ECONOMICS (856)

Aims:
1. To enable candidates to acquire knowledge 4. To acquaint candidates with the main
(information) and develop an understanding of institutions through which the productive
facts, terms, concepts, conventions, trends, process is carried out.
principles, generalisations, assumptions, 5. To develop an understanding of the role of
hypotheses, problems, processes, etc. in institutions in the functioning of an economy.
Economics.
6. To enable candidates to compare their own
2. To acquaint candidates with tools of economic economic structure with that of the other areas
analysis. of the world.
3. To develop an understanding of important
economic problems.
CLASS XI

There will be two papers in the subject: (ii) Micro and Macro Economics – Meaning and
Difference. Basic concepts: utility, price,
Paper I - Theory: 3 hours ……80 marks
value, wealth, welfare, money, market,
Paper II- Project Work ……20 marks capital, investment, income, production,
consumption, saving, Business cycle,
PAPER - I (THEORY) – 80 Marks Aggregate demand and Aggregate supply.
Part I (20 marks) will consist of compulsory short Meaning and difference between Micro
answer questions testing knowledge, application and and Macro Economics. A conceptual
skills relating to elementary / fundamental aspects of understanding of the terms: Human wants-
the entire syllabus. classification; factors of production; utility –
types and features, total utility, marginal
Part II (60 marks) will consist of eight questions out utility and diminishing marginal utility; price
of which candidates will be required to answer five – definition and general rise and fall in
questions, each carrying 12 marks. price; value – real vs nominal value; wealth
– explanation of the term, classification
Note: The syllabus is intended to reflect a study of
(personal and social); welfare – economic
the theory of Economics with specific reference to the welfare, social welfare and relation between
Indian Economy. Therefore, examples and specific wealth and welfare; money – barter economy
references to the Indian Economy must be made vs money economy; market – meaning and
wherever relevant. size; capital – meaning; investment –
meaning, investment as a process of capital
1. Understanding Economics formation; income – meaning, factor
(i) Definition of Economics: Adam Smith, incomes; production – meaning;
Alfred Marshall, Lionel Robbins, Samuelson. consumption – meaning; saving – meaning;
individual saving and aggregate savings.
Basic understanding of economics and
The above terms to be explained with the
economic phenomena to be explained
help of relevant examples.
especially in the context of the concept of
scarcity and allocation of resources. (iii) Basic problems of an economy: what to
Students may be introduced to the main produce; how to produce; for whom to
points on which the various definitions of produce; efficient use of resources.
economics could be analyzed. Features of The basic problem of scarcity and choice
definitions and two- three criticisms. must be emphasized. As this problem is
universal in character, i.e. faced by all
economies, irrespective of the economic

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 system they follow, it must be explained using (iv) Structural Changes in the Indian Economy
the concept of Production Possibility Curve. after liberalization.
The three problems - what to produce, how to Need, meaning, significance and features of
produce and for whom to produce - must be liberalization, globalization and privatization
highlighted. The role of technology and a of the Indian Economy; disinvestment:
shift in the Production Possibility Curve meaning.
(assumptions and features) must be
explained. (v) Current challenges facing the Indian
Economy.
(iv) Types of economies: developed and
developing; Economic systems: capitalism, Poverty – absolute and relative, vicious
socialism and mixed economy; mechanism circle of poverty, main programmes for
used to solve the basic problems faced by poverty alleviation: A critical assessment of
each economy. PAPs (Poverty Alleviation Programmes);
Rural development- Rural Credit (need,
Characteristics of developed and developing purpose and sources); Agricultural
economies; Development experience of marketing: defects and government measures
India: a comparison with neighbouring to improve agricultural marketing; role of
country (China) in terms of growth, cooperatives, agricultural diversification;
population and sectoral development alternate farming /organic farming: meaning
(introducing regional and global economic and importance.
grouping such as SAARC, European Union,
ASEAN, G-8, G-20 - basic knowledge); Human Capital formation: How people
different types of economic systems; become resource; role of human capital in
definition, features, merits and demerits of economic development; Growth of education
capitalism, socialism and mixed economic sector in India; Education – formal and
system; mechanisms used to solve the basic informal (Meaning only); Unemployment-
problems under each economic system to be types of unemployment, causes for
explained with the help of examples. The role unemployment, Policy measures (after 2000).
of government along with the price (vi) Economic Growth and Development.
mechanism to be emphasized. Price
Economic Growth and Development –
mechanism as a tool to solve economic
Meaning and difference.
problem.
(vii) Sustainable Development.
2. Indian Economic Development Effect of Economic Development on
(i) Introduction. Resources and Environment.
Indian economy post liberalization: Main Understanding the concept of Sustainable
features, problems and policies of development; Need for sustainable
agriculture, industry and foreign trade. development for improving the quality of life
- looking at the deteriorating quality of air,
(ii) Parameters of Development. water, food over time, developing an
Parameters of development: per capita appreciation to sustain at least what exists
income (definition and limitations); meaning for the generations to come.
and construction of Human Development Global warming – meaning and effects.
Index (HDI). India and HDI as per the
UNDP report. 3. Statistics
(iii)Planning and Economic Development in (i) Statistics: definition, scope and limitations of
India. statistics.
Planning and economic development in Statistics: definition, scope and limitations of
India: a brief explanation. Major objectives statistics. Special emphasis to be laid on
of all the Five-Year Plans. NITI Aayog: importance of statistics in economics.
objectives and role.
(ii) Collection, organization and presentation of
data.

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 Collection of data - Sources of data: commodities to be included (coverage),
primary, secondary. Methods of collecting choice of prices and the method to be used.
data: Some important sources of collecting
secondary data; ways of collecting primary (vii)Some Mathematical Tools used in
data; organization of data: meaning and Economics.
types of variables, frequency; presentation of Equation of a straight line and slope of a
data: tabular and diagrammatic presentation straight line.
(bar diagram, pie, line, histogram, polygon PAPER II – PROJECT WORK – 20 Marks
and ogive curve).
Candidates will be expected to have completed two
(iii) Measures of Central Value: average defined; projects from any topic covered in Theory.
type of averages: arithmetic mean; simple
and weighted; median and mode; ungrouped Mark allocation for each Project [10 marks]:
and grouped data; numericals, relationship Overall format 1 mark
between mean, median and mode.
Content 4 marks
Measures of Central Value: average defined;
type of averages: arithmetic mean; simple Findings 2 marks
and weighted; median and mode; ungrouped Viva-voce based on the Project 3 marks
and grouped data. Numericals only on
mean, median and mode for both ungrouped A list of suggested Projects is given below:
and grouped data. Relationship between 1. Study consumer awareness amongst households
mean, median and mode – the nature of the through designing a questionnaire and collection
frequency distribution – symmetrical, of primary data.
positively skewed and negatively skewed.
2. Prepare a report on productivity awareness
(iv) Measures of dispersion: definition, methods among enterprises through use of statistical data
of studying variation - range; standard from statistical tables published in Newspapers /
deviation; quartile deviation; the mean or RBI Bulletin / Budget /Census report / Economic
average deviation; coefficient of variation.
survey, etc.
Numericals on measures of dispersion 3. Make a study of two cooperative institutions
required.
(example milk cooperatives, etc.) with a view to
(v) Correlation: introduction, scatter diagram; compare the organizational and financial
Karl Pearson’s coefficient of correlation; structure of the organizations, production
Spearman’s coefficient of correlation. capacity and output, marketing strategies, sales,
Meaning and significance of correlation to market share, etc.
be explained along with types and degrees. 4. Study in detail the South Asian Association for
Scatter diagram, Karl Pearson’s method Regional Cooperation (SAARC) and its impact
(two variables, ungrouped data); Spearman’s on Indian economy
Rank Correlation to be explained with the
help of numericals. 5. Prepare a report on the various poverty
alleviation and employment generation
(vi) Index numbers: simple and weighted - programmes started in India, with special focus
meaning, types and purpose. Problems on MNREGA.
involved in constructing a Price Index
Number. 6. Compare the status of women of your State with
that at the National level for the last ten years, on
What does an Index number show, measure
or indicate (like a Price Index Number). the basis of educational level, employment, etc.
Difference between simple and weighted – 7. Prepare a report on the forest cover in India,
Price weighted or quantity weighted. highlighting the following aspects:
Laspayre’s, Paasche and Fisher’s methods of (a) Five States/Union Territories having higher
index numbers (to be explained with the help and lower forest cover and compare the
of numericals). Wholesale Price Index, extent of forest coverage.
Consumer Price Index and Index of
Industrial Production should be explained. (b) Causes for decrease in forest cover in the
Uses of Index Numbers. Problems involved in Country.
constructing Price Index Number – the (c) Measures adopted by the Central/State
choice of the base year, the number of Governments to increase the forest cover.

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 CLASS XII

There will be two papers in the subject: utility; (b) Ordinal Utility Analysis:
Indifference Curve – its meaning and
Paper I - Theory: 3 hours ……80 marks properties (including MRS and DMRS),
Paper II- Project Work ……20 marks indifference map, consumer’s budget line,
Consumer’s equilibrium – condition (to be
PAPER - I (THEORY) – 80 Marks explained with the help of a diagram).
Part I (20 marks) will consist of compulsory short (ii) Elasticity of demand: meaning, types of
answer questions testing knowledge, application and elasticity of demand, measurement of
skills relating to elementary / fundamental aspects of elasticity of demand; factors affecting
the entire syllabus. elasticity of demand.
Various methods of measurement of the
Part II (60 marks) will consist of eight questions out elasticity of demand: point method -
of which candidates will be required to answer five percentage method, expenditure method and
questions, each carrying 12 marks. geometric method. (Numericals required on
percentage method only). The cross and
Note: The syllabus is intended to reflect a study of income elasticity of demand must be
the theory of Economics with specific reference to the explained. Degrees of elasticity of demand to
Indian Economy. Therefore, examples and specific be explained. Use diagrams wherever
references to the Indian Economy must be made necessary.
wherever relevant.
(iii) Supply: meaning; difference between stock
1. Micro Economic Theory and supply; determinants of supply; Law of
Supply; movement and shift of the supply
(i) Demand: meaning, factors affecting demand; curve; elasticity of supply
Demand function; Law of Demand;
derivation of demand curve; movement and Difference between stock (intended supply)
shift of the demand curve; exceptions to the and supply (actual supply) with the help of
Law of Demand. relevant examples. A supply function should
be specified and explained. Law of Supply:
Law of Diminishing Marginal Utility, Law of Meaning, supply schedule and supply curve.
Equimarginal Utility, consumer’s Derivation of market supply curve from
equilibrium through utility approach individual supply curve. Movement and shift
(Cardinal) and indifference curve analysis of the supply curve, exceptions to the Law of
(Ordinal). Supply. Elasticity of Supply: Meaning,
The concept of demand: meaning. A demand degrees of elasticity of supply and
function to be specified incorporating the measurement of elasticity of supply by
determinants of demand. Diagrams should be percentage method and geometric method.
used in explaining the Law of Demand, (iv) Market Mechanism: Equilibrium and
reasons for downward slope of demand disequilibrium; Equilibrium price and effect
curve, its derivation using demand schedule. of changes in demand and supply on the
Derivation of market demand curve from equilibrium price. Simple applications of
individual demand curve. tools of demand and supply.
(a) Cardinal Utility Analysis: meaning of A basic understanding of the concept of
utility, total utility, marginal utility, equilibrium. The effects of changes in
relationship of TU and MU, Law of demand and supply - both along the curves
Diminishing Marginal Utility (schedule and and shift of the curves to be explained. Basic
diagram, Only assumptions to be taught, understanding of Price control, rationing,
criticisms not required), Consumer’s Price ceiling and Floor price with the help of
equilibrium – one commodity (schedule and demand and supply curves.
diagram), Law of Equimarginal Utility
(statement, schedule) and conditions of (v) Concept of production and production
consumer’s equilibrium using marginal function: (short run and long run production
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 function), returns to a factor, returns to scale 2. Theory of Income and Employment
(meaning only) total, average and marginal
physical products; Law of Variable Basic concepts and determination of Income and
Proportions and its three stages. Employment
A production function (concept only). Law of The concept of demand (exante) and effective
Variable Proportions: statement, (expost) demand. Aggregate demand and its
assumptions, schedule (for the purpose of components, propensity to consume and
propensity to save (average and marginal),
understanding and not for testing), diagram
and explanation to the three stages. equilibrium output; investment multiplier (its
meaning and mechanism). Meaning of full
(vi) Cost and revenue: Basic concepts of cost; employment. Problems of excess demand and
fixed cost, variable cost, total cost, marginal deficient demand; measures to correct them.
cost and average cost – their relationships;
opportunity cost; short run and long run cost 3. Money and Banking
curves. Revenue: meaning; average revenue,
marginal revenue and total revenue and their (i) Money: meaning, functions of money, supply
relationships under perfect competition and of money.
imperfect competition, Producer’s Meaning, kinds of money, functions of money
equilibrium. (primary, secondary and contingent) to be
Basic concepts – private cost, economic cost, explained; supply of money (only meaning of
social cost, money cost, real cost, explicit M0, M1, M2, M3 & M4). Inflation: meaning,
cost, implicit cost. demand pull and cost push (diagrams not
required)
Cost concepts – Fixed cost, variable cost,
total cost, marginal cost, average cost with (ii) Banks: functions of commercial bank; high
schedule and diagram; relationship between powered money, credit creation by
average cost, marginal cost, total cost (only commercial banks; Central Bank: functions.
concepts of long run and short run cost Basic understanding of the functions of
curves, derivations not required). commercial banks, credit creation process
Opportunity cost – meaning only. Difference with limitation. The regulatory role of the
between accounting cost and opportunity Central Bank, its functions and the way it
cost. controls the flow of credit needs to be
Revenue – Average revenue, marginal explained. A brief mention may be made of
revenue, total revenue – concepts and quantitative CRR, SLR, Bank Rate policy
relationships under perfect competition and (repo rate and reverse repo rate) and Open
imperfect competition. Producer’s Market Operations) and qualitative methods.
equilibrium (Profit maximization goal) –
meaning; conditions: (a) TR and TC 4. Balance of Payment and Exchange Rate
approach along with diagram (b) MR and Balance of Payment – meaning, components;
MC approach along with diagram. foreign exchange – meaning, determination of
(vii) Main market forms: perfect competition, exchange rate (Flexible).
monopolistic competition, oligopoly, Balance of Payment - Meaning and components;
monopoly, monopsony; characteristics of the Causes of disequilibrium and how the
various market forms; equilibrium of a firm disequilibrium can be corrected; Foreign
in perfect competition under short run and Exchange Rate – meaning, meaning of fixed and
long run. flexible exchange rate, determination of exchange
Features of perfect competition, monopolistic rate in a free market. Concepts of depreciation,
competition, oligopoly, monopoly and appreciation, devaluation and revaluation
monopsony (meaning only). Equilibrium of a (meaning only).
firm in perfect competition under short run
(explanation and diagram, shut down point
and break-even point) and long run (diagram
not required).

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5. Public Finance Mark allocation for each Project [10 marks]:
(i) Fiscal Policy: meaning and instruments of Overall format 1 mark
fiscal policy. Content 4 marks
Meaning and instruments of fiscal policy – Findings 2 marks
Public Revenue: Meaning, taxes (Meaning
and types), difference between direct and Viva-voce based on the Project 3 marks
indirect taxes; Public Expenditure: Meaning A list of suggested Projects is given below:
and importance; Public Debt: Meaning and
redemption; Deficit Financing: meaning. 1. Study a Public Sector Enterprise with reference
to its relevance to the Indian Economy and its
(ii) Government Budget: meaning, types and future prospects. Analyse the trend of its growth
components. for the last ten years.
Meaning and types of Government budget – 2. Conduct a Socio-Economic survey of a locality
union, state; components – revenue and (minimum sample size should be 30 households)
capital. Concept of deficit budget: revenue with reference to:
deficit, fiscal deficit, primary deficit – their (a) Demographic features.
meaning and implications. (b) Consumption Pattern – Expenditure on
necessities, comforts and luxuries.
6. National Income (c) Occupational structure.
(i) Circular flow of Income. 3. Compare the contribution made by different
sectors of the economy towards GDP growth
A simple model explaining the circular flow during the planning period.
of income with two, three and four sector 4. Prepare a report on the competition in the
models with leakages and injections. Aviation Sector in India with reference to:
(ii) Concepts and definition of NY, GNP, GDP, (a) Performance of the Public Sector and Private
NNP, private income, personal income, Sector.
personal disposable income, National (b) Operational strategies adopted by budget/low
Disposable Income and per capita income; cost carriers.
relationship between the income concepts. 5. Make a comparative analysis of lending
A brief understanding of the mentioned performance of five Commercial Banks in the
national income aggregates is needed. The past six years with reference to the changing
CRR and SLR.
concepts of GNP and NNP should be
explained both at factor cost and market 6. Many thinkers believe that we are rapidly
prices, real GDP and nominal GDP, depleting our natural resources. Assume that
National Disposable Income (Gross and there are only two inputs (labour and natural
resources) producing two goods (wheat and
Net), GDP and Welfare, GDP as an indicator gasoline) with no improvement in technology
of Economic welfare. over time. Show what would happen to the
(iii) Methods of measuring National Income: Production Possibility Curve over time as natural
product or value-added method; income resources are exhausted. How would invention
method and expenditure method with simple and technological improvement modify your
numericals based on them. answer? On the basis of this example, explain
why it is said “economic growth is a race
Simple numericals based on all the methods between depletion and invention.”
to be covered for better understanding of the 7. Make a comparative study of the allocation of
concept. Precautions and difficulties of financial resources of the Central Government
measuring National Income for each method. Budget on Agriculture, Defence, Industry and
Education in the last ten years. Prepare a report
PAPER II – PROJECT WORK – 20 Marks on your observations.
Candidates will be expected to have completed two 8. Prepare a trend Analysis of Growth and
projects from any topic covered in Theory. Productivity of any one industry such as:
Textile / Automobiles / Electronic and
The project work will be assessed by the teacher Tele-communication, etc. in India for the past ten
and a Visiting Examiner appointed locally and years.
approved by the Council.
NOTE: No question paper for Project Work will be
set by the Council.

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 SAMPLE TABLE FOR PROJECT WORK
S. Unique PROJECT 1 PROJECT 2 TOTAL
No. Identification MARKS
Number A B C D E F G H I J
(Unique ID) of Teacher Visiting Average Viva- Total Teacher Visiting Average Viva-Voce Total (E + J)
the candidate Examiner Marks Voce by Marks Examiner Marks by Visiting Marks
(A + B ÷ Visiting (C + D) (F + G ÷ Examiner (H + I)
2) Examiner 2)
7 Marks* 7 Marks* 7 Marks 3 Marks 10 Marks 7 7 Marks* 7 Marks 3 Marks 10 Marks 20 Marks
Marks*
1

10

*Breakup of 7 Marks to be awarded separately by the Name of Teacher:

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