Microeconomics 1

• 26 hrs lectures
• 26 hrs exercises

The goal of the course is to teach student to "think like an economist," which will help students to understand the world around, make better economic decisions in own life, and be a more informed citizen and voter. The course focuses on economic theory and therefore will often rely on abstract concepts. However, the course will emphasize the application of these concepts to real world situations through frequent in-class discussions of current events and interactive learning exercises.
Student will know theoretical approaches from a microeconomics area and he/she will understand the role of market to other microeconomics entities and he/she will make a critical analysis of real feature from microeconomics area.

This course does not assume any prior knowledge of economics.

1. Foundations of Economics and Microeconomics – economics, microeconomics and macroeconomics; positive and normative economics; economic models; development of microeconomics

2. Market System and Rational Behavior – economic agents, market system, role of prices, rational choice, opportunity and sunk costs

3. Demand Formation – marginal utility and indifference theory, individual and market demand, income and substitution effects, demand elasticity

4. Producer Behavior and Supply – costs and cost functions, marginal and average costs, supply curve, break-even and shutdown points, short-run and long-run equilibrium, elasticity of supply

5. Perfect Competition and Market Equilibrium – market equilibrium, equilibrium price, surpluses, efficiency, consumer and producer surplus

6. Imperfect Competition and Monopoly – monopoly, price discrimination, monopoly regulation

7. Oligopoly and Monopolistic Competition – oligopoly models, dominant firm, short-run and long-run equilibrium

8. Factor Markets and Labor Market – production function, labor demand and supply, labor market imperfections, unemployment

9. Capital and Land Markets – capital and money markets, investment, equilibrium, land market and rent

10. State and Public Sector in Microeconomics – microeconomic policy, price regulation, taxation, government failure

11. Externalities and Public Goods – externalities, Coase theorem, Pigouvian tax, public goods

12. Behavioral Economics – foundations, development, limits of rationality

13. Alternative Theories of the Firm – sales maximization and managerial models

The basic thematic content of the course is as follows:
• Information about the organization of the course, requirements for credit. Introduction to microeconomics. The market, types of markets, market entities, and market mechanisms.
• The scarcity of economic resources and the problem of their allocation. The use of graphs in microeconomics.
• Consumer behavior – utility and demand.
• Producer behavior – costs and supply.
• Market equilibrium and efficiency.
• Imperfect markets.
• Competition and regulation.
• Markets for factors of production, labor markets, and capital markets.
• Government intervention in prices.
• Externalities and public goods.
• Awarding credits.

Students will receive credit for the Microeconomics 1 exercise by achieving a minimum of 20 points out of a possible 40 in the ongoing written assignment. Students are entitled to have their continuous written work corrected. Detailed information about the time and place of the continuous written work will be provided in e-Learning, in the course news, or by the instructor. The requirements for the exam are knowledge of the material covered and a passing grade.

The exam is written. Students can earn a maximum of 60 points on the exam; to successfully complete the course, students must earn at least 30 points.

A maximum of 100 points can be obtained from the subject. The final classification of the student (on condition that the minimum number of points from the course and exam is achieved) is determined on the basis of the percentage of points obtained from the total possible number of points as follows:

A: 90–100%
B: 80–89%
C: 70–79%
D: 60–69%
E: 50–59%
F: less than 50%

Grading is based on the ECTS scale.

Attendance at seminars and lectures is optional.

It is not possible to repeat in a course after successfully completing it.