Syllabus of Macroeconomics Class 12

Mastering the big picture of the economy? Our blog post unpacks the Class 12 Macroeconomics syllabus, covering national income, money & banking, government’s role, and more! So, Get ready to dive into economic concepts that shape our world.

Table of Contents

ECONOMICS SYLLABUS OF CLASS – XII 2024-25

Parts	Units	Marks	Periods
Part A	Introductory Macroeconomics
	National Income and Related Aggregates	10	30
	Money and Banking	06	15
	Determination of Income and Employment	12	30
	Government Budget and the Economy	06	17
	Balance of Payments	06	18
		40

syllabus of Macroeconomics class 12

Unit 1: National Income and Related Aggregates – Syllabus of Macroeconomics class 12

What is Macroeconomics?
Basic concepts in macroeconomics: consumption goods, capital goods, final goods, intermediate goods; stocks and flows; gross investment, and depreciation.
Circular flow of income (two sector model); Methods of calculating National Income – Value Added or Product method, Expenditure method, Income method.
Aggregates related to National Income: Gross National Product (GNP), Net National Product (NNP), Gross Domestic Product, (GDP), and Net Domestic Product (NDP) – at market price, at factor cost;
Real and Nominal GDP, GDP Deflator, GDP and Welfare.

Unit 2: Money and Banking – Syllabus of Macroeconomics class 12

Money – meaning and functions, supply of money – Currency held by the public and net demand deposits held by commercial banks.
Money creation by the commercial banking system.
Central bank and its functions (example of the Reserve Bank of India): Bank of issue,
Govt. Bank, Banker’s Bank, Control of Credit through Bank Rate, Cash Reserve Ratio
(CRR), Statutory Liquidity Ratio (SLR), Repo Rate and Reverse Repo Rate, Open
Market Operations, Margin requirement.

Unit 3: Determination of Income and Employment – Syllabus of Macroeconomics class 12

Aggregate demand and its components.
Propensity to consume and propensity to save (average and marginal).
Short-run equilibrium output; investment multiplier and its mechanism.
Meaning of full employment and involuntary unemployment.
Problems of excess demand and deficient demand; measures to correct them –
changes in government spending, taxes, and money supply.

Unit 4: Government Budget and the Economy – Syllabus of Macroeconomics class 12

A government budget that, includes meaning, objectives, and components.
Classification of receipts so it includes revenue receipts and capital receipts;
Classification of expenditure therefore includes revenue expenditure and capital expenditure.
Balanced, Surplus, and Deficit Budget – includes measures of government deficit.

Unit 5: Balance of Payments – Syllabus of Macroeconomics class 12

Balance of payments account – meaning and components;
Balance of payments which includes two parts Surplus and Deficit
Foreign exchange rate – meaning of fixed and flexible rates and managed floating.
Determination of exchange rate in a free market, Merits and demerits of flexible and fixed exchange rate.
Managed Floating exchange rate system