MICROECONOMICS - I

Semester and Year Offered:

Course Coordinator and Team:Dr Robin Singhal

Email of course coordinator:rsinghal[at]aud[dot]ac[dot]in

Pre-requisites:MATHEMATICS at the +2 LEVEL

Course Objectives/Description:

This course is the first part of the training in micro-economic theory and concepts at undergraduate level. The course offers knowledge of utilitarian and non-utilitarian analysis of consumer behaviour in the economy. Further, the course introduces the theory of firm and the technological relationship that is embodied in production and cost functions.

Course Outcomes:

On successful completion of this course, students will be able to

1. Explainthe functioning of market mechanism through forces of demand and supply.
2. Develop analytical perspective about market equilibrium and analyse comparative statics on account of changes in market conditions.
3. Describe and illustrate the basic concepts fundamental to economic decision making in the case of consumers.
4. Explain the basic production and cost concepts in relation to the time period.
5. Develop insights for the application of micro-economic analyses to economic and social problems.

Brief description of modules/ Main modules:

1. Principles of Demand, Supply and Market Equilibrium:This module covers the relationships between prices and quantities and the general laws of demand and supply in market; the analysis of demand-supply in the market in a comparative static framework and introduces the theory of equilibrium.
2. Theory of Consumer Behaviour:This module provides insights into individual consumer’s behaviour in the market. It covers various key aspects such asconsumer preferences, utility functions, indifference curves and the consumer’s budget fundamental to comprehending the consumer’s optimization exercise. It develops the understanding of price effect (substitution and income effects) and related conceptual classification of goods as normal, inferior and Giffen. The non-utilitarian approaches such asrevealed preference is also covered.
3. Theory of Production:This module discusses the technological relationships between inputs, isoquants and the use of production functions in firm operations. It explores the relationship between several key concepts such as average, marginal and total product, explaining the stages of production.
4. Theory of Cost:This module discusses the concept of short-run and long-run cost curves in detail. It develops their understanding of cost concepts instrumental for firm’s economic behaviour pertaining to the optimization of profits and costs.

Assessment Details with weights:

Class Test (30%), Mid-Semester (30%), End Semester Examination (40%)

Reading List:

1. H. R. (2014). Intermediate microeconomics with calculus: a modern approach. WW Norton & Company.
2. Pindyck, R., & Rubinfeld, D. (2018). Microeconomics Global Edition. Pearson Australia Pty Limited.

ADDITIONAL REFERENCE:

1. Snyder, Chirstopher& Walter Nicholsan (2014). Microeconomic Theory: Basic Principles and Extensions, Cengage Learning. South-Western.