Download MicroEconomics

MicroEconomics
(EC202) Fall 2009
Instructor: Travis Wiseman
Economics 202 Syllabus
Class time: M-W-F: 9:00-9:50AM
Office/Hours: Clark C 320A
M-W-F: 10:00-11:00 and by appointment
Phone: 970.491.5336
Email: [email protected]
Course Description:
Most modern economists define economics as a social science, which studies how
societies solve the problems, which flow from relative scarcity. These problems are
commonly divided into four parts: allocation, distribution, stability, and growth. The
study of allocation problems – what to produce and how much -, and the distribution
problem – how real income is distributed among society’s members – are termed
Microeconomic Theory. In microeconomics the major theoretical tools are marginal
revenue, marginal cost, demand and supply analysis applied at the level of the household,
the firm and the industry.
Course Prerequisite: A basic understanding of algebra and geometry.
Course Objective:
A fundamental objective of microeconomics theory is to explain the forces that
determine relative prices, which economists believe to be essential factors in allocating
resources and distributing income.
Required Text: Campbell McConnell, Stanley Brue, and Sean Flynn, Economics:
Principles, Problems, and Policies, McGraw-Hill/Irwin; 18th edition.
Course Evaluation:
There will be two one-hour exams (35%), nine twenty-minute quizzes (35%), and
a final examination (30%). Make-up exams are given at the instructor’s discretion and
are only possible one day before or after a scheduled exam. No other arrangements will
be made. There will be no make-ups for quizzes.
Grade:
A
B
C
D
F
90-100
80-89
70-79
60-69
below 60
Course Attendance:
Students are expected to attend class on a regular basis. If, however, a student is
absent from class, the absence must be authorized. There will be a grade reduction of 5%
off the following exam for each unauthorized absence.
Class Participation:
Students are strongly encouraged to participate in this course. The blackboard is a
key tool used in the learning process. Students who do not wish to go to the blackboard
may approach me after the first class and will not be penalized for not participating.
Current Events:
You may want to keep informed on current economic development by reading the
following: Wall Street Journal, Business Week, and the Economist. You will have the
opportunity to subscribe to these publications at a discounted rate. Though these readings
are not required, it helps to stay current on issues related to the economy as this will help
facilitate class discussion.
Class Schedule
Your reading assignments are listed on the syllabus. Deviation from this schedule will be
announced in class.
What is Economics
The basics of economics
Scarcity and choice
Terminology
Economic goals
The circular flow
Chapter 1
The Economic Problem
Graphs and their meaning
Scarce resources
Opportunity cost
Production possibilities curve
Chapter 2
Understanding Individual Markets
Demand
The law of demand
Change in demand
Change in quantity demanded
Supply
Chapter 3
Quiz 1
The law of supply
Change in supply
Change in quantity supplied
Quiz 2
Understanding Individual Markets, cont’d
Chapters 7, 20
Price elasticity of demand
Price elasticity of supply
Income elasticity
Cross price elasticity
Quiz 3
Understanding Individual Markets, cont’d
Price ceiling
Price floor
Black market
Rent control
Quiz 4
Understanding Individual Markets, cont’d
Consumer choice
The theory of demand
Total utility and marginal utility
Consumer decision
Income effect
Substitution effect
EXAM 1
Chapters 8, 21
Chapters 1,2, 3, 7, 8, 20, 21
Exam 2 material begins here
Production and Cost
Production function
Production in the short run
Marginal products
Average products
The law of diminishing returns
Quiz 5
Production and Cost, cont’d
Short run cost, fixed cost, variable cost,
Chapters 9, 22
Marginal cost, average cost, long run cost
Economies and dis-economies of scale
Quiz 6
Profit Maximization and Pure Competition
Chapters 10, 23
Quiz 7
Market supply
The firm’s short run supply curve
The decision to shut down in the short run
The long run supply curve
EXAM 2
Chapters 9, 10, 22, 23
Monopoly
Chapters 11, 24
Pure monopoly
How monopolists maximize profit
Evaluating market outcomes under pure monopoly
The social cost of monopoly
Quiz 8
Chapters 11, 12, 24, 25
Price discrimination
Regulating monopoly
Monopolistic competition
Quiz 9
Oligopoly
Cartel, price leadership, and the kinked demand curve
REVIEW
CUMULATIVE FINAL EXAM: 60% on material covered after exam 2, 20% on exam
2 material, 20% on exam 1 material