Intermediate Microeconomic Theory

Economics 3070-002

Professor M. J. Greenwood                                                                                                 Fall 2003

Office: ECON 106

Office Hours: Monday and Wednesday 3:30-4:45, and by appointment.

COURSE OUTLINE

       Text:      Edgar K. Browning and Mark A. Zupon, Microeconomics: Theory and Applications, Eighth Edition (John Wiley & Sons, Inc., 2004)

Part I: Theories of Consumer Behavior and Demand

1.    Introduction: Chapter 1

2.    Utility and Choice: Chapters 3, 5, and 6

3.    Individual Demand: Chapter 4

4.    Market Demand and Elasticity: Chapters 2 and 4

Part II: Theories of Production and Cost

5.    Production: Chapter 7

6.    Costs: Chapter 8

Part III: Theories of Price and Output under Various Market Circumstances

7.    Profit Maximization and Supply: Chapter 9

8.    Perfect Competition: Chapters 9 and 10

9.    Monopoly: Chapters 11 and 12

10.  Imperfect Competition: Chapters 13, 14, and 15

11.  Strategy and Game Theory: Chapter 14

Part IV: Other Topics

12.  Pricing in Input Markets: Chapters 16, 17, and 18

13.  General Equilibrium: Chapter 19

14.  Externalities and Public Goods: Chapter 20

This course is divided into four sections. The first deals with theories of consumer behavior and demand. The second treats theories of production and cost. The third considers the firm under various types of market structure, including perfect competition, monopoly, and structures intermediate between these two extremes. The fourth part of the course focuses on factor markets and general equilibrium (as distinct from partial equilibrium, which is an implicit assumption in most of the earlier material of the course.) If time allows, we will also study externalities and public goods.

COMMENTS ABOUT THE COURSE

This course is essentially the language course of economics. The terms and concepts developed here are basic to economists in conversing with one another, and they underlie, in one way or another, much of economic theory and the policy implications derived therefrom. Economists often think of the terms and concepts of microeconomic theory as the nuts and bolts of economics, and they speak of the “tools” of economics or their “tool kit” in reference to the material of this course. Perhaps more importantly, we use these tools to better understand how economies such as that of the United States and other countries around the world, both advanced and less developed, operate.

My goal in this course is to convey to you an understanding of the basic tools of economic theory. The course could be taught with great emphasis on calculus, but that is not my approach. Rather, I emphasize diagrams. I expect you to understand the basics of numerous diagrams that, in pictures, reflect the concepts that are most important in intermediate microeconomic theory. To learn these many diagrams well, you must redraw and work with them. Many of the diagrams can be found on the web site (http://www.colorado.edu/Economics/courses/fall03-3070-002).

Because I have never met a student who could do very well in this course without attending class regularly, I have for the first time introduced an attendance requirement. Every day I will either take the roll myself (early in the term) or pass around an attendance roster (later in the term). After three absences (beginning with absence four), 5 points will be deducted from the student’s overall score for each absence. Ten points will be added for any student who misses no more than one class. Please come to class. Although many diagrams are available on the web, many others are developed only on the board.

EXAMINATION SCHEDULE/GRADING POLICY

Four major examinations will be given. The four exams will each cover approximately one-quarter of the course material and will count for 100 points each.

In addition to the four examinations, you will have a quiz worth 25 points. This quiz is set up exactly like the three examinations and is given one week before the first exam. The idea behind the quiz is to acclimate the student to the types of questions asked on the exams. Results of the quiz are factored into the student’s grade as a bonus.

Forty percent of each examination consists of multiple choice questions. Because students tell me that my multiple choice examination questions are much more difficult than those in the workbook, I offer a lengthy list of practice multiple choice questions, which you will find on the web site. Please use these questions.

NOTE: No makeup exams are offered and none will be scheduled.

Examination Schedule

Quiz:                       September 12

Examination #1:     September 19

Examination #2:     October 17

Examination #3:     November 14

Examination #4:     December 15 (1:30–4:00)