Topic Name Description
Course Introduction Course Syllabus
1.1: Individual Choice, Scarce Resources, Choices, and Opportunity Costs What Is Economics? Why Is It Important?

Read this section to learn about the basic problem of scarcity and the study of economics. Be sure to click through to read each of the pages in this section. As you read, reflect on the things that society needs and the resources that are needed for production like natural resources, money, labor, etc. Every society needs to take into account the problem of scarcity, and that decisions are needed to choose from producing one thing over another. An example is choosing between having a natural wild environment by not developing a piece of land, or developing that land for housing.

Defining Economics
Read this section to encounter the three fundamental questions that economists face and to learn about opportunity costs. Attempt the problems presented in the "Try It" section, and note how eventually every decision boils down to choosing between competing alternatives.
How Individuals Make Choices Based on Their Budget Constraints
Read this section to understand the concept of a budget constraint and how people make decisions when faced with this type of constraint. In economics, a budget constraint is a model that represents two possible things to choose from when spending some income. For example, suppose that you are a store manager and you have $100 to spend on two things for decorations for the store: flower arrangements at$10 each and posters at $5 each. A budget constraint for$100 will then be the different combinations with different number of flower arrangements and posters.
Economic Problem: Scarce Resources
Watch this video, which gives several examples of scarce resources that all of us confront as we make decisions on consumption and production.
Scarcity and Choice
Watch this video, which explains the concept of scarcity and why people make choices in their best interests. Make sure that you go back to the reading from before titled "What Economics Is and Why It’s Important" as it explains to you the meaning of scarcity.
Setting Global Priorities
This is an optional lecture and not a requirement of the course. In this unit, you learned that scarce resources underlie every economic decision that is made in society. You also learned that because of these scarce resources, there are trade-offs between alternate choices. In this guest lecture, Bjorn Lomborg advances this idea by discussing some pressing issues that need to be addressed. This talk should help you to identify the economic way of thinking, which will be elaborated upon in the next subunit.
1.2: Getting to Know Economics The Field of Economics
Read this section, and take a moment to read through the stated learning outcomes for this chapter, which you can find at the beginning of the section. These outcomes should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of the section before checking the answers.
Models and Theories
Watch this video, which explains the use of economic models for solving and understanding economic issues. When you think about an economic model, think about the simplicity of it to represent economic concepts. Most economic models come from the economic theory and used graphically. An example is the budget constraint graph from the previous reading which considered only two products and how we decide on purchasing different combinations of them according to the budget that was allocated.
Marginal Analysis
Read this article to learn about one of the fundamental terms in economics: marginal analysis. Specifically, understand the concept of marginal benefit and marginal cost and what is meant in economics when we say that individuals make rational choices at the margin. Also, complete the problems in the "Try It" box and check your answers.
The Economists' Tool Kit
Read this section and its learning outcomes, which should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of the section before checking the answers.
1.3: Review of Data Representation and Mathematics for Economics Solving Simple Equations
Graph from Slope-Intercept Equation
Watch this video, which provides a review of the basics of linear algebra you will need for this course, namely the ability to understand and graph straight lines, their slope, and their x- and y-intercepts. If you know this material well, don't dwell. Continue working your way through Unit 1.
Economic Models
Read this section on the reasoning behind economic models, which are just representations of reality or theoretical thinking for understanding something. Pay attention to the explanation about the Circular Flow Diagram (Figure 2), which represents how the economy and its actors are related to one another. Make sure to answer the quiz questions.
1.4: The Production Possibility Frontier Factors of Production and the Production Possibilities Curve

Read Sections 2.1 and 2.2. Take a moment to read through the stated learning outcomes for this chapter, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter. Also, attempt the "Try It" problems for each section before checking your answers.

The first section of the chapter will introduce you to the four factors of production that are present in the economy: labor, capital, natural resources, and entrepreneurship. Using any two factors of production, you can then learn to construct the production possibility frontier (PPF) in a two plane model. Note the economic implications of the downward slope and the bowed-out shape of the PPF curve. Also, note the meaning of producing on the curve versus inside the curve. Lastly, think about what it means to move along the curve

Production Possibilities Frontier
Watch this video about the production possibilities frontier, which is a representation of an economic model that shows you how we make decisions based on scarce resources.
Opportunity Cost

Watch this lecture about opportunity costs with the use of the production possibilities frontier. Make sure to go back to the main reading material for Unit 1.4 as it explains the meaning behind the concept of the PPF. In this video you will see how we can apply the production possibilities model to examine the choices to produce more of some good and less of another. The PPF shows the goods and services that an economy is capable of producing – its possibilities – given the factors of production and the technology it has available. The model specifies what it means to use resources fully and efficiently when a combination of the goods is represented on the line. Think about what it would mean to be: (1) inside the line and (2) outside the line.

Increasing Opportunity Cost
Watch this video lecture about increasing opportunity costs when you move a production point in the production possibilities frontier.
Allocative Efficiency and Marginal Benefit
Watch this video about allocative efficiency and marginal benefit with the use of the production possibilities frontier.
Economic Growth through Investment
Watch this video about economic growth through investment with the use of the production possibilities frontier.
Watch this video about comparative advantage specialization of a country and the benefits from trading with other nations.
Read this section, which covers the underlying meaning of the model of comparative advantage as it is used to analyze how countries as a whole deal with scarce resources.
Watch this video about comparative advantage and absolute advantage and think about how a small country is still able to make the most of its scarce resources.
Analyzing Advantage Data Tables and Graphs
Review this spreadsheet, which presents a hypothetical yet conceptually realistic illustration of the choices that countries face when exploring trade and productive specialization, and think about the questions it asks.
A Final Note on Absolute and Comparative Advantage
2.1: The Ceteris Paribus Assumption Ceteris Paribus
Read this brief text to learn the formal definition of ceteris paribus. As a practice activity, identify a variable and list the multiple factors that may be influencing it. For example, say you are planning to request an increase in your salary. What are the factors that influence your salary? Do you think you can attribute the change in your salary to any one of these factors if all of the factors influencing it were simultaneously changing?
2.2: Demand Demand
Read this section to learn about the theory of demand. Attempt the "Try It" problem. Use the data from the text to practice constructing and drawing the demand curve on your own, either on a paper or in Excel. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section.
Factors Affecting Demand
Read this to learn about how factors that affect demand, such as income and change in tastes, are graphed as shifts of the demand curve. Make sure to answer the "Try It" questions.
Law of Demand
Watch this video about the law of demand for understanding consumer behavior. The basic premise of the law of demand, as the video explains, is that if a consumer sees the price of product rising then this consumer will be less likely to buy that product or will lower the amount of consumption of that product. Think about the rise of gasoline prices and the effect it has on the average consumer as most consumers will try to reduce their gasoline consumption, assuming that one's income and wealth remains the same.
Price of Related Products and Demand
Watch this video about the price of related products and how the demand curve for a product gets affected. Examples of related products are those that can substitute for each other like oranges and apples. If the price of apples increases and the price of oranges remains the same, then consumers are more likely to buy less apples and more oranges.
Changes in Income, Population, or Preferences
Watch this video about how changes in income, population, and preferences affect the demand curve. Make sure to understand the difference between "a change of where we are in the demand curve" and "a shift of the demand curve".
Normal and Inferior Goods
Watch this video about normal and inferior goods to better understand the different types of consumer products. Make sure that you go back to the reading in Unit 2.2 to learn about the terms normal and inferior goods. The term inferior good usually relates to the standing in quality that a product has in society. For example, fast food is normally considered to be on a lower quality standing than restaurant food. Thus, when the incomes of people rise, less fast food is consumed and more of restaurant food is consumed instead, making fast food the inferior good and restaurant food the normal good.
Inferior Goods Clarification
Watch this video about inferior goods in order to see the relation between price and quantity demanded. Remember that inferior goods are considered to be on the low quality level in society and consumers would want to purchase less of them as their incomes rise and they are able to afford better quality products.
2.3: Supply Supply
Read this section to learn about the theory of supply. Attempt the "Try It" problem. Use the data from the text to practice drawing the supply curve on your own, either on paper or in Excel. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter.
Factors Affecting Supply
Read this section to learn more about how factors that affect supply, such as increases or decreases in the costs of production, are graphed as shifts of the supply curve. Make sure to answer the "Try It" quiz questions.
Law of Supply
Watch this video about the law of supply as it is graphed with an economic model. Make sure to go back to the main reading Unit 2.3 to learn that the law of supply states that a rise in prices makes producers want to sell more of that product in order to earn more revenue from their sales.
More on Factors Affecting Supply
Watch this video about to see how factors affecting supply make shifts of the supply curve. Remember that the main factors that affect supply are: land, labor, and capital.
2.4: Market Equilibrium Demand, Supply, and Equilibrium
Read this section to learn how demand and supply interact with one another to determine prices and quantities that may or may not be optimal. Attempt the "Try It" problem. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter.
Market Equilibrium
Watch this video about market equilibrium with the use of a graph so you can see the demand and supply curves come together in the market.
Changes in Market Equilibrium
Watch this video about how shifts of the demand or supply curves affect the market equilibrium point.
Putting Demand and Supply to Work
Read this section to learn about some applications of the demand and supply model. Attempt the "Try It” problem.
Changes in Supply and Demand
Introducing Supply and Demand
Read the sections on Demand, Supply, Market Equilibrium, and Government Intervention and Disequilibrium for a mathematical exposition of the demand and supply model, clicking through to the next when you have finished each page. The chapter also covers price ceilings and price floor analysis as well as quantity regulations.
2.5: Manipulating the Market: Price Controls Government Intervention in Market Prices: Price Floors and Price Ceilings
Read this section to learn why the government sometimes chooses to control prices. Attempt the "Try It" problem. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section.
Price Ceilings and Price Floors
Read this section as a review of price floors and price ceilings. Try solving the "Self-Check Questions".
Demand, Supply, and Efficiency
Read this section to learn more about how price floors and price ceilings create inefficiencies in the market. Pay special attention to the concepts of Consumer Surplus, Producer Surplus, and Social Surplus and how they are affected due to price controls. Try solving the "Self-Check Questions".
Inefficiency of Price Floors and Price Ceilings
Now, let's attempt several practical problems related to price controls. Answer the "Try It" questions here.
Minimum Wage and Price Floors
Watch this video about minimum wage and price floors with the use of a graph to understand the effect on the labor market.
2.6: Elasticity Elasticity: A Measure of Response
Read this chapter to learn about the concept of elasticity. Be sure to read Sections 5.1-5.4 following the introduction.
Introduction to Elasticity
Read this chapter to learn about the concept of elasticity. Be sure to read all the sections in this chapter (Sections 5.1-5.4) following the introduction.
Calculating Elasticity
Watch this lecture, focusing on both how elasticity is calculated as well as its potential implications for health care. Consider if you agree or disagree with the possible social and health implications of changing the overall elasticity of demand for national health systems.
Defining Price Elasticity of Demand
Read this section about price elasticity when there is a change along the demand curve. Make sure to back to the main reading in Unit 2.6 as it explains the concept of elasticity. Also, make sure that you understand the concept of "price elasticity of demand", which is about how the percentage change in the price of a product affects the amount of quantity demanded but measured as a percentage change.
Price Elasticity of Demand
Watch this video about how the price elasticity of demand is depicted with the use of a graph. Make sure that you understand when the elasticity of demand is elastic, inelastic, and unit elastic.
More on Elasticity of Demand
Watch this video to understand how to use the formula for calculating the elasticity of demand. You can also refer to the previous video listed for this unit titled "Price Elasticity of Demand".
Constant Unit Elasticity
Watch this video to understand how the constant unit elasticity looks like as the demand curve. Note that the demand curve is not straight in the case of a constant elasticity of demand.
Total Revenue and Elasticity
Watch this video about how total revenue for the producer is affected depending on the elasticity of demand for a product.
More on Total Revenue and Elasticity
Watch this video about to learn about the effect on the total revenue for a producer when the demand elasticity changes. The price elasticity of demand is oftentimes used a way to calculate changes in total revenuw for a producer.
Cross Elasticity of Demand
Watch this video to learn how to calculate the cross elasticity of demand for products that are complements and for products that are substitutes. You can think of complemenatry products like popcorn and a movie ticket, when the price of one goes up, the quantity demanded goes down for both, thus their cross price elasticity will show a negative relationship. The same applies for products that are substitutes, like popcorn and candy at a movie theater. When the price of popcorn rises, the quantity demanded for popcorn decreases but for candy it goes up, thus their cross price elasticity will show a positive relationship.
Elasticity of Supply
Watch this video about the concept of elasticity of supply. Just like the elasticty of demand, the elasticity of supply relates the percentage change in the quantity supplied to a percentage change in the price.
Elasticity and Strange Percent Changes
Watch this video to learn more about how to calculate the price elasticity of supply using the geometric approach. You should also go back to the reading for Unit 2.6 to learn in detail about the formulas used.
Calculating Elasticity and Percentage Changes

Taxes and Perfectly Inelastic Demand
Watch this video to learn about how taxes relate to a perfectly inelastic demand. Remember that a perfectly inelastic demand curve is one where the quantity demanded is constant regardless of changes in the price.
Taxes and Perfectly Elastic Demand
Watch this video to learn about how taxes relate to a perfectly elastic demand curve, which is one that is very sensitive to changes in prices.
3.1: Maximizing in the Market Place The Logic of Maximizing Behavior and Maximizing in the Marketplace
Read these sections revisit the concept of marginal costs and benefits within the context of the consumer's (and the firm's) maximizing behavior. The later pages in this section define two new concepts: consumer surplus and producer surplus. Take a moment to read through the stated learning outcomes, which should be your goals as you read through the chapter. Attempt the "Try It" problem for each section.
Consumer and Producer Surplus

Consumer Surplus Introduction

Watch this video about how to depict consumer surplus with the use of a graph to illustrate the equilibrium point effect on consumer welfare.

Demand Curve as Marginal Benefit Curve
Watch this video about the demand curve and how the marginal benefit curve shapes the demand curve.
Total Consumer Surplus as Area

Watch this video to learn about about the calculation and depiction of total consumer surplus. Make sure that you understand the concept of total consumer surplus to be as the added benefit that consumers get when they pay a price for something that was below the price they were willing to pay.

Producer Surplus

Watch this video about how to depict producer surplus with the use of a graph to illustrate the equilibrium point effect on producer welfare.

How Much to Produce? The Story of Marginal Revenue and Marginal Costs
Watch this video about how an apple farmer decides the optimal number of apples to pick. At the end of the video, consider whether or not the government should intervene. Think about which arguments you might make both supporting and disagreeing with the government acting in the market. In 3.2, we will cover specific ways the government might participate in the market.
3.2: When Markets Fail Market Failure
Read this section for a more detailed look at the topic of market failure. Attempt the "Try It” problem before checking your answer.
Positive Externalities and Public Goods

Read this chapter to learn more about public goods and the intervention of the government in correcting market failures. Pay attention to the concepts of externalities (both positive and negative externalities).

Positive Externalities
Watch this video about how positive externalities can be created with additional production. A good example of a positive externality is education. Getting an education does not just benefit an individual but all of society also benefits from this.
Watch this video about how rent control increases deadweight loss. You can think of rent control as a government intervention that affects both consumers and producers by affecting the total consumer and total producer surplus.
Watch this video to learn about how taxation affects deadweight loss. Make sure to go back to the main reading in Unit 3.2 to learn more about how taxes affect total consumer surplus and total producer surplus.
Percentage Tax on Hamburgers
Watch this video to see how a percentage tax on hamburgers affects deadweight loss. Make sure to distinguish between a "percentage tax", like a sales tax of 8%, and a "constant tax", like a tax of \$0.50.
Negative Externalities
Watch this video to learn how to depict a negative externality from production when the total societal costs of production is not taken into account when producing. A typical example of a negative externality in production is environmental pollution for the case of factories.
Taxes for Factoring in Negative Externalities
Watch this video to learn how to depict a negative externality from production when the total societal costs of production is not taken into account when producing. A typical example of a negative externality in production is environmental pollution for the case of factories.
Tragedy of the Commons
Watch this video to learn how to depict a negative externality from production when the total societal costs of production is not taken into account when producing. A typical example of a negative externality in production is environmental pollution for the case of factories.
3.3: Income Inequality Inequality, Poverty, and Discrimination
Read this chapter for a more detailed look at the topic of income inequality and discrimination in the labor markets as these are real examples of market failures. Attempt the "Try It" problems at the end of each section before checking your answers.
Measuring Income Inequality
4.1: The Rational Consumer, Consumer Preferences, and Consumer Choice Introduction to Consumer Choices
Read all the sections in this chapter for information on consumer choice, including utility, consumer equilibrium, consumer equilibrium demand, consumer surplus, budget constraint, and consumer equilibrium and indifference curves.
The Analysis of Consumer Choice
Read the Introduction and these two sections. Attempt the "Try It" problems at the end of each section. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter.
Rules for Maximizing Utility
The Art of Choosing
This is an optional lecture and not a requirement of the course. The speaker talks about her ground-breaking research on how people make choices and explains attitudes towards their decisions.
Marginal Utility
Watch this video about marginal utility. Make sure that you understand that marginal utility is a concept in economics that is used to explain and measure the satisfaction that consumers get when consuming something. For example, if you consume a soda, we assume in economics that you get some sort of satisfaction, your "utility", and marginal utility will be the additional satisfaction that you get from consuming an additional soda.
Budget Line
Watch this video to learn how to depict the budget line in a graph. Remember that the budget line for a consumer will show the different combinations that can be bought for two goods given a fixed budget of some sort.
Deriving Demand Curve from Tweaking Marginal Utility per Dollar
Watch this video to lean how to arrive at the demand curve from working with the marginal utility per dollar. To review this concept of marginal utility per dollar, make sure to go back to the main reading in Unit 4.1
Equalizing Marginal Utility per Dollar Spent
Watch this video about equalizing marginal utility per dollar spent for two products. Keep in mind that this method is for figuring out what products would people prefer to spend on given a budget.
Watch this video about adding demand curves of individuals to arrive at the overall market demand curve. You can think of the overall demand curve as one that is composed of all of the individual demand curves.
Preference and Utility
Watch this lecture for an explanation of consumer theory, and especially mathematical representations of consumer preferences.
4.2: Indifference Curves Indifference Curve Analysis: An Alternative Approach to Understanding Consumer Choice
Read this section to learn about indifference analysis. Attempt the "Try It” problems at the end of the section before checking your answers.
Indifference Curves
Indifference Curve Analysis
Types of Indifference Curves
Watch this video about to learn how to depict the different types of indifference curves depending on whether a product is a normal good, perfect substitute, or a perfect complement. You should consider reviewing the main reading material from Unit 4.1. that covered these concepts.
Optimal Point on Budget Line
Watch this video about the optimal point on a budget line. The optimal consumer choice in the indifference curve analysis is determined by the tangency condition between the marginal rate of transformation (MRT) and the marginal rate of substitution (MRS).
5.1: The Short Run Production Cost

Read this section on production cost. It will provide you with the needed definitions and some mathematical analysis of the topics for Unit 5.

Production Choices and Costs: The Short Run

Read this section to learn about the behavior of the producer in the short run. Attempt the "Try It" problems at the end of the section before checking your answers. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter.

Costs in the Short Run

Read this section about how to calculate costs in the short-run like variable and marginal costs. Make sure to answer the "Try It" questions.

Cost and Industry Structure

Read the Introduction in Chapter 7 and click through to Section 7.1. and 7.2 to learn about the short-run analysis in production. Pay attention to the difference between accounting and economic profit. Also, from section 7.2, pay special attention to how fixed costs that do not change in the short-run affect average total cost and average variable costs.

Understanding Normal Profit

Watch this video about how a coffee shop owner decides whether to keep is shop open or take another job, At the end of the video, consider the role of opportunity costs and how they affect business decisions. Think about times you've had to make choices and how opportunity costs affected those decisions.

A Firm's Marginal Product Revenue Curve

Watch this video about a firm's marginal product revenue curve. Make sure that you understand the relationship among the marginal product of labor, the total product curve, and the total revenue curve.

Economic Profit vs. Accounting Profit

Watch this video about economic profit versus accounting profit. Make sure that you understand that in economics, there are indirect expenses to consider. An example of an indirect expense is the wage when a self-employed owner does not earn somewhere else because he/she puts all their time into running their business and gives up earning an income somewhere else. That indirect expense, or opportunity cost, should be taken into account for determining the economic profit from running that business as a self-employed person.

Depreciation and Opportunity Cost of Capital

Watch this video about depreciation and the opportunity cost of capital. Calculating the depreciation of capital, such as equipment that is used in production, is a common method in accounting for determining the cost of that capital used in production.

Understanding the Short-Run Shutdown

Watch this video about how a baker decides whether to keep her bakery open or to close. At the end of the video, consider the role of costs and how they affect business decisions. Think about examples of businesses which have chosen to shut down.

Fixed, Variable, and Marginal Cost

Watch this video about fixed, variable, and marginal cost. Make sure that you go back to the main reading in Unit 5.1 to learn about these concepts in detail. It is especially the case that variable costs are those that change in the short-term, like wages. And fixed costs are those that cannot normally change in the short-run, like the rental payment for leasing property that is used in the production process.

Visualizing Average Costs and Marginal Costs as Slope

Watch this video about how the average cost and marginal cost curves are determined and shown in a graph.

Marginal Cost and Average Total Cost

Watch this video to continue learning about how the marginal cost curve and the average total cost curve are determined and depicted in a graph. If you need to review this topic, make sure to go back to the main reading in Unit 5.1.

Marginal Revenue and Marginal Cost

Watch this video to learn how the marginal revenue curve and the marginal cost curve are determined and depicted in a graph. Note that the market production will be in equilibrium when the marginal revenue is equal to the marginal cost.

Marginal Revenue below Average Total Cost

Watch this video about marginal revenue below average total cost. Pay special attention in that video when it mentions the difference between the short-run and the long-run supply curve.

5.2: The Long Run Production Choices and Costs: The Long Run

Read this section to learn about the behavior of the producer in the long run. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of the section before checking your answers.

Long-Term Supply Curve and Economic Profit

Watch this video about the long-term supply curve and economic profit. Pay special attention in this video when it shows the point of "shut down" for a producer.

The Structure of Costs in the Long Run

Read these sections to learn about the long-run analysis in production. Pay attention to economies of scale and to the long-run average cost curve.

Unit 5 Review Principles of Microeconomics Lecture Notes

Study these lecture notes to review producer theory and to take a look at how production functions and cost functions can be derived mathematically.

6.1: Perfect Competition Competitive Markets for Goods and Services

Read this chapter for an explanation of the model of perfect competition, which is crucial to your understanding of the more complicated and realistic models that will be studied next. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of each section.

Perfect Competition

Read this chapter as it gives you in a summary way the definition and assumptions of perfect competition.

More on Perfect Competition

Read Chapter 8, which provides an overview of the Perfect Competition model and a guide to the elements you need to know in order to understand the model. Be sure to read the sections following the introduction.

Wages and Employment in Perfect Competition

Study this chapter to learn about labor markets, including topics on wage differentials, discrimination, and unions.

How Many People to Hire Given the MPR Curve

Watch this video about how many people to hire given the marginal product revenue curve.

Perfect Competition Demonstration

Watch this video about how perfect competition is depicted with a graph. Pay special attention in this video to the definition given for perfect competition. Also, make note of the equilibrium point in the market under this type of market.

6.2: Non-competitive Markets: Monopoly Monopoly

Read this chapter to learn the characteristics, workings, and effects of the monopoly model. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of each section before checking your answers.

The Monopoly Model

Watch this lecture for an explanation of the monopoly model. Pay special attention to how a mathematical equation for the demand curve and the supply curve can give you the equilibirum points for the quantity demanded and supplied and the equilibrium price. Also, note that the equilibrium point occurs when marginal revenue equals marginal cost for a monopolist.

Introduction to a Monopoly

Read this chapter, which discusses monopolies. Be sure to click through to read the sections that follow the introduction.

Monopoly Basics

Watch this video about how a monopoly is depicted in a graph and compared to the perfectly competitive model. Make sure to go back to the main reading in Unit 6.1 and 6.2 to review the characteristics of the perfectly competitive market and the monopolistic market.

Review of Revenue and Cost Graphs for a Monopoly

Watch this video about revenue and cost graphs for a monopoly. Keep in mind that the equilibrium point for a monopolist is where the marginal revenue is equal to the marginal cost.

Monopolist Optimizing Price (Part 1): Total Revenue

Watch this video about how the demand curve relates to the total revenue curve and how a monopolist can maximize revenue. Keep in mind that this is Part 1 of three videos.

Monopolist Optimizing Price (Part 2): Marginal Revenue

Watch this video about how the demand curve relates to the total revenue curve and how a monopolist can maximize revenue by calculating marginal revenue. Keep in mind that this is Part 2 of three videos.

Monopolist Optimizing Price (Part 3): Dead Weight Loss

Watch this video about how the demand curve relates to the total revenue curve and how a monopolist can maximize revenue by calculating marginal revenue and setting it equal to marginal cost. Keep in mind that this is Part 3 of three videos.

Price Discrimination

Read this section to see how monopolists can potentially use their unique place in an industry to charge different prices to different consumers - in other words, how they indulge in price discrimination.

First Degree Price Discrimination

Watch this video about first degree price discrimination by a monopolist.

6.3: Imperfect Competition Monopolistic Competition: Competition among Many

Read this section to learn about monopolistic competition. Take a moment to read through the stated learning outcomes for this chapter of the text, which you can find at the beginning of each section. These outcomes should be your goals as you read through the chapter. Attempt the "Try It" problem before checking your answer.

Monopolistic Competition

Read this chapter to learn about monopolistic competition. Make sure to distinguish the short-run from the long-run model.

Oligopolies and Monopolistic Competition

Watch this video about oligopolies and monopolistic competition and know the difference between them. Also, make sure to go back to the main reading in Unit 6.3 to review the characteristics of these markets.

Monopolistic Competition and Economic Profit

Watch this video about how the monopolistic competition market is depicted in a graph. Also, make sure that you understand how economic profit is determined in this market when marginal revenue is set to marginal cost.

Oligopoly: Competition Among the Few

Read the pages in this section. Take a moment to read through the stated learning outcomes for this chapter of the text, which should be your goals as you read through the chapter. Attempt the "Try It" problems at the end of the section before checking your answers.

Oligopolies, Duopolies, Collusion, and Cartels

Watch this video about oligopolies, duopolies, collusion, and cartels. Also, make sure to go back to the main reading in Unit 6.3 to review the characteristics of these markets.

Oligopoly Lecture

Watch this lecture for an explanation of the oligopoly model. Pay special attention to the concept of the "Nask Equilibrium" that applies in this market when you have a few competitors that know each other's plans in the market.

Game Theory of Cheating Firms

Watch this video about game theory of cheating firms. For a review of how game theory can be used to understand the strategic behavior of firms in an oligopoly, go back to the main reading in Unit 6.3 titled "Oligopoly: Competition Among Few".

More on Nash Equilibrium

Watch this video about the Nash Equilibrium. Keep in mind that this is a concept in game theory that applies to a market with few competitors, like an oligopoly.

Why Parties to Cartels Cheat

Watch this video about why parties in a cartel tend to cheat. Keep in mind that this type of market applies to imperfect competition, like a duopoly.

Prisoners' Dilemma and Nash Equilibrium

Watch this video about the Prisoners' Dilemma and the Nash Equilibrium. Keep in mind that this is a concept in game theory that applies to a market with few competitors, like an oligopoly.

6.4: Government Regulation Antitrust Policy and Business Regulation

Read this chapter to learn about how government policies have been in place to curve the power of imperfect competition. Also identify what the US has used regulations to protect consumers and limit the excesses of businesses via antitrust policies.

Regulation

Watch this video, which illustrates with the use of graphs the need for government intervention in imperfect markets.

7.1: Public Finance and Public Choice Public Finance and Public Choice

Read this chapter to learn how the government provides goods and services in the economy to alleviate problems of the market system.

Public Economy

Read this chapter as it explains public choice theory and how the rational voter conducts cost-benefit analyses of public issues. Be sure to click through to read sections 18.1 to 18.3.

7.2: Environmental Economics The Economics of the Environment

Read this chapter to apply marginal benefit and marginal cost analysis to show how society can achieve efficient solutions to environmental problems.

Economic Resources

Study this brief chapter on economic resources which provide examples of the concepts discussed in this subunit.

Capital and Natural Resource Markets

Read the 6 sections of this chapter on resource markets, including topics such as demand, supply, and price ceilings and floors.

Environmental Protection and Negative Externalities

Read this chapter to learn more about the different types of environmental solutions. Recall that a negative externality from producing is usually environmental pollution. Be sure to click through to read sections 12.1 to 12.6.

7.3: Coase Theorem The Coase Theorem and the Theory of the State

Read this original piece of literature written by James M. Buchanan, who explains the Coase Theory.

Maximizing the Net Benefits of Pollution

Read this section about how to apply the Coase Theorem to solve environmental problems.

Market-Oriented Environmental Tools

Read this section to learn more about how permits and the Coase theorem can be applied to solve environmental problems by defining user and property rights in society. Make sure to answer the "Try It" questions.

Study Guide ECON101 Study Guide
Course Feedback Survey Course Feedback Survey