SYLLABI PART A ECONOMICS

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A chartered secretary operates at the centre of the organization.  The aim of this module is to equip the student with the knowledge and competencies in economic principles which affect the environment in which the business operates in.

LEARNING OUTCOMES

At the conclusion of this module the candidate will be able to.

  • Understand the principles of micro and macro economics.
  • Understand the relevance of these principles in the application of economic policies.
  • Understand the difference between microeconomic and macro economic problems.
  • Analyse economic issues and profer possible solutions.
  • Distinguish the types of business organization and understand factors that influence their formation, growth, and survival.

PRE-REQUISITE LEARNING

Evidence of assessed pre-requisite knowledge and understanding at ‘A’ level, or those of equivalent qualifications which have been approved as meeting the Institute’s requirements must be demonstrated.

LEARNING CONTENT

4.1.       Overview of Economics

What is economics.

Resources scarcity and choice.

Factors of production, division of labour, economies of scale.

The role of government in the economy.

The mixed economy, command economy.

National Income

Circular flow of national income, components of national income.

National income accounts.

Methods of measuring national income and output.

Demand, Supply, Prices and Market Structure

The price system, market prices and factor prices.

Basic theories of consumer demand, utility, prices.

Marginal and average costs, fixed and variable costs, opportunity costs, short and long-run costs.

Law of diminishing returns, increasing and decreasing costs.

Price and output determination under conditions of perfect and imperfect competition and monopoly, including State undertakings.

Profit maximization and equilibrium analysis.  Normal and super-normal profits.

Micro-level investment decisions, expected rates of return.

Elasticities of demand and supply – including cross market prices – effects of taxes, subsidies.

Level of Economic Activity

An outline of the Keynesian analysis.

Determination of level and changes in income and employment, propensities to consume and save, the multiplier effect – including foreign trade and government; the accelerator, determination of level of investment, liquidity preference and rate of interest.

The monetarist critique.  Government policies and relationship with inflation.

Consumption, savings and investments – their determinants.

The equilibrium of national income

Aggregate demand and supply – The multiplier formula.

Money and Prices and National Income

Meaning and functions of money, and credit.

Development of money, functions and attributes.  Measuring the supply, inflation, money and capital market.

Financial systems and monetary policy.

Systems and methods of monetary control.

Government policies and relationship with inflation.

Labour

Elementary knowledge of wage determination in conditions of perfect and imperfect competition; effect of trade unions on wage levels, wage differentials and level of employment; trade unionism in Zimbabwe.

Monopoly in the labour market.

Theory of Distribution

Marginal distribution theory, determination of wages.

Economic rent and transfer earnings.

Capital and interest – appraising investments, financing the firm.

Enterprise and profits.

Taxation and Fiscal Policy

Type of taxes and their effect on incomes, prices and individual and corporate activity.

Welfare Economics

Pareto criterion.  Allocative efficieny, efficiency and the free market.

Market Failure

Causes of failure, imperfect competition, externalities.

Public goods, government’s role.

Privatisation.

Transport and the economy.

National Economic Policies and Economic Development

Aims and conflicts of policy in relation to full employment, economic growth, price stabilization, balance of payments, equilibrium, income distributions, regional growth and employment balance, mixed economy, relationship between Government and public and private sectors.

Major problems confronting developing economies, including capital formation, population, agriculture, investment choices, trade relationships and international finance.

The International Economic System

The gains of international trade – comparative advantages and its limitations.

International trade relationships and monetary problems, including: balance of payments adjustment processes, fixed and flexible exchange rates, world liquidity, protective devices, primary commodity schemes and trading blocs, the role of the International Monetary Fund and the World Bank.

Protectionism.  Influence of Trade blocks.

The Zimbabwean Economy

The historical output of the economy, current structure, recent economy performance and current economic methods.  Levels of employment, inflation, national debt.

Growth and Development

Factors influencing growth, the debt problem, people and growth, development economics.  Role of regional bodies.

NOTE:

The examination will be related primarily to the Zimbabwean economy.

LEARNING CONTENT

Three hour examination paper

RECOMMENDED READING

Samuelson  P A

Nordhauj  W D (2005)

Economics (18th Edition) Tata McGraw-Hill New Delhi
Baumol W J, Blidner A S (1998) Economics Principles & Policing (7th Edition) Harcourt Brace and Company Orlando
Lipsey, Crystal (2004) Positive Economics (10th Edition) Oxford University  Press Oxford

Note: It is essential for the student of this subject to read current economic commentary in financial press.

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