Unit –I
Elasticity of Demand; Concept and measurement of Elasticity of Demand; Determinant of elasticity of demand; Importance of
elasticity of demand.
Unit –II
Production Function ; Law of variable Proportion; Iso-quant; Economics region and optimum factor combination ; Expansion path:
Return to Scale; Internal & External economics and diseconomies; ridge lines.
Theory of costs: Short run and long run curves – traditional and modern approaches.
Unit – III
Market Structure – I
Market Structure and Business Decision : Objective of a business firm.
a) Perfect Competition : Profit maximization and equilibrium of firm and industry; Short – run and long run supply curves; Price
and output determination.
b) Monopoly: Determination of price under monopoly; Equilibrium of a firm; Compression between perfect competition and
monopoly; Price discrimination.
Unit – IV
Market Structure – II
a) Monopolistic Competition ; Meaning and characteristics: Price and output determination under monopolistic competition;
Product Differentiation
b) Oligopoly : Characteristics indeterminate pricing and output; Classical models of oligopoly: Kinked demand curve
Unit – V
Factor Pricing – I : Marginal Productivity theory and demand for factor: Nature of supply of factors inputs: Determination of wage
rates under perfect competition and monopoly ; Exploitation of labour.
Factor Pricing – II : Rent concept, Recardian and modern theories of rent Quasireant Interests-concepts and theories of interest; Profit
nature, concepts and theories of profit.