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Applied Economics - Syllabus

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1. Course Description

This course introduces students to the fundamental principles of economics with a focus on applications relevant to the technology and computing sectors. It covers essential microeconomic and macroeconomic concepts such as market forces, demand and supply, theory of production, product pricing and factor pricing, national income, inflation and unemployment, business cycle, etc. Students will learn to apply these economic principles to decision-making in tech-driven environments, analyze the impact of economic policies on the IT industry, and understand the global economic factors influencing innovation and technological advancements.

2. General Objectives

  • To equip students with a foundational understanding of microeconomics and macroeconomics concepts relevant to computing and technology industries.
  • To enable the students to apply economic theories and quantitative methods to analyze economic problems in IT and tech sectors.
  • To enhance the capacity of the students to evaluate market conditions, competitive dynamics, and the economic environment and formulate effective strategies.
  • To teach students how to optimize the use of resources within an organization under different market conditions.
  • To make the students knowledgeable about the impact of government policies, regulations, and global economic trends on operations and strategy.

3. Contents in Detail

Specific ObjectivesContents
  • Explain a clear understanding of the nature and scope of fundamentals of economics, including its definition, purpose,  relevance it to the IT and technology sector.

 

Unit I: Introduction to Economics  (4 hrs)

  1. Nature and scope of economics
  2. Fundamental of economic problems: scarcity, choice and opportunity cost
  3. Microeconomics vs macroeconomics
  4. Role of economics in the IT and technology sectors

 

  • Apply quantitative measures (such as elasticity) and graphical tools (such as supply-demand diagrams and indifference curves) to analyze economic phenomena.

 

Unit II:  Demand, Supply and Consumer Behavioursis (6 hrs)

  1. Market forces of demand and supply
  2. Elasticity and its application
  3. (numerical assignments)

 

  • Describe how firms make cost-related decisions in both the short-run and long-run, and how these decisions impact overall performance in term of reveunue.

 

Unit III:  Cost and Revenue Analysis (4 Hrs)

  1. Nature and types of cost curves (both traditional and modern), relationship among total, average and marginal cost curves.
  2. Nature and types of revenue curves, relationship among total, average and marginal revenue curves
  3. (Numerical Assinments)
  • Compare and contrast different market structures, understanding the implications of each for making strategy and public policy.
  • Calculate how firms in various market structures determine pricing, output, and competitive strategies.
  • Define and explain the concepts and types of rent, wages, interest and profit.

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Unit IV: Market Structure: Product Pricing and Factor Pricing in IT sector (8 hrs)

  1. Market structure and degree of competition
  2. Perfect competition: Price and output determination
  3. Monopoly: Sources of monopoly, price and output determination
  4. Monopolistic competition: Price and output determination
  5. Oligopoly: Concept and characteristics of oligopoly market
  6. Concept and types of factor prices: Rent, wages, interest and profit

(Focus on IT and service sector)

  • Explain the circular flow of national income under two, three and four sector models addressing the leakages and injections of the economy as well.
  • Define and explain the concepts of national income and learn the methods of calculating national income and application
  • Identify the challenges and importance of calculating national income.

 

Unit V: National Income (10 hrs)

  1. Circular flow of national income in two, three and four sectors economy
  2. Concept of national income: GDP, GNP, NNP, personal income, disposable income, and per capita income
  3. Methods of calculation of national income: product, income and expenditure methods
  4. Diffculties in calculation of national income

(Numerical Assignments)

  • Link the employment perspective from IT sector

Unit VI: Employment Theory in digital Economy (8 Hours)

  1. Theory of Employment from Keynesian Approach
  2. Digital payment, fintech, and cryptocurrency
  3. Economic development in IT sector
  • Define and describe the business cycle its features, phases and explain the counter-cyclical policies for economic stabilization.
  • Define and explain inflation, its measure, types, causes, effects and control measures.
  • Explain the concept of Phillips curve.
  • Define fiscal policy and monetary policy with the major objectives and tools.
  • Describe the role of deficit financing in an economy.
  • Distinguish between the fiscal policy and monetary policy.

Unit VII: Macroeconomic Issues and Policies  (8 hrs)

  1. Business cycle: Definition, features and phases, Counter-cyclical policies.
  2. Inflation: Definition and measurement, Types, causes and effects, control measures
  3. Fiscal policy: Objectives and tools, deficit financing
  4. Monetary policy: Objectives and tools.
  5. Assessment of the comparative effectiveness of fiscal and monetary policies on IT sectors.

4. Methods of Instruction

To effectively convey the concepts and their practical applications in the applied economics, here are some possible teaching methods: Lecture method applied to introduce and explain key concepts, theories and models. To make lectures more engaging, real-world examples are discussed. Besides, group discussion to foster collaborative learning; quantitative excersise to strengthen students’ ability in quantitative tools in economic analysis; guest lectures and industry speakers to bring real-world insights into the classroom; and, assessment method to evaluate understanding and application of concepts.

5. Evaluation system and Students’ Responsibilities

Evaluation System

In addition to the formal exam(s) conducted by the Office of the Controller of Examination of Pokhara University, the internal evaluation of a student may consist of class attendance, class participation, quizzes, assignments, presentations, written exams, etc. The tabular presentation of the evaluation system is as follows.

External EvaluationMarksInternal EvaluationMarks
Total Internal50Class attendance, quizzes, assignment15
Presentation10
Internal Term Exam25
Total External50Total Internal50
Full Marks 50+50 = 100

6. Students’ Responsibilities

Each student must secure at least 45% marks in the internal evaluation with 80% attendance in the class to appear in the semester end examination. Failing to obtain such score will be given NOT QUALIFIED (NQ) and the student will not be eligible to appear in the semester end examinations. Students are advised to attend all the classes and complete all the assignments within the specified time period. If a student does not attend the class(es), it is his/her sole responsibility to cover the topic(s) taught during the period. If a student fails to attend a formal exam, quiz, test, etc. there won’t be any provision for a re-exam.

7. Prescribed Books and References

Text Books

  1. Mankiw, N. G. (2021). Principles of Microeconomics (9th ed.). Cengage Learning.
  2. Mankiw, N. G. (2019). Macroeconomics (10th ed.). Worth Publishers.

Reference Books

  1. Salvatore, D. (2020). Microeconomics: Theory and Applications (6th ed.). Oxford University Press.
  2. Pindyck, R.S, & Rubinfeld, D.L. (2018). Microeconomics (9th ed.). Pearson.
  3. Vaish, M.C. (2010). Macroeconomic Theory (14th ed.). Vikas Publishing House.

Note: Latest editions of the prescribed text books and references are recommended.