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Intermediate Microeconomics

Intermediate Microeconomics. -------------Introduction . Part 1 MICROECONOMICS AND MACROECONOMICS. Microeconomics The study of how households and firms make decisions and how they interact in markets Macroeconomics

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Intermediate Microeconomics

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  1. Intermediate Microeconomics -------------Introduction

  2. Part 1 MICROECONOMICS AND MACROECONOMICS Microeconomics The study of how households and firms make decisions and how they interact in markets Macroeconomics the study of the economy as a whole and economy-wide phenomena, including inflation, unemployment, and economic growth

  3. Part 2 Describing the relationship(1) Economic models • Two key variables: • Endogenous variable: Endogenous variables are those variables that a model tries to explain. • Exogenousvariable: Exogenous variables are those variables that a model takes as given.

  4. Part 2 Describing the relationship(1) Economic models • Objective: • 1)Show the key relationship among endogenous variables and the exogenous variables that are given. • 2)Comparative statics: show how changes in the exogenous variables affecting the endogenous variables

  5. Part 2 Describing the relationship(1) Economic models • Assumptions——the start of our analysis. • A multitude of models：Whether the underlying assumptions are reasonable for the problems facing to us。 • Two implicit and important assumptions throughout microeconomic and macroeconomics

  6. Part 2 Describing the relationship(1) Economic models • 1)Economic actors are fully rational.——Optimization principle • Households and firms do the best they can for themselves, given their objectives and the constraints they face.

  7. Part 2 Describing the relationship(1) Economic models • 2)The resources are scarce. • Scarcity means that the economy has limited resources and therefore cannot produce all the goods and services that people desire. Economicsis the study of how society locating its scarce resources.

  8. Part 2 Describing the relationship(2)Function • Demand function • Utility function • Supply function • Cost function • ……

  9. Part3 How this semesterproceeds 1 . Consumer theory: • The consumers will choose the best bundles they can afford.( i,e. The consumers will maximize their utility under the budget constraints coming to them.)

  10. Part 3 How this semesterproceeds 2. Producer theory: • The producers will maximize their profits under the constraints of technology and market.

  11. Part 3 How this semesterproceeds 3 . Market demand and industry supply • Uncertainty • Do you know how to fix the premium in the perfectly competitive market?

  12. Part 3 How this semesterproceeds Game theory • 如果给你两个师的兵力，你的任务是攻克“敌人”占据的一座城市，而敌军的守备力量是三个师。规定双方的兵力只能够整师地移动，通往城市的道路只有甲乙两条。当你攻击时，你的兵力超过敌人，你就胜利；你的兵力比敌军的守备兵力少或者相等，你就失败。 • 问：我军获胜概率是多少？

  13. Part 3 How this semesterproceeds • Exchange : • The Edgeworth box • Information technology • Asymmetric information

  14. Part 4 Hints • 不要通读全书，把握模型的几何特点及其经济含义 • 注意把握体系，切忌零散地死记 • 注意经济学和数学的关系：经济学是引导，数学是工具，经济学不是数学 • 适当习题，但是要以理解为前提，不要用题海战术 • 对于这一科，实践证明，“临时抱佛脚”并不那么管用。

  15. Part 5 Example • 如果一个典型的消费者的偏好是“完全替代”的，那么请描述出这个消费者所做出的可能的最优选择。

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