ASSOCIATE BHARATIYA VIDYA BHAVAN
DR. S. BISALIAH*
* Support for computerising the material by Mrs. R. Kalavathi is gratefully acknowledged. Dr. N. S. Viswanath was of great help in providing the basic framework for developing this material. His help is hereby acknowledged. ORIENTATION IN ECONOMICS
(FOR I YEAR MBA STUDENTS)
Instructor: Prof. S. BISALIAH
Module 1: Introduction
1. Economics: Science of Scarcity, Choice and Efficiency.
• Scarcity of resources ( Choice.
• Scarcity of resources ( Efficiency.
Question: How to organize the system which promotes the most efficient use of resources?
2. Three Fundamental Problems of Economic Systems:
• What commodities shall be produced and in what quantities? • How shall these commodities be produced?
• For whom shall these commodities be produced?
3. Micro and Macro Economics:
• Micro Economics: Concerned with the behaviour of individual economic units and their interactions '' consumers and producers/business firms.
← Major type of interactions in the market
← Three major components of Microeconomics:
← Product pricing
← Input (Factor) pricing
← Welfare economics
← Major uses of Microeconomics:
← Provides basic tools of economic analysis for application in special areas like Business (Managerial) Economics, Industrial Economics etc. ← Helps in understanding how the economic units operate, and whether they operate efficiently or not. ← Helps in making conditional prediction/forecasting.
• Macro Economics:
← Study of aggregates: Deals not with individual income, but with national income, not with individual prices, but with general price levels, not with individual output but with national output. ← Study of forest rather than of individual...