Course Code: ECON-201
Title: Intermediate Microeconomics
Credit Hours: 03
Prerequisite: Principles of Microeconomics, Calculus I
Objectives:
The course seeks to provide an understanding of the core economic models for the analysis of decisions by consumers, firms, and markets. It would focus on illustrating the functionality of certain core microeconomic models. The objective of this course is to enable students to develop ability to use analytic reasoning to understand and apply basic models of microeconomic theory. Simple Calculus and Graphical methods will be used extensively.
Course Contents Consumer Theory
- Consumer Preferences
- Well-Behaved Preferences
- Indifference Curves
- Budget Constraint
- Utility Functions
- Utility Maximization
- Choice
- Deriving the Demand Curve
- Consumer Surplus
- The idea of revealed preference
Goods classifications
- Elasticity computation
- Normal Goods
- Inferior Goods
- Giffen Goods
- Substitutes
- Complements,
- The Price and income Offer Curves
- Engel curve
- The Inverse Demand Function
Price Effects
- Substitution Effect
- Income effect
- Sign of Substitution Effect
- Total Change in Demand
- Rates of Change
- Law of demand
- Compensating Demand Curves.
Technology
- Inputs and Outputs
- Describing Technological Constraints
- Examples of Technology
- Properties of Technology
- Long Run and Short Run
Cost and Revenue
- Cost Minimization
- Returns to Scale and Cost Function
- Long Run and Short Run Costs
- Fixed and Quasi-Fixed Costs
- Sunk Costs.
Profit under perfect and imperfect markets
- Profits: Short run and long run profit maximization.
- Comparative Statistic
- Profit Maximization and Returns to Scale (with respect to production technology and profits)
Monopoly
- Maximizing Profits
- Linear Demand Curve and Monopoly
- Markup Pricing
- Inefficiency of Monopoly
- Deadweight Loss of Monopoly
- what causes Monopolies?
Monopoly Behavior
- Price Discrimination
- First-Degree Price Discrimination
- Second-Degree Price Discrimination
- Third-Degree Price Discrimination
- Bundling
- Two-Part Tariffs
- Monopolistic Competition.
Factors Market
- Introduction to the market of factors of production
- Demand and supply curves
- Derivation of derived demand curve
- Market equilibrium
- Monopsony
Recommended Books:
- Varian, H. R. (2009). Intermediate Microeconomics: A Modern Approach (8th ed.). W.W. Norton & Company.
- Nicholson, W. (2000). Intermediate microeconomics and its applications. Dryden Press: New York.
- Maddala, G. S. (2004), Microeconomics: theory & applications. Tata McGraw-Hill Education: New York.