RUTGERS UNIVERSITY (NEW BRUNSWICK)
INTERMEDIATE MICROECONOMIC ANALYSIS (CR.3)
COURSE NUMBER: 01:220:203 SEC. 06
FALL 2002
DAYS: MON & WED
TIME: 7:40 – 9:00 PM
ROOM: SEC 209 (Busch Campus)
BASANTA K. CHAUDHURI
732-932-8061 (campus)
chaudhur@econ.rutgers.edu
OFFICE: NJH (New Jersey Hall) 425
OFFICE HOURS:
M & W 6-7pm; Sat 12-12:45 & 4-5pm
The Department of Economics maintains a comprehensive web site at http://www.economics.rutgers.edu. This
is a very useful first stop for all your economics inquiries. My web page is econweb.rutgers.edu/chaudhuri.
REQUIRED READING (Textbook and Study Guides): ( see http://www.wiley.com/college/besanko)
David BESANKO and Ronald BRAEUTIGAM (B&B), MICROECONOMICS: An Integrated Approach 2002 (John Wiley).
STUDY GUIDE to MICROECONOMICS B&B (prepared by K. Rocket) – MICROECONOMICS 2002 (John Wiley)
PREREQUISITES:
INTRO TO MICRO- AND MACRO-ECONOMICS (01:220:102,103), CALCULUS I (01:640:135)
GRADING:
FINAL COURSE GRADE IS A WEIGHTED AVERAGE OF THREE (3) QUIZZES (20%) AND THREE (3) EXAMS: EXAM I
(25%), EXAM II (25%) AND FINAL (30%). All quizzes and exams (except the FINAL) will be held during the
regularly scheduled class hours. Consult the final exam schedule to avoid conflicts during the finals week.
There will be no make-ups for missed quizzes and exams. EXAMS WILL CONSIST OF MULTIPLE CHOICE AND/OR
SHORT QUESTIONS. The exams are not cumulative.
IMPROVEMENT OF PERFORMANCE OVER TIME WILL BE CONSIDERED CASE BY CASE.
There will be no extra work of any kind for the purpose of raising a grade during or after the term.
COURSE OBJECTIVES:
To develop an understanding and foundations of Microeconomics involving consumer and firm decision
making as a constrained optimization problem, how firms behave under different market structure and of public
policy affecting business outcome, efficiency and equity. EMPHASIS WILL BE GIVEN TO ECONOMIC
ANALYSIS AND PROBLEM SOLVING (using CALCULUS since CALCULUS I or an equivalent course is a
PREREQUISITE). This course will cover the following CONCEPTS
DEMAND (CONSUMER CHOICE – UTILITY MAXIMIZATION AND BUDGET CONSTRAINT),
PRODUCTION (FIRM BEHAVIOR – PROFIT MAXIMIZATION and COST MINIMIZATION),
MARKET STRUCTURE (PERFECT AND IMPERFECT COMPETITION),
PRICING AND MARKET POWER (monopoly, monopsony, price discrimination and oligopoly),
GAME THEORY AND STRATEGIC BEHAVIOR (brief), PRINCIPAL-AGENT PROBLEM (brief),
INPUT (FACTOR) MARKET (Labor Market),
GENERAL EQUILIBRIUM AND ECONOMIC EFFICIENCY (Pareto Efficiency/Optimality),
CASES OF MARKET FAILURE: EXTERNALITIES, PUBLIC GOODS AND ASYMMETRIC INFORMATION.
WHILE ATTENDANCE WILL NOT BE GRADED, I STRONGLY ENCOURAGE STUDENTS TO ATTEND CLASSES
REGULARLY, AS PERFORMANCE IN THE COURSE IS USUALLY HIGHLY CORRELATED WITH ATTENDANCE.
STUDENTS ARE EXPECTED TO ATTEND ALL CLASSES ON TIME AND BE RESPONSIBLE FOR MATERIALS COVERED
IN CLASS (YOU MISS CLASSES AT YOUR OWN RISK). STUDENTS ARE EXPECTED TO SOLVE PROBLEMS FROM THE
TEXT AS WELL AS THE STUDY GUIDE. Each chapter contains “Learning-by-Doing” exercises solving specific numerical
problems. A good understanding of these problems is expected. ASSIGNMENTS (OPTIONAL) WILL BE ANNOUNCED FROM
TIME TO TIME. YOU CANNOT EXPECT TO DO WELL IF YOU DO NOT KEEP UP WITH THE MATERIALS. TO
UNDERSTAND THE MATERIALS DISCUSSED TRY TO KEEP UP WITH THE READING BEFORE AND AFTER CLASS.
MAKE-UP TEST WILL ONLY BE GIVEN FOR EMERGENCY conditions (WITH PROPER/VALID
DOCUMENTATION). MAKE-UP TEST WILL BE ALL-INCLUSIVE AND COMPREHENSIVE.
Please turn off your cell phones, beepers and other electronic devices. Thanks for your co-operation and understanding.
If you arrive late or need to leave early, please do so w/o disturbing others or w/ minimum distraction to others.
Academic Honesty:
Cheating is totally unacceptable and highly risky. The University has established rather severe penalties for
cheating. You are strongly advised to review Rutgers’ policies on cheating (see the Undergraduate Catalog).
Grades are posted on the bulletin boards outside Econ Office (NJH). No queries on grades via e-mail will be
entertained.
COURSE CONTENTS AND SCOPE / CLASS AND QUIZ/EXAM SCHEDULE
I: INTRODUCTION TO MICROECONOMICS (MARKET AND PRICES)
Chap. 1. Analyzing Economic Problems (Overview and Brief Intro)
Chap. 2. Supply and Demand Analysis (Quick Review)
II: CONSUMER THEORY
Chap. 3. Consumer Preferences and the Concept of Utility (Intro to Consumer Choice)
QUIZ 1
Chap. 4. Consumer Choice
Chap. 5. The Theory of Demand
REVIEW
EXAM I (Wed, Oct 2nd)
III: PRODUCTION AND COST THEORY (Theory of the Firm)
Chap. 6. Inputs and Production Functions
Chap. 7. Costs and Cost Minimization
QUIZ 2
Chap. 8. Cost Curves
IV: PERFECT COMPETITION (AND APPLYING THE COMPETITIVE MODEL )
Chap. 9. Perfectly Competitive Markets
Chap. 10. Competitive Markets: Applications (Brief)
REVIEW
EXAM II (Wed, Nov 6th)
V: MARKET POWER AND MARKET STRUCTURE
Chap. 11. Monopoly and Monopsony
Chap. 12. Capturing Surplus (Price Discrimination)
QUIZ 3
VI: IMPERFECT COMPETITION AND STRATEGIC BEHAVIOR
Chap. 13. Market Structure and Competition (Oligopoly Pricing)
Chap. 14. Game Theory and Strategic Behavior (Brief)
VII: GENERAL EQUILIBRIUM AND ECONOMIC WELFARE
Chap. 16. General Equilibrium Theory and Efficiency
VIII: MISSING MARKETS: LIMITED INFORMATION, MARKET FAILURE, AND THE ROLE OF GOVERNMENT.
Chap. 17. Externalities and Public Goods.
REVIEW
FINAL EXAM (Wednesday, December 18, 8-11pm)