Micro Economics is all about how individual actors make decisions, how supply and demand determine prices, how companies think about competition and determines the prices. All in all, this course enables students to understand the basics of economics particularly how economic agents - individuals and firms make rational decision in an economy. It is not only one subject of an overall curriculum, but, it is a fundamental and rudimentary for understanding advanced and hard core economic subjects like Macro Economics, International Economics, Welfare Economics, Mathematical Economics and Econometrics.The whole syllabus of Micro Economics in this MOOC has been presented in five parts: Introduction to Economics; Demand Analysis; Consumer Behavior; Production Function and Cost Analysis; and Market Structure -Competitive & Non-Competitive Markets in total 48 modules. The first part, Introduction to Economics gives overview of major ideas of Economics comprising definitions of Economics, Principles of Economics. It also imparts nature and scope of Micro Economics, Interdependence between Micro & Macro Economics, and brief introduction about methodology of Economics. Second section covers a detailed study of Demand. It introduces the crucial assumption of Micro Economics i.e. ceteris paribus in Law of Demand. It also explores factors causing movements along the curve and shifts in the curve, and concept of various types of demand elasticity. Third part focuses on Consumer Behaviour which deals with the law of demand and consumer equilibrium with the help of utility analysis and indifference analysis. The Fourth section Production Function and Cost Analysis explicates about the most important economic agents: the producer (a company or firm)- who is responsible for creating the production function (output) and is subject to various cost measures. It also discusses how and why a firm's costs may differ in the short run and the long run. Lastly, fifth section Market Structure: Competitive & Non-Competitive Markets explains different type of market structure especially perfect (pure competition), imperfect competition (monopolistic competition and oligopoly), and monopoly. It also briefly discusses game theory, under prisoner's dilemma model and the Nash equilibrium. All in all, this course helps in better understanding of real-life situations. It will enable learners to think like an Economist.
Overview
Syllabus
Weekly Study Plan
Week Module Title of Lesson/Module
1 1 Introduction to Economics
2Principles of Economics
3Scarcity and Choices
Production Possibility Frontier
4Micro and Macro Economics
Meaning, Difference and Interdependence; Methodology of Economics
2 5 Law of Demand
Law of Demand, Demand Curve, Demand Schedule, Individual and Market Demand Curve. Exceptions of Law of Demand.
6Movement and Shifts in Demand
Movement along a Demand Curve and Shifts in Demand Curve. Factors affecting Demand.
7Elasticity of Demand
Concept and Different types of Price Elasticity of Demand, Measurement of Price Elasticity. Total revenue and Price Elasticity.
8Income and Cross Elasticity
3 9 Consumer Behavior: Cardinal Utility Analysis -I
Meaning of Utility, Law of Diminishing Marginal Utility, Relationship between Marginal, Total Utility. Principle of Equi-Marginal Utility
10Cardinal Utility Analysis -II
Principle of Equi-Marginal Utility, Critical evaluation of Cardinal Approach
11Consumer Behavior: Ordinal Utility Analysis
Consumer Preferences, Assumptions, Indifference Curve, Indifference Map, Marginal Rate of Substitution, Properties of Indifference Curve, Non Normal cases of Indifference Curve
12Ordinal Utility Analysis-II
Budget Line, Consumer Equilibrium (Necessary and Sufficient Condition), Corner Solutions, Substitutes and Complimentary Goods.
4 13 Income and Substitution Effect
Income Consumption Curve & Engel curve
14Price, Income and Substitution Effect
Price Consumption Curve, Breaking up Price Effect
15Application Indifference Curve
Cash Subsidy vs Kind Subsidy,
16Revealed Preference Theory
5 17 Factors of Production
Meaning and Classifications of Factors of Production.
Production Function: Relationship between Inputs and Outputs.
18Law of Variable Proportion,
Three stages of Law of Variable Proportion, Applicability of Law of Diminishing Returns
19Production Function with Two Variables
Production Isoquants, Marginal rate of Technical Substitution, Economic Region of Production, Properties of Isoquants,
20Optimum Factor Combination & Return to Scale
Iso-Cost Line, Optimal Combination of Resources, Cobb-Douglas Production Function, Returns to Scale
6 21 Introduction to Cost Analysis
22Cost of Production
Concept of Cost, Social & Private costs, Short run Cost- Total, Average and Marginal Cost Curves. Learning Curve.
23Cost of Production
Long run Cost Curves. Learning Curve.
24Market Structure
Meaning of Market and Classification of Markets
7 25 Concept of Revenue
Concepts of revenue: Marginal and Average: Revenue under conditions of Perfect and Imperfect Competition
26Firm: A General Analysis
Equilibrium of the Firm
27Perfect Competition -I
Meaning and condition of Perfect Competition. Equilibrium of the firm. Producer surplus.
28Perfect Competition-II
Industry Equilibrium, Industry’s long run supply curve
8 29 Stability Analysis
Demand- Supply Equilibrium: Walrasian and Marshallian.
30Application of Demand - Supply Analysis
Impact of taxes and subsidy
31Monopoly
Meaning and Conditions of Monopoly. Causes of Monopoly.
32Price and Output Equilibrium under Monopoly
9 33 Monopoly -II
Shifts in demand curve and the absence of the supply curve The social costs of monopoly power including Deadweight loss.
34Price Discrimination
Degrees of Price Discrimination
35Monopoly Power
Measurement of Monopoly Power, Rule of thumb for pricing.
36Horizontal and Vertical Integration of Firm
10 37 Imperfect Competition
Monopolistic and Oligopoly. Product Differentiation and Monopolistic Competition. Characteristics of Monopolistic Competition.
38Monopolistic Competition-I
Price and Output Equilibrium
39Monopolistic Competition-II
Selling Costs and Advertising. Optimum level of Advertising Outlay. Monopolistic Competition and economic efficiency
40Oligopoly
Characteristics of Oligopoly, Oligopoly and Interdependence
11 41 Collusive Oligopoly
Cartel as a Cooperative Model
42Price-Leadership Model
Price Leadership by dominant firm
43Kinked Demand Curve Theory of Oligopoly
44Prisoners’ Dilemma and Oligopoly Theory
12 45 Sales Maximization Model of Oligopoly Firm
46Classical Model of Oligopoly
Cournot’s Duopoly Model, Stackelberg model
47Contestable markets Theory
48Pricing Public Utilities
Taught by
Dr. M. Vasim Khan
