Introduction to Economics

CHRP - Introduction to Economics, Pdf notes, syllabus and past papers

CHRP 06 Introduction to Economics

This course unit is intended to equip the learners with knowledge, skills and attitudes that would enable them to appreciate the various economic issues that affect the functions of organizations.

General Objective

To equip learners with knowledge, skills and attitudes for making decisions that influence economic development.

Learning Outcomes

At the end of this course unit, the learner will be able to:

  1. Apply economics skills and knowledge in management of resources.
  2. Demonstrate skills and knowledge for use in management.
  3. Discuss role of Human Resource in economics development.
  4. To appreciate the link between Economics and other disciplines in Economic development.


Meaning and Scope of Economics

  • Defining meaning of scope of economic
  • Microeconomics and macroeconomics
  • Economics theories, laws(principles) and models
  • Human wants and needs
  • Economics resources
  • Microeconomics and macroeconomics
  • Economic theories, laws (principles) and models

Concept of Security and Choice

  • Meanings of scarcity of scarcity and choice
  • Opportunity cost
  • Resource allocation
  • Basic economic questions
  • Production possibilities frontier
  • Economic systems
  • Concept of utility
  • Total, average and marginal utility
  • Law of diminishing marginal utility

Demand Analysis

  • Meaning of market and demand
  • Law demand
  • Individual and market demand schedule, demand curve and demand function
  • Why demand curves normally¬† slope downward
  • Factors affecting demand for commodity
  • Change in quantity demanded
  • Change in demand
  • Substitution and complementary goods
  • Factors influencing change in demand
  • Abnormal demand
  • Factors affecting price elasticity
  • Cross elasticity of demand
  • Income elasticity

Supply Analysis

  • Meaning of supply
  • Law supply
  • Factors affecting supply of a product
  • Change in quantity supplied
  • Change supply
  • Abnormal supply
  • Elasticity of supply
  • Factors affecting elasticity of supply
  • Application of elasticity of supply

Price Determination

  • Meaning of price
  • Price mechanism
  • Equilibrium price and quantity
  • Changes in equilibrium price and quantity
  • Effects of price floors and ceilings
  • Effects of government expenditure, taxes, subsides and quotas

Production Theory

  • Meaning of production
  • Purpose of production
  • Levels of production
  • Factors of production and their rewards
  • Production function
  • Production period
  • Law of diminishing returns
  • Law of variable proportions
  • The three stages of production
  • Returns to a factor of production
  • Returns to scale

Theory of the Firm

  • Distinction between firm and industry
  • Concepts/types of costs
  • Total cost, average cost and marginal cost
  • Relationship between average total cost(ATC)average variable cost (AVC) and marginal cost (MC)
  • Distinction between firm and industry
  • Meaning of revenue
  • Total revenue, average revenue and marginal revenue
  • Demand curve and average revenue
  • Relationship between average revenue (AR) and marginal revenue (MR)
  • Economics and diseconomies of scale
  • Location of an industry
  • Factors affecting location of industry
  • Localization and delocalization of industry
  • Optimal size of the firm
  • Equilibrium of the firm
  • Profits and losses
  • Short-run equilibrium
  • Long-run equilibrium

Market Structures

  • Definition of market structure
  • Perfect competition
  • Monopoly
  • Monopolistic competition
  • Oligopoly

National income

  • Meaning of national income
  • Forms/concepts of national income
  • Income, product and expenditure approaches to computing national income
  • Income per capital
  • Importance of national income statistics
  • Circular flow of national income
  • Injections and withdrawals
  • Autonomous and induced expenditure
  • National income equilibrium
  • Simple keynesian multiplier and its assumptions
  • National income equation
  • Inflationary an deflationary gaps
  • Causes of income disparities

Monetary Policy

  • Meaning and objectives of monetary policy
  • Tools of monetary policy
  • Evolution of money
  • Characteristics of money
  • Functions of money
  • Supply and demand for money
  • Theories of money
  • Inflation and deflation
  • Consumer price index (CPI)
  • Meaning , objectives and tools of monetary policy
  • Central banking
  • Commercial banking
  • Credit creation
  • Other financial intermediaries, their functions and role in development
  • Money and capital markets

International Trade

  • Meaning and importance of international trade
  • Specialization and division of labour
  • Theories of comparative advantage and absolute advantage
  • Terms of trade
  • Advantage and disadvantages of international trade
  • Reasons for protecting domestic industry
  • Barriers to international trade
  • Balance of payments
  • Solutions of balance of payments problems
  • Foreign exchange rate systems
  • Role of WTO and regional economic blocs
  • International monetary fund (IMF) and¬† world bank

Labour and Unemployment

  • Definition¬† of population
  • Population growth and its effects
  • Theories and determination of wages
  • Demand for and supply of labour
  • Meaning, types and causes of unemployment
  • Measures to alleviate unemployment problem

Economic Growth and Development

  • Distinction between economic growth and development
  • Characteristics of LDCs
  • Theories of economic growth and development
  • Meaning of economic planning
  • Need for development planning
  • Types of development plans
  • Principles of development planning
  • Logical planning framework
  • Development planning strategies limitation of development plans

Emerging Issues in Economic Development

  • Internal environment factors
  • External environmental factor
  • International trends and issues
  • Challenges posed by emerging economic trends and issues
  • Coping with challenges posed by emerging trends and issues in economics

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