Class 12 Economics Syllabus 2021

CBSE and ICSE boards have reduced 30% of the economics syllabus for the academic year 2021 due to the nonfunctioning of schools. Therefore, it is important to go through the detailed revised Class 12 Economics Syllabus to better succeed in the exam.

This post takes you through the revised syllabus, marking scheme, and delete topics of the economics subject.

Revised CBSE Class 12 Economics Syllabus 2021 

You will be studying the economy of nation or company that decides the rise and fall of that nation or organization which eventually affect the citizen of the country or the people of that particular organization in economics syllabus class 12 CBSE 2021.

In CBSE Class 12 Economics, the theory paper holds a weightage of 80 marks and the project work holds a weightage of 20 marks. The revised syllabus of class 12 economics is divided into three parts:

Part A: Macroeconomics having a weightage of 40 marks. 

Part B: Indian Economic Development having a weightage of 40 marks. 

part C: Project Work for 20 marks. 

Part A: Introductory Macroeconomics  21

Go through the detailed syllabus of class 12 economics for Part A and plan your preparation accordingly.

Unit 1: National Income and Related Aggregates

• 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 and Welfare 

Unit 2: Money and Banking

Enhance your preparation by solving ​​​​​​ Class 12 Economics Sample Papers on a weekly basis. Also, this will help you know the difficulty level of the paper and the type of questions asked in the exam. 

• Money - meaning and supply of money - Currency held by the public and net demand deposits held by commercial banks. 
• Money creation by the commercial banking system.
• The 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, CRR, SLR, Repo Rate and Reverse Repo Rate, Open Market Operations, Margin requirement.

Unit 3: Determination of Income and Employment

• Aggregate demand and its components.
• The 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 the changes in government spending, taxes, and money supply.

Revised Class 12 Economics Syllabus PDF

Unit 4: Government Budget and the Economy

• Government budget - meaning, objectives, and components.
• Classification of receipts - revenue receipts and capital receipts; classification of expenditure – revenue expenditure and capital expenditure.
• Measures of government deficit - revenue deficit, fiscal deficit, primary deficit their meaning.

Unit 5: Balance of Payments

• Balance of payments account - meaning and components; the balance of payments deficit meaning.
• Foreign exchange rate - meaning of fixed and flexible rates and managed to float.
• Determination of exchange rate in a free market.

Part B: Indian Economic Development 

Let us have a look at the detailed syllabus of Part B here.

Unit 6: Development Experience (1947-90) and Economic Reforms since 1991

• A brief introduction of the state of the Indian economy on the eve of independence. Indian economic system and common goals of Five Year Plans. 
• Main features, problems, and policies of agriculture (institutional aspects and new agricultural strategy), industry (IPR 1956; SSI – role & importance), and foreign trade.

Economic Reforms since 1991:

Features and appraisals of liberalization, globalization, and privatization (LPG policy); Concepts of demonetization and GST 

Unit 7: Current challenges facing the Indian Economy

• Poverty: absolute and relative; Main programs for poverty alleviation: A critical assessment. 
• Human Capital Formation: How people become resource; Role of human capital in economic development; Growth of Education Sector in India
• Rural development: Key issues: credit and marketing - the role of cooperatives; agricultural diversification; alternative farming - organic farming
• Employment: Growth and changes in the workforce participation rate in formal and informal sectors; problems and policies
• Infrastructure: Meaning and Types: Case Studies: Energy and Health: Problems and Policies- A critical assessment;
• Sustainable Economic Development: Meaning, Effects of Economic Development on Resources and Environment, including global warming

Unit 8: Development Experience of India

• A comparison with neighbours 
• India and Pakistan 
• India and China
• Issues: economic growth, population, sectoral development, and other Human Development 
• Indicators

Part C: Project Work

• Learners will complete only ONE project in each academic session. 
• The project should be 3,500-4,000 words (excluding diagrams & graphs), preferably hand-written. 
• It will be an independent, self-directed piece of study. 

Scope of the project

• Choose a title/topic
• Collection of the research material/data
• Organization of material/data
• Present material/data
• Analyzing the material/data for the conclusion
• Draw the relevant conclusion
• Presentation of the Project Work 

Expected Checklist

• Introduction of topic/title
• Identifying the causes, consequences, and/or remedies
• Various stakeholders and effect on each of them
• Advantages and disadvantages of situations or issues identified
• Short-term and long-term implications of economic strategies suggested in the course of research
• Validity, reliability, appropriateness, and relevance of data used for research work and for presentation in the project file
• Presentation and writing that is succinct and coherent in the project file
• Citation of the materials referred to, in the file in footnotes, resources section, bibliography, etc.

CBSE Class 12 Economics Project Work Syllabus PDF 2021

At the end of the stipulated term, you will present the research work in the Project File to the External and Internal examiner. The questions should be asked from the Research Work/ Project File of the learner. The Internal Examiner should ensure that the study submitted by you is your own original work. In case of any doubt, authenticity should be checked and verified.

Marking Scheme: Marks are suggested to be given as: 

Project Suggestions: 

• Micro and Small Scale Industries
• Food Supply Channel in India
• The contemporary Employment situation in India
• Disinvestment policy of the government
• Goods and Services Tax Act and its Impact on GDP
• Health Expenditure (of any state)
• Human Development Index
• Inclusive Growth Strategy
• Self-help group
• Trends in Credit availability in India
• Monetary policy committee and its functions
• Role of RBI in Control of Credit
• Government Budget & its Components
• Trends in the budgetary condition of India
• Exchange Rate determination – Methods and Techniques
• Currency War – reasons and repercussions
• Livestock – Backbone of Rural India
• Alternate fuel – types and importance
• Sarwa Siksha Abhiyan – Cost Ratio Benefits
• Golden Quadrilateral- Cost ratio benefit
• Minimum Support Prices
• The relation between Stock Price Index and Economic Health of the Nation
• Waste Management in India – Need of the hour
• Minimum Wage Rate – approach and Application
• Digital India- Step towards the future
• Rain Water Harvesting – a solution to water crises
• Vertical Farming – an alternate way
• Silk Route- Revival of the past
• Make in India – The way ahead
• Bumper Production- Boon or Bane for the farmer
• Rise of Concrete Jungle- Trend Analysis
• Organic Farming – Back to Nature
• newspaper article and its evaluation on basis of economic principles
• Any other topic

CBSE Class 12 Economics Marking Scheme

Let us have a look at the table below to know the marking scheme of the Economics Class 12 Syllabus.

Deleted Portions in CBSE Class 12 Economics Syllabus 2021

Due to the currents situation, few topics have been removed from the Economics syllabus. The deleted syllabus of economics class 12 CBSE 2021 are listed below:

Part A: Introductory Macroeconomics

The following topics are deleted from Part A Economics Class 12 Syllabus of the CBSE board.

• Unit 2: Money and Banking - Control of Credit through Bank Rate, CRR, SLR, Repo Rate, and Reverse Repo Rate, Open Market    Operations, Margin requirement.
• Unit 5: Balance of Payments - Balance of payments deficit-meaning. Determination of exchange rate in a free market.
• Unit 7: Current challenges facing Indian Economy - Growth of Education Sector in India alternative farming - organic farming; Infrastructure: Energy

Deleted CBSE Class 12 Economics Syllabus PDF

Best CBSE Class 12 Economics Books 2021

You can refer to the following books while preparing for the class 12 economics syllabus.

Revised ICSE Class 12 Economics Syllabus 2021

ICSE Class 12 Syllabus emphasizes more on your analytical and practical approach. It is difficult to score in ICSE as compared to CBSE board examinations.

The significant shortening of the academic year has compelled the board authorities to reduce the ICSE Class 12 Economics syllabus to maintain linear progression across classes while retaining the core concepts. 

Marks Allocation: Marks are allotted in three different parts : 

1. Part I (20 Marks) will consist of compulsory short answer questions testing knowledge, application, and skills relating to elementary/fundamental aspects of the entire syllabus.
2. Part II (60 marks) will consist of eight questions out of which you will be required to answer five questions, each carrying 12 marks. 
3. Part III (20 Marks) will consist of Project Work. 

Note: Part I and Part II will combine to form the theory exam. 

Part - I & II (Theory) Syllabus

Have a look at the complete ICSE Class 12 Commerce Syllabus for Economics subject below.

Unit-1: Micro Economic Theory 

(i) Demand: meaning, factors affecting demand; Demand function; Law of Demand; derivation of demand curve; movement and shift of the demand curve; exceptions to the Law of Demand. Law of Diminishing Marginal Utility, Law of Equimarginal Utility, consumer’s equilibrium through utility approach (Cardinal), and indifference curve analysis (Ordinal). The concept of demand: meaning. A demand function to be specified incorporating the determinants of demand. Diagrams should be used in explaining the Law of Demand, reasons for the downward slope of the demand curve, its derivation using demand schedule. Derivation of the market demand curve from the individual demand curve. 

(a) Cardinal Utility Analysis: the meaning of utility, total utility, marginal utility, the relationship of TU and MU, Law of Diminishing Marginal Utility (schedule and diagram, Only assumptions to be taught, criticisms not required), Consumer’s equilibrium – one commodity (schedule and diagram), Law of Equimarginal Utility (statement, schedule) and conditions of consumer’s equilibrium using the marginal utility. 

Revised ICSE Class 12 Economics Syllabus PDF

(b) Ordinal Utility Analysis: Indifference Curve – it is meaning and properties (including MRS and DMRS), indifference map, consumer’s budget line, Consumer’s equilibrium – condition (to be explained with the help of a diagram).

(ii) Elasticity of demand: meaning, types of elasticity of demand, measurement of elasticity of demand; factors affecting elasticity of demand. Various methods of measurement of the elasticity of demand: point method - percentage method, expenditure method, and geometric method. (Numericals required on percentage method only). The cross and income elasticity of demand must be explained. Degrees of elasticity of demand to be explained. Use diagrams wherever necessary. 

(iii) Supply: meaning; the difference between stock and supply; determinants of supply; Law of Supply; movement and shift of the supply curve; elasticity of supply Difference between stock (intended supply) and supply (actual supply) with the help of relevant examples. A supply function should 83 be specified and explained. Law of Supply, supply schedule, and supply curve. Derivation of the market supply curve from individual supply curve. Movement and shift of the supply curve, exceptions to the Law of Supply. The elasticity of Supply: Meaning and measurement of elasticity of supply by percentage method and geometric method.

(iv) Market Mechanism: Equilibrium and disequilibrium; Equilibrium price and effect of changes in demand and supply on the equilibrium price. Simple applications of tools of demand and supply. A basic understanding of the concept of equilibrium. The effects of changes in demand and supply - both along the curves and shift of the curves to be explained. Basic understanding of Price control, rationing, Price ceiling, and Floor price with the help of demand and supply curves. 

(v) Concept of production and production function (short-run and long-run production function), returns to a factor, total, average, and marginal physical products; Law of Variable Proportions and its three stages. A production function (concept only). Law of Variable Proportions: statement, assumptions, schedule (for the purpose of understanding and not for testing), diagram, and explanation to the three stages.

(vi) Cost and revenue: Basic concepts of cost; fixed cost, the variable cost, total cost, marginal cost, and average cost – their relationships; opportunity cost; short-run and long-run cost curves. Revenue: meaning; average revenue, marginal revenue, and total revenue and their relationships under perfect competition and imperfect competition, Producer’s equilibrium. Basic concepts – private cost, economic cost, social cost, money cost, real cost, explicit cost, implicit cost. Cost concepts – Fixed cost, the variable cost, total cost, marginal cost, the average cost with schedule and diagram; the relationship between average cost, marginal cost, total cost (only concepts of long-run and short-run cost curves, derivations not required). Opportunity cost – meaning only. Difference between accounting cost and opportunity cost. Revenue – Average revenue, marginal revenue, total revenue – concepts, and relationships under perfect competition and imperfect competition. Producer’s equilibrium (Profit maximization goal) – meaning; conditions: (a) TR and TC approach along with diagram (b) MR and MC approach along with a diagram.

(vii) Main market forms: perfect competition, monopolistic competition, oligopoly, monopoly, monopsony; characteristics of the various market forms; equilibrium of a firm in perfect competition under the short run and long run. Features of perfect competition, monopolistic competition, oligopoly, monopoly, and monopsony (meaning only). Equilibrium of a firm in perfect competition under short-run (explanation and diagram, shut down point and break-even point) and long-run (diagram not required).

Unit-2: Theory of Income and Employment

Basic concepts and determination of Income and Employment. The concept of demand (ex-ante) and effective (export) demand. Aggregate demand and its components, propensity to consume and propensity to save (average and marginal), equilibrium output; investment multiplier (it is meaning and mechanism). Meaning of full employment. Problems of excess demand and deficient demand; measures to correct them.

Unit-3: Money and Banking

(i) Money: meaning, functions of money, the supply of money. Meaning, kinds of money, functions of money (primary, secondary, and contingent) to be explained; supply of money (the only meaning of M1, M2, M3 & M4). 

(ii) Banks: functions of the commercial bank; high powered money, credit creation by commercial banks; Central Bank: functions. Basic understanding of the functions of commercial banks, credit creation process with limitation. The regulatory role of the Central Bank, its functions, and the way it 84 controls the flow of credit needs to be explained. A brief mention may be made of quantitative CRR, SLR, Bank Rate policy (repo rate and reverse repo rates), and Open Market Operations) and qualitative methods.

Unit-4: Balance of Payment and Exchange Rate

Balance of Payment – meaning, components; foreign exchange – meaning, determination of exchange rate (Flexible). Balance of Payment - Meaning and components; Causes of disequilibrium and how the disequilibrium can be corrected; Foreign Exchange Rate – meaning, meaning of fixed and flexible exchange rate, determination of exchange rate in a free market. Concepts of depreciation, appreciation, devaluation, and revaluation (meaning only).

Unit-5: Public Finance

(i) Fiscal Policy: meaning and instruments of fiscal policy. Meaning and instruments of fiscal policy – Public Revenue: Meaning, taxes (Meaning and types), the difference between direct and indirect taxes; Public Expenditure: Meaning and importance; Public Debt: Meaning and redemption; Deficit Financing: meaning.

1. ii) Government Budget: meaning, types, and components. Meaning and types of Government budget – union, state; components – revenue and capital. Concept of deficit budget: revenue deficit, fiscal deficit, primary deficit – their meaning and implications.

Unit-6: National Income

(i) Circular flow of Income. A simple model explaining the circular flow of income with two, three, and four sector models with leakages and injections.

(ii) Concepts and definition of NY, GNP, GDP, NNP, private income, personal income, personal disposable income, National Disposable Income, and per capita income; the relationship between the income concepts. A brief understanding of the mentioned national income aggregates is needed. The concepts of GNP and NNP should be explained both at factor cost and market prices, real GDP and nominal GDP, National Disposable Income (Gross and Net), GDP and Welfare, GDP as an indicator of economic welfare.

(iii)Methods of measuring National Income: product or value-added method; income method and expenditure method with simple numerical based on them. Simple numerical based on all the methods to be covered for a better understanding of the concept. Precautions and difficulties of measuring National Income for each method.

Paper-III (Project Work) 

You will be expected to complete two projects from any topic covered in the theory syllabus. The practical work will be assessed by the teacher and a Visiting Examiner appointed locally and approved by the Council. 

Marking Scheme: Marks are suggested to be given as: 

Note: Mark allocation for each Project is 10 marks. 

A list of suggested projects is given below:

1. Study a Public Sector Enterprise with reference to its relevance to the Indian Economy and its future prospects. Analyze the trend of its growth for the last ten years.
2. Conduct a Socio-Economic survey of a locality (minimum sample size should be 30 households) with reference to:

Demographic features

Consumption Pattern – Expenditure on necessities, comforts, and luxuries. 

Occupational structure

1. Compare the contribution made by different sectors of the economy towards GDP growth during the planning period.
2. Prepare a report on the competition in the Aviation Sector in India with reference to: 

Performance of the Public Sector and Private Sector

Operational strategies adopted by budget/low-cost carriers

1. Make a comparative analysis of the lending performance of five Commercial Banks in the past six years with reference to the changing CRR and SLR. 
2. Many thinkers believe that we are rapidly depleting our natural resources. Assume that there are only two inputs (labor and natural resources) producing two goods (wheat and gasoline) with no improvement in technology over time. Show what would happen to the Production Possibility Curve over time as natural resources are exhausted. How would invention and technological improvement modify your answer? On the basis of this example, explain why it is said: “economic growth is a race between depletion and invention.”
3. Make a comparative study of the allocation of financial resources of the Central Government Budget on Agriculture, Defence, Industry, and Education in the last ten years. Prepare a report on your observations.
4. Prepare a trend Analysis of Growth and Productivity of any one industry such as Textile / Automobiles / Electronic and Tele-communication, etc. in India for the past ten years.

NOTE: No question paper for Practical work will be set by the Council. 

ICSE Class 12 Economics Books 2021

Let us have a look at the table below to know the important books for the preparation of class 12 Economics Syllabus ICSE. 

Class 12 Economics Syllabus 2022

Note that the syllabus of Class 12 Economics for the next academic year i.e. 2022 will remain the same as the 2019 syllabus. Let us have a look at the detailed Economics syllabus of Class 12 of both CBSE and ICSE boards from the table below.