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Department of Economics Hunter College of the City University of New York |
Economics 200: Principles of Microeconomics
Autumn 1997
Mondays and Thursdays, 9:45am-11:00am
Hunter North 514A
Kenneth J. McLaughlin,
Associate Professor
Description
At the foundation of economics is the concept of foregone opportunity: by doing this, I forego that.
Hence the course opens with the study of scarcity, opportunity cost, and comparative advantage.
The body of the course is divided into three components.
In the first third of the course, we will analyze the determinants of trade in markets using
the concepts of demand, supply, and equilibrium. In particular, we will learn how prices and
the amount traded depend on the incomes of consumers, the prices of other goods (complements and
substitutes), the prices of inputs used to produce the good, technology, and government restrictions
(e.g., rent controls, prohibition, taxes, and subsidies).
In the middle third of the course, we will develop a deeper understanding of the determinants of demand
and supply. In particular, we will analyze the fundamentals
of production and costs, and we will derive market supply curves based on the profit-maximizing choices
of individual firms, explore the dynamics of how markets respond to fundamental changes (e.g., innovation),
and characterize the effects of monopoly power. This section of the course closes by applying game theory
to strategic interactions or rivalries among firms.
The final third of the course focuses on the markets for resources or inputs, such as flour, cheese, and
restaurant space in the case of pizza production. We will investigate what determines whether a
resource is paid what it's worth. In particular, are workers paid what they're worth in a free market?
We will also study financial markets, including determination of equilibrium interest rates and iinvestments.
The course closes with a characterization of the performance of free markets in the presence of
externalities: what happens in free markets when one person's choices spill over to directly effect
the welfare of others.
Textbook
The required textbook by Dolan and Lindsey will be available at the bookstore;
the supplementary study guide will also be available.
Prerequisite
Math 120 is a prerequisite: each student must have (a) passed Math 120 with a grade of C or
higher, or placed out of Math 120 by passing Part I of the Calculus Readiness Test.
(A student may register to take the Calculus Readiness Test in the
Dolciani Mathematics Learning Center
(HN 300).)
Skill in working with graphs and algebraic functions is absolutely essential:
the student must be able to work with the graph of a function,
to read slopes from graphed functions, to draw tangencies to a function, and to find a
simultaneous solution as the intersection of several functions.
So satisfying the formal requirement is not enough: each student must have retained working knowledge
of the subject matter.
Examinations
Office Hours