TEMPLE UNIVERSITY

Department of Economics

Spring 1999

Tuesday and Thursday, 10:10 AM - 11:30 AM

Speakman Hall 210
(this is a change from the class listing catalog!)

Final Exam, May 11, 8:30 AM - 10:30 AM

Instructor:	Andrew J. Buck	815 Ritter Annex 204-1985
Office Hours:	Tues and Thurs after class or by arrangement
Textbook:	Microeconomics, 2nd edition by Fred Gottheil Southwestern Publishing
Recommended Supplements:	· None this semester
Information for an electronic age:	· email: buck@astro.ocis.temple.edu
	Listserv mailbox   Listserv Web site - - Archive
Electronic textbooks:	· Essential Principles of Economics: or go to the Mirror Site · Principles of Economics · An online course: Principles of Microeconomics · College Mathematics Review · TU's Calculus on the Web Project

The text and its supplements: The text by Gottheil is a new one for me.  Fred is a popular teacher at University of Illinois.  In fact he was one of the instructors for one of the classes I took there as part of my PhD program.  The book is not difficult to read, but you will encounter a lot of new vocabulary.  Create your own glossary by writing definitions in the margins.  At the end of each chapter is a review.  It is good practice to read the review before and after you read the chapter.  There are also review questions at the end of each chapter; read them even if you don't write out answers.  At the very bottom of the page is a link to the publisher's online tutorial materials.  If you are a careful reader with good comprehension and retention skills then you may not find the supplements important.  If you are just an average Joe, like me, then you will probably find the supplements helpful in clarifying and reinforcing what you have read.

Course Requirements: There will be one mid term exam and a final exam. You must write both exams. The dates are shown below. Make-up exams will be given only under extraordinary circumstances and by prior arrangement. There will be homework assigned periodically, check the timetable below. Your course grade will be computed as follows:

Goals of the Course: Microeconomic Principles will acquaint you with some of the basic models used by economists to explain the everyday behavior of individuals and firms. The science of economics is built on a specialized vocabulary. If you don't learn the vocabulary, then you won't learn the science. Mastery of the science of economics will involve learning to manipulate the vocabulary in order to systematically describe behavioral outcomes. We then try to generalize these outcomes as 'laws' or models. The 'laws' of economics are the basis of all of the other business disciplines. Most of the founding and noteworthy scholars in the other disciplines received their initial training in economics.

The fundamental result that you MUST keep with you throughout the rest of your academic and working careers is that firms and individuals make decisions at the margin. That notion was formalized more than 200 years ago by Adam Smith². Adam Smith proposed that we choose that course of action which resulted in the greatest net incremental benefit.  The principle was understood by one of our founding fathers and local luminary, Ben Franklin.  Franklin recommended that one divide a page in half, listing the costs on one side and the benefits on the other. The correct course of action would then be dictated by weighing the costs and benefits and looking for the greatest net gain.

What makes this class different from Econ 52? This is an honors class.  It is my presumption that you are prepared to go beyond what is expected of the students in the regular classes.  The syllabus below reflects what is normally expected of my principles of microeconomics students in terms of materials and exercises.

At this time I have some strongly held beliefs.  First, the best way to learn a subject is to be prepared to teach it.  Second, you are poised at the early stages of a revolution in the way we deliver courses. Third, you have a comparative advantage in computer technology and communicating with your peers.  With these beliefs in mind, your challenge will be to create computer based course materials for future principles of microeconomics students.  We will try our hands at discussion questions and problems sets; the standard fare.  From there the sky is the limit.  You can see below that I have created some interactive graphs.  We can create animated gif's (see the index for principles of microeconomics materials), or audio, music and video clips (MTV?) for use by students trying to learn microeconomics.  If you are artisitic we can do storyboards or electronic comic books.  You just need to dream it.

Words to the Wise: Attendance is not required, but I strongly recommend it. Indeed, how can you garner the 15% of your grade allocated to participation if you are not in class? Also remember that learning is hard work. It can be fun, but it is still hard work. Class time, reading assignments, and homework exercises are all part of the learning process. To paraphrase the wisdom of Confucious:

Timetable for assignments, readings, and exams
Date	Text and SW web site	References to an electronic text	Discussion Questions	Mathview Tutorials	Newspaper Articles and Other Reading	Problem Sets
Jan 19	Introduction Chapter 1	Introduction	Introduction	Graphs: Slopes and Intercepts Graphs: Down and to the Right?
Jan 21	Production Possibilities Chapter 2	Neoclassical Perspective	Scarcity	Production Possibility Frontiers: Movements and Shifts	Opportunity Cost
26	Demand and Supply Chapter 3	Supply and Demand	The Price System	1. A change in the quantity demanded, 2. A change in demand 3. The effect of a change in demand, on equilibrium 4. A change in the quantity supplied, 5. A change in supply   6. The effect of a change in supply on equilibrium	1. Equilibrium 2. Privatizing PA's Liqour Stores 3. Hog Prices	Production Possibilities,  and Answer
28	Further Topics in Supply and Demand Chapter 6			Measuring Consumer Surplus Measuring Producer Surplus The Incidence of Taxation Efficiency and Taxes	Health Care for the Poor	Supply and Demand Shifts and Answer Key
Feb 2	Elasticity Chapter 4	Elasticity		Elasticity: Part 1 and Part 2 and Part 3	Demand for hotel rooms in Philly Cigarettes	Equilibrium, due 9/16, answer key
4						Consumer Surplus: Tarif Vert and Answer Key
9	Consumer Choice Chapter 5	Demand Theory: Part I and Part II	Marginal Analysis	How Many Should You Buy Getting the Most for Your Money		Elasticity, due 9/18, answer key
11						Utility Maximization and key
16	Business Ownership Chapter 7		Real Firms			Indifference Curves
18	Production Chapter 8	Production	The PPF, Production  and Resource Constraints	Production from one variable input
23						Production from one input and answer key
25	Profit Maximization Chapter 9	Cost and Supply	Inputs and Profit Maximization	Fixed, Variable and Total Costs   Production, and Average and Marginal Costs
March 2
5	Midterm Exam: An example with answers This semester's exam key

9	Spring break
11	Spring break
16	Markets and Market Structures Chapter 10
18	Price and Output: Competition	Competition The Notion of Efficiency: Tying some ideas together	Competition	Quantity Choice by the Competitive Firm	Grain: A Homogeneous Good
23	P&O: Monopoly	Monopoly	Monopoly	The Monopolist's Profit Maximization	Microsoft and Monopoly	The Competitive Paradigm
25	P&O: Other Paradigms	Imperfect Competition and Game Theory	* Imperfect   Competition		Oligopoly Monopolistic Competition	Price and Output under Monopoly
30	Antitrust and Regulation Chapter 13		* Antitrust     The Mock Trial		Microsoft's Antitrust Woes	A middle ground: Monopolistic Competition
April 1			Regulation		Deregulating Electricity	Antitrust or Regulation
6						Monopoly, Competition and Regulation
8	Competitive Labor Markets Chapter 15	Factor Markets	Factor Markets	Employment in a competitive labor market	Labor Markets
13						Labor Demand in competitive markets
15	Monopsony and labor Unions Chapter 17			Wages and employment in monopsony	Discrimination in Baseball
20	Income and Poverty Chapter 18				The Living Wage and Philadelphia	The Demand for Labor in imperfectly competitive markets
22	Foreign Trade Chapter 19	Trade and Foreign Exchange			A Foreign Trade Primer from the NY Fed NAFTA after 5 Years	Wage Determination Review
27					Survey:and World Financial Crises
29	Exchange Rates Chapter 20				1. Foreign Exchange 2. The Euro 3. The World Financial Crisis of 1998	Two Country Trade: Part 1 Two Country Trade: Part 2
May 4
Final Exam, 5/11, 8:30 - 10:30 : An example with answers

Prototype for PPF interactive video: An event in the HTML page spawns a video.  Incidentally, it is possible to launch a web page (not done yet) from a video clip, not just the other way around as in the prototype.

Try these applets:
Price Ceiling
Price Floor
Taxes and Elasticities
Taxes: Who Pays?

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