Rajasthan Board Economics Syllabus for Class 12

Rajasthan Board Syllabus for Class 12 Economics

Introductory Micro Economics:


1. Introduction


Meaning of micro economics and macro economics.

What is an economy? Central problems of an economy : what, how and for whom to

produce; concepts of production possibility frontier and opportunity cost.


2.Consumer Equilibrium and Demand


Consumer’s equilibrium – meaning of utility, marginal utility, law of diminishing

marginal utility, conditions of consumer’s equilibrium using marginal utility

analysis. (Underlined topics are not to be examined but to be discussed in class)

Indifference curve analysis of consumer’s equilibrium-the consumer’s budget (budget

set and budget line), preferences of the consumer (indifference curve, indifference map)

and conditions of consumer’s equilibrium.

Demand, market demand, determinants of demand, demand schedule, demand curve,

movement along and shifts in the demand curve; price elasticity of demand - factors

affecting price elasticity of demand; measurement of price elasticity of demand – (a)

percentage-change method and (b) geometric method (linear demand curve);

relationship between price elasticity of demand and total expenditure


3. Producer Behavior and Supply


Production function: Total Product, Average Product and Marginal Product.

Returns to a Factor. Cost and Revenue: Short run costs - total cost, total fixed cost,

total variable cost; Average fixed cost, average variable cost and marginal cost-meaning

and their relationship. Long term cost- average and marginal cost.


Revenue - total, average and marginal revenue.


Producer’s equilibrium-meaning and its conditions- interms of marginal revenue-marginal



Supply, market supply, determinants of supply, supply schedule, supply curve

movements along and shifts in supply curve. (Underlined topics are not to be examined

but to be discussed in class)


price elasticity of supply; measurement of price elasticity of supply – (a) percentage

change method and (b) geometric methods.



4. Forms of Market and Price Determination



Perfect competition - features. Determination of market Equilibrium and effects of

shifts in demand and supply.


Other market forms- monopoly, monopolistic competition oligopoly - their meaning and




5. Simple applications of Tools of demand and supply (not to be examined)


6. National Income and related aggregates


Some basic concepts : consumption goods, capital goods, final goods, intermediate

goods; stocks and flows; gross investment and depreciation.


Circular flow of income; Methods of calculating National Income – Value Added or

Product method, Expenditure method, Income method.


Aggregates related to National Income:


Gross National Product (GNP), Net National Product (NNP), Gross and Net

Domestic Product (GDP and NDP) - at market price, at factor cost; National

Disposable Income (gross and net), Private Income, Personal Income and Personal

Disposable Income; Real and Nominal GDP. GDP and Welfare


7. Money and Banking


Money – its meaning and functions Demand of money- Transaction Motive, Speculative



Supply of money – Currency held by the public and net demand deposits held by

commercial banks. Money creation by the commercial banking system. Central bank

and its functions (example of the Reserve Bank of India).


8. Determination of Income and Employment


Aggregate demand and its components.

Propensity to consume and propensity to save (average and marginal).(Underlined topics

are not to be examined but to be discussed in class)

Short–run equilibrium output; investment multiplier and its mechanism.

Meaning of full - Employment and involuntary unemployment, problems of excess

demand, deficient demand ; measures to correct them - change in government spending,

availability of credit.


9.Government Budget and the Economy


Government budget - meaning, objectives and components.

Classification of receipts - revenue receipt and capital receipt; classification of

expenditure - revenue expenditure and capital expenditure.

Measures of government deficit - revenue deficit, fiscal deficit, primary deficit:their

meaning. Fiscal policy and its role.


10. Balance of Payments


Balance of payments account - meaning and components; balance of payments deficit meaning.

Foreign exchange rate – meaning of fixed and flexible rates and managed

floating. Determination of exchange rate in a free market.


Prescribed Books:


1. Microeconomics - NCERT's Book Published under Copyright

2. Macroeconomics - NCERT's Book Published under Copyright

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