Micro Economics – Concept, Consumption and Production

Syllabus

Micro Economics – Concept, Consumption and Production

Unit – I

Definition and Concepts of Economics: Wealth, Welfare, Scarcity and Growth Oriented definitions, Concept of Scarcity, Optimum Utilization and Equilibrium, Various Forms of Equilibrium. Nature and Scope: Economics as a Science and Art, Normative and Positive Science, Relation with other subjects. Micro and Macro Economics. Inductive and Deductive methods of Economic Analysis.

Unit – II

Consumer Behaviour: Theory of Demand and its Elasticity; Definition, Types and Measurement of Elasticity. Concept and Types of Utility. Cardinal Approach;, Law of Diminishing Marginal Utility, Law of Equi-diminishing Marginal Utility. Consumer Surplus.Ordinal Approach; Indifference Curves: Meaning, Assumptions, Indifference Map and Properties. Consumer Equilibrium, Price, Income and Substitution Effects-Hicks’ Approach. Practical Problems.

Unit – III

Producer’s Behaviour: Production and Factors of Production. Laws of Production; Law of Variable Proportions and Return to Scale. Isoquant: Meaning, Assumptions and Properties. Isoquant Map. Producer’s Equilibrium through Isoquants. Practical Problems.

Unit – IV

Cost of Production: Meaning of Cost: Long-Run and Short-Run Cost. Implicit and Explicit Cost, Accounting and Economic Cost, Total Cost, Fixed Cost, Variable Cost, Average Cost, Average Fixed Cost, Average Variable Cost and Marginal Cost. Opportunity Cost. L-Shaped Cost Curve. Practical Problems.