Course Catalogue

Module Title: Microeconomics I

Module Code: MIC 101

Programme: BA Economics +, BA (Hon) Economics

Credit Value: 12

Module Tutor: Sonam Cheki

General Objectives:

This course is designed to expose first-year students, who may be new to economics, the basic principles of microeconomic theory. The emphasis will be on thinking like an economist and the course will illustrate how microeconomic concepts can be applied to analyse real-life situations. The mathematical requirements of the course are minimal, since exposition of the material is based largely on diagrams and elementary algebra.

Learning Outcomes

At the end of this module, the students are expected to be able to:

· Demonstrate an understanding of the key concepts and principles in economics

· Explain principles underlying consumption and production

· Predict how changing world economic conditions affect market price and production.

Evaluate the impact of government price controls, minimum wages, price supports, and production incentives.
Determine how taxes, subsidies, tariffs, and import quotas affect consumers and producers.
Apply supply-demand curves to the analysis of competitive markets.
Explain how the pricing, investment, and output decisions of firms depend on market structure and the behavior of competitors.

Learning and teaching approach:

Lectures (60 hours in 15 weeks)

Tutorials (15 hours in 15 weeks)

Discussions (10 hours in 15 weeks)

Assignments (15 hours in 15 weeks)

Case Study (5 hours in 15 weeks)

Assessment:

Semester end examination (60%)

Assignments I (10%)

Assignments II (20%)

Presentation (10%)

Subject Matter

Part I. Introduction: Markets and Prices (5 hours)

The Basics of Supply and Demand

Part II. Producers, Consumers, and competitive markets (45 hours)

1. Consumer Theory; Budget Constraint; Consumer preference and Indifference curves; concept of utility and utility maximization; Choice; Demand and Revealed Preferences. Income and Substitution effects; Compensated and uncompensated demand curves; Consumer surplus

2. Production technology; Isoquants; Marginal rate of Substitution; Marginal products; Cost curves; Short and Long Run; Return to Scales; Cost Minimisation; Profit Maximisation; Supply Curves

3. Market Equilibrium; Market Demand and Supply; Elasticities; Market Equilibrium, Comparative Statics; Deadweight Loss; Taxes.

4. Perfect Competition; Characteristics of perfect competition; profit maximization under perfect competition.

Part III. Imperfect Market structure (10 hours)

1. Monopoly and Imperfect Competition; Monopoly Pricing; Welfare Cost of Monopoly; Natural Monopoly and regulations; pricing with market power; price discrimination; peak-load pricing; two-part tariff and other examples of Non-Linear Pricing.

Reading list

Essential Reading:

· Pindyck, R.S., Rubinfeld, D. ( 2012). Micro Economics, 8^th edition, Prentice Hall.

· Andreyeva, T., Long, M. W., M.P.H., & Brownell, K. D. (2010). The impact of food prices on consumption: A systematic review of research on the price elasticity of demand for food. American Journal of Public Health, 100(2), 216-22.