Course Outline ECON 1101 Microeconomics 1 (& ECON 7073 Microeconomic Principles for Economic Policy) Semester 1, 2014 STUDENTS: Course details change from semester to semester. Please check that you are reading the Course Outline for the correct semester. Course Description The course examines how individuals and firms make decisions by weighing up costs and benefits, and how the interaction of their decisions leads to market and social outcomes. The model of market supply and demand is employed to examine the effects of taxes, subsidies, and other government interventions in market activity. The implications of different market structures, including perfect competition and monopoly, are examined. Public goods, externalities and common resources are key examples of cases in which private markets may yield socially sub-optimal outcomes. Such cases are examined and the role of government policy in correcting for these is discussed. Contacts Role Office address Email Telephone Consultation Times Adam Allanson, Lecturer Room 1021, HW Arndt Bldg adam.allanson@anu.edu.au 6125 3363 Fridays 09:00-10:00 Joshua Soo, Head Tutor Room 2019, HW Arndt Bldg joshua.soo@anu.edu.au 6125 4544 TBA Finola Wijnberg, School Administrator Room 1014, HW Arndt Bldg finola.wijnberg@anu.edu.au 6125 0195 09:00-17:00 Terry Embling, Course Administrator Room 1013, HW Arndt Bldg terry.embling@anu.edu.au 6125 0384 08:30-16:30 Communication All questions linked to the course material should be directed to your tutor during tutorial or the tutor s consultation time. The lecturer (Adam Allanson) also welcomes questions after the lecture. In addition, a Microeconomics Help Desk is available to students (see below). All administrative questions (e.g. tutorial allocations, lodging medical certificates for missed Tutorial Tests) should be directed to the Course Administrator (Terry Embling). Terry Embling asks that students generally contact him via email. Help Desk Consultation Hours A Microeconomics Help Desk will be open: Wednesdays 2pm 5pm (Arndt 1002) Thursdays 2pm 5pm (Arndt 1002) Fridays 11pm 12pm (Manning Clark LT 2) Tutors will be at the Help Desk to answer any questions about the contents of the course that you have not been able to resolve through your own study and participation in your tutorial group. Answers to assessable tutorial questions will be presented at the Friday 11pm 12pm session in the Copland Lecture Theatre.
Announcements Students are expected to check the Wattle site for announcements about this course, e.g. changes to timetables or notifications of cancellations. Notifications of emergency cancellations of lectures or tutorials will be posted on the door of the relevant room. Course URLs More information about this course may be found on: Study @ ANU; the College of Business and Economics website; and Wattle, the University's online learning environment: you can log on to Wattle using your student number and your ISIS password. Course Information Learning Outcomes Upon successful completion of the requirements for this course, students will be able to: 1. Explain the principles that underpin modern economics 2. Demonstrate an understanding of the way budget constrained individuals make optimising choices and the way resources are allocated in private markets 3. Assess the likely impact of different market structures on the prices and quantities traded in these markets 4. Evaluate the effects of government interventions and other exogenous changes in markets using economic principles 5. Present clearly written analysis of economic issues and problems Workload Students taking this course are expected to commit at least 10 hours a week to this unit of study, which will include: attending lectures (3 hours) attending your tutorial (1 hour) private study and tutorial preparation (6 hours) On-line Learning The lecturer will upload material (including lecture overheads) to the Wattle site for ECON1101/7073 and recordings of lectures will be made available to students in the DLD block on this site. If you buy the textbook you will find an access code to online resources which allow you to test your learning through quizzes on each chapter. Answers are provided. These quizzes are not part of the course assessment.
COURSE OUTLINE The following table outlines the key concepts to be taught in Microeconomics 1. The Chapter numbers refer to the prescribed textbook by Gans, King and Mankiw. Teaching Week Week 1. An introduction to economics (Chapters 1 & 2) Week 2. Interdependence and the gains from trade (Chapter 3) Weeks 3 & 4. Demand and Supply (Chapters 4 & 5) Week 5. Markets, efficiency and welfare (Chapters 6, 7 & 8) Week 6. International Trade (Chapter 9) Weeks 7 & 8. The economics of the public sector (Chapters 10, 11, 12) Week 9. Firms in competitive markets (Chapters 13 & 14) Week 10. Monopoly (Chapter 15) Weeks 11, 12 & 13(part). Markets and the role of Government (Chapters 16, 17, 18 & 23) Week 13 (part). Summary and Revision Key concepts - The scope and role of microeconomics and macroeconomics - Normative and positive analysis - Key assumptions underpinning standard microeconomic models - Scarcity, trade-offs, sunk costs and opportunity costs - Being economically rational and making decisions at the margin - Working with graphs - The Production Possibility Frontier - Absolute and comparative advantage - Specialisation and the gains from trade - Marginal Benefit, Consumer Behaviour and Demand - Marginal Cost, Firm Behaviour and Supply - Using ipad s to understand market equilibrium, price determination and economic efficiency - Using Demand and Supply to predict changes in prices and quantities - Elasticity of Demand and Supply - Consumer Surplus and Producer Surplus - Economic efficiency and deadweight loss - The impact of: price ceilings; price floors; and government taxes and subsidies - Comparative advantage and gains from international trade - The economic impacts of tariffs, quotas, subsidies - Winners and losers and the politics of trade liberalisation - Externalities: private & public solutions - Public Goods and Common Resources - Application: Funding Higher Education - The costs of production in the short run and the long run - Profit and entry and exit in a perfectly competitive market - The Invisible Hand perfect competition leads to economic efficiency - Monopoly pricing & price discrimination - How monopolies affect economic wellbeing - The economic bases for government intervention: public goods, externalities, non-competitive behaviour, equity, and (macroeconomic) stabilisation - Monopolistic competition and oligopoly: firm pricing when markets are not perfectly competitive. The welfare implications of different market structures - Asymmetric information & game theory: adverse selection, the market for lemons, moral hazards and the principal-agent problem - Efficiency, equity and political economy - Market failure vs. government failure
Proposed Assessment Assessment Item Description Weighting (%) Tutorial Tests (6) Final Examination (June exam period) Students are expected to prepare answers to the set of tutorial questions each week. Six times during the semester (randomly selected by Tutors), students will be examined on a tutorial question. In particular, during the first 10 minutes of the tutorial and without reference to notes, students will be asked to provide a written answer to a tutorial question selected by their tutor. The answers will be marked and returned the following week in tutorial. The purpose of the Tutorial Tests to keep students on track with their learning and provide feedback on progress. Answers to assessable tutorial questions will be presented during the Friday Help Desk session (see above). The Tutorial Test marks will count toward an aggregate 40% of your course mark. Final exam questions will be similar to the Tutorial Test questions. Students will register for tutorials in the first week of semester. Students must sit Tutorial Tests in the tutorial to which they are assigned. A make-up Tutorial Test will be conducted during Week 13 for any student who is unable to sit an assigned Tutorial Test due to sickness (see conditions below). A three-hour final exam will be held in the examination period in June. Details will be posted on the ANU exam timetable site. 40% 60% The final mark for the course will be weighted as indicated above, subject to possible scaling of marks for the whole class. Tutorial Registration Enrolment in tutorials will be completed online using the Electronic Teaching Assistant (ETA). To enrol, follow these instructions: 1. Go to http://eta.fec.anu.edu.au. 2. You will see the Student Login page. To log into the system, enter your University ID (your student number) and password (your ISIS password) in the appropriate fields and hit the Login button. 3. Read any news items or announcements. 4. Select "Sign Up!" from the left-hand navigation bar. 5. Select your courses from the list. To select multiple courses, hold down the control key. On PCs, this is the key; on Macs, it is the Once courses are selected, hit the SUBMIT button. key. Hold this key down while selecting courses with the mouse. 6. A confirmation of class enrolments will be displayed. In addition, an email confirmation of class enrolments will be sent to your student account. 7. For security purposes, please ensure that you click the LOGOUT link on the confirmation page, or close the browser window when you have finished your selections. 8. If you experience any difficulties, please contact the Course Administrator, Terry Embling (see page 1 for contact details).
Sickness and Employment-Related Absences from Tutorial Tests If you are ill on the day of a Tutorial Test, then you must obtain a medical certificate and give it to the Course Administrator, Terry Embling, in HW Arndt 1010. This must be done as soon as possible following the period of absence covered in the certificate. Given that the Tutorial Tests are an important component of course assessment, holiday or other travel plans will not be accepted as valid reasons for missing a Tutorial Test. Work commitments will not automatically be considered a valid reason but will be considered on a case-by-case basis with documentation from the student s employer. If you are assessed by the Course Administrator to have a valid reason for absence from a Tutorial Test, you will able to participate in the make-up Tutorial Test to be conducted in Week 13. Texts and Other Reading Prescribed Texts Gans, King, Mankiw (2012), Principles of Microeconomics (5 th edition), Cengage Learning. A limited number of copies will be available through short-term loan in the Chifley Library. Other Reading Students may find the following texts useful: Frank, Jennings and Bernanke (2012), Principles of Microeconomics (3 rd edition), McGraw-Hill Australia. Hubbard, Garnett, Lewis and O Brien (2011), Microeconomics (2 nd edition), Pearson Education Australia. A limited number of copies will be available through short-term loan in the Chifley Library. Course-related Matters Co-teaching For students enrolled in ECON7073, the course mark will be calculated as above for 85% of the total, with an additional 15% coming from the special additional essay that these students are set. See the ECON1101 page on Wattle for details of these additional requirements and additional tutorials. General Information on Policies, Procedures and Rules For more information on relevant policies, procedures and rules, go to your course Wattle site. The relevant information is posted in two versions at the top of the central panel in Wattle. Version 1 is a link to Key issues explained: Policies, Programs, Courses and Assessments. In this section, you will find important information about a range of educational and administrative matters. If you can t find the link on your Wattle site, go to http://cbe.anu.edu.au/current_students/general_info/student_info.asp. Version 2 is called Online social interaction, Netiquette and more.