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ECONOMICS (856), CLASS XII, Analysis: Indifference Curve – its meaning, and properties (including MRS and, DMRS), indifference map, consumer’s, budget line, Consumer’s equilibrium –, condition (to be explained with the help of, a diagram)., , There will be two papers in the subject:, Paper I - Theory: 3 hours ……80 marks, Paper II- Project Work ……20 marks, PAPER - I (THEORY) – 80 Marks, Part I (20 marks) will consist of compulsory short, answer questions testing knowledge, application, and skills relating to elementary / fundamental, aspects of the entire syllabus., , (ii) Elasticity of demand: meaning, types of, elasticity of demand, measurement of, elasticity of demand; factors affecting, elasticity of demand., Various methods of measurement of the, elasticity of demand: point method percentage method, expenditure method, and geometric method. (Numericals, required on percentage method only). The, cross and income elasticity of demand must, be explained. Degrees of elasticity of, demand to be explained. Use diagrams, wherever necessary., , Part II (60 marks) will consist of eight questions, out of which candidates will be required to answer, five questions, each carrying 12 marks., Note: The syllabus is intended to reflect a study of, the theory of Economics with specific reference to, the Indian Economy. Therefore, examples and, specific references to the Indian Economy must be, made wherever relevant., , (iii) Supply: meaning; difference between stock, and supply; determinants of supply; Law of, Supply; movement and shift of the supply, curve; elasticity of supply, Difference between stock (intended supply), and supply (actual supply) with the help of, relevant examples., A supply function, should be specified and explained. Law of, Supply: Meaning, supply schedule and, supply curve. Derivation of market supply, curve from individual supply curve., Movement and shift of the supply curve,, exceptions to the Law of Supply. Elasticity, of Supply: Meaning, degrees of elasticity of, supply and measurement of elasticity of, supply by percentage method and, geometric method., , 1. Micro Economic Theory, (i), , Demand: meaning, factors affecting, demand; Demand function; Law of, Demand; derivation of demand curve;, movement and shift of the demand curve;, exceptions to the Law of Demand., Law of Diminishing Marginal Utility, Law, of Equimarginal Utility, consumer’s, equilibrium through utility approach, (Cardinal) and indifference curve analysis, (Ordinal)., The concept of demand: meaning. A, demand function to be specified, incorporating the determinants of demand., Diagrams should be used in explaining the, Law of Demand, reasons for downward, slope of demand curve, its derivation using, demand schedule. Derivation of market, demand curve from individual demand, curve., (a) Cardinal Utility Analysis: meaning of, utility, total utility, marginal utility,, relationship of TU and MU, Law of, Diminishing Marginal Utility (schedule, and diagram, Only assumptions to be, taught,, criticisms, not, required),, Consumer’s equilibrium – one commodity, (schedule and diagram), Law of, Equimarginal Utility (statement, schedule), and conditions of consumer’s equilibrium, using marginal utility; (b) Ordinal Utility, , (iv) Market Mechanism: Equilibrium and, disequilibrium; Equilibrium price and, effect of changes in demand and supply on, the equilibrium price. Simple applications, of tools of demand and supply., A basic understanding of the concept of, equilibrium. The effects of changes in, demand and supply - both along the curves, and shift of the curves to be explained., Basic understanding of Price control,, rationing, Price ceiling and Floor price, with the help of demand and supply curves., (v) Concept of production and production, function: (short run and long run, production function), returns to a factor,, 1

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returns to scale (meaning only) total,, average and marginal physical products;, Law of Variable Proportions and its three, stages., , components, propensity to consume and, propensity to save (average and marginal),, equilibrium output; investment multiplier (its, meaning and mechanism)., , A production function (concept only). Law, of Variable Proportions: statement,, assumptions, schedule (for the purpose of, understanding and not for testing),, diagram and explanation to the three, stages., , 3. Money and Banking, (i) Money: meaning, functions of money,, supply of money., Meaning, kinds of money, functions of, money (primary, secondary and contingent), to be explained; supply of money (only, meaning of M 0, M 1 , M 2 , M 3 & M 4 )., Inflation: meaning, demand pull and cost, push (diagrams not required), , (vi) Cost and revenue: Basic concepts of cost;, fixed cost, variable cost, total cost,, marginal cost and average cost – their, relationships; opportunity cost; short run, cost curves. Revenue: meaning; average, revenue, marginal revenue and total, revenue and their relationships under, perfect, competition, and, imperfect, competition, Producer’s equilibrium., Basic concepts – private cost, economic, cost, social cost, money cost, real cost,, explicit cost, implicit cost., Cost concepts – Fixed cost, variable cost,, total cost, marginal cost, average cost with, schedule and diagram; relationship, between average cost, marginal cost, total, cost (only short run cost curves,, derivations not required). Opportunity cost, – meaning only. Difference between, accounting cost and opportunity cost., Revenue – Average revenue, marginal, revenue, total revenue – concepts and, relationships under perfect competition and, imperfect, competition., Producer’s, equilibrium (Profit maximization goal) –, meaning; conditions: MR and MC, approach along with diagram., , (ii) Banks: functions of commercial bank; high, powered money; Central Bank: functions., Basic understanding of the functions of, commercial banks. The regulatory role of, the Central Bank, its functions and the way, it controls the flow of credit needs to be, explained. A brief mention may be made of, quantitative CRR, SLR, Bank Rate policy, (repo rate and reverse repo rate) and Open, Market Operations) and qualitative, methods., 4. Balance of Payment and Exchange Rate, Balance of Payment – meaning, components;, foreign exchange – meaning, determination of, exchange rate (Flexible)., Balance of Payment - Meaning and components;, Causes of disequilibrium and how the, disequilibrium can be corrected; Foreign, Exchange Rate – meaning, meaning of fixed and, flexible exchange rate, determination of, exchange rate in a free market. Concepts of, depreciation, appreciation, devaluation and, revaluation (meaning only)., , (vii) Main market forms: perfect competition,, monopolistic, competition,, oligopoly,, monopoly, monopsony; characteristics of, the various market forms; equilibrium of a, firm in perfect competition under short run., , 5. Public Finance, (i) Fiscal Policy: meaning and instruments of, fiscal policy., Meaning and instruments of fiscal policy –, Public Revenue: Meaning, taxes (Meaning, and types), difference between direct and, indirect taxes; Public Expenditure:, Meaning and importance; Public Debt:, Meaning, and, redemption;, Deficit, Financing: meaning., , Features, of, perfect, competition,, monopolistic, competition,, oligopoly,, monopoly and monopsony (meaning only)., Equilibrium of a firm in perfect competition, under short run by MR and MC approach, (explanation and diagram, shut down point, and break-even point)., 2. Theory of Income and Employment, , (ii) Government Budget: meaning, types and, components., Meaning and types of Government budget –, union, state; components – revenue and, capital. Concept of deficit budget: revenue, , Basic concepts and determination of Income and, Employment, The concept of demand (exante) and effective, (expost) demand. Aggregate demand and its, 2

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deficit, fiscal, meaning., , deficit,, , primary, , A list of suggested Projects is given below:, , deficit, , 1. Study a Public Sector Enterprise with reference, to its relevance to the Indian Economy and its, future prospects. Analyse the trend of its, growth for the last ten years., , 6. National Income, (i) Circular flow of Income., A simple model explaining the circular flow, of income with two, three and four sector, models with leakages and injections., , 2. Conduct a Socio-Economic survey of a locality, (minimum sample size should be 30, households) with reference to:, , (ii) Concepts and definition of NY, GNP,, GDP, NNP; relationship between the, income concepts., A brief understanding of the mentioned, national income aggregates is needed. The, concepts of GNP and NNP should be, explained both at factor cost and market, prices, real GDP and nominal GDP, GDP, and Welfare, GDP as an indicator of, Economic welfare., , (a) Demographic features., (b) Consumption Pattern – Expenditure on, necessities, comforts and luxuries., (c) Occupational structure., 3. Compare the contribution made by different, sectors of the economy towards GDP growth, during the planning period., 4. Prepare a report on the competition in the, Aviation Sector in India with reference to:, (a) Performance of the Public Sector and, Private Sector., (b) Operational, strategies, adopted, by, budget/low cost carriers., , (iii) Methods of measuring National Income:, product or value-added method; income, method and expenditure method with, simple numericals based on them, (Numericals not required)., Simple numericals based on all the, methods to be covered for better, understanding of the concept (Numericals, not required). Precautions and difficulties, of measuring National Income for each, method., , 5. Make a comparative analysis of lending, performance of five Commercial Banks in the, past six years with reference to the changing, CRR and SLR., 6. Many thinkers believe that we are rapidly, depleting our natural resources. Assume that, there are only two inputs (labour and natural, resources) producing two goods (wheat and, gasoline) with no improvement in technology, over time. Show what would happen to the, Production Possibility Curve over time as, natural resources are exhausted. How would, invention and technological improvement, modify your answer? On the basis of this, example, explain why it is said “economic, growth is a race between depletion and, invention.”, , PAPER II – PROJECT WORK – 20 Marks, Candidates will be expected to have completed two, projects from any topic covered in Theory., The project work will be assessed by the teacher, and a Visiting Examiner appointed locally and, approved by the Council., Mark allocation for each Project [10 marks]:, Overall format, Content, Findings, Viva-voce based on the Project, , 1 mark, 4 marks, 2 marks, 3 marks, , 7. Make a comparative study of the allocation of, financial resources of the Central Government, Budget on Agriculture, Defence, Industry and, Education in the last ten years. Prepare a report, on your observations., 8. Prepare a trend Analysis of Growth and, Productivity of any one industry such as:, Textile / Automobiles / Electronic and, Tele-communication, etc. in India for the past, ten years., NOTE: No question paper for Project Work will be, set by the Council., , 3

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SAMPLE TABLE FOR PROJECT WORK, S. No., , Unique, Identification, Number, (Unique ID) of, the candidate, , A, Teacher, , B, Visiting, Examiner, , PROJECT 1, C, Average, Marks, (A + B ÷ 2), , 7 Marks*, , 7 Marks*, , 7 Marks, , D, VivaVoce by, Visiting, Examiner, 3 Marks, , E, Total, Marks, (C + D), , F, Teacher, , G, Visiting, Examiner, , 10 Marks, , 7 Marks*, , 7 Marks*, , PROJECT 2, H, I, Average, Viva-Voce, Marks, by Visiting, (F + G ÷ 2), Examiner, 7 Marks, , 3 Marks, , 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, *Breakup of 7 Marks to be awarded separately by the, Teacher and the Visiting Examiner is as follows:, Overall Format, , 1 Mark, , Content, , 4 Marks, , Findings, , 2 Marks, , Name of Teacher:, Signature:, , Date, , Name of Visiting Examiner, Signature:, , Date, , NOTE: VIVA-VOCE (3 Marks) for each Project is to be conducted only by the Visiting Examiner, and should be based on the Project only., , 4, , J, Total, Marks, (H + I), 10 Marks, , TOTAL, MARKS, (E + J), , 20 Marks