10131 Introduction to Microeconomics

Credits: 3 introductory credits in Economics

Prerequisites: none 1

Author: Gideon Yaniv

The course acquaints students with the basic concepts and tools of analysis of microeconomics.

Topics: The economic problem: scarcity (factors of production, production possibilities, full employment and efficient production, preferences and choices, specialization and exchange, economic growth); decision makers (businesses and households, market structure, planning by the market, market failure, combined initiatives). Perfect competition: manufacturer’s behavior production, short-term costs and profit (production function, diminishing marginal return, production costs, revenues and profits, determining production capacity); supply function (quantity supplied, supply curve, production surplus). Perfect competition: consumer behavior determining allocation of consumption (system of tastes, budget constraints, equilibrium); demand function (demand quantity, inferior and normal goods, substitutes and supplements, demand curve, demand and utility, diminishing marginal utility, demand price, consumer surplus). Determining price in a competitive market the competitive market mechanism (aggregate demand and supply, equilibrium in a competitive market, equilibrium changes, demand and supply elasticity); government intervention (sales tax, subsidies, price fixing, import tariffs, export premiums). Monopoly and imperfect competition monopoly (determining short term price and production capacity, monopoly vs. perfect competition, government intervention, price discrimination); imperfect competition (oligopoly, determining prices, cooperation among manufacturers, monopolistic competition).

1To successfully complete this course, students need at least 3-point level knowledge of high school mathematics. Students who do not have this background are advised to take the Mathematics Refresher Workshop for Social Science Students (95001) before taking this course.