Course Overview

Introduction to Microeconomics

Microeconomics is the branch of economics that studies the behavior of individual economic agents, such as consumers and firms, and how they make decisions to allocate limited resources. This course, ECON 2420, covers foundational concepts, market structures, and the analysis of public policy impacts on efficiency and welfare.

• Focus: Individual elements of the economy (consumers, firms, markets)

• Key Areas: Market decisions, production, costs, profit maximization, and public policy

• Market Structures: Perfect competition, monopoly, monopolistic competition, oligopoly

Course Topics

Major Topics Covered

The course is structured around twelve core topics, each corresponding to a major area in microeconomic theory and application:

1. Comparative Advantage

2. Demand and Supply

3. Economic Efficiency

4. Elasticity

5. Healthcare Economics

6. Firms and Corporate Governance

7. International Trade

8. Production and Costs

9. Perfect Competition

10. Monopolistic Competition

11. Oligopoly

12. Monopoly

Learning Objectives

Key Skills and Knowledge Areas

Upon completion of the course, students should be able to:

• Understand and apply the concepts of absolute and comparative advantage

• Explain and calculate opportunity cost and gains from trade

• Identify and analyze market equilibrium

• List and evaluate factors affecting market demand and supply

• Assess the effects of price regulations and government intervention

• Define and calculate consumer surplus and producer surplus

• Evaluate market efficiency using economic surplus

• Calculate and interpret elasticity of demand and supply

• Analyze healthcare markets and concepts such as adverse selection and moral hazard

• Characterize different types of firms and their methods of raising capital

• Apply concepts of present value to future income

• Assess the impact of international trade on markets and economic surplus

• Classify inputs and production durations; illustrate specialization and diminishing marginal returns

• Calculate production costs and represent long-run production

• List characteristics and profit maximization strategies for perfect competition, monopolistic competition, oligopoly, and monopoly

• Understand game theory and identify Nash and Stackelberg Equilibria

• Evaluate the effects of cartels, cooperation, and market entry

• Discuss the causes and effects of monopolies on economic surplus

Course Structure and Assessment

Assignments and Exams

• Each topic includes: textbook reading, lecture slides, video lectures, sample problems, discussion questions, and homework assignments.

• Three non-cumulative tests, each covering four topics.

• A cumulative final exam covering all twelve topics.

• Homework and discussion assignments for each topic, with multiple attempts allowed for homework.

Grading Breakdown

Grading Scale

Course Schedule

Topic Timeline and Due Dates

Key Microeconomic Concepts (Preview)

Comparative and Absolute Advantage

• Absolute Advantage: The ability of an individual, firm, or country to produce more of a good or service than competitors using the same amount of resources.

• Comparative Advantage: The ability to produce a good or service at a lower opportunity cost than others.

• Opportunity Cost: The value of the next best alternative foregone when making a choice.

• Gains from Trade: Both parties can benefit from trade if they specialize according to their comparative advantage.

• Formula for Opportunity Cost:

Demand and Supply

• Law of Demand: As the price of a good increases, the quantity demanded decreases, ceteris paribus.

• Law of Supply: As the price of a good increases, the quantity supplied increases, ceteris paribus.

• Market Equilibrium: The point where quantity demanded equals quantity supplied.

• Equilibrium Price and Quantity:

Elasticity

• Price Elasticity of Demand: Measures the responsiveness of quantity demanded to a change in price.

• Formula:

• Interpretation: Elastic (>1), Inelastic (<1), Unitary (=1)

Market Structures

• Perfect Competition: Many firms, identical products, free entry and exit.

• Monopolistic Competition: Many firms, differentiated products.

• Oligopoly: Few firms, interdependent decision-making.

• Monopoly: Single firm, unique product, barriers to entry.

Course Policies and Resources

Professionalism and Academic Integrity

• Students are expected to demonstrate professionalism, including punctuality, preparation, and ethical conduct.

• Academic misconduct (plagiarism, cheating, fabrication) will result in disciplinary action.

Attendance and Participation

• Regular attendance and participation are required and monitored.

• Assignments, discussion participation, and timely submission are essential for success.

Support Services

• Disability Services: Accommodations available through the Disability & Access Center.

• Tutoring: Free tutoring available for economics and related subjects at the Tutoring Spot.

• Counseling: Free counseling services for students, faculty, and staff.

• Technical Support: MTSU Help Desk available 24/7 for technical issues.

Communication Guidelines

• All course communication should use institutional email accounts.

• Discussion and group work require respectful, constructive participation.

Additional Info

• Course uses Hubbard & O'Brien, Microeconomics (9th Edition) as the main textbook.

• Online resources and assignments are managed through MyEconLab and Canvas.

• Students are encouraged to work ahead and utilize all available resources for success.