Microeconomics

Course Code: BBA 211

Credit Hour: 3

Course Group: Core Courses

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Introduction & Basic Concepts: Definition of Economics - Microeconomics vs. Macroeconomics - Scope of Economics - Meaning of Economic Theory - Product – Commodity – Want – Utility – Consumption - Factors of Production - The Invisible Hand Theory.

Supply and Demand: Law of Demand - Law of Supply - The Interaction of Supply and Demand - Limitations of Supply/Demand Analysis - Real World Supply and Demand Applications - Government Intervention in the Market.

Elasticity of Supply and Demand: price Elasticity - Calculating Elasticity - Elasticity of Supply and Demand - Elasticity and Revenue - Other Elasticity Concepts.

Utility Analysis and Indifference Curve Analysis: Utility Theory and Individual Choice - Rational Choice and Marginal Utility - Maximizing utility and geometric analysis of consumer equilibrium through indifference curve.

Production and Cost Analysis: The Role of the Firm - Production Process - The Costs of Production - Graphing Cost Curves - Making long run production decisions - Technical efficiency and economic efficiency - Determinants of the shape of the long run cost curves - Cost function and estimation of cost function - using cost analysis in the real world - Isocost/Isoquant analysis.

Market Structure and Policy: A perfect competitive market - The profit - Maximizing level of output - Total profit at the profit maximizing level of output - Short run market supply and demand - Long run competitive equilibrium - Adjustment from the short run to the long run - The key difference between a monopolist and a perfect competitor - A model of monopoly - Profits and monopoly - The welfare loss from monopoly - Price discriminating monopolist - Barriers to entry and monopoly - Normative views of monopoly - The problems of determining market structure - characteristics of monopolistic competition - Output, price, and profit of a monopolistic competition - Characteristics of oligopoly - models of oligopoly behavior - An overview of game theory and strategic decision making.

Rent, Interest and Profit: Economic Rent – Interest - Economic Profit.

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Text Book:

H.L. Ahuza, Modern Economics, (Latest edition), S. Chand & Co. Ltd. New Delhi, India.

Reference Books:

Paul A. Samuelson & William D. Nordhaus, Economics, (18/e), Tata McGraw Hill Publishing Company ltd., 2005