- Understand the rationale behind the use of mathematics in economics and in other fields of study.
- Appreciate the scientific method employed by the economic models.
- Explore more complex and abstract concepts presented through the use of mathematics.
- Contrast and compare different methods for approaching the same problem.
- Apply the models learned in economics in practical and everyday affairs such as financial thinking.
- Draw economic and policy inferences based on a given data by applying the techniques learnt.
- Friendly introduction to new and apparently complicated topics before exploring more rigorous methods.
- Use of real world data in econometric techniques which reinforces the idea with a real example.
- Stress on not only solving given problems but also reverse engineering those problems to make new ones while exploring the limitations of any given technique
- Continuous assessment through quizzes and problem solving challenges.
Functions and Graphs
o Understanding meaning and idea of functions. How to visualize functions through graphs. Interpreting graphs and drawing causal relations.
o Inverse functions. Budget constraint.
o Solving for values for given functions and construct functions with given information.
o The idea of slope or rate of change of a function from which the idea of marginal is derived in economics. The meaning of intercept.
o Meaning of limits. What it means for a function to be continuous.
o Comparative statics and the reduced form of an economic model.
o Solving for multiplant monopoly and price discrimination.
o Quadratics and Polynomials.
o The idea of timeline and differing values of money due to cost of capital in the economy.
o Present value, future value, compounding and discounting.
o Annuities, series of payments, equated monthly installments.
o Stock markets and the idea of returns on capital.
o The concept of real cost through discounting. The difference between a nominal value and real value of any economic parameter.
o Basic idea of arithmetic mean, mode and median. Their limitations and validity.
o Choosing independent and dependent variables and its meaning.
o Data series of two variables and its dependence on and relation with each other.
o Variance, covariance and standard deviation.
o Regression – the method of ordinary least squares, coefficient of determination, accuracy of the model, correlation and its coefficient.
o Look at non-linear regression models.
Introduction to calculus
o Differential calculus and the idea of slope reconsidered.
o Rules of differentiation. Ease of determining slope with differentiation.
o Deriving various economic functions such as marginal cost, marginal revenue from TC and TR curves.
o Idea of profit maximization.
o Point elasticity, tax yield, Keynesian multiplier and other applications.
o First order conditions for minimum and maximum of a function.
o Second order conditions for minimum or maximum.
o Comparative statics – effect of taxes.
o Marginal product and production functions of various types.
o First and second order partial derivatives.
o Applying PD on non-linear models discussed.
o Constrained optimization via substitution.
o Lagrange’s multiplier: Constrained optimization with two variables.
o Second order conditions and Lagrange’s multiplier.
o Constrained minimization.
o Constraint optimization with more than two variables.
Further topics in calculus
o Chain rule, product rule and quotient rule.
o Marginal revenue productivity theory of demand for labor.
o Point elasticity for non-linear functions.
o Integration – definite and indefinite integrals.