ICMAP

SYLLABUS 2016
Estd. 1951

FUNDAMENTAL LEVEL
F2 - Business Economics
Weightage

Part-B
Part-A Part-A Micro-Economics 50%

Part-B Macro-Economics 50%

Syllabus Overview: Learning Outcomes:

This course is designed to provide understanding on
concepts, laws and factors of micro and macro
economics. The syllabus gives the students insight over
economic theories and factors to be considered in
decision making and strategy formation at higher level
papers.
On completion of this course, students will be able to
understand, analyse and interpret the concepts of
economic theories, policies and factors related to micro &
macro economics environment and their impacts.

Detailed Contents Weightage Level of

in % Study Required
PART-A: MICRO-ECONOMICS
1. Nature and Scope l Definition of economics U
of Economics l Allocation of scare resources and wants U
l Introduction of factors of production - land, labor, U
capital and enterprise 5
l Concept of opportunity cost and production A
possibility curve
2. Consumer's Behaviour l Utility and its kinds U
and Its Analysis l Law of diminishing and equi-marginal utility 5 A
l Consumer's equilibrium through indifference curve
techniques A
l Income effect, price effect and substitution effect A
3. Demand and Supply l Concept of demand & supply and their function A
Analysis l Supply & demand schedule and their curves A
l Laws of demand and supply 10 A
l Market Equilibrium A
l Consumer's surplus and producer's surplus A
l Momentary, short-run and long-run equilibrium price A
4. Elasticity of Demand l Introduction to elasticity of demand U
and Supply l Kinds of elasticity of demand i.e. price, cross and U
Income elasticity of demand 5
l Methods of measuring Elasticity A
l Introduction to elasticity of supply U
l Measurement of elasticity of supply A
5. Government Measures l Price stability v/s price instability U
to Control Price l Economic impacts of price instability U
Instability l Reasons for price instability for primary goods U
l Minimum and maximum pricing policies of 5 D
government in the goods market
l Minimum and Maximum pricing policies of D
government in the factor market

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SYLLABUS 2016
Estd. 1951

6. Production Function lShort-run and long-run production functions A

l Laws of Return A
l Laws of returns to scale A
l Economies and Diseconomies of Scale 5 D
l Externalities A
l Government measures to deal with externalities D
7. Cost and Revenue l Concept of cost of Production U
Analysis l Average, Total and Marginal Cost A
l Long-run and Short-run cost behaviour 5 A
l Sunk v/s Floating Cost U
l Implicit v/s Explicit cost A
l Average, Total and Marginal Revenue A
8. Market Structure and l Characteristics of Perfect and Imperfect Competition D
Firm's Behaviour (Monopoly, Duopoly, Oligopoly and Monopolistic
Competition) 10
l Price-output determination under Short run D
l Price-output determination under Long run D

PART-B: MACRO-ECONOMICS
9. National Income and l Different concepts of National Income A
National Income l Measurement of National Income D
Determination l Difficulties in measurement of National Income 10 U
l Factors affecting National Income U
l Circular Flow of National Income D
10. Income and l Consumption, Saving and Investment function D
Employment l Keynes' Theory of Full Employment D
Theory l Unemployment A
Types and Causes
Consequences 15
l Multiplier and Accelerator Principle A
l Stages of Trade Cycle (meaning and D
characteristics) and its influences on business
environment
l Inflationary and Deflationary Gaps, causes and A
measures to control these gaps
11. Money, Banking and l Nature and Functions of Money U
Financial System l Quantity Theory of Money A
l Inflation and its causes , effects and measures D
l Role of Financial Intermediaries U
l Functions of Commercial Banks and Credit Creation 15 U
l Functions and role of Central Bank U
l Money market, Capital market, Derivative market U
l Financial Instruments (Definitions): Shares, A
debentures, bonds, futures, options, cap, floor,
collar, swaps, forward
12. The Role of l Macro-economic policy goals U
Government/Public l Fiscal Policy kinds and objectives U
Finance l Monetary Policy kinds and objectives 5 U

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SYLLABUS 2016
Estd. 1951

13. International l Direct and Indirect Taxation U

Economics l Balance of Trade and Balance of Payments D
l Causes of Adverse Balance of Payments and
its correction U
l Terms of Trade U
l Global Financial Institutions (functions) U
l Trade Agreements and WTO (functions) 5 U
l Theories of Exchange Rate Determination D
l Devaluation and Depreciation A
l Trade Restrictions U
Quota System
Import & Export Duties

TOTAL WEIGHTAGES 100

NOTE:-
U = Understanding
A = Application
D = Decision

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(Constituted under Cost and Management Accountants Act, 1966) 61