MP Board Class 12 Economics Syllabus 2025-26: MPBSE 12th Economics Syllabus Download PDF

Microeconomics: An Introduction Chapter

Introduction

General economy, central institutions of economy, organization of economic activities, (centrally planned economy, market economy), positive and ideal economics, microeconomics and macroeconomics, book plan.

Theory of consumer behavior

Utility (cardinal utility analysis, ordinal utility analysis), consumer's budget (budget set and budget line, changes in budget set), consumer's optimal choice, demand (demand curve and law of demand, derivation of demand lines from indifference curves and budget constraints, normal and inferior goods, substitutes and complements, shifts in the demand curve, movements in the direction of the demand curve and shifts in the demand curve), market demand, elasticity of demand (elasticity in the direction of a linear demand curve, factors determining price elasticity of demand for a commodity, elasticity and expenditure.

Production and Cost

Production function, short run and long run, total product, average product, and marginal product (total product, average product, marginal product), law of diminishing marginal product and law of variable proportions, shapes of total product, marginal product, and average product over time, returns to scale, cost (short run cost, long run cost)

Theory of the firm in conditions of perfect competition

Perfect competition: Definitional characteristics, attainment, profit maximization, a firm's supply curve (a firm's short-run supply curve, a firm's long-run curve, production closure point, normal profit, and profit unprofitability).

Market Equilibrium

Equilibrium, maximization, excess supply (market equilibrium: fixed number of firms, market equilibrium: entry and exit), applications (price ceiling, price ceiling)

Macroeconomics: An Introduction Chapter

Introduction

The emergence of macroeconomics, with reference to the present book of macroeconomics

National Income

Some basic concepts of macroeconomics, circular flow of income, and methods of computation of national income (product or value added method, expenditure method, income method, factor cost, base prices and market prices), some macroeconomic identities, monetary GDP and real taxes, GDP and welfare.

Money and Banking

Functions of money, demand for and supply of money (demand for money, supply of money), credit creation by the banking system (balance sheet of a hypothetical bank, limits to credit creation and money multiplier, policy instruments to control money supply.

Determination of Income and Employment

Aggregate demand and its components.

Average and marginal propensities for consumption and saving.

Output at short-term equilibrium; the mechanism of the investment multiplier.

Meanings of voluntary unemployment and full employment.

Excess and insufficient demand issues, and solutions like adjustments to government expenditure, taxation, and the money supply.

Government Budget and the Economy

Government budget – meaning, objectives, and components.

Classification of receipts – revenue receipts and capital receipts;

Classification of expenditure – revenue expenditure and capital expenditure.

Balanced, Surplus, and Deficit Budget – measures of government deficit.

Payments Balance

Meaning and components of the balance of payments account;

Payments balance: Surplus and Deficit

Foreign exchange rate definition includes managed floating, flexible rates, and fixed rates.

Exchange rate determination in a free market, Benefits and drawbacks of fixed and variable exchange rates.

Managed System of floating exchange rates