Micro Economics for Management
Yossi Spiegel
Semester bet 2002/3

Course Description:  The course covers basic topics in intermediate microeconomics.  The main objective is to present a set of concepts and analytical techniques that are vital to any microeconomic analysis.

The first part of the course deals with the behavior of individual consumers and producers.  The second part deals with market outcomes when consumers and producers meet one another.  We will consider two extreme market structures: perfectly competitive markets in which consumers and producers have no "market power" and imperfectly competitive markets in which either consumers or producers have "market power."

Prerequisites:  Students should be familiar with calculus as this is an extremely useful tool for analyzing economic models.  In addition to calculus I will also use graphical presentation to illustrate the main ideas and will emphasize the general logic and intuition behind the results.  In the second part of the course we will also use basic concepts in game theory.

Teaching Method:  There is a weekly meeting on Monday 14:15-15:45 room 303.  Students are also expected to attend a weekly review session with the TA, Alice Belenkin.  The review sessions are held on Monday, 12:15-13:45 in room 255 in Recanati and will be used to discuss assigned and graded problem sets.  Alice has a webpage in virtual tau.

Office hours:  My office hours are immediately after class.  I will be happy to answer questions you may have about the material.  Questions about the problem sets should be addressed to the Alice Belenkin

Textbook:   The text book for this course is Microeconomics: An Integrated Approach by David Besanko and Ronald Braeutigam (the library has  5 copies of this book).

Apart from Besanko and Braeutigam's text book there are other good textbooks around that you can consult, including,

Please ask me in case you have other text books that you'd like to use but are not sure whether they are appropriate.

Useful links:

Additional material:

Evaluation:  Evaluation will be based on a final exam (60% of the final grade), a midterm exam (20% of the final grade) and on weekly problem sets (20%).  The midterm exam will take place shortly after the passover break.  The midterm exam will take place on Friday, May 2 (exact time and place will be announced later on).  The final exam will take place on Sunday, June 15,  08:30.  In order to make the midterm and final exams less stressful, I will make them open book.

Problem Sets:  The weekly problem sets will account for 20% of your final grade.  The completed problem sets should be returned in the weekly review session before the session begins.  If you cannot submit the problem set on time you should tell about it to Alice in advanceNo credit will be given to problem sets that will be handed out late (or not handed out at all).  Although you are welcome to work in groups, each one of you should submit his/her own set.  The grades of the problem sets appear in Alice's webpage.

Midterm Exam:  The exam will cover consumer theory (the material we studied in the first 7 weeks of the course).  It will contain 4 questions.  The first two questions are worth 30 points each, and they are divided into 5 parts (question 1) and 6 parts (question 2).  The last two questions are worth 20 points each are are divided into 3 parts (question 3) and 2 parts (question 4).  It is always hard to predict the difficulty level of exams but I suspect that it will be about the same as that of your problem sets.  I will give you 3 hours for the exam though I hope you will not need more than 2.

Final Exam:  The exam will contain 4 questions: 2 worth 30 points each and 2 worth 20 points each.  The questions deal with the topics we studied during the course with a heavy emphasis on the material we covere in the second half of the semester.  In particular, you should expect to be asked about cost functions, technology, perfect competition, monopoly behavior, and 3rd degree price discrimination.  You have 3 hours to complete the exam.  I believe that anyone who studied well throughout the semester should do well in the exam.   Judging by the results of the midterm, most of you should not have special problems with the exam despite the fact that it is not particularly easy (but not too hard as well).

The tentative plan for the course*
Week Topic Readings from Besanko and Braeutigam Problems Due Date
Week 1: Feb 17 Brief introduction
Budget constraints
Ch. 4.1, Ch. 3    
Week 2: Feb 24
Preferences and indifference curves
Ch. 3
  The consumer's problem Ch. 4.2-4.3 Problem set 1 March 3
Week 3: March 3
Utility functions
Ch. 3
Week 4: March 10 Demand curves and their properties, elasticities Ch. 2-3 Problem set 2 March 17
Week 5: March 17 Applications of consumer theory Ch. 4, 5.1, 5.7 Problem set 3 March 24
Week 6: March 24  Applications of consumer theory,
revealed preferences
Ch. 4 Problem set 4 March 31
Week 7:  March 31 Applications of consumer theory,
consumers' surplus
Ch. 4, 5.3 Problem set 5 April 7
Week 8:  April 7 Technology, production functions, cost minimization Ch. 6-7 Problem set 6 April 28
Week 9:  April 28
Properties of cost functions
Ch. 6-8
 no problem set
Friday, May 2
Week 10: May 5
Properties of cost functions
Ch. 6-8
Problem set 7
May 12
Week 11:  May 12 Perfectly competitive markets - short run Ch. 9-10 Problem set 8 May 19
Week 12:  May 19 Perfectly competitive markets - long run Ch. 9-10 Problem set 9 May 26
Week 13:  May 26 Monopoly Ch. 11    
 Week 14:  June 2
Price discrimination
Ch. 12
Problem set 10
June 2
* An important remark: the plan for the course is only tentative.  It is almost certain that I will adjust it as the semester progresses.

Last updated: Monday, June 2, 2003