Microeconomics I
Keywords |
Classification |
Keyword |
OFICIAL |
Economics |
Instance: 2019/2020 - 1S
Cycles of Study/Courses
Teaching language
Portuguese
Objectives
The main objectives of this course are:
(1) understanding some basic economic instruments and principles;
(2) applying those instruments and principles to some economic problems, mainly individual decision-making problems and market problems.
Learning outcomes and competences
Every student must be able to:
(1) explain the concepts of opportunity cost and reservation price;
(2) apply the cost-benefit principle to an individual decison-making process (individual, firm or a country);
(3) explain the supply and demand model and how a perfectly competitive market works;
(4) evaluate the effects of economic measures in a perfectly competitive market (e.g., introduction of a tax or subsidy);
(5) explain the decision-making process of an individual consumer;
(6) evaluate the effects of a change in the price of a good or in consumer's income in the decisions of an individual consumer;
(7) compute the total price effect and decompose it into a substituion effect and an income effect.
Working method
Presencial
Program
Chapter 0. Mathematical instruments: Graphical analysis; Total value, average value and marginal value. Part I-Basic Economic Concepts Chapter 1. Choice and Scarcity 1.1 The principle of scarcity 1.2 The cost-benefit principle 1.2.1 Opportunity cost 1.2.2 Reservation price 1.2.3 The opportunity cost and the best alternative activity 1.2.4 Distinction between average cost (benefit) and marginal cost (benefit) 1.2.5 The opportunity cost and the sunk cost 1.3 Absolute advantage and comparative advantage 1.4 Production possibilities curve 1.5 Positive analysis versus normative analysis 1.6 Microeconomics versus macroeconomics Chapter 2. Supply and Demand 2.1 The concept of a market 2.2 Demand 2.2.1 The market demand curve 2.2.2 Determinants of the market demand 2.3 Supply 2.3.1The market supply curve 2.3.2 Determinants of the market supply 2.4 Market equilibrium 2.5 Changes in market equilibrium 2.6 Elasticity 2.6.1 The price elasticity of demand 2.6.2 The income elasticity of demand 2.6.3 The cross-price elasticity of demand 2.6.4 The price elasticity of supply 2.7 The price elasticity of demand and supply and the changes in the market equilibrium Chapter 3. Supply, Demand and Government Policies 3.1 Controls on prices 3.1.1 Price ceilings 3.1.2 Price floors 3.2 Production Quotas 3.3. Taxes and subsidies 3.4 Applications Chapter 4. Supply, Demand and Efficiency of Markets 4.2 Consumer Surplus 4.2 Producer surplus 4.3 Market equilibrium and efficiency 4.4 Market efficiency and economic policies 4.4.1 Market efficiency and taxes 4.4.2 Market efficiency and price controls 4.4.3 Market efficiency and production quotas 4.5 Applications Part II – Consumer Choice Theory and Demand Chapter 5. Consumer Behavior 5.1 Consumer preferences 5.1.1 Properties of consumer preferences 5.1.2 Indifference curves 5.1.3 Cardinal utility versus ordinal utility 5.2 Budget constraint 5.3 The consumer´s optimal choice 5.4 Generalization to several consumer goods 5.5 Applications Chapter 6. Individual demand and market demand 6.1 Changes in Income 6.2. Changes in prices 6.3 Deriving the demand curve 6.3 Income and substitution effects 6.5 Applications
Mandatory literature
N. Gregory Mankiw e Mark P. Taylor; Microeconomics, 2ª edição, Cengage, 2011
David Besanko and Ronald Braeutigam; Microeconomics, 4ª edição, John Wiley & Sons, Inc., 2011
Complementary Bibliography
Frank, Robert e Bern Bernanke; Princípios de Economia, McGraw-Hill, 2003
Teaching methods and learning activities
Theoretical and applied lectures. In general, concepts and economic principles are presented and discussed in each lecture, followed by examples and applications. At the end of every chapter, students are required to do two economic problems.
Evaluation Type
Distributed evaluation without final exam
Assessment Components
Designation |
Weight (%) |
Teste |
100,00 |
Total: |
100,00 |
Amount of time allocated to each course unit
Designation |
Time (hours) |
Estudo autónomo |
99,00 |
Frequência das aulas |
63,00 |
Total: |
162,00 |
Eligibility for exams
Students can choose to do either a final exam or two tests.
The first test covers chapters 1 and 2; the second test covers the remaining chapters.
Calculation formula of final grade
Students can choose to do either a final exam or two tests. In the latter case, the first test has a weight of 30% and the second test has a 70% weight. Students who choose doing the two tests must have an average of 9.5, as long as the grade of any of the two tests is not less than 5.0.
If the grade of any of the two tests is less than 5.0, the student fails by tests, yet he/she can do the final exam.