Micro Economics Theory
Economic Theory: Nature and technique. Micro and macroeconomics. Static dynamic and comparative static analysis. Positive and normative economics. Theory of consumer‟s behavior: Utility analysis. Indifference curve analysis, Consumer‟s equilibrium, Price substitution and Income effect. Normal inferior and gutter goods. Price consumption curve and derivation of demand curve. Elasticity of demand: Price income and cross elasticity of demand. Arc and point elasticity. Relationship between elasticity. AR, MR and TR. Factors affecting price elasticity of demand. Substitute and complementary goods, concept of consumer‟s surplus.
Section – B
Production Function : Law of variable proportions. Three stages of production Iso quant and iso – cost, optimum factor combination. Law of returns and returns to scale. Theory of cost – short run and long run cost curves. Different market structures: Perfect competition: determination or price and long run. Discriminating monopoly. Monopolistic competition short and long run equilibrium of the firm. Excess capacity.
Marginal productivity theory of distribution factor pricing under perfect and imperfect competition in labour market. Ricardina theory of rent. Modern theory of rent and quasi – rent Classical theory of interest, liquidity preference theory of interest. Risk and uncertainty theory of profit.