ECON F211 - POE Handout

SECOND SEMESTER 2023-24
Course Handout Part II
Dated: 09/01/2024
In addition to part I (General Handout for all courses appended to the time table) this portion gives further
specific details regarding the course.
Course No. : ECON F211

Course Title : PRINCIPLES OF ECONOMICS
Instructor-in-Charge : Prof. Sudatta Banerjee
Instructors : Prof. Archana Srivastava, Prof. Mini Thomas
1. Scope and Objective:

This introductory course aims to cover fundamentals and principles of economics. Economics, as a discipline,
has grown tremendously in recent times. Going by its relevance in understanding present day phenomena to
complex policy issues, it would be apt to say that every individual should be equipped with basic understanding
of economics. It helps greatly in making better decisions in every walk of life. Here we try to understand the
consumption decisions made by the individuals and production decisions made by the firms. How do these
decisions interact and result in a market outcome? How can the policymakers intervene to improve the
outcome? The course aims to provide an insight into production, distribution and consumption of wealth,
analysis of market structure, input pricing and economics of development. The course is designed so as to give
emphasis on the application of various fundamental concepts of economics with the help of real life examples.
2. Text Book:
th
 Karl E. Case, Ray C. Fair & Sharon E. Oster, “Principles of Economics”, Pearson Education, 12
Edition, 2017
3. Reference Books:
th
 R1: Lipsey, R. G. & K. A. Chrystal, “Economics”, Oxford University Press, 13 Edition, 2015
th
 R2: Samuelson P. A. & W. D. Nordhaus, “Economics”, Tata McGraw-Hill, 20 Edition, 2019
th
 R3: N. Gregory Mankiw, “Principles of Economics”, Cengage Learning, 7 Edition, 2015
4. Course Plan:
Lec. Learning Objective Topic(s) to be covered Chapter in

No. the TB
I Introduction to Economics
1-3 Why study Economics, Understanding the The Scope and method of Chapter 1 &
problem of scarcity and choice and the concepts Economics, The Economic Problem: 2
of comparative advantage Scarcity & Choice – Definitions
4-6 Elements of market Economy Demand, Supply and Market Chapter 3
Equilibrium
7-8 Applications of Demand & Supply Price Mechanism and Rationing Chapter 4
9-10 Elasticity Concepts Demand Elasticity, Income Chapter 5
Elasticity
II The Market System
11-14 Marginal Utility Household Behavior and Consumer Chapter 6
Choice
15-18 Analysis of Production The Production Process: The Chapter 7
behavior of profit maximizing firms
19-24 Cost Analysis Cost Structure of Firms and output Chapter 8 &
decision 9
25-30 Input pricing: Land, Labor, Capital and Input demand: The labour and land Chapter 10
Investment market, the Capital Market and the & 11
Investment Decision
III Market imperfections
31-34 Monopoly Monopoly, Different Forms of Chapter 13
Competitive Structures & 15 (only
table)
35-37 Externalities and Economics of Public Goods Externalities- details, Public Goods, Chapter 16
and common resources
IV Macroeconomics
38-40 Introduction to Macroeconomics Concepts and Measurement of Class Notes

macroeconomic variables
5. Learning Outcomes:
Module I: Introduction to Economics
It is expected that after completing this module, the student should be able to, recognize economics as the study
of how society addresses the conflict between unlimited desires and scarce resources, describe ways in which
society decides what, how and for whom to produce, identify the opportunity cost of a decision or action,
explain the difference between positive and normative economics, define microeconomics and macroeconomics
and various sub-fields of economics, explain why theories deliberately simplify reality, explain the difference
between real and nominal variables, build a simple theoretical model, use ‘other things equal’ to ignore, but not
forget, some aspects of a problem in order to focus on core issues, define the concept of a market, draw demand
and supply curves (and inverse demand and supply curves), find equilibrium price and equilibrium quantity,
describe how price adjustment reconciles demand and supply in a market, analyze what shifts demand and
supply curves, describe consumer and producer surplus, analyze excess supply and excess demand, discuss the
consequences of imposing price controls, discuss how markets answer what, how and for whom to produce,
describe the functions of prices (to ration, to allocate), describe how elasticities measure the responsiveness of
demand and supply, define and calculate price elasticity of demand, indicate the determinants of price elasticity,
describe the relationship between demand elasticity and revenue, recognize the various fallacies in economics,
describe how cross-price elasticity relates to complements and substitutes, define and calculate income elasticity
of demand, use income elasticity to identify inferior, normal and luxury goods, define and calculate elasticity of
supply.
Module II: The Market System
It is expected that after completing this module, the student should be able to define the relationship between
utility and tastes for a consumer, describe the concept of diminishing marginal utility, describe the concept of
diminishing marginal rate of substitution and calculate the marginal rate of substitution (MRS), represent tastes
as indifference curves, derive a budget line, explain how indifference curves and budget constraints explain
consumer choice, describe how changes in consumer income affect quantity demanded, describe how a price
change affects quantity demanded, define income and substitution effects, show how the market demand curve
relates to the demand curves of individual consumers, Sketch, and explain the shape of production function and
cost curves, Distinguish between and calculate various concepts of profit, State and explain the profit
maximizing rule and identify profit maximizing behavior graphically and using data, Use graphs to explain the
effect of market level changes on firm level behavior, Understand and analyze different type of markets that a
firm may face.
Module III: Market imperfections and the role of government
It is expected that after completing this module, the student should be able to understand and analyze the effect
the type of market has on efficiency, Define and give examples of price discrimination, and use graphs/data to
show its effect on profit and efficiency, understand and analyze the effects of market imperfection on efficiency
and consumers. The students will also learn about externalities, social costs of negative externalities,
government involvement to rectify the same; learn about public goods and common resources.
Module IV: Macro Economics

This module will discuss the primary concerns of Macroeconomics and understand the interaction between the
four components of the macroeconomy.
6. Evaluation Scheme:
S.No. Components Duration Weightage Date, Time & Nature of

(%) Venue Component
1 Mid-Semester Exam 90 Mins 30 13/03 - 11.00 - OB
12.30PM
2 Section specific multiple To be 30 CB
surprise quizzes announced
5 Comprehensive Exam 3 hours 40 11/05 FN CB
7. Chamber Consultation Hour: To be announced in class
8. Notices shall be displayed on CMS.
9. Make-up policy: Make-up will be granted only on genuine grounds and if prior permission from Instructor-
in-charge/Instructor is taken, via official email only. Requests for make up after the test/exam will not be
entertained at all. No make-up shall be granted for quizzes.
10. Academic Honesty and Integrity Policy: Academic honesty and integrity are to be maintained by all the
students throughout the semester and no type of academic dishonesty is acceptable.
Instructor-in-Charge
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SECOND SEMESTER 2023-24

Course Handout Part II

Course No. : ECON F211

1. Scope and Objective:

Lec. Learning Objective Topic(s) to be covered Chapter in

38-40 Introduction to Macroeconomics Concepts and Measurement of Class Notes

Module I: Introduction to Economics

Module II: The Market System

Module III: Market imperfections and the role of government

Module IV: Macro Economics

S.No. Components Duration Weightage Date, Time & Nature of

7. Chamber Consultation Hour: To be announced in class

8. Notices shall be displayed on CMS.

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