Microeconomics I

Code:

LEC101

Acronym:

MIC I

Keywords
Classification	Keyword
OFICIAL	Economics

Instance: 2004/2005 - 1S

Active?	Yes
Responsible unit:	Grupo de Economia
Course/CS Responsible:	ECONOMICS

Cycles of Study/Courses

Acronym	No. of Students	Study Plan	Curricular Years	Credits UCN	Credits ECTS	Contact hours	Total Time
ECO	448	Official Curricular Structure since 2004	1	3		-

Objectives

The main objectives of this course are basically as follows:
(i) to provide an understanding of the basic economic concepts and principles
and
(ii) to apply those concepts and principles to a variety of economic problems, namely individual economic decisions and markets.

Program

Chapter 0. Mathematical instruments: graphs; distinction among total, average and marginal values.
Part I- Basic Economic Concepts
Chapter 1. Choice and Scarcity
1.1 The scarcity principle
1.2 The cost-benefit principle
1.2.1 Opportunity cost
1.2.2 Reservation price
1.2.3 Opportunity cost and sunk costs
1.2.4 Distinction between average cost (benefit) and marginal cost (benefit)
1.3 Production possibility curve
1.4 Comparative advantage and absolute advantage
1.5 Positive economics versus normative economics
1.6 Microeconomics versus macroeconomics

Chapter 2. Supply and Demand
2.1 The concept of market
2.2 Demand
2.2.1 The market demand curve
2.2.2 Determining factors of demand
2.3 Supply
2.3.1 The market supply curve
2.3.2 Determining factors of supply
2.4 Equilibrium and stability
2.5 Changes in market equilibrium
2.6 The elasticity concept
2.6.1 Price elasticity of demand
2.6.1.1 Arc elasticity and point elasticity
2.6.1.2 The slope of the demand curve versus price elasticity of demand
2.6.1.3 Price elasticity of demand and the total revenue
2.6.2 Income elasticity of demand
2.6.3 Cross price elasticity of demand
2.6.4 Price elasticity of supply
2.7 Applications

Chapter 3. Supply, demand and Government
3.1 Price ceiling and price floor
3.2 Taxes and subsidies
3.3 Applications

Chapter 4. Supply, demand and efficiency
4.1 Consumer surplus
4.2 Producer surplus
4.3 Equilibrium and efficiency
4.4 Applications

Part II - Consumer theory and Demand
Chapter 5. The consumption decision
5.1 Consumer preferences
5.1.1 Indiffference curves
5.1.2 Cardinal versus ordinal utility
5.2 Budget constraint
5.3 Optimal consumption decision
5.4 Extension to several goods.
5.5 Applications

Chapter 6. Individual versus market demand
6.1 Income effects
6.1.1 Change in income and the optimal consumption decision
6.1.2 The income-consumption curve
6.1.3 The Engel curve
6.2 Price effects
6.2.1 Change in price and the optimal consumption decision
6.2.2 The price-consumption curve
6.2.3 The individual demand curve

Main Bibliography

Principles of Economics, Robert Frank and Ben Bernanke, McGraw-Hill, 2003.

Microeconomics, Robert S. Pyndick and Daniel L. Rubinfeld, Prentice-Hall, 5th edition, 2002.

Teaching methods and learning activities

Theoretical and applied lectures

Evaluation Type