Microeconomics in business 2600-DSFRz1MIB
1. Basic issues in economics (Etymology of the term economics. The concept of microeconomics, macroeconomics, mesoeconomics and megaeconomics. Resources and flows).
2. The market mechanism (Demand versus Quantity. Potential demand and effective demand. Law of demand. Inverted demand equation. Change in demand. Supply and Quantity Supplied. Low of supply. Inverted supply equation. Change in supply. Market equilibrium. Market shortage. Market surplus. Ceiling price. Minimum price. Market effects of changes in demand and supply. Long-term market equilibrium).
3. Elasticity of demand and supply (point and arc elasticity, price elasticity of demand, cross elasticity of demand, income elasticity of demand, price elasticity of supply).
4. Utility theory (consumer behaviour, rational behaviour, irrational behaviour, cardinal utility theory, ordinal utility theory, law of diminishing marginal utility, indifference curves, marginal rate of substitution, budget line, the right to equalize the marginal utility, consumer equilibrium).
5. Producer theory (principle of rational management, one-factor production function, law of diminishing marginal productivity of an input, stages of production, two-factor production function, isoquant, marginal rate of technical substitution, declining MRTS, cost equation, isocost curve, optimum output, expansion path).
6. Theory of costs and profits (economic costs, hidden costs, production cost function, fixed costs, variable costs, total costs, average fixed costs, average variable costs, average total costs, marginal costs, long-run total costs, long-run average total costs, long-run marginal costs, economies and diseconomies of scale, book profit, economic profit, normal profit).
7. Perfect competition (model assumptions, break-even point, shut-down point, short-run supply curve, long-run equilibrium, allocative efficiency, production efficiency, long-run supply curve).
8. A complete monopoly (model assumptions, short-run equilibrium, long-run equilibrium, monopoly pricing, elasticity and marginal revenue, measuring monopoly power, price dispersion, first-degree price discrimination, second-degree price discrimination, third-degree price discrimination, two-part tariff, interm price discrimination).
9. Monopolistic competition (model assumption, short-run and long-run equilibrium, non-price competition).
Course coordinators
Type of course
Mode
Learning outcomes
After completing the course, the student:
In terms of knowledge:
• Has advanced knowledge and understanding of the terminology regarding basic economic issues (K_W01)
• Has advanced knowledge and understanding of the theories and forms of market organization (K_W03)
• Has advanced knowledge and understanding of economic processes and phenomena and their impact on financial decisions in organizations, the functioning of organizations, in particular as regards economic activities (K_W05)
• Has advanced knowledge and understanding of the principles of creating and developing various forms of entrepreneurship (K_W06)
In terms of skills:
• Can use the economic theory to recognize, diagnose and solve problems related to the functioning of organizations on the market (K_U01)
• Can correctly interpret economic processes and phenomena and their impact on the functioning of organizations (K_U02)
• Can plan and organize their own and team work (K_U05)
• Can self-educate and improve the acquired qualifications (K_U06)
In terms of attitudes:
• Is ready to assess and critically approach situations and phenomena related to the functioning of organizations on the market (K_K01)
• Is ready to think and act in an entrepreneurial manner (K_K02)
• Is ready to comply with professional ethical standards for economic activities (K_K03)
Assessment criteria
A written exam must by passed by the student to get credit for the course on microeconomics. The prerequisite for students to take the final exam is a positive grade received for the classes. All students failing the exam or unable to take it for the lack of credited classes can sit for it during the retake session in February.
Exam structure:
1) narrative questions,
2) a fill-in-the-blanks test,
3) algebra and graphics assignments.
Bibliography
Obligatory reading:
Zalega, T. (2016). Mikroekonomia. Warszawa: Wydawnictwo Naukowe Uniwersytetu Warszawskiego.
Begg, D., Fisher, S., Vernasca, G., Dornbusch, R. (2016). Mikroekonomia. Warszawa: PWE.
Supplementary reading
Krugman, P., Wells, R. (2013). Mikroekonomia. Warszawa: PWN.
Mankiw, M.G., Taylor, M.P. (2009). Mikroekonomia. Warszawa: PWE.