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  #2  
29th July 2015, 09:30 AM
Super Moderator
 
Join Date: Mar 2013
Re: SSC Economics Notes Pdf

As you want I am here giving you notes/Syllabus for Economics topics for Combined graduate level examination of Staff Selection Commission (SSC).

Economics Syllabus :

Consumer Behavior:
The budget set is the collection of all bundles of goods that a consumer can buy
with her income at the prevailing market prices.
The budget line represents all bundles which cost the consumer her entire income.
The budget line is negatively sloping.
• The budget set changes if either of the two prices or the income changes.
• The consumer has well-defined preferences over the collection of all possible
bundles. She can rank the available bundles according to her preferences
over them.
• The consumer’s preferences are assumed to be monotonic.
• An indifference curve is a locus of all points representing bundles among which
the consumer is indifferent.
• Monotonicity of preferences implies that the indifference curve is downward
sloping.
• A consumer’s preferences, in general, can be represented by an indifference map.
• A consumer’s preferences, in general, can also be represented by a utility function.
• A rational consumer always chooses her most preferred bundle from the budget set.
• The consumer’s optimum bundle is located at the point of tangency between the
budget line and an indifference curve.
• The consumer’s demand curve gives the amount of the good that a consumer
chooses at different levels of its price when the price of other goods, the consumer’s
income and her tastes and preferences remain unchanged.
• The demand curve is generally downward sloping.
• The demand for a normal good increases (decreases) with increase (decrease) in
the consumer’s income.
• The demand for an inferior good decreases (increases) as the income of the
consumer increases (decreases)
The market demand curve represents the demand of all consumers in the market
taken together at different levels of the price of the good.
• The price elasticity of demand for a good is defined as the percentage change in
demand for the good divided by the percentage change in its price.
• The elasticity of demand is a pure number.
• Elasticity of demand for a good and total expenditure on the good are closely
related.

Production and Cost
For different combinations of inputs, the production function shows the maximum quantity of output that can be produced.
• In the short run, some inputs cannot be varied. In the long run, all inputs can be
varied.
• Total product is the relationship between a variable input and output when all
other inputs are held constant.
• For any level of employment of an input, the sum of marginal products of every
unit of that input up to that level gives the total product of that input at that
employment level.
• Both the marginal product and the average product curves are inverse ‘U’-shaped.
The marginal product curve cuts the average product curve from above at the
maximum point of average product curve.
• In order to produce output, the firm chooses least cost input combinations.
• Total cost is the sum of total variable cost and the total fixed cost.
• Average cost is the sum of average variable cost and average fixed cost.
• Average fixed cost curve is downward sloping.
• Short run marginal cost, average variable cost and short run average cost curves
are ‘U’-shaped.
• SMC curve cuts the AVC curve from below at the minimum point of AVC.
• SMC curve cuts the SAC curve from below at the minimum point of SAC.
• In the short run, for any level of output, sum of marginal costs up to that level
gives us the total variable cost. The area under the SMC curve up to any level of
output gives us the total variable cost up to that level.
• Both LRAC and LRMC curves are ‘U’ shaped.
• LRMC curve cuts the LRAC curve from below at the minimum point of LRAC.

Economics : The Theory of the Firm under Perfect Competition
In a perfectly competitive market, firms are price-takers.
The total revenue of a firm is the market price of the good multiplied by the firm’s
output of the good.
For a price-taking firm, average revenue is equal to market price.
For a price-taking firm, marginal revenue is equal to market price.
The demand curve that a firm faces in a perfectly competitive market is perfectly
elastic; it is a horizontal straight line at the market price.
The profit of a firm is the difference between total revenue earned and total cost
If there is a positive level of output at which a firm’s profit is maximised in the
short run, three conditions must hold at that output level
(i) p = SMC
(ii) SMC is non-decreasing
(iii) p ≥ AV C.
If there is a positive level of output at which a firm’s profit is maximised in the
long run, three conditions must hold at that output level
(i) p = LRMC
(ii) LRMC is non-decreasing
(iii) p ≥ LRAC.
The short run supply curve of a firm is the rising part of the SMC curve from and
above minimum AVC together with 0 output for all prices less than the minimum
The long run supply curve of a firm is the rising part of the LRMC curve from and
above minimum LRAC together with 0 output for all prices less than the minimum
Technological progress is expected to shift the supply curve of a firm to the right.
An increase (decrease) in input prices is expected to shift the supply curve of a
firm to the left (right).
The imposition of a unit tax shifts the supply curve of a firm to the left.
The market supply curve is obtained by the horizontal summation of the supply
curves of individual firms.
The price elasticity of supply of a good is the percentage change in quantity
supplied due to one per cent change in the market price of the good.
Economics : Market Equilibrium
In a perfectly competitive market, equilibrium occurs where market demand
equals market supply.
• The equilibrium price and quantity are determined at the intersection of the
market demand and market supply curves when there is fixed number of firms.
• Each firm employs labour upto the point where the marginal revenue product
of labour equals the wage rate.
• With supply curve remaining unchanged when demand curve shifts rightward (leftward), the equilibrium quantity increases (decreases) and equilibrium price increases (decreases) with fixed number of firms.
With demand curve remaining unchanged when supply curve shifts rightward (leftward), the equilibrium quantity increases (decreases) and equilibrium price decreases (increases) with fixed number of firms.
• When both demand and supply curves shift in the same direction, the effect
on equilibrium quantity can be unambiguously determined whereas the
effect on equilibrium price depends on the magnitude of the shifts.
• When demand and supply curves shift in opposite directions, the effect on equilibrium price can be unambiguously determined whereas the effect on equilibrium quantity depends on the magnitude of the shifts.
In a perfectly competitive market with identical firms if the firms can enter and exit the market freely, the equilibrium price is always equal to minimum average cost of the firms.
• With free entry and exit, the shift in demand has no impact on equilibrium price but changes the equilibrium quantity and number of firms in the same direction as the change in demand.
• In comparison to a market with fixed number of firms, the impact of a shift in demand curve on equilibrium quantity is more pronounced in a market with free entry and exit.
• Imposition of price ceiling below the equilibrium price leads to an excess demand.
• Imposition of price floor above the equilibrium price leads to an excess supply

Economics : Non-competitive Markets
The market structure called monopoly exists where there is exactly one seller
in any market.
• A commodity market has a monopoly structure, if there is one seller of the
commodity, the commodity has no substitute, and entry into the industry
by another firm is prevented.
• The market price of the commodity depends on the amount supplied by the
monopoly firm. The market demand curve is the average revenue curve for
the monopoly firm.
• The shape of the total revenue curve depends on the shape of the average
revenue curve. In the case of a negatively sloping straight line demand curve,
the total revenue curve is an inverted vertical parabola.
• Average revenue for any quantity level can be measured by the slope of the
line from the origin to the relevant point on the total revenue curve.

-Marginal revenue for any quantity level can be measured by the slope of the
tangent at the relevant point on the total revenue curve.
The average revenue is a declining curve if and only if the value of the marginal
revenue is lesser than the average revenue.
• The steeper is the negatively sloped demand curve, the further below is the
marginal revenue curve.
• The demand curve is elastic when marginal revenue has a positive value, and
inelastic when the marginal revenue has a negative value.
• If the monopoly firm has zero costs or only has fixed cost, the quantity supplied
in equilibrium is given by the point where marginal revenue is zero. In
contrast, perfect competition would supply an equilibrium quantity given by
the point where average revenue is zero.
• Equilibrium of a monopoly firm is defined as the point where MR = MC
and MC is rising. This point provides the equilibrium quantity produced.
The equilibrium price is provided by the demand curve given the
equilibrium quantity.
• Positive short run profit to a monopoly firm continue in the long run.
• Monopolistic competition in a commodity market arises due to the commodity
being non-homogenous.
• In monopolistic competition, the short run equilibrium results in quantity
produced being lesser and prices being higher compared to perfect
competition. This situation persists in the long run, but long run profits
are zero.
• Oligopoly in a commodity market occurs when there are a small number of
firms producing a homogenous commodity.
  #3  
9th May 2020, 01:08 PM
Super Moderator
 
Join Date: Aug 2012
Re: SSC Economics Notes Pdf

Economics Notes







Important Questions for SSC CGL exam

Q1. The process of curing inflation by reducing money supply is called

(a) Cost-push inflation

(b) Demand-pull inflation

(c) Disinflation

(d) Reflation

Q2. Indian agriculture is typically characterized as

(a) land surplus, labour scarce economy

(b) land surplus, labour surplus economy

(c) land scarce, labour surplus economy

(d) land scarce, labour scarce economy

Q3. Which of the following items is a major item of Indian export?

(a) Computer chips

(b) Potato chips

(c) Textile garments

(d) Car engines

Q4. Price theory is also known as

(a) Macro

(b) Development

(c) Public

(d) Micro

Q5. Which of the statements is correct about India’s national income?

(a) Percentage share of agriculture is higher than services

(b) Percentage share of industry is higher than agriculture

(c) Percentage share of services is higher than industry

(d) Percentage share of services is higher than agriculture and industry put together

Q6. The gradation and standardization of agricultural products are conducted through

(a) Food Corporation of India

(b) Directorate of Marketing and Inspection

(c) Indian Standards Institution

(d) Central Statistical Organization

Q7. When too much money is chasing too few goods, the situation is

(a) Deflation

(b) Inflation

(c) Recession

(d) Stagflation

Q8. One of the main factors that led to rapid expansion of Indian exports is

(a) Imposition of import duties

(b) Liberalization of the economy

(c) Recession in other countries

(d) Diversification of exports

Q9. Cheap money means

(a) Low rates of interest

(b) Low level of saving

(c) Low level of income

(d) Low level of standard of living.

Q10. Compared to the rich the poor save

(a) A larger part of their income

(b) An equal part of their income

(c) A smaller part of their income

(d) All of their incomes

Q11. Kisan Credit Card scheme was introduced in

(a) 1991

(b) 1996

(c) 1998

(d) 2000

Q12. Government takes ‘ways and means advances’ from

(a) RBI

(b) IDBI

(c) SBI

(d) ICICI

Q13. ‘NABARD’ is associated with the development of

(a) agricultural sector and rural areas

(b) heavy industries

(c) banking sector

(d) real estates

Q14. The permission given to a bank customer to draw cheques in excess of his current account balance is called

(a) a personal loan

(b) an ordinary loan

(c) discounting a bill of exchange

(d) an overdraft

Q15. Which of the following taxes is not collected by the Central Government?

(a) Income tax

(b) Customs duty

(c) Professional tax

(d) Excise duty

Q16. Tire supply of agricultural products is generally Important Questions by pinnacle

(a) elastic

(b) inelastic

(c) perfectly elastic

(d) perfectly inelastic


Q17. With which form of economy is the term ‘Laissez-faire’ associated?
(a) Capitalist economy

(b) Socialist economy

(c) Mixed economy

(d) Command economy

Q18. When the total product rises at an increasing rate, the

(a) marginal product is zero

(b) marginal product is rising

(c) marginal product is falling

(d) marginal product remains constant

Q19. The definition of ‘small-scale industry’ in India is based on

(a) sales by the unit

(b) Investment in machines and equipments

(c) market coverage

(d) export capacity

Q20. Economies of Scale means reduction in

(a) unit cost of production

(b) unit cost of distribution

(c) total cost of production

(d) total cost of distribution

Q21. Free Trade refers to

(a) free movement of goods from one country to another

(b) movement of goods free of cost

(c) unrestricted exchange of goods and service

(d) trade free of duty

Q22. Imputed gross rent of owner occupied buildings is a part of

(a) capital formation

(b) final consumption

(c) intermediate consumption

(d) consumer durable

Q23. Purchasing Power Parity theory is related with

(a) Interest rate

(b) Bank rate

(c) Wage rate

(d) Exchange rate

Q24. Excise duty on a commodity is payable with reference to its

(a) production

(b) production and sale

(c) production and transportation

(d) production, transportation and sale

Q25. Knowledge, technical skill, education etc. in , are regarded as

(a) social-overhead capital

(b) human capital

(c) tangible physical capital

(d) working capital

Q26. Which is the most essential function of an entrepreneur ?

(a) Supervision

(b) Management

(c) Marketing

(d) Risk bearing

Q27. Bank Rate refers to the Interest rate at which

(a) Commercial banks receive deposits from the public

(b) Central bank gives loans to Commercial banks

(c) Government loans are floated

(d) Commercial banks grant loans to their customers

Q28. All of the goods which are scarce and limited in supply are called

(a) Luxury goods

(b) Expensive goods

(c) Capital goods

(d) Economic goods

Q29. Which of the following is a better measurement of Economic Development?

(a) GDP

(b) Disposable income

(c) NNP

(d) Per capita income

Q30. Foreign currency which has a tendency of quick migration is called

(a) Scarce currency

(b) Soft currency

(c) Gold currency

(d) Hot currency

Q31. In India, disguised unemployment is generally observed in

(a) the Agricultural sector

(b) the Factory sector

(c) the Service sector

(d) All these sectors

Q32. The demand curve for a Giffen good is

(a) upward rising

(b) downward falling

(c) parallel to the quantity axis

(d) parallel to the price axis

Q33. “Supply creates its own demand” – Who said this ?

(a) J. B. Say

(b) J.S. Mill

(c) J. M. Keynes

(d) Senior

Q34. Engel’s Law states the relationship between

(a) quantity demanded and price of a commodity

(b) quantity demanded and price of substitutes

(c) quantity demanded and tastes of the consumers

(d) quantity demanded and income of the consumers

Q35. Which one of the following items is not included in the current account of India’s Balance of Payments ?

(a) Short-term commercial borrowings

(b) Non-monetary gold movements

(c) Investment income

(d) Transfer payments

Q36. Capital : Output Ratio of a measures

(a) its per unit cost of production

(b) the amount of capital invested per unit of output

(c) the ratio of capital depreciation to quantity of output

(d) the ratio of working capital employed to quantity of output

Q37. ‘The national income consists of a collection of goods and services reduced to common basis by being measured in terms of money.”— Who says this?

(a) Samuelson

(b) Kuznets

(c) Hicks

(d) Pigou

Q38. What does ECS in banking transactions stand for?

(a) Excess Credit Supervisor

(b) Extra Cash Status

(c) Exchange Clearing Standard

(d) Electronic Clearing Service

Q39. Which of the following is the classification of Industries on the basis of raw-materials?

(a) Small Scale -Large scale

(b) Primary and Secondary

(c) Basic and Consumer

(d) Agro-based and Mineral based

Q40. Who propounded the ‘market law?

(a) Adam Smith

(b) J.B. Say

(c) T.R. Malthus

(d) David Recardo

Q41. The practice of selling goods in a foreign country at a price below their domestic selling price is called

(a) ‘diplomacy’

(b) ‘discrimination’

(c) ‘dumping’

(d) ‘double pricing

Q42. An expenditure that has been made and cannot be recovered is called

(a) Variable cost

(b) Opportunity cost

(c) Sunk cost

(d) Operational cost

Q43. Bank deposits that can be withdrawn without notice are called

(a) account payee deposits

(b) fixed deposits

(c) variable deposits

(d) demand deposits

Q44. New capital issue is placed in

(a) Secondary market

(b) Grey market

(c) Primary market

(d) Black market


Q45. Prime cost is equal to
(a) Variable cost plus administrative cost

(b) Variable cost plus fixed costs

(c) Variable cost only

(d) Fixed cost only

Q46. If the tax rate increases with the higher level of income, it shall be called

(a) Proportional tax

(b) Progressive tax

(c) Lump sum tax

(d) Regressive tax

Q47. Capital formation in an economy depends on

(a) Total Income

(b) Total demand

(c) Total savings

(d) Total production

Q48. Industrial exit policy means

(a) forcing foreign companies to leave India

(b) forcing business units to move out of congested localities

(c) allowing manufacturers to shift their line of products

(d) allowing business units to dose down

Q49. Which of the following does not determine supply of labour?

(a) Size and age-structure of population

(b) Nature of work

(c) Marginal productivity of labour

(d) Work-leisure ratio

Q50. if the price of tea fails, demand for coffee will

(a) increase

(b) decrease

(c) remain same

(d) None of these
Attached Files
File Type: pdf SSC Economics Notes Pdf.pdf (1.23 MB, 64 views)


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