WELCOME TO ECONOMICS E-1010: MICROECONOMIC THEORY

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Today\'s Agenda. Go Over SyllabusRequirementsPoliciesTopicsWhat is Microeconomics?An ExampleNext Time. Depiction. Financial matters E-1010 presents the fundamental systematic devices of microeconomics. We will begin by taking a gander at the choice making of individual purchasers and ask how these choices can be streamlined, or made strides. Next, we will take a gander at how firms settle on and coordinate their choices under varyi

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WELCOME TO ECONOMICS E-1010 : MICROECONOMIC THEORY Fall 2009 W, 5:30-7:30 Maxwell Dworkin G115 Robert Neugeboren 51 Brattle St, Rm 521 TA: Rajiv Shankar W 3-4 and by app't. rshankar@fas.harvard.edu neugebor@fas.harvard.edu Sections: T, 5:30-6:30 or 6:30-7:30 TBA Website: www.isites.harvard.edu/k63102

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Today's Agenda Go Over Syllabus Requirements Policies Topics What is Microeconomics? An Example Next Time

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Description Economics E-1010 presents the essential explanatory apparatuses of microeconomics. We will begin by taking a gander at the basic leadership of individual purchasers and ask how these choices can be upgraded, or progressed. Next, we will take a gander at how firms settle on and facilitate their choices under differing market structures, including impeccable rivalry and imposing business model.

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Description Then we will take a gander at vital conduct in defectively aggressive markets, making utilization of ideas from diversion hypothesis, for example, Nash harmony. At long last, we will take up themes including (from among?) dealing hypothesis, data financial aspects, externalities, open products, and welfare examination.

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Description ECE-1010 is instructed at the halfway level and is proper for understudies who have officially finished a first-year "standards" course in microeconomics. Numerical planning at the level of fundamental variable based math is an essential, and recognition with first-year analytics will be of offer assistance. Understudies will take in the key devices and standards financial analysts apply to comprehend an extensive variety of marvels, utilizing graphical portrayals, some math, and plain rationale to show the essential thoughts and tackle fundamental microeconomic issues.

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Requirements 10% Sections. Participation obligatory. 20% Problem Sets. 4, each 2-3 weeks. 30% Midterm Exam. October 14 . 40% Final Exam. December 16 . Graduate Credit: Additional material will be allocated on issue sets and exams.

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Readings There are a few decent course readings on middle of the road microeconomics. Both of the accompanying are suggested: Besanko & Braeutigam, Microeconomics , 3 rd (Wiley). Pindyck & Rubinfeld, Microeconomics,6 th (Prentice Hall). A decent option is Varian, Intermediate Microeconomics . Understudies are relied upon to peruse the allocated sections before the comparing class session. Every once in a while, extra foundation references and supplementary readings might be relegated.

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Course Policies Academic Honesty Harvard considers matters of scholarly genuineness important. While you may talk about assignments with your schoolmates and others, ensure any composed material you submit is your own work . Utilization of old course materials, including issue sets and exams from online sources, is disallowed .

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Course Policies Academic Honesty You ought to counsel the Official Register of the Harvard Extension School and the site http://www.extension.harvard.edu to acclimate yourself with the conceivable genuine outcomes of scholastic untruthfulness. Late Policy Problem sets must be submitted, in either on line or face to face, by 5:30 on Wednesday.

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Course Policies Sections Part of your review will be founded on your support in segment (regardless of whether live or on-line). Areas will be particularly useful in get ready for issue sets and exams. Site & Textbook Support All official course declarations will show up on the course site, including assignments, answer keys, and connections to the distributer's site.

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Topics UNIT I CONSUMER CHOICE UNIT II FIRMS & MARKETS Oct 14 MIDTERM UNIT III COMPETITIVE STRATEGY UNIT IV INFORMATION & WELFARE Dec 16 FINAL EXAM

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Topics UNIT I CONSUMER CHOICE P-R parts 9/2 Introduction: What is Microeconomics? (1-2) 9/9 Theory of the Consumer (3) 9/16 Individual and Market Demand (4)

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Topics UNIT II FIRMS & MARKETS 9/23 Theory of the Firm (6) 9/30 Profit Maximization (7) 10/7 Perfect Competition (8-9) 10/14 MIDTERM

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Topics UNIT III COMPETITIVE STRATEGY 10/21 Monopoly (10-11) 10/28 Duopoply (12) 11/4 Strategic Behavior (13) kkk

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Topics UNIT IV INFORMATION & WELFARE 11/18 Decision under Uncertainty (5) 12/2 Bargaining and Negotiation (17) 12/9 Externalities and Public Goods. (18) 12/26 FINAL EXAM

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UNIT I: Theory of the Consumer Introduction: What is Microeconomics? Hypothesis of the Consumer Individual & Market Demand 9/2

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Theory of the Consumer What is Microeconomics? The Assumption of Rationality Equilibrium & the Exchange Economy Optimal Choice: An Example Next Time

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What is Microeconomics? Financial experts ponder everything from cash and costs to kid raising and nature. They investigate little scale basic leadership and expansive scale global approach making. They assemble information about the past and make forecasts about what's to come. Numerous monetary thoughts have cash in regular day to day existence, springing up in daily papers, magazines, and strategy banters about. The sum you pay each month to fund an auto or new home buy will rely on upon financing costs. Representatives make venture arrangements in light of desires of future request, and approach producers devise spending plans to accomplish craved social objectives.

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What is Microeconomics? Over the expansive scope of points that intrigue market analysts is an extraordinary way to deal with learning, something basic to the way all financial analysts see the world. Business analysts share certain presumptions about how the economy functions, and they utilize standard techniques for breaking down information and conveying their thoughts. What is Macroeconomics?

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What is Microeconomics? The Dismal Science Since its starting, financial aspects has been engrossed with the issue of shortage. The hours in a day, the cash in one's pocket, the sustenance the ground can supply are altogether constrained; spending assets on one movement fundamentally comes to the detriment of some other, inevitable open door. Shortage gives financial aspects its focal issue: how to settle on decisions under imperative?

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What is Microeconomics? We don't state that the generation of potatoes is financial movement and the creation of rationality is definitely not. We say rather that, in so far as either sort of action includes the surrender of other craved options, it has its financial viewpoint. There are no constraints on the topic of Economic Science spare this. - Lionel Robbins

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The Assumption of Rationality Economists approach an extensive variety of subjects with the supposition that the conduct under scrutiny is best comprehended as though it were sane (however we realize that not all conduct is, truth be told, levelheaded) and that the best clarifications, models, and hypotheses we can develop take sanity as the standard. Levelheadedness, in the expressions of Frank Hahn, is the "feeble causal recommendation" that gets all monetary examinations under way.

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The Assumption of Rationality Economics can be recognized from other sociologies by the conviction that most (all?) conduct can be clarified by expecting that specialists have steady, very much characterized inclinations and settle on judicious decisions predictable with those inclinations. - Colin Camerer and Richard Thaler .

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The Assumption of Rationality : the suspicion that specialists favor more of what they need to less; Max E(U). Specialists' needs, or inclinations, are not really self-intrigued. One can need others to be in an ideal situation and normally seek after their interests also. Business analysts expect that whatever their inclinations, specialists will endeavor to augment their fulfillment, subject to the imperatives they confront.

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Equilibrium & Exchange Whoever offers to another a deal of any sort proposes. Give me that which I need, and you might have what you what … ; and it is in this way that we acquire from each other the far larger piece of those great workplaces we remain needing. It is not from the kindness of the butcher, the brewer, or the dough puncher that we expect our supper, yet from their respect to their own particular self-intrigue. - Adam Smith

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Equilibrium & Exchange Yet a segregated deal is not all Smith had as a top priority. For a certain something, it is likely that various terms of trade (costs) exist which both sides would discover beneficial, and it conceivable the result could be impacted by fanciful or coercive means either side may have. Where rather every performing artist confronts countless: the market.

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Equilibrium & Exchange In the market, every individual is frail to set costs, which are rather dictated by the cooperation of a lot of people. Balance as an adjust of powers The Bargain Buyer and Seller attempt to concede to a cost. Purchaser is in an ideal situation at a cost not as much as b, Seller at a cost above s. On the off chance that b < s, there is no value they can concur on: b (uyer's reservation cost) 0 50 100 150 200 250 s (eller's reservation value) S (urplus) = b (uyer's reservation cost) – s (eller's reservation cost)

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Equilibrium & Exchange In the market, every individual is weak to set costs, which are rather controlled by the collaboration of a lot of people. Harmony as an adjust of strengths The Bargain Buyer and Seller attempt to concede to a cost. Purchaser is in an ideal situation at a cost not as much as b, Seller at a cost above s. On the off chance that b > s, we say there is a positive zone of assention , or surplus : b (uyer's reservation cost) 0 50 100 150 200 250 s (eller's reservation value) S (urplus) = b (uyer's reservation cost) – s (eller's reservation cost)

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Equilibrium & Exchange In the market, every indi

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