Office: Hoover 206
Tel: 717-361-1543
Email:
Web: pauls@etown.edu http://users.etown.edu/p/pauls/ec102
Class meetings
Tue, Thu 2:00-3:40 pm
Hoover 213
Office hours
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Mon 1:15-3:15 pm
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Tue 1:00-2:00 pm
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Wed 1:15-3:15 pm
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Thu 1:00-2:00 pm
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And by appointment
Course description
How do consumers and firms make their decisions? That, in a nutshell, is what our course in microeconomics is about. Take consumers first. How do they decide how much to buy of various goods?
What are the factors they take into account? In order to answer these questions, we develop the concept of utility, a measure of satisfaction (jolly!) that consumption provides. Consumers are interested in maximizing utility subject to a budget constraint (goods cost money, and one's income is limited after all... yes, even Bill Gates'). The principle of utility maximization, as we shall see, enables us to derive the demand for goods.
To derive the supply of goods, we turn to the theory of the firm. How does a firm decide on the amount of output to be produced? Also, how does it decide the price to be charged for its product? The answers lie in the principle of profit maximization. Firms, interested in maximizing profits, decide the optimal amount of output and the optimal price. These optimal values are influenced by various factors - notably, the nature of the product, and the degree of competition within an industry. We will have much to say about the latter; the market structure ranges from perfect competition at one end to monopolies at the other.
In certain cases, free markets fail to deliver the optimal amount of the good. We look at why market failures occur, and the appropriate government policies to correct them.
Student Learning Outcomes
By the end of the course students will be able to:
1.
Discuss and apply concepts of demand and supply to explain the behavior of consumers and producers.
2.
Describe income inequality in society
3.
Explain the functioning of a market economy
4.
Analyze the influence of prices and income on consumption
5.
Describe the methods involved in building economic models of profit maximization
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Contents in brief
The following table provides an outline of the material that we expect to cover in the course. The topics mentioned below are not exhaustive. Also, paucity of time may force us to curtail some material.

Introduction

Scarcity, opportunity costs

Markets and government
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The basics of supply and demand
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Elasticity
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Utility maximization, demand curve
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Forms of business enterprises
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Cost functions
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Perfect competition, supply curve
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Monopoly
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Monopolistic competition, oligopoly
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Factor markets
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Market failure
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Income distribution
Readings
The required readings for the course are:
1.
Krugman, Paul and Robin Wells (2015). Microeconomics, Fourth Edition. Worth Publishers.
Access to LaunchPad is required (see below). Price: $84.99.
2.
The Wall Street Journal (daily).
Price: $15.
Instructions on buying access to LaunchPad and WSJ subscription are available at http://users.etown.edu/p/pauls/ec102 . We will use LaunchPad quite extensively—for assignments, the e-book, calendar and gradebook. If you buy the book elsewhere, you may not get access to these materials.
Evaluation
Your grade will be based on your performance in exams, quizzes and assignments.
Item
Exams: The exams may include multiple-choice questions, graphs, mathematical problems, and short-answer questions. They are cumulative and will be conducted in the classroom.
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Quizzes: Quizzes will be brief, lasting 20 minutes or less. They will be given in the classroom and without advance notice. In order to accommodate unforeseen absences, I will drop two of the lowest scores.
Assignments: Assignments will be will be assigned frequently. They will mainly rely on submissions through the
LaunchPad system. To provide some flexibility, I will drop two of the lowest scores.
The grading scale is as follows:
100-93% A
92-90 A-
89-87 B+
86-83 B
82-80 B-
79-77 C+
76-73 C
72-70 C-
69-67 D+
66-63 D
62-60 D-
< 59 F
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Missed exams
An exam will be given again only under exceptional circumstances - e.g., very poor health. Missed items will generally result in a score of zero.
Attendance
You are advised to attend all classes regularly. If you absent yourself from class, you are likely to do poorly on the tests, assignments and quizzes. You are responsible for acquiring any missed notes.
Academic integrity
Students are expected to adhere to the Pledge of Integrity at Elizabethtown College. In this course, you are expected to complete the assignments and tests entirely on your own. You will not discuss the tests or assignments with others, nor will you seek or receive assistance from others in completing them. Any breach of academic integrity will be dealt with in accordance with the policy stated in the
College Catalog .
Email communication etiquette

Start emails with an appropriate salutation (Dear Dr. Paul, for example). End them with your name.

Always provide a subject in the subject line. Include “EC102” in the subject, so that I know right away it is from a student in the class.
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Use standard English, with proper spelling and grammar. If you write “i cant send u my sa til later ttyl”, I will not know what it means and will consequently ignore it altogether.
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Make sure your @etown.edu inbox is not full. If it is, my emails to you will not reach you, and you will be left in the dark. Do not be left in the dark!

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General policies
Deadlines are extremely important. Pay close attention to the due dates. Plan ahead. Don’t wait until the last minute to complete your task. Your Internet connection may go down; your computer may crash; the world may come to an end. In the interest of fairness to the class, I will not be able to accommodate late submissions.
There are no opportunities for extra credit.
Disabilities
Elizabethtown College welcomes otherwise qualified students with disabilities to participate in all of its courses, programs, services, and activities. If you have a documented disability and would like to request accommodations in order to access course material, activities, or requirements, please contact the Director of
Disability Services, Lynne Davies, by phone (361-1227) or e-mail daviesl@etown.edu.
If your documentation meets the college’s documentation guidelines, you will be given a letter from Disability
Services for each of your professors. Students experiencing certain documented temporary conditions, such as post-concussive symptoms, may also qualify for temporary academic accommodations and adjustments. As early as possible in the semester, set up an appointment to meet with me, the instructor, to discuss the academic adjustments specified in your accommodations letter as they pertain to my class.
Class cancellation
Classes may be occasionally cancelled for reasons pertaining to adverse weather conditions, health, travel and other emergencies. In such cases, I will make every effort to notify you as soon as possible and make suitable alternative arrangements.
Religious observances
The College is willing to accommodate individual religious beliefs and practices. It is your responsibility to meet with the class instructor in advance to request accommodation related to your religious observances that may conflict with this class, and to make appropriate plans to make up any missed work.
SCHEDULE (tentative)
Week of Jan 11 (week 1):
Introduction: The Ordinary Business of Life
Chapter 1: First Principles
Week of Jan 18 (week 2):
Chapter 2. Economic Models: Trade-offs and Trade
Chapter 2 Appendix. Graphs in Economics
Week of Jan 25 (week 3):
Chapter 3. Supply and Demand
Chapter 4. Consumer and Producer Surplus
Chapter 5. Price Controls and Quotas: Meddling with Markets

Week of Feb 1 (week 4):
Chapter 9. Decision Making by Individuals and Firms
MIDTERM EXAM 1 on Tue, Feb. 2
Week of Feb 8 (week 5):
Chapter 10. The Rational Consumer
Chapter 10 APPENDIX: Consumer Preferences and Consumer Choice
Week of Feb 15 (week 6):
Chapter 10 APPENDIX: Consumer Preferences and Consumer Choice
Week of Feb 22 (week 7):
Chapter 6. Elasticity
Chapter 7. Taxes
Week of Feb 29 (week 8):
SPRING BREAK—No classes
Week of Mar 7 (week 9):
Chapter 11. Behind the Supply Curve: Inputs and Costs
Week of Mar 14 (week 10):
Chapter 11. Behind the Supply Curve: Inputs and Costs
MIDTERM EXAM 2 on Tue, Mar. 15
Week of Mar 21 (week 11):
Chapter 12. Perfect Competition and the Supply Curve
Week of Mar 28 (week 12):
Chapter 12. Perfect Competition and the Supply Curve
Week of Apr 4 (week 13):
Chapter 13. Monopoly
Week of Apr 11 (week 14):
Chapter 15. Monopolistic Competition and Product Differentiation
Chapter 14. Oligopoly
Week of Apr 18 (week 15):
Chapter 16. Externalities
Chapter 17. Public Goods and Common Resources
Week of Apr 25 (week 16):
Chapter 19. Factor Markets and the Distribution of Income
Week of May 2 (week 17):
FINAL EXAM on Tue, May 3, 2:30pm
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