Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Part A
Topic: 1
Some Fundamentals of Micro Economics
Microeconomics: Comparison with other branches of economics. The uses and
limitations of Microeconomic theories. The problem of Scarcity. The Concept
of opportunity cost. Markets, Firms and Individuals. Demand and Supply: A
Review. Relative and absolute Prices. Real and Nominal Prices. Cobweb
Theorem. Slope and Elasticity of Demand. Short Run and Long Run Elasticity.
Different Kinds of elasticities of demand. Price Controls. Consumer and
Producers surpluses. Network Externalities.
Topic: 2
Theory of Consumer Choice
Cardinal measurement of utility: Consumers equilibrium one commodity
and general case. Derivation of demand curve. Income and Substitution effects
under Cardinal Approach. Diamond Water Paradox. Drawbacks of Cardinal
Approach
Ordinal measurement of utility: Properties of preferences. The notion and
examples of homothetic preferences and non-homothetic preferences. Axioms
of consumer choice and their implications for preference ordering. Properties
of indifference curves maps. The problem of bundles ranking and properties of
consumption bundles. Types of utility functions.
Consumers choice: Interior and corner solution optimum of a consumer.
Algebraic solution for the optimum of a consumer. Solution for the optimum
in the case of perfect complements. Boundary optimum of a consumer.: choice
with perfect substitutes, neutrals, mutually exclusive goods, good /bad
cases.
Price Income and Substitution effects Under Hicksian and Slutsky
Framework. Slutsky identity and Slutsky equation. Derivation of Slutsky
equation and its economic interpretation. Indirect Utility Function and its
derivation and properties. Application of Indifference curve analysis.
Revealed Preference theory.
Topic: 3
Analysis of Demand
Determinants and properties of an individual demand function. Homogeneity
of degree zero in prices and income. Deriving income-consumption and
Engel curves. Engel expenditure curves. The difference between normal and
inferior goods, .necessity and luxury goods in respect of marginal propensity
to consume and income elasticity values. Income-consumption and Engel
curves for homothetic preferences cases. Quasilinear preferences case.
Deriving price-consumption and individual demand curves. The difference
between ordinary and non-ordinary goods. The notion of a Giffen good. Gross
substitutes and complements. The two notions of real income: in terms of
Hicks and in terms of Slutsky. Substitution effect under Hicks and under
Slutsky. Explanation of the sign of a substitution effect. Diagrams explaining
price effect signs and derivations of individual demand curves for: a normal
good, an inferior and ordinary good, a Giffen good.
Topic: 4
Theory of Production
The Concept of Production Function; Production with one variable and two
variable inputs, Laws of Returns and Returns to scale. The substitution and
Resource effects of change in input prices. Eulers Theorem. The elasticity of
substitution. Some special production functions: Cobb Douglas Production
function. CES Production Function. Translog Production function.
Homogenous Production Function.
Topic: 5
Cost of Production and Revenue
Definition and kinds of costs. Cost Functions. Traditional, Modern and
Engineering costs theories. Economies of Scale and Scope. Learning Curve.
Cost Minimization (A Mathematical Treatment). Revenue Analysis (Total,
Marginal and Average Revenue)
Part B
Topic: 6
The Theory of Market Behaviour
6.1
Pure and Perfect competition: equilibrium of firm in Short run. The
supply curve of the firm and the industry. Short run equilibrium of
industry. equilibrium of firm and industry in Long run. Optimum
Resource allocation. Dynamic changes and Industry Equilibrium: Shift in
the Market demand, Predictions of the perfect competition model when
costs change, Effects of Imposition of a Tax. Mathematically Price and
Quantity Solution.
Evaluating the gains and loses from Govt polices--consumer and Producer
surplus. The efficiency of a competitive market. Minimum Prices. Price
Supports and Production Quotas. Import Quotas and Tariffs. The impact of
Tax or subsidy. Mathematical Derivation of Price and Output Decision.
6.2
Monopoly its basis. The negatively sloping demand curve: Short run and
Long Run equilibrium, Predictions in dynamic changes: Shift in the
Market demand, An increase in the costs of monopolist. Imposition of a
Tax. Comparison with perfect competition: Govt regulated Monopoly.
Monopoly Power its sources and social cost. Monopsony and Monoply
compared. Monopsony Power its sources and social cost. Bilateral
Monopoly. Multi-plant Monopolist Firm, Mathematical Derivation of
Price and Output Decision.
6.3
Monopolistic competitive conditions: The historical setting of the theory
of monopolistic competition, Characteristics of Monopolistically
competitive firms. The concepts of industry & group: The basic
Chamberlin theory of Monopolistic competition:(Model No 1: Equilibrium
with new firms entering the industry, Model No 2: Equilibrium with Price
competition, Model No 3: Equilibrium with Price competition and free
entry). Critique of Chamberlin Model. Comparison with pure competition.
Mathematical Derivation of Price and Output Decision.
6.4
Topic: 7
Pricing With Market Power
Capturing Consumer Surplus. Price Discrimination (First, Second and Third
degrees) Intertemporal Price Discrimination and Peak Load Pricing. The two
part tariff. Advertising. A rule of thumb for advertising. Transfer pricing when
there is no outside market, when there is competitive outside market, when
there is noncompetitive outside market. (A numerical example).
Topic: 8
Pricing of Factors of Production and Income Distribution
Factor Pricing in perfectly competitive and imperfectly competitive Markets.
Elasticity of Factor substitution, Technological progress and Income
Distribution. The Price of fixed Factors: Rents & Quasi-rents. Non
homogenous factors and Wage differentials. The adding up problem and
product exhaustion theorems.
Topic: 9
General Equilibrium and Economic Efficiency
Partial and general Equilibrium Analysis. Two interdependent markets
-moving to general equilibrium (an example). Efficiency in exchange. Equity
and Efficiency. Efficiency in Production.
Topic: 10
Welfare Economics
Criteria of social welfare: Growth of GNP as a welfare criterion, Benthams
criterion, A cardinalist criterion. The Pareto optimality criterion. The KaldorHicks Compensation criterion. The Bergson criterion social welfare function.
Maximization of social welfare. Determination of the welfare maximizing
output mix, Commodity distribution and Resource Allocation. Welfare
Maximization and Perfect Competition.
Recommended Books:
1. Bilas, Richard A, Microeconomic Theory*. McGraw-Hill Kogakusha,Ltd, (2 nd
Edition).
2. Koutsoyiannis, A., Modern Microeconomics*, London, Macmillan, (Latest Edition.
3. Pindyck, Robert. S, Daniel L. Rubinfeld and Prem L.Mehta, Microeconomics*.
Pearson Education Inc, (Sixth Edition).
4. Henderson, J.M & Quandt, R.E., Microeconomic Theory*. N.Y Macmillan II A Book
Co.
5. Varian Hal R., Micro Economics Analysis*, Norton & Company, New York, 1992.
6. Ferguson, C.E & Gould, J.P, Microeconomic Theory. Macmillan, (Latest Edition).
7. Layard and Walter A.A., Micro Economics, McGraw Hills, (Latest Edition).
8. Walter Nicholson, Microeconomic Theory: Basic Principles and Extensions (6th
edition)
Additional Readings:
1. Baumol, W)., Economic Theory and Operations Analysis, Prentice Hall (Last
Edition).
2. Hirshleifer Jack, Price Theory and Applications*, Prentice Hall (Latest Edition).
3. Kameischon: D.T. R., Readings in Microeconomics, Nevi York, The world publishing
co (last Edition).
4. Stiglor, GT., The Theory of price, N.Y Macmillan, London. (Last Edition).
5. Silberberg E., The Structure of Economics, A Mathematical Analysis, McGraw Hill,
(Latest edition).
6. Dwivedi, D.N. Microeconomics theory and applications. Pearson Education Inc,
(Second Edition).
7. Salvatore, Dominick, Micro Economic Theory*, McGraw Hills, (Latest Edition).
(*Strongly Recommended).
NOTE:
Assignment No. 1 will be formulated from Part A and Assignment No. 2 will
be based on Part B.
Show graphically long run supply a curve of an industry is drawn under perfect
competition? Also illustrate graphically the derivation of the long run supply curve of a
firm under perfect competition.
Q2: Why does price leadership sometimes evolve in oligopolistic markets? Explain how the
price leader determines a profit maximization price.
Q3: Monopolistic competition is the middle ground between perfect competition and
monopoly. Explain this statement.
Q4: What is MRP? What roles does it play in the derivation of demand curve for a factor or
production?
Q5: What is marginal rates of transformation (MRT)? Explain why the MRT of one good for
another is equal to the ratio of the marginal costs of producing the two goods.
Assignment No. 1 will be formulated from Part A and Assignment No. 2 will
be based on Part B.
Topic: 8
Optimization: Constrained & Extrema
Free and constrained optimization, extrema of a function of two variables: graphical
analysis, Lagrange method. Utility maximization & Cost minimization. Homogenous
Production function, Cobb Douglas Production function. Jaccobian determinants.
CES Production Function. Translog Function.
Topic: 9
Linear Programming
Ingredients of linear Programming. Graphical approach, simplex method, economic
application of linear programming. Concept of primal & dual. Duality theorems.
Solving of Primal via dual. Economic interpretation of a dual.
Recommended books:
1. Chiang, A.C., Fundamental Methods of Mathematical Economics, McGraw Hills,
(Latest Edition).
2. Baumol W. L., Economic Dynamics, Macmillan, (Latest edition).
3. Budnick, Frank, Applied Mathematics for Business, Economics and Social Sciences.
4. Dowling E. T., Mathematics for economists, Schum Series (latest edition).
5. Weber E. Jean, Mathematical Analysis, Business and Economic Applications (Latest
Edition) I-Harper and Row Publishers, New York.
NOTE:
Assignment No. 1 will be formulated from Part A and Assignment No. 2 will
be based on Part B.
DEPARTMENT OF ECONOMICS
BAHAUDDIN ZAKARIYA UNIVERSITY, MULTAN
ASSIGNMENT NO.1
M.A. ECONOMICS, PART-I, MATHEMATICAL ECONOMICS, PAPER - 4,
INSTRUCTOR: DR. IMRAN SHARIF CHAUDHRY
Q1:(a) Explain the different types of function and give examples from economics.
(b)If A = {2, 3, 4, 5}, B = {3, 5, 7}, C = {1, 2, 3, 4, 5, 6} verify the distributive laws.
Marks:10+10
Q2:(a) Differentiate between partial and general market equilibrium. Also construct the twocommodity model to find out equilibrium level of prices.
(b) If the national income model is as:
Y = C + I + G
C = a + b (Y T)
T = d + ty
(i) List out parametric, their sign and economic meaning
(ii) Identify the exogenous variables
(iii) Find the equilibrium level of national income
Marks:10+10
Marks:10+10
Q4:(a) State and prove the first prove properties of determinant by using the following matrix
2
3
1
A=
0
5
6
3
1
1
(b) If input matrix and final demand vector
0.2
0.3
0.2
A=
0.4
0.1
0.2
0.1
0.3
0.2
(i)
(ii)
(iii)
Q5:
d=
10
5
6
Marks:10+10
Marks:04+04+04+04+04
DEPARTMENT OF ECONOMICS
BAHAUDDIN ZAKARIYA UNIVERSITY, MULTAN
ASSIGNMENT NO.2
M.A. ECONOMICS, PART-I, MATHEMATICAL ECONOMICS, PAPER - 4,
INSTRUCTOR: DR. IMRAN SHARIF CHAUDHRY
Q1:(a) Analyze the comparative static with its limitation and compare with static analysis.
(b) State the limit theorems involving a single and two functions. Why is this concept of
limit important in Economics?
Marks:10+10
Q2:(a) Write out different rules of differentiation with numerical examples.
(b) Explain the economic uses of derivative with examples.
(c) The total money supply has two components: bank deposits D and Cash holding C,
which we assume to bear a constant ratio C/D = c, 0<c<1. The high-powered money
H is defined as the sum of cash holding held by the public and the reserved held by
the banks. Bank reserve are a function of bank deposits, determined by the reserve
ratio r, 0<r<1.
(i)
Express the money supply M as a function of high-powered money H.
(ii)
Would an increase in the reserve ratio r raise or lower the money supply?
(iv)
How would an increase in the cash-deposit ratio c affect the money supply?
Marks:05+09+06
Q3:(a) Construct the partial market equilibrium and find out equilibrium price and quantity.
Also, examine the comparative-static properties of this equilibrium quantity and
check your results by graphical analysis.
(b) A monopolist is facing the following demand function:Q1 = 21 0.1P1, Q2 = 50 0.4 P2 where Q = Q1 + Q2 and its cost C = 2000 + 10Q1 +
10Q2
Find the profit maximizing level of output and prices.
Marks:10+10
Q4:(a) Explain the economic applications of exponential and logarithmic derivatives.
(b) Define the following concepts:(i)
Concave function
(ii)
Convex function
(iii)
Quasiconcavity
(iv)
Quasiconvexity
(c) Define the homogeneous function and determine whether the following functions are
homogenous, If so, of what degree?
(i)
Q = X3 XY2 + 3Y3 + X2Y
(ii)
Q = XY2 + 2XW
W
Also determine return to scale of each of the following production function.
Marks:06+08+06
Q5: Write short note of the following:Marks:05+05+05+05
(i)
(ii)
(iii)
(iv)
Economic interpretation of e
Optimization of multivariable functions in economics
Interpretation of the Lagrange multiplier
Taylors series of expansion
Assignment No. 1 will be formulated from Part A and Assignment No. 2 will
be based on Part B.
DEPARTMENT OF ECONOMICS
BAHAUDDIN ZAKARIYA UNIVERSITY, MULTAN
M.A ECONOMICS PART-I
Paper VI: Major Issues in Pakistans Economy
COURSE INSTRUCTOR: Shahzad Hussain
PART A
Topic: 1
Overview of Pakistan Economy
Development Experience, Approaches, Policies and Outcomes. Identification of
Issues: The era of 1950's, 1960's, 1970's, 1980's 1990's and 2000's. Structural
Change and Sources of Growth. Emergence of Economic Issues, Human
Resource Development, Unemployment, Poverty, Income Distribution, Debt, Deficit
etc. Growth with limited development in Pakistan.
Topic: 2
Development Planning and Resource Mobilization
Agricultural Development Policies and Priorities, Major Targets of Development
Plans and Emerging Issues; Neglects and Successes: Mobilization of Domestic
Resources; Shortages, Deficits and Role of Foreign Aid. Agricultural Vs. Industrial
Development Debate. Agricultural Adequacy.
Topic: 3
Agriculture and Industrial Development: Emerging Issues
Pattern of' Agricultural and Industrial Development, Land Reforms and Its Impacts,
the Role of Green Revolution and its Impacts: Present Status.' Agricultural Price
Policy and Income Tax. Sectoral Terms of Trade.
Industrial Development Policies and Strategies. Development of Large and Small
Industries. Value Added: Manufacturing Goods Vs. Primary Goods, Production.
Agriculture Vs. Industry: Development Debate.
Topic: 4
Sectoral Development, Employment Patterns and Unemployment
Sectoral Priorities and Development Issues. Human Resource Development and
Emerging Issues: Population Growth, Labor Force Participation Rate and
Employment Pattern, Unemployment and Underemployment, Forecasting Manpower
Needs and Employment. Strategies to combat unemployment. .
Criteria to Measure. Unemployment/Underemployment: Time Criterion,
Productivity Criterion and New Index of Unemployment: Application to Pakistan
and Empirical Evidences. Good Governance, Social Action Plan and its Impact.
Role of Institution in Development. Social Sectors development Vs. High Return
Sectors: Growth trade off.
PART B
Topic: 5
International Debt and Dependency
Concepts of Foreign Aid and Debt. Borrowing Vs. Domestic Reserve Mobilization
(failure). Size of Foreign Debt, Debt Servicing and its Impacts. Strategies to combat
with High Debt Servicing Policy, Foreign Trade. Promotion, Cutting nondevelopment Expenditures, Rescheduling and its Impacts. Debt Management in
Pakistan and Its Impacts. Debt Modeling and Future Implications.
Topic: 6
Poverty and Income Distribution
Pattern of Income Distribution: Rural and Urban. Definitions and Approaches to
Measure Poverty: Income Approach, Expenditure Approach, Basic Needs Approach,
Assignment No. 1 will be formulated from Part A and Assignment No. 2 will
be based on Part B.
a)
b)
Q3:
a)
b)
Q4: Describe the unemployment situation in Pakistan. Also suggest remedial measures to
reduce unemployment.
Q5: Discuss the development of social sectors in Pakistan. How these sectors can play their
role in development process?