Economics: An Orientation Sunitha.S Assistant Professor School of Management Studies, National Institute of Technology (NIT) Calicut Industrial Economics Lecture 1 30 Dec 2009

Why should engineers study Economics? What happens when you decide a new design? Do you need to take a feasibility appraisal? What are the things which you consider before implementing the project? How can you implement the marketing of your product? Do you have to consider any other entity apart from your ultimate customers? If there are two solutions for the problem, how will you select the best solution? 2

Starting a firm or business!! Do I need to borrow or take my own funds? If to borrow, what are the means of doing it? share capital, bank loans? How will I know my production plan? How much should I produce? For whom shall I produce? Who are my competitors and do they really matter to me? What should be the price fixed ? Will I ever make profits? 3

What all information do you require to set up a firm or to sell an idea? Demand and supply CostCapital Skilled labour Markets Market regulations Taxation Insurance 4

News that make headlines!! RBI increases CRR to 6%!! Inflation rises to 4 %!! Rupee falls to Dollar!!currency depreciation!! Sensex gains by 200 points!! Recession sets back the economy Tax cuts Asian economies soaring high Financial Scams everywhere 5

Topics to be discussed in the Course duration

Micro Economics Demand Analysis: – Elasticity of Demand & Applications – Demand Forecasting Theories of Production Costs Concepts & Behaviour Productivity & Efficiency

Economies of scale & scope Market structure Differential pricing Organizational forms & business motives Break Even Analysis

Macro Economic aggregates National Income: Concepts & measurement Inflation and Deflation Fiscal & Monetary policies

Monetary system Money Market Capital market Commercial Banks Industrial Finance: Development banks Role of RBI

International Economics International trade Foreign exchange market Balance of Payments (BOP) versus Balance of Trade (BOT) Disequilibrium in BOP Regulation of trade

Public Finance Public expenditure Taxation: types Public Debt Budget Externalities

Course evaluation Midterm Quiz (2 Quizzes- by the end of January & March respectively) Group Presentation End Semester exam

Group Presentation Preferably 3 students to form a group and have to give 20 minutes presentation. i.e, each has to present for approximately 6 minutes and followed by 5 minutes of discussion. Finally, a report of the topic for presentation has to be submitted.

Quiz Pattern Quiz could either be open book or a closed one. Type of questions range from objective type, numericals, case analysis, short answer type and essay type. Thank You