Microeconomics is an important branch of Western economics. After more than 200 years of development, microeconomics has become a social science with complete system, strict logic and many branches.
Microeconomics studies the behavior of single economic subject and its interaction in market economy, explains how the market mechanism allocates resources and the necessity of government intervention in micro-economic activities.
In microeconomics, there is an important assumption: the scarcity of resources. Under this assumption, microeconomics focuses on how to make the limited resources be fully utilized, that is, the problem of resource allocation. With the optimal allocation of resources as the goal, we can derive the price theory in microeconomics: The lower the price, the less the supply and the greater the demand; Supply and demand determine prices. This is the law of prices, it’s the most important part of microeconomics.
Besides the assumption of resource scarcity, there is also the assumption of rational economic man. Or we can say: The economic decision makers are rational. From this assumption, we can get that, consumers pursue the maximization of satisfaction or utility, firms pursue the maximization of profits.
The study of microeconomics gives us a new perspective to judge our behavior. At the same time, we will also realize that the theory of microeconomics is not perfect, and needs the efforts of every economist to constantly improve.
1.1 Why Study Economics？
1.2 The Scope and method of Economics
1.3 Appendix: How to read and understand graphs
1.4 Review of Chapter 01
Chapter 02 The Economic Problem: Scarcity and Choice
2.1 Scarcity, Choice, and Opportunity Cost
2.2 Economic Systems and the Role of Government
2.3 Review of Chapter 02
Chapter 03 Demand Supply, and Market Equilibrium
3.1 Firms and Households: The Basic Decision-Making Units
3.2 Demand in Product/Output Markets
3.3 Supply in Product/Output Markets
3.4 Review of Chapter 03
Chapter 04 Demand and Supply Applications
4.1 The Price System: Rationing and Allocating Resources
4.2 Supply and Demand and Market Efficiency
4.3 Review of Chapter 04
Chapter 05 Elasticity
5.1 Price Elasticity of Demand
5.2 Calculating Elasticities
5.3 Other Important Elasticities
5.4 Review of Chapter 05
Chapter 06 Household Behavior and Consumer Choice
6.1 Household Choice in Output Markets
6.2 The Basis of Choice: Utility
6.3 Income and Substitution Effects
6.4 Review of Chapter 06
Chapter 07 The Production Process: The Behavior of Profit-Maximizing Firms
7.1 The Behavior of Profit-Maximizing Firms
7.2 The Production Process
7.3 Isoquants and Isocosts
7.4 Review of Chapter 07
Chapter 08 Short-Run Costs and Output Decisions
8.1 Costs in the Short Run
8.2 Output Decisions: Revenues, Costs, and Profit Maximization
8.3 Review of Chapter 08
Chapter 09 Long-Run Costs and Output Decisions
9.1 Short-Run Conditions and Long-Run Directions
9.2 Long-Run Costs: Economies and Diseconomies of Scale
9.3 Long-Run Adjustments to Short-Run Conditions
9.4 Review of Chapter 09
Chapter 10 Input Demand: The Labor and Land Markets
10.1 Input Markets: Basic Concepts
10.2 The Firm’s Profit-Maximizing Condition in Input Markets
10.3 Review of Chapter 10
Chapter 11 Input Demand: The Capital Market and the Investment Decision
11.1 Capital, Investment, and Depreciation
11.2 The Demand for New Capital and the Investment Decisio
11.3 Review of Chapter 11
Chapter 12 General Equilibrium and the Efficiency of Perfect Competition
12.1 Market Adjustment to Changes in Demand
12.2 Allocative Efficiency and Competitive Equilibrium
12.3 The Sources of Market Failure
12.4 Review of Chapter 12
Chapter 13 Monopoly and Antitrust Policy
13.1 Imperfect Competition and Market Power
13.2 Price and Output Decisions in Pure Monopoly Markets
13.3 The Social Costs of Monopoly
13.4 Review of Chapter 13
Chapter 14 Oligopoly
14.1 Market Structure in an Oligopoly
14.2 Game Theory
14.3 The Role of Government
14.4 Review of Chapter 14
Chapter 15 Monopolistic Competition
15.1 Industry Characteristics
15.2 Product Differentiation and Advertising
15.3 Price and Output Determination in Monopolistic Competition
15.4 Review of Chapter 15
Chapter 16 Externalities, Public Goods, and Social Choice
16.1 Externalities and Environmental Economics
16.2 Public (Social) Goods
16.3 Social Choice
16.4 Review of Chapter 16
