Pakistan Economy

Pakistan Economy

Pakistan Economy

Table of Contents
To the Student Introduction Economics PART ONE MICROECONOMICS Key Concepts in Microeconomics Monopoly and Cartels; Cars sale boosts by 61 Case 1: pc in July November Monopoly and Cartels; Cartels , monopolies Case 2: and prices Demand and Supply; Chicken prices jump by Case 3: Rs 14 in five days Demand and Supply and Elasticities; Chicken Case 4: prices nosedive; mutton, beef sky rocket Demand and Supply ; Cricket fever pushes TV Case 5: sales up by 25 pc Demand and Supply; Oil near 4 month lows Case 6: as supply worries subside Oligopoly, Demand and Supply; OPEC hopes Case 7: non-members will cut 500,000 bpd Demand and Supply and Elasticities; Tomato, Case 8: Poultry, Wheat and Onion prices shoot up Demand and Supply; EPB, Exporters put Case 9: heads together on date price rise Case 10: Oligopoly; Govt calls cement industry meeting Oligopoly; Suzuki stops bookings, premium Case 11: rises Natural Monopoly; PTCL jittery as monopoly Case 12: slips from its hands Oligopoly and Cartels; MCA begins probe Case 13: against industry cartels 5 7

33 37 40 43 48 51 54 56 59 62 65 68 71

Pakistan Economy

PART TWO MICROECONOMICS Key Concepts in Microeconomics Monetary Policy; Credit to private sector rises Case 1: further Monetary and Fiscal Policy; Domestic Case 2: borrowing costs budget deficit Trade Barriers; Dumping duty imposed on Case 3: Taiwanese firm Exchange Rates; $ Down 1.1 pc against rupee Case 4: in Oct Nov Exchange Rates; Importers feel pinch of rising Case 5: EURO Monetary Policy; SBP monetary policy Case 6: statement next month Monetary Pollcy and inflation; Rising money Case 7: supply fuels inflation Economic Indicators; oil, gas, wheat flour Case 8: prices keep on rising Monetary Policy and inflation; rising cash Case 9: holding to push up inflation Case 10: Monetary Policy: SBP keeps TBs rate stable Gross Domestic Product and Aggregate Case 11: Expenditures; Consumer focused growth frozen mind sets

89 92 95 99 102 105 109 112 118 121 124

Pakistan Economy

To the Student
This book has been written for the students enrolled in BBA/MBA, B.Com / M.Com, MS/MSc./ Mphil, Economics, BS Economics , ICAP and ICMA or studying courses of microeconomics and macroeconomics at any other levels. In Pakistan, text books recommended for economics course contains theory developed for the west and examples given in the textbooks reflect working of western markets which are more matured and work efficiently than any Pakistani markets. Pakistani students when asked to apply theory to real world, most of the students find it hard to do that. Even teachers sometime find it hard to relate economic theory with Pakistani markets. Hence lectures go dry and in the end students are forced to memorize theory to pass examination. The traditional method of teaching hardly helps stimulate thinking process of the students. In the above backdrop, it was felt that a book sis required containing examples of local markets and Pakistans economy, which could then be linked with theory being taught in the classroom. The main focus of the book is to apply theory of microeconomics and macroeconomics with examples of Pakistani markets. How this book is different than other books? The text encourages students to see world of economics in real sense and employ basic principles of economics to understand and explain what they observe in the world around them. The book gives you two in one: microeconomics and macroeconomics. The format of the book encourages you to read actively rather then passively. You will be asked at the end of each case to answer questions. More than 100 questions are included in the book. Answering questions is likely to broaden your thinking level and help you to apply in real world what you learn in classrooms. Remember the objective of the book is not to sharpen you memory but thinking process. Good luck with your study of cases in
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Pakistan Economy

economics. Wherever possible, Links of useful websites are provided to help students to broaden their research work. Photos of various local markets have also been included in the book to give real touch. The first edition of this book is now in your hand. Making cases particularly about Pakistans economy is not an easy task, given the limited information and data available for research work. It took me about a year to collect and make the cases. The book has attempted to include basic topics which are normally taught in microeconomics and macroeconomics. I am now working on developing new cases on advanced topics in economics which are not covered in the first edition but will be included in the second edition coming out sometime in 2006, Inshallah.

June 6, 2005 Islamabad.

Syed Asad Hussain