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MICROECONOMICS ECS201

MICROECONOMICS ECS201. WELCOME. WHAT ARE WE DOING TODAY?. Who am I? What to do and not to do Means of communication ADC services Unisa Analyze your study skills What do you see? Chapter 1 Chapter 2 Questions. Adc services. Delivering academic support regarding: Time Management

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MICROECONOMICS ECS201

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  1. MICROECONOMICSECS201 WELCOME

  2. WHAT ARE WE DOING TODAY? • Who am I? • What to do and not to do • Means of communication • ADC services • Unisa • Analyze your study skills • What do you see? • Chapter 1 • Chapter 2 • Questions

  3. Adc services • Delivering academic support regarding: • Time Management • Study Skills • Exam Preparation and Techniques • Stress Management • Professional development of lecturers.

  4. To do or not to do … • Prepare • Pre-requisite • Participation • Homework • Tardiness • Cell phones • Eat and Drink

  5. Means of communication www.liezavandervyver.weebly.com After class Student Support Office @ student reception By appointment By e-mail: lvdvyver@varsitycollege.co.za Phone: (012) 348-2551 Website!!!

  6. Your unisa registration UNISA PROCEDURES • Registrations • Tutorial letter 1 • MyUnisa • Assignments • Important dates • Prescribed textbook • Exam entry

  7. Let’s analyze your study skills • Questionnaire • Different types of learners • Analyse • Assist

  8. What do you see?

  9. What do you see?

  10. Chapter 1 Preliminaries What is Microeconomics?

  11. Outcomes • Nature and importance of microeconomics • The workings of a market • Real and Nominal prices

  12. Public Economics Monetary Economics Finance Economics Development Economics International Economics

  13. WHAT IS MICROECONOMICS? • Equips us to answer questions • Explain irregularity in our everyday lives • Provide the background for other economic disciplines • Knowledge of basic economic theory • Application of basic economic theory • Gain insight in social and economic events WHY? Help us predict what is likely to happen

  14. THEMES of microeconomics • Trade-offs • Prices and Markets • Theories and Models • Positive and Normative analysis • Nature of Markets • Real versus Nominal prices • Why study Economics?

  15. THEMES of microeconomics- Trade-offs Consumer Theory Theory of the firm

  16. Prices and Markets

  17. LIMITED RESOURCES • THEORIES AND MODELS

  18. LIMITED RESOURCES • POSITIVE AND NORMATIVE ANALYSIS

  19. MARKET • Definition: • Collection of buyers and sellers • Through actual or potential interactions • Determine price of a product • Or, set of products • Market = More than an industry • Industry: Collection of firms that sell same/closely related products. • Potential interactions & actual interactions • Arbitrage: • Significant difference in price of commodity • Practice of buying low @ one location & sell high at another location

  20. MARKET • Competitive market • Perfectly competitive: Many buyers and sellers e.g. agricultural markets • Noncompetitive market • Many producers • Cartel: Group of producers act collectively • Market price: • Competitive market = Single price = market price • Not perfectly competitive = Different prices • Average price = Market price

  21. MARKET • Market Definition: • Buyers and sellers • Extent of the market: • Determine which buyers and sellers • Boundaries of a market • Geographical and i.t.o. range of products • Market definition importance: • Understand who is actual and potential competitors • Public policy decisions

  22. REAL VS NOMINAL PRICES • Nominal prices: • Absolute price • “Current-dollar” • Real prices: • Price relative to aggregate measure of prices • “Constant-dollar” • Consumer Price Index • Producer Price Index

  23. IMPOTANT CONCEPTS • IMPORTANT CONCEPTS • CETERIS PARIBUS • Assumption used when designing models. • Meaning: All variables other than the one economist use will remain unchanged. • Latin expression: “All other things being equal” • EQUILIBRIUM • Important in economic theory • A situation, once it has been reached, tends to persist • All factors in balance.

  24. IMPOTANT CONCEPTS • IMPORTANT CONCEPTS • PRICES • MACRO = Absolute prices i.e. price of goods and services • MICRO = Relative prices i.e. relationship between price in question and price of other products • RATIONAL INDIVIDUALS • Behave rationally • Well off given limitations • MALE OR FEMALE? • “He” merely used for practical reasons

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