PAPER 4.1. ECONOMICS–II - TEXT BOOK

UNIT - I Introduction: Meaning, Nature and Scope, Importance of Macro-Economics, Limitations of Macro-Economics, Difference between Micro and Macro-Economics; Circular Flow of Income: Stock and Flow, Comparative Static and Comparative Dynamic Model, Circular flow of Income in Two–Sector and Three–Sector Model;

UNIT - II National Income Accounting: Meaning of National Income and National Product, Measurement of National Income, Difficulties in the Measurement of National Income, National Income as a Measure of Welfare and Economic Progress;

UNIT - III Theory of Income and Employment: Classical Theory of Output and Employment, Say‘s Law of Markets, Keynesian Theory of Income Determination, Determinants of Macro Equilibrium with Aggregate Demand and Aggregate Supply Functions under Employment, Keynes‘ Criticism of Say‘s Law and Classical Theory of Income and Employment, Theory of Multiplier; 

UNIT - IV Business Cycles: Phases of Business Cycles, Features of Business Cycles, Theories of Business Cycles– Hawtrey‘s Monetary Theory, Hayek‘s over Investment Theory, Keynes‘ View on Trade Cycle;

UNIT - V Theory of Money: Functions for Money, Classification, Supply and Demand for Money, Effects of Money on Output and Prices Inflation and Deflation, Monetary Policy, Money Markets and Capital Markets Commercial Banking–Functions Organization and Operations Central Banking– Functions and Credit Control, Non–Banking Financial Institutions– Meaning, Role; Distinction between Banks and NBFI;