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Microeconomics 1 Course Overview

The Microeconomics 1 (EC101) module at Midlands State University aims to provide students with an understanding of decision-making processes for households and firms, focusing on maximizing satisfaction and profits. The course covers key topics such as resource allocation, demand and supply factors, government intervention, consumer theory, production costs, and market structures. Assessment consists of continuous evaluation and a final exam, with a strong emphasis on attendance and participation.

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44 views3 pages

Microeconomics 1 Course Overview

The Microeconomics 1 (EC101) module at Midlands State University aims to provide students with an understanding of decision-making processes for households and firms, focusing on maximizing satisfaction and profits. The course covers key topics such as resource allocation, demand and supply factors, government intervention, consumer theory, production costs, and market structures. Assessment consists of continuous evaluation and a final exam, with a strong emphasis on attendance and participation.

Uploaded by

tino
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Midlands State University

Faculty of Commerce
Department of Economics

Module: Microeconomics 1 (EC101)


Course leaders: Chipunza T., Mhere F., Makoni P., & Mutanga F.
E-mails: chipunzat@[Link]; mheref@[Link],
pmakoni@[Link]; mutangaf@[Link]

Preamble
The module is intended to provide students with some elementary understanding of how
households and firms make decisions to maximize satisfaction and profits or revenues,
respectively. Whilst some calculations are unavoidable, efforts shall be taken to
accommodate students without a sound Mathematical background.

Aims
 The module enables students to have an appreciation of rational decision making
by consumers and firms.
 It equips students with the skill of analysing the impact of government policies on
households and firms.
 The module inculcates skills of predicting the outcomes of the decisions of firms
on performance/ profitability.

Objectives
By the end of the module students should be able to:
 Understand how an economic system allocates resources.
 Examine the factors influencing demand and supply.
 Analyse the impact of government intervention on commodity markets.
 Analyse how consumers and firms maximize utility and profits, respectively.
 Analyse how a market structure influences firm behavior and performance.

Approaches
The teaching methodology combines lectures, discussions and presentations. Adequate
preparation and active participation during discussions is encouraged.

Attendance
Students are encouraged to attend all lectures and should attend with their relevant
groups.

Assessment
The grade for the module is based on continuous assessment (30%) and a final
examination at the end of the semester (70%). Continuous assessment shall consist of in-
class tests and presentations, details of which shall be availed to students during the
course of the semester. Students are particularly advised not to miss any of the tests since
there is no provision for make-up tests.
Module Content
1. INTRODUCTION TO MICROECONOMIC ANALYSIS
 Definitions
- Economics, Microeconomics, Macroeconomics
 Scarcity and opportunity cost
- The Production Possibilities Frontier
 Economic Systems
- Market Economy
- Command Economy
- Mixed Econ omy

2. PRICE AND OUTPUT DETERMINATION


 Determinants of demand
 Demand versus quantity demanded
 Determinants of supply
 Supply versus quantity supplied
 Market equilibrium

3. ELASTICITY
 Concept of elasticity
 Elasticity of demand versus elasticity of supply
 Own price elasticity of demand
 Income elasticity of demand
 Cross elasticity of demand
 Elasticity and the power of buyers

4. CONSUMER THEORY
 Consumer choices and preferences
 Utility and its representation
 Diminishing marginal utility in consumption
 Indifference curve analysis
 The budget line
 Equilibrium consumption- The condition for utility maximisation
 Normal goods, inferior goods and Giffen goods

5. PRODUCTION AND COSTS


 Output, fixed inputs and variable inputs
 The total product curve
 The average product curve
 The marginal product curve
 Concept of diminishing returns in production
 Definition of costs
 Fixed costs, Variable costs and Marginal cost
 Relationship between the cost curves
 The concept of revenue
 Concept of profit
 Short-run and long-run

6. MARKET STRUCTURES
 Classification of markets
 Profit maximization
 Perfect competition
- Profit maximization in the short-run
- Profit maximization in the long-run
 Monopolistic competition
- Profit maximization in the short-run
- Profit maximization in the long run
 Oligopoly
- Profit maximization in the short-run
- Profit maximization in the long-run
 Monopoly
- Profit maximization in the short-run
- Profit maximization in the long-run
 Price discrimination and the rationale behind it
 The efficiency comparison of the market structures

References
 Beardshaw J et al 2001. Economics: A Student’s Guide, London: Prentice-Hall
 Grant, S. J., 2000. Stanlake’s Introductory Economics 7th Revised Edition,
Longman
 Lipsey R. G. & Chrystal K. A., 2007. Economics 11th Ed, NY, Oxford University
Press
 Mankiw, N. G., 2009. Principles of Economics 6th Ed, South Western CENGAGE
Learning.
 McConnell C. R., Brue S. L., & Flynn, S.M., 2014. Economics: Principles,
Problems & Policies, NY: McGraw-Hill education.
 Perloff, J. M., 2014. Microeconomics, Pearson.

Note: The reference list above is not exhaustive.

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