introduction
- Explanation
- Flexibility of wages Interests and Prices
- Keynes's View on Full Employment
- Determination of Equilibrium Level of Income and Employment
- Introduction
- Achievement
- Unemployment Associated with Full Employment
- Important Terms of Employment and Unemployment
- Full Employment
- Categories of Unemployment
- Real-Life Application
- Key Point Summary
23 Problems of Deficient Demand and Excess Demand [Revision]
- Types of Employment Equilibrium
- Deficient Demand
- Concept of Deficient Demand
- Measures to Correct Deficient Demand
- Fiscal Policy
- Monetary Policy
- Export Promotion Measures
- Effects of Deficient Demand on Output, Employment and Prices
- Excess Demand
- Concept of Excess Demand
- Measures to Correct Excess Demand
- Fiscal Policy
- Monetary Policy
- Increasing Imports and Increase in Output
- Deflationary Gap
- Introduction
- Measurement of Deflationary Gap: Diagrammatic Explanation
- Consequence of Excess Demand
- Inflationary Gap
- Introduction
- Definition: Inflationary Gap
- Explanation
- Diagrammatic Representation
- Difference between Deficient Demand and Excess Demand
- Cyclical Fluctuations
24 Measures to Correct Deficient and Excess Demand [Revision]
- Structure of Public Finance > Fiscal Policy
- Introduction
- Meaning
- Definition: Fiscal Policy
- Formulas
- Changes in Government Expenditure
- Fiscal Policy and Deflationary Gap
- Fiscal Policy and Inflationary Gap
- Introduction
- Other Instruments of Fiscal Policy
- Objectives of Fiscal Policy
- Monetary Policy
- Introduction
- Definitions
- Instruments of Monetary Policy
- Quantitative or General Methods of Credit Control
- Qualitative or Selective Methods
- Monetary Policy and Deflationary Gap
- Monetary Policy and Inflationary Gap
- Cheap money policy & Dear money policy-A comparison
- Objectives of Monetary Policy
- Foreign Trade Policy
3: Money and Banking [Revision]
CISCE Class 12 Economics Syllabus
25 Money: Meaning and Functions [Revision]
- Barter system
- Introduction
- Definition: Barter System
- Difficulties in Barter System
- Real-Life Application
- Key Point Summary
- Concept of Money
- Introduction
- Definition: Money
- Features: Flowchart
- Real-Life Application
- Key Point Summary
- Modern Form of Money
- Modern Money Form
- Similarities and Dissimilarities between Coins and Paper Notes
- Types of Money
- Types
- Functions of Money
- Primary Functions
- Secondary Functions
- Contingent Functions
- Real-Life Application
- Key Point Summary
- Importance of Money
- Supply of Money
- Introduction
- Components of Money Supply
- Measures of Money Supply in India
- High-powered Money
- Inflation
- Meaning of Inflation
- Demand-pull Inflation
- Cost-push Inflation
26 Banks: Commercial Bank and Central Bank [Revision]
- Concept of Bank
- Introduction
- Definition: Bank
- Types of Bank
- Structure of Money Market in India > Organized Sector
- Commercial Banks
- Introduction
- Definitions: Commercial Bank
- Functions of Commercial Banks
- Structure
- Commercial Banks
- Banking > Functions of Commercial Bank
- Primary Functions
- Secondary Functions
- Credit Creation by Commercial Banks
- Definitions
- Methods of Credit Creation
- Process of Credit Creation
- Limits to Credit Creation
- Role of Commercial Banks in an Economy
- Central Bank
- Introduction
- Definitions
- Evolution of Central Bank
- Need for Central Bank
- Importance of Central Bank
- Functions of Central Bank
- Comparison Between Central Bank and Commercial Banks
- Central Bank as a Controller of Credit
- Introduction
- Objectives
- Methods of Credit Control
- General or Quantitative Methods
- Selective or Qualitative Methods
- Limitations on the Power to Control Credit
- Monetary Policy of the Central Bank
- Quantitative Methods
- Bank rate
- Open market operations
- Cash reserve ratio
- Qualitative (Or Selective) Methods
- Limitations on the Power to Control Credit
- Quantitative Methods
4: Balance of Payment and Exchange Rate [Revision]
CISCE Class 12 Economics Syllabus
27 Balance of Payment and Exchange Rate [Revision]
- Concept of Balance of Payments
- Definition: Balance of Payments
- Introduction
- Features of Balance of Payment
- Structure of Balance of Payment
The Current account (components of current account, balance on current account)
The Capital account (components of capital account, balance on capital account)
- Balance of Trade and Balance of Payments- Comparison
- Methods to Measure Balance of Payments
- Components of Balance of Payments
- Introduction
- Components or Items of Current Account
- Components or Items of Capital Account
- Table Representation
- Current Account Transactions
- Export and Import of Goods or Merchandise
- Invisible Items
- Capital Account Transactions
- Balance of Payments Always Balances
- Categories of Balance of Payments
- Balance of Trade
- Balance of Current Account
- Balance of Capital Account
- Balance of Payments
- Balance of Payments Disequilibrium
- Introduction
- Causes of Disequilibrium in Balance of Payments
- Measures to Correct Disequilibrium in the Balance of Payments
- Monetary Measures
- Non-Economic Monetary Measures
- Political Measures
- Foreign Exchange Rate
- Demand for Foreign Exchange
- Supply of Foreign Exchange
- Exchange Rate
- Introduction
- Definitions
- Types of Foreign Exchange Rate
- Fixed Exchange Rate System
- Flexible Exchange Rate System
- Managed Floating Rate
- Fixed Rate of Exchange
- Introduction
- Argument for Stable or Fixed Rate of Exchange
- Arguments against Fixed Rate of Exchange
- Flexible Rate of Exchange
- Introduction
- Arguments in favour of Flexible Rate of Exchange or Floating Rate of Exchange
- Arguments against Flexible Exchange Rate or Floating Rate
- Managed Floating Exchange Rate System
- Determination of Equilibrium Rate of Exchange
- Factors or Determinants of Foreign Exchange Rate
- Concepts of Depreciation, Appreciation, Devaluation and Revaluation
- Depreciation
- Appreciation
- Devaluation
- Revaluation
- Exchange Rates and the Domestic Prices of Traded Goods
- The Influence of Exchange Rate on Imports and Exports
- Determination of Exchange Rate in a Free Market
- Introduction
- Demand for Foreign Exchange (Dollars)
- Supply of Foreign Exchange
5: Public Finance [Revision]
CISCE Class 12 Economics Syllabus
28 Fiscal Policy [Revision]
- Structure of Public Finance > Fiscal Policy
- Introduction
- Meaning
- Definition: Fiscal Policy
- Formulas
- Changes in Government Expenditure
- Public Finance
- Introduction
- Functions of Government
- Meaning
- Definitions
- Instruments of Fiscal Policy
- Budget
- Taxation
- Public Expenditure
- Public Works and Public Debt
- Objectives of Fiscal Policy
- Miscellaneous Objectives of Fiscal Policy
- Fiscal Measures for Stabilisation
- Methods of Fiscal Policy in Developing Countries
- Limitations of Fiscal Policy
- Structure of Public Finance > Public Revenue
- Meaning
- Sources of Public Revenue
- Instruments of Fiscal Policy - Taxation
- Introduction
- Meaning of Taxes
- Types of Taxes
- Tax Reforms in India
- Proportional, Progressive and Regressive Taxes
- Proportional Taxation
- Progressive Taxation
- Regressive Taxation
- Degressive Taxation
- Structure of Public Finance > Public Expenditure
- Explanation
- Classification
- Reasons for Growth in Public Expenditure
- Recent trends in Public Expenditure in India
- Growth of Public Expenditure in Recent Times
- Components of Public Expenditure
- Importance of Public Expenditure
- Effect of Public Expenditure on Production
- Effect of Public Expenditure on Investment
- Effect of Public Expenditure on Income Distribution
- Effect of Public Expenditure on Economic Growth
- Public Expenditure and Economic Stability
- Structure of Public Finance > Public Debt
- Meaning
- Types
- Internal Debt VS External Debt
- Classification of Activities
- Reasons for Borrowing by the Government
- Public Debt - Redemption
- Deficit Financing
- Meaning
- Why Deficit Financing?
- Adverse Effects of Deficit Financing
- Fiscal Policy in Action
- Fiscal Policy (Measures) to Control Inflation
- Fiscal Policy and Economic Stability
- Fiscal Policy and Economic Growth
- Fiscal Policy and Equity
29 Government Budget [Revision]
- Budget
- Introduction
- Definition: Budget
- Features of Public Budget
- Types of Budget
- Government Budget
- Introduction
- Meaning
- Need and Importance of Government Budget
- Types of Government Budget in India
- Union Budget
- State Budget
- Performance Budget
- Supplementary Budget
- Components (Structure) of the Government Budget
- Revenue Budget
- Capital Budget
- Modern Classification of Budget
- Classification of Budget Receipts
- Revenue Receipts
- Capital Receipts
- Components of Budgetary Receipts
- Balanced Budget Vs Unbalanced Budget
- Balanced Budget
- Unbalanced Budget
- Zero-Base Budgeting (ZBB)
- Introduction
- Characters
- Pre-conditions of ZBB
- Expected Benefits
- Limitations
- Zero-Base Budgeting in India
- Introduction
- Problems of ZBB in India
- Traditional Budgeting Vs. Zero Base Budgeting
- Concepts Related to Budget Deficits
- Introduction
- Budget Deficit
- Revenue Deficit
- Fiscal Deficit
- Primary Deficit
- Example of Budget Deficits
- Constituents of budget /Structure of the budget
- Structure of Public Finance > Public Expenditure
- Explanation
- Classification
- Reasons for Growth in Public Expenditure
- Recent trends in Public Expenditure in India
- Growth of Public Expenditure in Recent Times
- Components of Public Expenditure
- Revenue Expenditure and Capital Expenditure
- Developmental and Non-developmental Expenditure
- Tax Revenue
- Introduction of Tax
- Types of Tax
- Public Revenue > Non-tax Revenue
- Public Revenue > Taxes
- Capital Receipts
- Definition of Public Debt
- Public Debt and Taxes
- Deficit Financing
- Capital Receipts
- Objectives of Budget
- Significance of Budget
- Types of budget deficit
- Budgetary Procedure
- Preparation of the Budget
- Enactment of the Budget
- Execution of the Budget
- Parliamentary Control Over Finances
6: National Income [Revision]
CISCE Class 12 Economics Syllabus
30 National Income and Circular Flow of Income [Revision]
- Concept of National Income
- Introduction
- Classical Definitions
- Keynes Approach to National Income / Neo-Classical Approach
- Modern Definitions
- Domestic Income
- Introduction
- Difference between National Income and Domestic income
- National Income Aggregates
- Significance or Importance of National Income
- Circular Flow of Income
- Meaning
- Types of Circular Flow
- Distinction between Real Flow and Money Flow
- Assumptions
- Circular Flow in a Closed Economy
- Circular flow in a Single Sector Economy
- Circular flow in a Two Sector Economy
- Circular flow in a Three Sector Economy
- Circular flow and the Equality between Production, Income and Expenditure
- Introduction
- Leakages and Injections
- Circular Flow in a Open Economy
- Economic Sectors of an Economy
- Two-Sector Model without Savings and Investment
- Two-Sector Model with Savings and Investment
- Three-Sector Model of Circular Flow of Income
- Four-Sector Model of Circular Flow of Income
- Significance or Importance of Circular Flow of Income
31 National Income Aggregates [Revision]
- Key Relationships Among National Income Aggregates
- Domestic Product and National Product
- National Product at Market Prices and National Product at Factor Cost
- Gross Product and Net Product
- National Income Aggregates
- Gross Domestic Product at Market Price
- Definition
- GDP at MP
- Features
- Gross National Product at Market Price
- Definition
- Features
- Net Domestic Product at Market Price
- Definition
- Introduction
- Net National Product (NNP)
- Net National Product (NNP) at Market Prices
- Merits of NNP at Market Prices
- Gross Domestic Product at Market Price
- Constituents of GNP
- Difference between Net Domestic and Net National Product at Market Price
- Difference between Net National and Gross National Product at Market Price
- Net National Income or Product at Factor Cost
- Introduction
- Definition
- Constituents of Net National Product at Factor Cost
- Relation between NNP at Market Price and NNP at Factor Cost
- Net Domestic Product or Income at Factor Cost
- Introduction
- Definition
- Constituents of NDP at Factor Cost or Net Domestic Incomes
- Difference between Net Domestic Product at Factor Cost and Net Domestic Product at Market Price
- Gross Domestic Product or Income at Factor Cost
- Definition
- Introduction
- Gross National Product at Factor Cost
- Introduction
- Constituents of Gross National Product at Factor Cost or GNP
- Equality between Gross National Income and Gross National Product
- Factor Income from Net Domestic Product accuring to Private Sector
- Introduction
- Definition
- Private Income
- Definition
- Constituents of Private Income
- Difference between National and Private Income
- Personal Income of National Income
- Definition
- Constituents of Private Income
- Difference between Private and Personal Income
- Disposable Income Aggregates
- Introduction
- Definition
- Concept of Transfer Payments
- National Disposable Income
- Per Capita Income
- Real Income
- Interrelationship among National Income Aggregates
- Real GDP and Nominal GDP
- Gross Domestic Product (National Income) and Economic Welfare
- Concept of Economic Welfare
- Gross Domestic Product (National Income) as an Indicator of Economic Welfare
- Limitations of National Income (Gross Domestic Product) as an Indicator of Economic Welfare
32 Methods of Measuring National Income [Revision]
- Concept of National Income
- Introduction
- Classical Definitions
- Keynes Approach to National Income / Neo-Classical Approach
- Modern Definitions
- Methods of Measurement of National Income
- Flowchart
- Net Product or Value Added Method
- Introduction
- Classification of Production Units
- Estimation of Net Value Added by Each Enterprise
- Estimating Net Domestic Output
- Estimating of Net Factor Income from Abroad
- Expenditure Method
- Introduction
- Formula
- Breakdown of GNP Formula
- Classification
- Components
- Precautions
- Difficulties
- Precautions in the Estimation of National Income by Value-added Method
- Difficulties in the Estimation of National Income by Value-added Method
- Precautions in the Estimation of National Income by Expenditure Method
- Alternative Methods of National Income Estimation
- Reconciling The Three Methods Of Estimating National Income
- Components of Net National Product at Factor Cost in its Three Phases
- The Identity of Output, Income and Expenditure
- Transactions Included in National Income
- Significance of three Methods
- Transactions not Included in National Income
- Numericals on Income, Product and Expenditure Method
33 National Income and Economic Welfare [Revision]
- Welfare Economics
- Introduction
- Definitions of Welfare Economics
- A.C. Pigou's Definition
- W.J. Baumol's Definition
- Oscar Lange's Definition
- Pareto's Concept of Economic Welfare
- Vilfredo Pareto
- Arthur Okun's Concept of Economic Welfare
- Factors Determining the Size of National Income
- National Income and National Welfare
- Relation between Economic Welfare and National Income
- National Income as a Measure of Economic Welfare
- Causes of Slow Growth of National Income
- Economic Factors
- Social Factors
- Political Factors
- Suggestions for Increasing National Income
