114-0402/06 – Microeconomics B - Intermediate Microeconomics (Mikro B)
| Gurantor department | Department of Economics | Credits | 5 |
| Subject guarantor | doc. Ing. Jan Janků, Ph.D. | Subject version guarantor | Ing. Lenka Spáčilová, Ph.D. |
| Study level | undergraduate or graduate | Requirement | Compulsory |
| Year | 1 | Semester | winter |
| | Study language | Czech |
| Year of introduction | 2012/2013 | Year of cancellation | 2014/2015 |
| Intended for the faculties | EKF | Intended for study types | Follow-up Master |
Subject aims expressed by acquired skills and competences
- interpret modern microeconomics at the intermediate level
- illustrate the consumer behaviour through indifference analysis and connect the basic model of consumer behaviour with consumer decision-making under risk
- formulate the conditions of different market structures and compare models of firm's decision-making on the price and size of the output in terms of perfect and imperfect competition
- analyze the market of inputs and identify perfectly and imperfectly competitive markets of inputs
- classify the types of market failure and evaluate the solutions of market failure
- connect the consumer choice and behaviour of the firm in general equilibrium analysis
Teaching methods
Lectures
Seminars
Summary
The aim of this course is to give students the conceptual basis and the
necessary tools for understanding modern microeconomics at the intermediate
level. This course develops the neoclassical theory of optimising behaviour of
consumers and firms. The discussion of consumer theory is followed by a
careful examination of price and output determination under alternative market
structures. The implications of alternative goals of firms are also examined.
After the theory of supply and demand in the output market, the focus turns to
an examination of resource markets.
Compulsory literature:
Recommended literature:
Additional study materials
Way of continuous check of knowledge in the course of semester
E-learning
Other requirements
For credit, student must be able to solve examples with a similar character, such as examples in LMS, topics 1 to 5.
Credit:
Maximum 35 points. Minimum 20 points.
Prerequisities
Subject has no prerequisities.
Co-requisities
Subject has no co-requisities.
Subject syllabus:
1. Introduction to the Study of Intermediate Microeconomics
2. Consumer Choice
- Income-Consumption Curve, Engel Curve, Engel Expenditure Curve, Income Elasticity of Demand
- Price-Consumption Curve. Substitution and Income Effect, Price Elasticity of Demand
- Intertemporal Consumption Choices. Rate of Time Preference. Intertemporal Budget Constraint. Interest Rate.
3. Decision under Risk and Uncertainty.
Risk. Uncertainty. Probability. Measuring Risk- Variance, Standard Deviation. Expected Mean (Value).
Expected Utility Theory.
Attitude Toward Risk - Risk Averse, Risk Loving, Risk Neutral.
Insurance. Adverse Selection and Moral Hazard.
4. Theory of production
Long-run Production Function. Isoquant Analysis. Marginal Rate of Technical Substitution. Economic Region of Production. Long-run Expansion Path.
Short-run Production Function. Short-run expansion path.
Short-run Costs. Long-run Costs.
5. Perfect Competition.
Short-run and Long-run Equilibrium of the Firm under Perfect Competition.
6. Monopoly
- Price Discrimination. Natural Monopoly. Network Industries.
7. Oligopoly
- Pricing Strategies of the Oligopolistic Firms.
- Cournot's Model, Stackelberg Model, Sweezy Model.
8. Anti-monopoly Regulation.
- Rate of Return Regulation, Price Cap Regulation; Franchise regulation; Yardstick regulation
9. Monopolistic Competition.
- Short-run and Long-run equilibrium of the Firm under Monopolistic Competition
10. Labour Market.
- Individual Demand and Supply of Labour.
- Market Demand and Supply on Competitive Labour Market. Short-run and Long-run Equilibrium on Competitive Labour Market.
11. Capital Market.
12. General Equilibrium and Welfare Theorems.
- Edgeworth Box. Consumption Efficiency. Production Efficiency. Pareto Efficiency.
- Welfare Theorems.
- Monopsony Labour Market.
13. Market Failures. Microeconomic policy of government.
Externalities.
Public Good. Efficient Scale of Provision of a Public Good.
Public Choice Theory.
Tutorials:
1. Theory of Demand. Elasticities of Demand.
2. Consumer Choice.
3. Production Functions. Costs of Firm.
4. Firm Behaviour under Perfect and Imperfect Competition.
5. Input Markets. Decision under Risk.
Conditions for subject completion
Occurrence in study plans
Occurrence in special blocks
Assessment of instruction