Economics is one of the most important and interesting subject of class 11th Commerce. It deals with the study of production, distribution and consumption of goods and services. It helps a student to get aware about how an economy as an individual or as a whole works. Economics has a two broad branches- Microeconomics, where the individual analysis is done and Macroeconomics, where the analysis on the economy as a whole is done. Economics reasoning and theories is widely used in the recent era and therefore it is quite easy for the class 11th students to relate the concepts with real life situations. Therefore, a proper understanding of the topics can help students to score well in this particular subject.
Economics is an important subject for every individual as there are many economic decisions which everyone in the society has to make. The decision may be pertaining to choosing a job in the labour market, buying a commodity in the market, starting a new enterprise, investing your savings or paying taxes to the government. Understanding of economics help in making correct decisions. Since its knowledge is needed in all spheres of life, the subject is offered to students of all the three streams Science, Commerce and Humanities in class 11.
In Class 11 the two papers which are offered to Economic students are-
• Introduction to Microeconomics
• Elementary Statistics
Introduction to Microeconomics
Microeconomics covers four units –
• Introduction to Microeconomics-
We all are aware that resources are limited for an individual as well as for the society. We all have a limited amount of time and money but our wants are unlimited and they keep reoccurring in nature. We have to make calculated microeconomic decisions on how to use limited and scarce resources to maximise personal satisfaction. This chapter emphasises on this economic problem and its universality all over the world.
• Consumer’s Equilibrium and Demand-
The unit deals with how the consumer decides as to how many units to consume of a certain commodity. Two theories i.e. Utility approach and Indifference curve approach explain the behaviour of a consumer in the market .Both the theories derive the law of demand which states that price and demand are inversely related assuming other factors are kept constant .This unit also explains to the students the famous law of Economics which is Law of Diminishing Marginal utility.
• Theory of Producer Behaviour and Supply-
From consumer we move in this unit to make students understand the behaviour of producer. Producer aims to maximise profits. Profit is the difference between revenue and costs. To understand Producer’s equilibrium therefore it becomes essential to comprehend the behaviour of cost and revenue as producer increases its output in short run. The unit explains production function, cost function, Revenue function and Producers’ equilibrium. Once a student understands the derivation of supply curve is the rising part of MC curve (over and above the average variable cost), the unit concludes with the factors that affect the supply of a commodity.
• Forms of market and price determination under perfect competition with simple applications-
Last unit deals with four different market forms, i.e., Perfect Competition, Monopoly, Monopolistic Competition and Oligopoly. After understanding the behaviour of consumer and producer it becomes easier to understand the price fluctuations that happen in perfect competitive markets.
Alfred Marshall stated that “Statistics are the straw out of which I, like every other economist, have to make bricks”. Researchers, Insurance companies, Medical professionals, Business Houses, Traders, Doctors, Governments, Banks and Investors almost all the institutions need to analyse statistical data relating to their occupation. Thus this branch of Economics is extensively used in practical life. Syllabus of class11 is divided into three units:
• Introduction to Statistics-
This deals with its importance and its relevance in today’s world. Statistics can be defined in two ways – Singular sense and Plural Sense .Both the definitions are dealt with in this chapter .The chapter concludes with the limitations of statistics and its distrust.
• Collection, Organisation and Presentation of data-
The unit discusses the different types of data i.e. Primary and Secondary Data, different methods of data collection i.e. Census and Sample methods and different techniques of data presentation in the form of Tables, Graphs and diagrams. The unit also discusses the formation of three different forms of series i.e. Individual observations, Discreet Series and Continuous series.
• Statistical tools and Interpretation-
After collecting data the most important task is analysing and interpretation of data. This unit gives knowledge to the student as to how the following tools are calculated - Measure of central tendency like Arithmetic mean, Median and Model, Measures of variation like Mean Deviation and standard deviation, Measures of Correlation like Karl Pearson’s and Rank Correlation Coefficient, Index Numbers like Unweighted and Weighted Index Numbers.