UNDERGRADUATE COURSE SYLLABUS
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Course Title and Number:
ECON 1001 - MICROECONOMICS
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Professor Ingo BÖBEL, Dr., Dr. habil.
ibobel@monaco.edu
For course details see: www.ibobel.pbwiki.com
Phone: +377-97-986-986
Office hours: I am available for discussions after each class!
Term:
Fall 2010
Class Meeting Times:
Monday & Wednesday 9.00 to 10.40 am
BUMA 1001, MATH 1001 or MATH 1011
Prerequisites:
This course is a broad survey of the microeconomic theory and policy.
Course Description:
Emphasis is placed on the fundamentals of economic organization, the
theory of supply and demand, price elasticity, consumer choice and
utility theory, theory of the firm and production theory, perfect
competition, oligopolies and monopolistic competition, uncertainty,
risk, and game theory.
Course Learning Outcomes:
Assessment
Link to BSBA program
On successful completion of this course
tools:
learning outcomes:
students should be able to:
1. (functional knowledge)
 Demonstrate understanding of the Quizzes, exams,
2. (written communication)
basic concepts and principles of written
4. (problem solving and critical
microeconomic theory and policy: the assignments,
thinking)
study of how our economy works to homeworks.
5. (cultural diversity)
allocate scarce resources among
6. (ethical considerations)
consumers and firms.
7. (independent research)
 Develop a theoretical framework for
8. (understand business
this analysis and understand how this
environment)
framework can be applied to realworld issues
 Accomplish high degree scientific
research related to microeconomics.
Credit Hours:
Name of Instructor:
Contact Details:

Participate in discussions, in class, and Oral participation,
develop their own point of view and in class
discussions.
critical thinking process.
1. (demonstrate knowledge)
2. (oral communication)
4. (problem solving)
8. (understand business
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Methodology:
environment)
The course will be taught in an interactive and participatory mode by
interjecting lectures, discussions, exercises and case analysis throughout
the course. Students must come prepared to each class by having read
the chapters related to the course in the textbook and by having
prepared the exercises indicated in the present syllabus, before class.
Homework is assigned with the intent that students make an effort to
understand the topic covered in the text prior to our in-class discussion so
that we can move forward in class.
All written homework must be typed, double-spaced and using Excel for
spreadsheet work and problems. You may work together on the
problems, but the answers must be written up in your own words. Use
graphs whenever appropriate.
I expect that students will actively use the library and the library
resources that are available when solving homework problems or any
other assignments.
Required Textbook:
Michael Parkin, Economics, 9th. ed., Pearson: Boston 2010
There is such a big choice of useful Microeconomic textbooks. I
Other
Resources/Recommended recommend the following modern texts as reference books:
Readings:
Paul A. Samuelson and William D. Nordhaus, Economics, 18th ed.,
Irwin/McGraw-Hill, 2007
Hal R. Varian, Intermediate Microeconomics-A Modern Approach, 7th
ed., WW. Norton, 2006
R. Pindyck and L. Rubinfeld, Microeconomics, 3rd. ed., Prentice-Hall,
2004
Attendance:
You will find that your understanding of both current economic events
and economic analysis will be bolstered by the regular persual of
periodicals such as The Economist, The Financial Times, The Wall
Street Journal, and Business Week. (See the information given in the
Preface Chapter in Parkin's book!)
Students are expected to attend all classes!
Absences affect the final course grade.
See IUM Student Handbook for details.
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Assessment
Grading:
and The final course grade will be composed of the following components
with given weights:
Class participation
Homework
Quizzes
Final exam
Academic Honesty:
Class Code of Conduct
10%
20%
35%
35%
Academic honesty is fundamental to the integrity of an educational
community and the University views any incident of academic cheating
or plagiarism to be very serious. A student who willingly gives or
receives aid in examinations, copies another student’s work, or turns in
any material claimed as his or her own, but coming from another source,
is subject to an academic sanction.
Any form of dishonest academic behavior has to be reported to the
Academic Committee that will determine the sanction.
1. Students and the instructor must respect and preserve the integrity of
the learning environment of the classroom.
Accordingly,
disruptive
behavior
is
not
permitted and will be reported to the Associate Dean for appropriate
disciplinary action. Examples of disruption are the sound or any use of
mobile telephones, entering or leaving the room during a class.
2. No eating, drinking, or smoking is permitted.
3. No caps or hats should be worn in class.
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COURSE OUTLINE ECON 1001 MICROECONOMICS
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Session
Topics covered
1
13.9.10
Course organization
Introduction to Economics:
The coordination of production,
consumption and investment (scarcity and
the basic economic questions: what, how, for
whom, and who makes the decisions); the
Economic Way of Thinking (how to make
choices).
The Economic Problem: Budget constraint,
Ch 2/
time constraint, PPF: Production
Read pp. 32-39, 43-56
Possibilities and Opportunity Cost (the
meaning of trade offs and opportunity costs),
the marginal principle (marginal cost); sunk
costs.
The circular flow model
The Market Economy: markets, prices, and
the role of government in a modern
economy; the role of prices in a market
economy (the functions of prices).
Quiz 1
Ch. 2/pp. 40ff.
2
3
Sep. 20
Readings/ Assignments
Relevant chapter numbers
correspond to the required
textbook by M. Parkin
Ch 1 including the Appendix
Gains from Trade (absolute and comparative
advantage)
4
Gains from Trade (absolute and comparative
advantage) cont’d.
Ch. 3/
The Demand and Supply Framework:
Basic Elements of Demand Analysis
The basic competitive model; the demand
function; determinants of demand; the law of
demand; normal vs. inferior goods;
substitutes vs. complements; the ceteris
paribus assumption; demand schedule vs.
demand curve; individual demand vs. market
demand; shifts of the demand curve vs.
movement along a demand curve; the case
of reducing the demand for smoking as an
4
example.
5
Sep. 27
Quiz 2
Basic Elements of Supply Analysis:
determinants of supply; the law of supply;
the supply schedule vs. the supply curve;
individual supply vs. market supply curves;
shifts in supply; movement along a supply
curve vs. shifts in supply.
Market Equilibrium: Supply and Demand
together: The equilibrium on a market;
comparative statics: comparison of
equilibria; the cases of surplus and shortage
(deviations from the market equilibrium);
price floors and price ceilings
Ch. 3 /
6
Extensions of Supply and Demand Analysis
The Price Elasticity of Demand:
theoretical considerations;
the determinants of the price elasticity of
demand (necessities vs. luxuries;
characteristics of markets; time horizon;
etc.); five cases of changes in elasticities
(incl. the extreme cases of perfect elasticity
and a perfectly elastic demand); calculations
of elasticities (examples using the mid-point
method); numerical examples calculating
elasticity; price elasticity of demand vs. the
slope of the demand curve.
Practice session: Solving problems on
Elasticities
Ch. 4
7
Oct. 4
Quiz 3
Practice session: Solving problems on
Elasticities
Ch. 4
8
Organizing Production: Theory of the Firm
The firm's goal; measuring a firms profit;
accounting profits vs. economic profits.
Markets and market structures: The
competitive landscape; measures of
concentration; the structure-conductperformance paradigm
Quiz 4
Production Theory
Production with one variable input
Ch.10/
9
Oct. 11
Ch. 11/pp. 252ff.
5
10
11
Oct. 18
(will be
reschedul
ed)
12
Oct. 20
(will be
reschedul
ed)
13
14
15
16
17
Output and Costs
Short-run costs: Total cost; fixed cost;
variable cost; marginal cost; average cost;
how do cost curves run?; the relationships
between the different cost curves.
Long-run costs: the production function;
long-run average cost curve
Quiz 5
Output, Price and Profit in Perfect
Competition
Short-run equilibrium; change in demand;
long-run adjustments; entry and exit
decisions: shut down vs. exit decision;
changes in plant size;
Changes in tastes and technology
Market Imperfections
Monopoly (The problem of market power;
how monopoly arises; price-setting
strategies; output and price decision in a
monopoly: price and marginal revenue;
marginal revenue and elasticity; output and
price decision).
Quiz 6
Monopoly vs. perfect Competition: A
Comparison
Price discrimination
Review Session
Monopoly Policy Issues
Gains from monopoly; natural monopoly;
regulating natural monopolies; marginal cost
pricing and average cost pricing rules.
Quiz 7
Monopolistic Competition (I)
Definition of market structure; product
differentiation; competing on quality and
price; entry and exit; output and price under
monopolistic competition; economic profits
in the short-run and in the long-run
Monopolistic Competition (II)
Monopolistic Competition and Perfect
Competition
Product Development and Marketing
Oligopoly
Barriers to Entry
Game theoretical considerations; what is a
game?; the prisoner's dilemma; price fixing
Ch. 11
pp. 257ff.
Ch. 12
Read on p<AVC:
http://news.yahoo.com/s/ap/20091
127/ap_on_bi_ge/us_farm_scene_
unpicked_apples
Ch. 13
Read all relevant chapters in
Parkin and your class notes incl.
homework questions
Ch. 13
Ch. 14
Ch. 14
Solve short answer questions
(given in class)
and self-test questions
Ch. 15
6
18
19
game in an oligopoly; collusion; Nash
equilibrium and Duopoly;
Repeated games and sequential games
Regulation and Antitrust Law (I)
Market intervention; regulation; antitrust
law; economic theory of regulation
Regulation and deregulation; natural
monopoly again; rate-of-return regulation
Quiz 8
Regulation and Antitrust Law (II)
Antitrust Law
Understanding Market Failure and
Government
20/21
Review Sessions
Preparation for Final Exam
6.12.10.12.
FINAL EXAM WEEK
Ch. 15
Solve short answer questions
(given in class)
and self-test questions
Ch. 15
Read all relevant chapters in
Parkin and your class notes incl.
homework questions
Please note that the professor reserves the right to modify this outline. Make-upclass dates will be announced – the topic schedule will change accordingly!
Last updated: July 6, 2010
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