INTERMEDIATE MICROECONOMICS

 

Professor Yongmin Chen

Office: Econ 112

Tel. (303)492-8736

Office Hours: 3:30-5.00 on Tuesdays and 11:00-12:00 on Thursdays

Website: http://stripe.colorado.edu/~cheny/

 

Course Description:      This course is concerned with the behavior of individual economic agents and their interactions.   It studies how individual economic agents make decisions and how markets function. The course is roughly composed of four parts. Part 1 introduces the basics of microeconomic analysis.  It also serves as a quick review of some basic economic concepts.   Part 2 studies consumer behavior and market demand.  We will show how a consumer may make optimal choices, how individual demands are formed, and how market demand can be derived.  Part 3 discusses the firm's technologies, production functions and production costs.  We shall see how firms can make the optimal input choices to minimize production costs.  This lays the foundation for the study of behavior of firms under different forms of market structure.   Part 4 integrates the previous material into models of prices and outputs under different market structures.  Topics in game theory and business strategies will be covered.  Economic efficiency and public policy issues will also be discussed. 

 

The presentation of the course is at the intermediate level.  It is required that you have passed an introductory course in economics or microeconomics (such as ECON 1000-4 or ECON 2010-4), and have passed MATH 1050, 1060, 1070, 1080, 1090 and 1100.  In order to take this course, you need to be familiar with calculus.    

 

Course Materials: The textbook is Microeconomics: An Integrated Approach, by David Besanko and Ronald Braeutigam, published in 2002 by John Wiley & Sons, Inc.  (ISBN 0-471-17064-X). I will indicate the required readings below. 

 

Grading: Grades are based on homework and class attendance (20%), two midterm exams (25% each), and a final exam (30%). There is also an optional project, which is to write a short paper. If you choose to write the paper (see more details later), your highest two grades from the paper and the two midterm exams will then be used to count as 20% each. This will offer you an opportunity to improve your course grade if your performance in midterm exams is below your expectations.

 

You are required to attend all classes. If you must miss a class, you need to let me know the reason. Please select a regular seat in the class so that it is easier for me to recognize you. You are encouraged to form study groups to discuss homework and lecture materials.  All exams will be in closed-book forms.  

 

How to Study effectively in this Course: I suggest that you read the assigned materials before each class, so that you are prepared when you come to classes.  After each class, I suggest that you have a quick review within one day.  If you have questions, try to have them answered before we move on to new materials. The best time to ask me questions is during the class or at my office hours; but you are also welcome to talk to me at other times.

 

Note: Students with disabilities who may need academic accommodations should discuss options with me during the first two weeks of class.
  

The course materials are arranged by topics, and each topic is usually covered over several classes.  There is a homework assignment for each topic, which is due at the beginning of the first class for the next topic.  You can start working on some problems in an assignment before I have finished the topic. Below is a tentative course schedule.  There can be changes to this schedule during the semester, which will be announced in classes.  It is your responsibility to update your information about the course according to announcements made in classes.

 

Course Schedule:

Topics                                                                          Readings   

                                   

1. Introduction to Microeconomic Analysis                    Ch 1; Ch 2. pp. 2-60

Assignment 1: pp. 23: #1.1, 1.4, 1.5; pp. 75-76: #2.1, 2.3, 2.5, 2.8, 2.10.                                                                                                                   

2. Consumer Preferences and Utility                              Ch 3.

Assignment 2: pp. 109-110: #3.1, 3.3, 3.6, 3.7, 3.8, 3.9, 3.11.

 

3. Consumer Choice                                                     Ch 4. pp. 82-144.

Assignment 3: pp. 152-153: #4.1, 4.3, 4.6, 4.7, 4.8

                                   

4. Individual and Market Demands                                Ch 5

Assignment 4: pp. 212-214: #5.5, 5.7, 5.8, 5.12, 5.14.

 

FIRST MIDTERM EXAM: Tuesday, September 23, at normal class time.

 

5. Inputs and Production Functions                               Ch 6, pp. 217-249

Assignment 5: pp. 255-256: #6.1, 6.2, 6.3, 6.5, 6.7, 6.8

 

6. Costs and Cost  Minimization                                    Ch 7.

Assignment 6: pp. 296-297: #7.1, 7.3, 7.6, 7.7, 7.9.

 

7. Cost Curves                                                             Ch. 8

Assignment 7: pp. 340: #8.1, 8.2, 8.3, 8.5.

 

8. Perfectly Competitive Markets                                  Ch 9, Ch 10

Assignment 8: pp. 405-406: #9.1, 9.2, 9.3, 9.4, 9.6, 9.8.

 

SECOND MIDTERM EXAM: Thursday, October 30, at normal class time.

 

9. Monopoly                                                                Ch 11, pp. 462-503

Assignment 9: pp. 511-512: #11.1, 11.2, 11.3, 11.5, 11.11.

 

10. Capturing Surplus                                                   Ch. 12

Assignment 10: pp. 548-549: #12.1, 12.2, 12.3, 12.10.

 

11. Game Theory and Strategic Behavior                      Ch 14

Assignment 11: pp. 624-626: #14.1, 14.2, 14.3, 14.4, 14.5, 14.7

 

12.  Market Structure and Competition                         Ch 13

Assignment 12: pp. 591: #13.1, 13.2.

 

13. Risk and Information                                                           Ch 15: pp. 627-657

Assignment 13: pp. 669-671: #15.1, 15.3, 15.8, 15.9

FINAL EXAM: Monday, December 15, 4:30-6:00 pm

 

Optional Project

Format: A short paper, about 3-5 pages (typed, double-spaced).

Purpose: Applying the theory and concepts of microeconomics to analyzing a practical economic problem.

Schedule:The completed paper is due on May 2.

Suggested topics for the paper:

1. You may choose to discuss and analyze issues such as the business strategy of a firm, the pricing policy of a firm (or several firms), the economic conditions of a market, or the competition in a market, from your readings of newspapers or magazines or from your own experiences.

2. You may choose to discuss and analyze the economic issues facing a firm or an organization that you are personally familiar with.You may want to discuss and analyze one or several issues of the firm or the organization, such as the determinants of demand for the firm and for the market of which the firm is a part, the determinants of costs for the firm or the organization,the economic decision problems facing the organization, and how these change overtime.You may also want to discuss how factors such as demand and costs affect management and organization strategies.

3. You may also choose topics such as:

--.The best new business on CU campus.(You need to identify a product, analyze demand and cost conditions, and argue why this is a promising product to be offered on CU campus, etc.)

--. How and why prices differ in two stores or two locations.(You need to be specific about the stores or the locations, and be specific about the price information.)