Topics
National Income and Related Aggregates
- Macroeconomics Vs Microeconomics
- Representative Goods and Sectors
- Macroeconomic Agents and Government Role
- Emergence of Macroeconomics
- Context of the Present Book of Macroeconomics
- Meaning of Economic Wealth and Final Goods
- Stocks, Flows, and Depreciation
- Capital Formation, Trade-off & Circular Flow of Income
- Circular Flow of Income and Methods of Calculating National Income
- Output Method/Product Method
- Expenditure Method
- Income Method
- Factor Cost, Basic Prices and Market Prices
- Some Macroeconomic Identities
- National Disposable Income
- Private Income
- National Income Aggregates
- Real GDP and Nominal GDP
- GDP and Welfare
Introductory Macroeconomics
Introduction
- A Simple Economy
- Central Problems of an Economy
- Concepts of Production Possibility Frontier
- Organisation of Economic Activities
- Positive and Normative Economics
- Macroeconomics Vs Microeconomics
Development Experience (1947-90) and Economic Reforms since 1991
- India's Economy Before Independence
- Low Level of Economic Development Under the Colonial Rule
- Agricultural Sector in India
- Industrial Sector
- Foreign Trade of India
- Demographic Condition
- Occupational Structure
- Infrastructure
- Post-Independence Economic Systems and Planning
- Five Year Plans (FYP)
- Agriculture
- Industry and Trade
- Trade Policy: Import Substitution
- The 1991 Economic Crisis and Reforms
- Background of the New Economic Policy
- Liberalisation
- Privatisation
- Globalisation
- World Trade Organisation (WTO)
- Impact of the Economic Reforms
Theory of Consumer Behaviour
- Consumer Behaviour: The Problem of Choice
- Basic Concepts of Microeconomics > Utility
- Cardinal Approach (Utility Analysis)
- Derivation of Demand Curve in the Case of a Single Commodity
- Ordinal Utility Analysis/Indifference Curve Analysis
Indian Economic Development
Current Challenges Facing Indian Economy
- Concept of Human Capital
- Sources of Human Capital
- Human Capital and Economic Growth
- Human Capital and Human Development
- State of Human Capital Formation in India
- Growth of Education Sector in India
- Challenges and Future Prospects in Education
- Rural Development in India
- Credit and Marketing in Rural Areas
- Agricultural Market System
- Diversification into Productive Activities
- Sustainable Development and Organic Farming
- The Nature and Importance of Work in Society
- Workers and Employment
- Participation of People in Employment
- Self-employed and Hired Workers
- Employment in Firms, Factories and Offices
- Growth and Changing Structure of Employment
- Informalisation of Indian Workforce
- Concept of Unemployment
- Government and Employment Generation
- Environment and Sustainable Development in India
- State of India’s Environment
- Concept of Sustainable Development
- Strategies for Sustainable Development
Money and Banking
- Concept of Money
- Functions of Money
- Demand for Money and Supply of Money
- Money Creation by Banking System
- Limits to Credit Creation and Money Multiplier
- Policy Tools To Control Money Supply
- Demand and Supply for Money : A Detailed Discussion
- The Transaction Motive
- The Speculative Motive
- Various Measures of Supply of Money
- Narrow and Broad Money
- Demonetisation
Development Experience of India – a Comparison with Neighbours
Introductory Microeconomics
Production and Costs
- Production Function
- Basics of Production Theory
- Variation of Output in the Short-Run Returns to a Factor
- Relation Between Total, Average and Marginal Product
- Law of Variable Proportions
- Average and Marginal Physical Products
- Changes in Production
- Cost - Fixed Cost
- Cost -variable Cost
- Behaviour of Cost in the Short - Run
- Relationship Between Average Variable Cost and Average Total Cost and Marginal Cost
- Concept of Opportunity Cost
- Marginal Revenue
- Producer's Equilibrium
- Law of Supply
- Market Supply Schedule
- Distinguish between Stock and Supply
- Determinants of Supply
- Movements Along and Shifts in Supply Curve
- Measurement of Elasticity of Supply
- Methods of Measurement of National Income
- Cost Concepts > Marginal Cost
- The Law of Diminishing Marginal Product
- Shapes of Product Curves
- Costs in Long Run Period
- Returns to Scale
Determination of Income and Employment
- Aggregate Demand and Its Components
- Consumption
- Investment
- Determination of Income in Two-sector Model
- Determination of Equilibrium Income in the Short Run
- Macroeconomic Equilibrium with Price Level Fixed
- Effect of an Autonomous Change in Aggregate Demand on Income and Output
- The Multiplier Mechanism
- Paradox of Thrift
- Equilibrium Output and Employment
The Theory of the Firm Under Perfect Competition
- Concept of Market
- Market Equilibrium
- Determination of Market Equilibrium
- Effect of Simultaneous change in Demand and Supply on Equilibrium Price
- Perfect Competition
- Imperfect Competition
- Classification of Market Structure
- Oligopoly
- Market Forms - Perfect Oligopoly
- Market Forms - Imperfect Oligopoly
- Equilibrium Price
- Applications of Tools of Demand and Supply Price Control
- Price Ceiling
- Price Floor
- Revenue Concepts
- Profit Maximisation Objective
- Determinants of a Firm’s Supply Curve
- Market Supply Schedule
- Price Elasticity of Supply
Government Budget and the Economy
Market Equilibrium
- Simple Monopoly in the Commodity Market
- Other Non - Perfectly Competitive Markets
Balance of Payments
- Open Economy and Its Linkages
- Concept of Balance of Payments
- Current Account
- Capital Account
- Balance of Payments Surplus and Deficit
- Foreign Exchange Market
- Foreign Exchange Rate
- Determination of the Exchange Rate
- Merits and Demerits of Flexible and Fixed Exchange Rate Systems
- Managed Floating Exchange Rate System
Estimated time: 15 minutes
CBSE: Class 12
Maharashtra State Board: Class 11
Maharashtra State Board: Class 11
Background
- India's economy was underdeveloped due to British colonial exploitation.
- Planning was introduced to tackle poverty, unemployment and low productivity after Independence.
- India adopted the Five Year Plan model from the USSR (Russia).
- The Planning Commission was established in 1950 under Jawaharlal Nehru.
- The Five Year Plan system ended in 2017 and was replaced by NITI Aayog.
Fundamental Principle: Proportionate distribution of resources and optimum use of human resources to fulfil people's needs.
Maharashtra State Board: Class 11
Aims of Five Year Plans
- Rural and agricultural development.
- Balanced industrialisation.
- Ensuring a minimum standard of living.
- Promoting people's participation in development.
CBSE: Class 12
Four Major Goals of Planning
| Goal | Description |
|---|---|
| Growth | Increase in GDP and national income. |
| Modernisation | Adoption of new technology and progressive social outlook, including women's rights. |
| Self-reliance | Reducing dependence on imports. |
| Equity | Ensuring the benefits of growth reach all sections of society. |
Tamil Nadu Board of Secondary Education: Class 12
Important Models
- First Five-Year Plan — Harrod-Domar Model
- Second Five-Year Plan — P.C. Mahalanobis Model
Maharashtra State Board: Class 11
Plan-wise Overview (1951–2017)
| Plan Period | Main Objective / Strategy | Target (%) | Achievement (%) | Key Highlight |
|---|---|---|---|---|
| 1st (1951–56) | Agriculture | 2.1 | 3.6 | Foundation of planned development |
| 2nd (1956–61) | Heavy industries | 4.5 | 4.1 | Industrialisation and infrastructure |
| 3rd (1961–66) | Agriculture & industry | 5.6 | 2.7 | Affected by wars and famine |
| Annual Plans (1966–69) | Plan Holiday | — | — | Introduced due to economic crisis |
| 4th (1969–74) | Growth with stability | 5.7 | 3.3 | Affected by oil crisis and Bangladesh War |
| 5th (1974–79) | Removal of poverty | 4.4 | 4.8 | Focus on social welfare |
| Rolling Plan (1978–80) | Annual rolling planning | — | — | Replaced the Fifth Plan temporarily |
| 6th (1980–85) | Quality of life | 5.2 | 5.7 | Poverty alleviation and employment |
| 7th (1985–90) | Social welfare & employment | 5.0 | 6.0 | Food, employment and productivity |
| Annual Plans (1990–92) | Interim planning | — | — | Due to political instability |
| 8th (1992–97) | Economic dynamism | 5.6 | 6.8 | Liberalisation and human development |
| 9th (1997–2002) | Social justice & rural development | 7.0 | 5.6 | Agriculture and infrastructure |
| 10th (2002–07) | Poverty reduction | 8.2 | 7.8 | Faster economic growth |
| 11th (2007–12) | Inclusive growth | 8.1 | 7.9 | Focus on inclusive development |
| 12th (2012–17) | Sustainable & inclusive growth | 8.0 | N.A. | Last Five Year Plan |
Maharashtra State Board: Class 11
Major Schemes by Plan
| Plan | Important Schemes |
|---|---|
| 6th | IRDP, RLEGP, NREP |
| 7th | Jawahar Rojgar Yojana, Indira Awaas Yojana |
| 8th | PM Rozgar Yojana, Midday Meal Scheme |
| 9th | PM Gram Sadak Yojana, Antyodaya Anna Yojana |
Maharashtra State Board: Class 11
Tamil Nadu Board of Secondary Education: Class 12
Tamil Nadu Board of Secondary Education: Class 12
Factors That Affected Plans
- Wars
- Famines
- Oil crisis
- Political instability
CBSE: Class 12
Maharashtra State Board: Class 11
Tamil Nadu Board of Secondary Education: Class 12
Maharashtra State Board: Class 11
Tamil Nadu Board of Secondary Education: Class 12
Key Points: Five Year Plans
- India adopted the Five Year Plan model from the USSR (Russia); the Planning Commission was established in 1950 under Jawaharlal Nehru.
- The main aims were agricultural & industrial development, employment generation, poverty reduction, and self-reliance.
- The four goals of planning were Growth, Modernisation, Self-reliance, and Equity.
- The First Plan focused on agriculture, while the Second Plan focused on heavy industries under the Mahalanobis Model.
- Wars, famines, the oil crisis, and political instability affected the success of several plans.
- The Planning Commission was replaced by NITI Aayog (2015), and the Twelfth Plan (2012–17) was the last Five Year Plan.
