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Course Outline Aseq 1151 Microecon

Business

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14 views1 page

Course Outline Aseq 1151 Microecon

Business

Uploaded by

njagiagness77
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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1

ASEQ/ABBQ/ABMI/ 1151: INTRODUCTION TO MICROECONOMICS


Course Objective
The purpose of this course is to introduce students to economic concepts and techniques of microeconomics
analysis. This will give students an understanding of the working of the economy and to apply the
theoretical and the practical aspects of microeconomic analysis in solving real life economic problems.

COURSE OUTLINE

Week 1: Introduction to Economics: Defining economics, scarcity, choice, scale of preference and
Opportunity cost. Production possibility frontier: Nature and methods of economics, economic problem,
economic systems. Concept of the consumer’s sovereignty and its limitation.

Week 2 to 3: Demand and supply analysis: Demand Analysis: Definition of demand; law of demand
exceptions of the law, Determinants of demand, Individual and market demand curve. Supply Analysis:
Definition of supply, law of supply, exceptions, Determinants of supply, Market supply. Concept of
equilibrium: Determination of market equilibrium price and quantity; Effects of Changes in supply and
demand and the effect they have on equilibrium price and quantity. Minimum and maximum price controls,
effects of a tax and subsidies

Week 4 to 5: Concept and Measurements of elasticity: Definition of elasticity, Price elasticity of


demand, other types of elasticity of demand. Price elasticity of supply and, calculation various price
elasticity, various calculations. Importance of the concept of elasticity.

Week 6 to 7: Consumer demand theory: Utility analysis (Cardinal Approach): Total and marginal utility,
law of marginal utility and consumer’s equilibrium. Derivation of the individual demand curve, limitation
of the Cardinalist approach. Indifference curve analysis (Ordinalist Approach): The ordinal utility approach,
definition of indifference curve, properties of indifference curves, marginal rate of substitution of good X
for Y (MRS). Budgetary constraint and the budget line, consumer’s equilibrium.

Week 8 to 9: Production Theory: Factors of production: Land, labour, capital and enterprise. Mobility of
factors of production and specialization. Production function defined: -Short- run changes in production;
Total, Average and marginal products, stages of production and the law of diminishing returns: -Long-run
changes in production; The least-cost factor combination; concepts of isoquants, isocosts and the Marginal
rate of technical substitution (MRTS);- Returns to scale-, Theory of the Firm: economies and diseconomies
of scale: Costs of production: Total average and marginal costs, relationship between cost curves in the
short run and long run.

Week 10 to 12: Market Structure: Perfect competition: characteristics, long run and short run
equilibrium. Monopoly: characteristics, sources of monopoly power, long run and short run equilibrium,
Price discrimination. Monopolistic competition: characteristics, long run and short run equilibrium.
Oligopoly and duopoly.

REFERENCE

Suggested texts
1. J. Beardshaw, Economics, A student Guide, 4th Edition, Pitman, London, 1990.
2. R. Mudida: Modern economics. Nairobi, Focus Books 1st Edition 2003.

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