ECONOMICS (ELECTIVE)
APPENDIX ‘A’
(Outlines of Test)
| PAPER ‘A’: Basic Mathematics and Microeconomics | 100 |
| PAPER ‘B’: Macroeconomics and Economic Development of Pakistan | 100 |
| Total: | 200 |
Appendix ‘B’
(Syllabi and courses of reading)
NOTE :
In paper “A” four questions will be set from Section-I and six questions from Section-II. The candidates will be required to attempt 05 questions in all selecting 03 questions from section-I and 02 questions from section-II.
Paper – A
SECTION – I BASIC MATHEMATICS
1.FUNCTION AND EQUATIONS:
(i) Function: Relation Vs Function. Variables Constants And Parameters. Types Of Function: Linear And Non-Linear; Exponential And Logarithmic. Graphical Presentation Of Function. Examples From Micro And Macro Economics.
(ii)Equation: Equation Vs Identities. Solution Of Linear, Quadratic And Simultaneous Equations. Equilibrium Analysis In Economics : Partial Market Equilibrium ; Linear And Quadratic Models. Equilibrium In National Income.
- DERIVATIVES:
The concept of derivative. The concept of limit and its relevance to derivatives. Slope vs elasticity of a Function. Rules of Differentiation: A Constant, A power, Sum, Difference, Product and Quotient Function Rule. The Derivation of Marginal Quantities in economics. The calculation of Elasticity of Demand and Supply.
- MAXIMA AND MINIMA OF FUNCTIONS:
Optimum values vs Extreme Relative Maxima and Minima, point of inflexion, Criteria for Relative Maxima and Minima. First order condition and second order condition. Constrained Optimization. Problems of optimisation in Economics: Profit, Utility and Revenue Maximization. Cost Minimization. The Equilibrium of a Consumer and a Firm. The least cost combination of Inputs.
SECTION II: MICRO ECONOMICS
1.THE NATURE AND IMPORTANCE OF MICRO ECONIMICS:
Basic problems of Micro Economics Theory. The Determination of Output composition. The Allocation Resource. The distribution of the Product and the Maintenance and Expansion to the Productive capacity of the economy. Market economy and the treatment of basic economic problems. The relative importance of market mechanism in capitalism, socialism and Islamic Economics system.
2.THE THEORY OF CONSUMER BEHAVIOUR:
The Utility Theory of Consumer Behaviour. Indifference Preference Analysis. Indifference Curves And Marginal Substitution. Consumer Equilibrium. Income Substitution And Price Effect Of Normal, Inferior And Giffen Good, Derivation Of Demand Curve From Price-Consumption Curve. Revealed Preference Theory. Price Income And Cross Elasticity Demand And Their Measurement.
3.THE THEORY OF PRODUCTION COSTS AND REVENUES:
The Concept of Production Function. Iso-Quant And Iso-Cost Curves. Marginal Rate of Technical Substitution. Optimal Combination of Resources. The Cost and Revenue of Firm.
4.THE THEORY OF FIRM BEHAVIOUR AND MARKET ORGANIZATION:
(a) Perfect Competition
Assumptions Competition. Equilibrium of A Firm and Industry during Short and Long Periods. Short and Long Periods Supply Curve of A Firm and Industry.
(b) MONOPOLY:
The Nature and Extent of PuMs Monopoly. Short-Run and Long Equilibrium Under Pure Monopoly. Dumping and Price Discrimination. Welfare Effects Of Pure Monopolies.
(c) Imperfect Competition:
Monopolistic competition and its main characteristics. Short-run and long run Equilibrium under monopolistic competition. Pricing and output determination under oligopoly. Price leadership and cartels. Inefficiencies due to imperfect competition.
- PRICING AND EMPLOYMENT OF RESOURCES:
The Marginal Productivity Theory of Resource Pricing. The Modern Theory Of Resource Pricing And Employment. The Demand Curve of A Firm With One Variable Resource. The Demand Curve of a Firm With Several Variable Resources. The Market Demand Curve. The Supply Curve of Resources. Resource Pricing Under Perfect Competition, Monopoly and Monopsony.
Recommended books:
| (i) Chieng, Alpha C, | Fundamentals Methods of Mathematical Economics’ 3rd Edition. |
| (ii) J.Parry Lewis | “An Introduction of Mathematics Theory” And 2nd Edition. |
| (iii) Ferguson & Gould’s | “Microeconomics Theory” 6 Edition. |
| (vi) Glahe, Fred R. | “Macroeconomics” 2nd Edition. |
| (v) Prof. Abdul Ghani Chaudhary | “Rahber-e-Muashiat” |
| (vi) Dr. Muhammad Hussain Chaudhary | “Economic Thoery” |
| (vii)M. Hanif Aslam | “Economic Theory” |
PAPER–B:
MACRO ECONOMICS AND ECONOMIC DEVELOPMENT OF PAKISTAN
NOTE:
In Paper “B” six questions will be set from Section-I and four questions from Section-II. The candidates will be required to attempt five questions in all selecting three questions from Section-I and two questions from Section-II.
SECTION – I MACRO ECONOMIC:
- A FRAME – WORK FOR MACRO ECONOMICS
Macro Economics Vs Micro Economics. Macro Economics. Macro Economic Problems: Unemployment, Inflation And Growth.
- DETERMINATION OF NATIONAL INCOM AND EMPLOYMENT (two sector Economy)
(i) The Classical Theory of Employment:
Say’s Law of Market. Aggregate Demand and the Quantity Theory of Money.
Real Wage Function. Classical Macro Economics System, its Diagrammatic representation. Keynesian Critique of the Classical System.
(ii) Keynesian Theory of Income and Employment:
Equilibrium Level of National Income: Saving and Investment Approach; Consumption and Investment Approach. Relation Between Investment and Income. Investment Multiplier. Inflationary and Deflationary Gaps and Full Employment level.
- DETERMINANTS OF NATIONAL INCOME (Two Sector Economy) :
(i) Consumption:
Consumtion and Saving Functions. Keynesian Psychological Law of Consumption. Determinants of Consumption. Explanation of the Observed Relationship between consumption and Income Relative Income, Permanent Income and Life Cycle Theories of Consumption.
(ii) Investment:
Investment and Capital, Determinants of Investment. Marginal Efficiency of Capital (MEC) and Marginal Efficiency of Investment (MEI). Optimal Level of Investment. The Principals of Acceleration.
- GENERAL EQUILIBRIUM IN THE GOODS AND MONEY MARKET:
The Derivation of IS Function in the Goods Market. The Slope and position of IS Curve. The Derivation of LM Function in the – Money Market. The Demand for and Supply of Money. The Interest Rate. The Slope of position of LM Curve. Simultaneous Equilibrium in the goods and Money Market. Adjustments towards Equilibrium.
- FLUCTUATIONS IN NATIONAL INCOME:
Business Cycles and their main Features.Interactionof Multiplier and Accelerator. Counter-Cyclical Measures.
- MONETARY INFLUENCE ON INCOME DETERMINATION:
Monetary Policy: Its Nature, Objectives and Instruments. Influence of Monetary Policy on Income Determination (by affecting C+I+G). Money and Inflation, Stagflation.
- FISCAL POLICY AND INCOME DETERMINATION:
Fiscal Policy: Its Nature, Objectives and Instruments. The Impact of Government Expenditure, Taxes and Transfer Payments in the Equilibrium Level of National Income.
- INTERNATIONAL TRADE AND INCOME DETERMINATION
Theory of Comparative Advantage. Classical and Hackcher-Ohlin Theory. Balance of Payments. Disequilibrium and Adjustment Policies. Devaluation and Revaluation. Depreciation and Appreciation of Exchange Rates. Determination of National Income in a Four Sector Economy. The Foreign Trade Multiplier and Changes in the Level of Income.
SECTION – II: ECONOMIC DEVELOPMENT OF PAKISTAN
1.THE CONCEPT AND MEASUREMENT OF ECONOMIC DEVELOPMENT:
Main Features of Developing Economy with Special Reference to Pakistan.
2.AGRICULTURE AND INDUSTRY:
Relative Importance of Agricultural and Industrial Sectors in the Economic Development of Pakistan.
3.ECONOMIC DEVELOPMENT THROUGH PLANNING:
Need and Role of Development Planning. Market Imperfections and Price Distortions. Short Term, Medium Term and Long Term Plans. Formulation of Objective targets and Strategy in Development Planning.
4.ECONOMIC PLANNING IN PAKISTAN:
Planning Machinery in Pakistan. Justification of Economic Planning in Pakistan. Factors Prohibitive in Effective Planning in Pakistan. Main Contours and Critic Evaluation of the Last Five Year Plan (Seventh Five Year Plan) with reference to Strategies, Objectives, Targets and Achievements. Role of Annual Planning in Economic Development.
- RESOURCE MOBILIZATION FOR PLANNED ECONOMIC DEVELOPMENT IN PAKISTAN :
(i) Financial Resources :
Domestic and Foreign Resources of Pakistan. Extent of Pakistan’s Dependence on Foreign Aid and Debt Servicing Problem.
(ii) Human Resources:
Human Resource Mobilization in Pakistan. The Need and Role of Manpower Planning.
Recommended books:
| (i) Chieng, Alpha C, | Fundamentals Methods of Mathematical Economics’ 3rd Edition. |
| (ii) J.Parry Lewis | “An Introduction of Mathematics Theory” And 2nd Edition. |
| (iii) Ferguson & Gould’s | “Microeconomics Theory” 6 Edition. |
| (vi) Glahe, Fred R. | “Macroeconomics” 2nd Edition. |
| (v) Prof. Abdul Ghani Chaudhary | “Rahber-e-Muashiat” |
| (vi) Dr. Muhammad Hussain Chaudhary | “Economic Thoery” |
| (vii)M. Hanif Aslam | “Economic Theory” |
