EC 201Z Principles of Microeconomics

Lecture Hours: 4
Credits: 4

Examines how consumers and firms make choices when facing scarce resources, and how those choices are related to government policy and market outcomes, such as prices and output.

Prerequisite: Placement into WR 115 (or higher), or completion of WR 090 (or higher); and completion of MTH 095 (or higher); or consent of instructor. (All prerequisite courses must be completed with a grade of C or better.)
Student Learning Outcomes:

Articulate the concepts of opportunity costs and trade-offs.
Explain producer and consumer behavior using economic models.
Analyze the relationship between supply and demand and its applications across various economic contexts.
Identify the impact of market failures and government policy on efficiency and welfare.
Distinguish the characteristics, cost determination, and firm’s profit-maximizing price and output of each of the four basic market structures.

Statewide General Education Outcomes:

Apply analytical skills to social phenomena in order to understand human behavior.
Apply knowledge and experience to foster personal growth and better appreciate the diverse social world in which we live.

Content Outline

Overview of Microeconomics
Why Do Economists Use Models
Basic Features of a Capitalist Economy
- Private ownership of the means of production
- Wage labor
- Commodity production
- Rapid change and uncertainty
Supply and Demand
- Assumptions of perfect competition
Theory of Household Choice
- Choosing among products
  - Pecuniary emulation and conspicuous consumption
  - Utility maximization
- Price elasticity
Theory of the Firm
- Goal of profit maximization
- Production and costs
  - Technology
  - Resources
  - Firm/labor conflict
  - Externalities
- Revenues and profit
  - Firm vs. Firm competition (market structure)
  - Price determination
Economic Theory and the Optimal Governmental Policy
- Perfect corporation and laissez faire vs. imperfect competition, externalities and government regulation
- Market failures
Theory of Labor (Factor) Markets
- Determination of wages
- Causes of and solutions to poverty