Fundamentals of Microeconomics is a unique textbook in the field of Microeconomics, which is a core subject for undergraduate and diploma students pursuing courses in Business and various other courses such as engineering, computer sciences, architecture, management and many more. It is specially designed to meet the needs of students studying economics first time at the tertiary level and for non-economists who want to appreciate the subject matter of Microeconomics.
This book is the first volume of a series and covers, in the main, the meaning and scope of Economics as a discipline. It goes ahead to treat the key essentials of Microeconomics, ie demand, supply, market equilibrium, elasticity of demand, elasticity of supply and consumer choice theory. The second volume will treat theory of production, Cost theory, theory of the firm-perfect competition, monopoly and monopolistic competition.
The rich experience of the writer in the teaching of Economics plays out in meeting the needs of the student throughout the pages of the book. The coverage and structure of the book have been designed taking into account the syllabi of Microeconomics courses prescribed by higher education institutions and universities. It is clearly written in a student-friendly manner, and replete with easy to-do exercises so that the first time learner of Economics can do a self-study with this book and excel in Microeconomics. The book will be useful for readers who often have difficulty in understanding microeconomic concepts. This book is packed with illustrations, sketch graphs and diagrams that are altogether functional and relevant to the theories presented. Finally, the author hopes the reader is able to apply the basic theories, principles and concepts to help solve everyday economic and business problems that they encounter daily.
Table of Contents
- OVERVIEW OF ECONOMICS
- 1.1 INTRODUCTION
- 1.2 DEFINITION OF ECONOMICS
- 1.3 DEFINITION OF MICROECONOMICS
- 1.4 DEFINITION OF MACROECONOMICS
- 1.5 EXPLANATION OF SOME KEY CONCEPTS IN ECONOMICS
- 1.5.1 Ends
- 1.5.2 Means
- 1.5.3 Scarcity
- 1.5.4 Choice
- 1.5.5 Scale of Preference
- 1.5.6 Opportunity Cost
- 1.6 ECONOMIC APPLICATION OF THE CONCEPT OF OPPORTUNITY COST
- 1.6.1 Opportunity Cost and the Individual
- 1.6.2 Opportunity Cost and the Firm
- 1.6.3 Opportunity Cost and the Government
- 1.6.4 Conditions under which Opportunity Cost is Zero
- 1.6.5 General Importance of Opportunity Cost
- 1.7 OPPORTUNITY COST AND THE PRODUCTION POSSIBILITY CURVE (PPC)
- 1.7.1 Production Possibility Curve (PPC)
- 1.8 IMPORTANCE OF THE STUDY OF ECONOMICS
- 1.8.1 Households
- 1.8.2 Firms
- 1.8.3 Government
- 1.9 THE SCOPE OF ECONOMICS
- 1.9.1 Production activities
- ECONOMIC SYSTEMS AND THEIR FUNCTIONS
- 2.1 OVERVIEW OF ECONOMIC SYSTEMS
- 2.2 TRADITIONAL ECONOMY
- 2.2.1 Advantages of a Traditional Economy
- 2.2.2 Disadvantages of Traditional Economy
- 2.3 CAPITALIST ECONOMY
- 2.3.1 Features of a Capitalist Economy
- 2.3.2 Advantages of a Capitalist Economy
- 2.3.3 Disadvantages of a Capitalist Economy
- 2.4 SOCIALIST ECONOMY
- 2.4.1 Features
- 2.4.2 Advantages of Socialist Economy
- 2.4.3 Disadvantages of a Socialist Economy
- 2.5 MIXED ECONOMY
- 2.5.1 Features of a Mixed Economy (Using Ghana as a case)
- 2.5.2 Advantages of a Mixed Economy
- 2.5.3 Disadvantages of a mixed Economy
- 2.6 FUNCTIONS OF AN ECONOMIC SYSTEM
- 2.6.1 Primary functions of an Economy
- 2.6.2 Secondary Functions
- DEMAND AND SUPPLY
- 3.1 DEMAND
- 3.1.1 Factors affecting Demand
- 3.1.2 Demand Schedule
- 3.1.3 The Law of Demand
- 3.1.4 Exceptional Demand Curves/Deviations from the Law of Demand
- 3.1.5 Changes in Demand
- 3.1.6 Consumer and Producer Surpluses
- 3.2 SUPPLY
- 3.2.1 Factors affecting Supply
- 3.2.2 Supply Schedules
- 3.2.3 The Law of Supply
- 3.2.4 Exceptional supply curves/deviations from the law of supply
- 3.2.5 Changes in Supply
- PRICE DETERMINATION
- 4.1 INTRODUCTION: THE CONCEPT OF PRICE
- 4.1.1 Bargaining/Haggling
- 4.1.2 Auctioning
- 4.1.3 Tender
- 4.1.4 Government pricing/Price control
- 4.1.5 Demand and supply
- 4.2 ESTABLISHING EQUILIBRIUM PRICE AND EQUILIBRIUM QUANTITY
- 4.3 EQUILIBRIUM PRICE DETERMINATION-CHANGES IN DEMAND AND SUPPLY
- 4.3.1 A Change in Demand and the Impact on Equilibrium Price
- 4.3.2 A Change in Supply and its Impact on Equilibrium Price
- 4.4 TYPES OF DEMAND
- 4.4.1 Competitive Demand
Objectives and Key Themes
This textbook aims to provide a foundational understanding of microeconomics for business students and non-economists. It seeks to explain core microeconomic concepts in an accessible and practical manner, enabling students to apply these concepts to real-world scenarios.
- Introduction to Microeconomics and its Scope
- Analysis of Economic Systems
- Understanding Demand and Supply
- Price Determination and Market Equilibrium
- Application of Microeconomic Principles
Chapter Summaries
OVERVIEW OF ECONOMICS: This chapter introduces the fundamental concepts of economics, defining microeconomics and macroeconomics and differentiating between them. It lays the groundwork by explaining key terms like scarcity, choice, opportunity cost, and the production possibility curve. The chapter also highlights the importance of studying economics at the household, firm, and governmental levels, illustrating how these concepts apply to various economic agents and their interactions within an economy. The significance of opportunity cost is explored in detail through examples from individual, firm, and governmental perspectives.
ECONOMIC SYSTEMS AND THEIR FUNCTIONS: This chapter delves into different economic systems, comparing and contrasting traditional, capitalist, socialist, and mixed economies. The analysis includes examining the features, advantages, and disadvantages of each system, using Ghana's mixed economy as a case study. The chapter concludes by outlining the primary and secondary functions of any economic system, highlighting the essential roles these systems play in allocating resources and managing an economy.
DEMAND AND SUPPLY: This chapter explores the core concepts of demand and supply, examining the factors that influence both. It details the law of demand and supply, providing illustrations and examples of exceptions to these laws. The chapter also introduces the concepts of demand and supply schedules, analyzing how changes in these factors impact market equilibrium. Further, it delves into consumer and producer surpluses, explaining their significance within the supply and demand framework.
PRICE DETERMINATION: This chapter focuses on price determination, examining various methods, including bargaining, auctioning, tendering, and government price controls. A central theme is the concept of equilibrium price and how it's established through the interaction of demand and supply. The impact of shifts in demand and supply on equilibrium price is thoroughly analyzed, enriching the understanding of market dynamics. Different types of demand, such as competitive demand, are also introduced.
Keywords
Microeconomics, Macroeconomics, Opportunity Cost, Economic Systems (Traditional, Capitalist, Socialist, Mixed), Demand, Supply, Market Equilibrium, Price Determination, Consumer Surplus, Producer Surplus, Scarcity, Choice.
Frequently Asked Questions: A Comprehensive Guide to Microeconomics
What is this textbook about?
This textbook provides a foundational understanding of microeconomics, suitable for business students and non-economists. It explains core microeconomic concepts accessibly and practically, enabling students to apply these concepts to real-world scenarios. The text covers an overview of economics, different economic systems, demand and supply, and price determination.
What topics are covered in the "Overview of Economics" chapter?
This chapter introduces fundamental economic concepts, defining microeconomics and macroeconomics. It explains key terms like scarcity, choice, opportunity cost, and the production possibility curve (PPC). It also discusses the importance of studying economics at the household, firm, and government levels and explores the significance of opportunity cost through various examples.
What are the different economic systems discussed?
The textbook compares and contrasts traditional, capitalist, socialist, and mixed economies. For each system, it details the features, advantages, and disadvantages. Ghana's mixed economy serves as a case study.
What does the chapter on "Demand and Supply" cover?
This chapter explores the factors influencing demand and supply, detailing the law of demand and supply, including exceptions. It covers demand and supply schedules and analyzes how changes impact market equilibrium. The concepts of consumer and producer surpluses are also explained.
How is price determination explained in the textbook?
The chapter on price determination examines various methods like bargaining, auctioning, tendering, and government price controls. It focuses on equilibrium price and how it's established through demand and supply interaction. The impact of demand and supply shifts on equilibrium price is thoroughly analyzed, and different types of demand (like competitive demand) are introduced.
What are the key objectives of this textbook?
The textbook aims to provide a foundational understanding of microeconomics, explaining core concepts accessibly and practically. It seeks to enable students to apply these concepts to real-world scenarios. Key themes include: Introduction to Microeconomics and its Scope, Analysis of Economic Systems, Understanding Demand and Supply, Price Determination and Market Equilibrium, and Application of Microeconomic Principles.
What are the main keywords associated with this textbook?
Key terms include: Microeconomics, Macroeconomics, Opportunity Cost, Economic Systems (Traditional, Capitalist, Socialist, Mixed), Demand, Supply, Market Equilibrium, Price Determination, Consumer Surplus, Producer Surplus, Scarcity, Choice.
What is included in the Table of Contents?
The table of contents provides a detailed breakdown of the textbook's structure, including an overview of economics, economic systems and their functions, demand and supply, and price determination. Each main topic is further subdivided into numerous subtopics, offering a comprehensive exploration of microeconomic principles.
What is the structure of the chapter summaries?
Chapter summaries provide concise overviews of each chapter's key concepts and arguments. They highlight the main points discussed and offer a succinct recap of the information presented in each section of the textbook.
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- Frank Opuni (Autor:in), 2017, Fundamentals of Microeconomics. Key Essentials of Demand and Supply Analysis, München, GRIN Verlag, https://www.grin.com/document/378728
