ECO10 Introduction to Microeconomics, Fall 2013

Economics Department, LIU Post

ECO10 Introduction to Microeconomics, Fall 2013 Section 3, Mondays and Wednesdays 11:00 am – 12:20 pm, Kahn Discovery Center KA210 Section 6, Mondays and Wednesdays 3:30 pm – 4:50 pm, Kahn Discovery Center KA210

Instructor: Udayan Roy Course’s Description (from the Undergraduate Bulletin 2012—2013): This course discusses the important economic theories and concepts that facilitate the understanding of economic events and issues. Its main focus is on the choices made by consumers, producers, and governments, and the interactions of these choices. Topics include demand and supply, consumption, production, competitive and non-competitive product markets, markets for resources, and welfare. Course Credits: This is a 3-credit course. The New York State Education Department (NYSED) requires that for each credit hour there shall be at least 15 hours (of 50 minutes each) of instruction and at least 30 hours of supplementary assignments. Therefore, a 3-credit course shall meet for a minimum of 45 hours, each hour being 50 minutes, for a total of 2,250 minutes, and require at least 90 hours of supplementary assignments and readings outside of the lecture. Students should expect to spend at least 45 hours on reading (3 hours a week) and 45 hours on homework assignments (3 hours a week). Therefore, overall, you should expect to spend 135 hours on this course. Prerequisites: There are no formal prerequisites for this course. Very basic algebra skills are assumed. An ability to use graphs to represent links between variables would be very helpful. (The appendix to Chapter 2 of the course’s textbook provides a good review of graphing concepts.) Course’s Goals: This course is one of the two economics courses in LIU Post’s Core Curriculum. According to the statement of the Core Curriculum’s goals in LIU Post’s Undergraduate Bulletin for 20122013, “The Core Curriculum will: 1. 2. 3. 4. 5. 6. 7.

Foster the continued development of critical and analytical skills Increase the understanding and appreciation of areas of human knowledge Develop an understanding of diverse modes of inquiry Promote understanding of ethical and moral issues Increase the ability to examine problems and issues from multiple perspectives Develop the capacity to conduct independent research Foster a capacity for lifelong learning.”

Goals 1-3 and 5 are within the ambitions of this course. Specifically, I expect that in this course:

1. Students will acquire an understanding and applied knowledge of the core concepts and analytical tools of economic theory. They will be able to apply and evaluate the core concepts of economics such as scarcity, opportunity cost, and production possibilities frontier. They will be able to apply the theory of comparative advantage to everyday life and national policy. 2. Students will acquire the ability to utilize the supply and demand model to analyze real world problems. They will be able to identify various factors that shift supply and demand curves, use the concept of market equilibrium to identify the equilibrium price and quantity, and predict how changes in demand or supply affect market equilibrium. They will be able to describe the effects of government policies, such as taxes and subsides and price floors and price ceilings, in competitive markets. 3. Students will acquire the ability to utilize applied microeconomic concepts including market structure and market failure. They will be able to define perfect competition, and to determine graphically and numerically the output and profit of a firm in this market. They will be able to explain why competitive markets may not allocate resources efficiently in the presence of market failures – including monopoly, externalities, and public goods – and evaluate various public policies that are designed to address these market failures. The first three weeks will be spent on the basics of economics—including, most importantly, the supplydemand theory of how a market-based economy works. We will then discuss a variety of related questions: Why do changes in supply and demand have effects—on the price and the quantity traded of a commodity—that are sometimes large and sometimes small? How does government intervention—in the form of price control and the imposition of taxes and subsidies—affect the price and the quantity traded of a commodity? How are the social costs and benefits of economic activity affected by government intervention (a) when markets are working well and (b) when markets are not working well? Under what circumstances do markets fail to work well? How does the market for a commodity work when there is a great deal of competition among sellers? And how does it work when there isn’t? Why does the labor market reward different workers differently? What can or should the government do to change the distribution of incomes the labor market creates? These are tough and important questions that every society has to wrestle with. By the end of the semester, I hope to leave you with a way of thinking about economic issues that you will consider both non-obvious and reasonable. Course’s Required Textbook: Principles of Microeconomics, Sixth Edition, by N. Gregory Mankiw, South-Western Cengage Learning, Mason, Ohio, 2011, ISBN 9780538453042. (Note: Principles of Economics, Sixth Edition, by N. Gregory Mankiw, South-Western Cengage Learning, Mason, Ohio, 2011, ISBN 9780538453059, would be a perfectly good substitute. The fifth—or even the fourth—edition of either of the above two books would do very well too.) A copy of the textbook book will be kept on

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reserve for you at the library’s circulation desk throughout the semester. Recommended Study Guide: Study Guide for Mankiw’s “Principles of Microeconomics” by David R. Hakes, South-Western Cengage Learning, Mason, Ohio, 2011, ISBN: 9780538477451. This study guide is recommended but not required. A copy of the study guide will be kept on reserve for you at the library’s circulation desk throughout the semester Examinations and Grading: Your grade will be based on your performance in the Midterm, the Final, some in-class quizzes, and some homework assignments. In preparing the course grade I will use the following weights: 30% for the Final, 30% for the Midterm, 20% for the quizzes, and 20% for the homework assignments. Using these weights, I will calculate each student’s overall percentage score. The overall percentage scores will then be scaled—according to the procedure shown in the table below—to yield each student’s letter grade. You are guaranteed the grade … A AB+ B BC+ C CD

if your overall percentage is in the range … 93.01 – 100 87.01 – 93 82.01 – 87 76.01 – 82 70.01 – 76 65.01 – 70 59.01 – 65 53.01 – 59 42.01 – 53

or you are in the … Top decile (tenth) 9th decile 8th decile 7th decile 6th decile 5th decile 4th decile 3rd decile 2nd decile

This is a rough guide to my grading procedure. I will use my discretion when this procedure gives an ambiguous result (as, for example, when too many students get the exact same percentage score). But, when the above procedure gives an unambiguous grade, I will abide by it. Midterm: The Midterm will be held on Monday, October 21. It will consist of multiple-choice questions on the material taught prior to the day of the test. Final: The Final will be held during Finals Week (on either Monday, December 16 or Wednesday, December 18). The Final will be cumulative: that is, it will be based on all material taught in the course. The Final test will contain questions chosen by the economics department in addition to those chosen by me. The questions set by me will not be cumulative—that is, they will be based essentially on the material not tested in the Midterm. However, the questions inserted by the economics department may cover all chapters taught. In-Class Quizzes: I will give approximately six short in-class quizzes—with adequate notice—throughout the semester. I will count only your four highest quiz scores and these will have a collective weight of 20% in your course grade, as I said earlier.

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Sapling Learning Homework Assignments: The homework assignments will consist of computer-graded online quizzes within the Sapling Learning course management system. This will cost you $29.99. To enroll, please follow these instructions: 1. Go to http://saplinglearning.com and click on "US Higher Ed" at the top right. 2. If you already have a Sapling Learning account, log in and skip to step 3. a. If you have Facebook account, you can use it to quickly create a Sapling Learning account. Click the blue button with the Facebook symbol on it (just to the left of the username field). The form will auto-fill with information from your Facebook account (you may need to log into Facebook in the popup window first). Choose a password and time zone, accept the site policy agreement, and click "Create my new account". You can then skip to step 3. b. Otherwise, click the "Create an Account" link. Supply the requested information and click "Create My Account". Check your email (and spam filter) for a message from Sapling Learning and click on the link provided in that email. 3. Find your course in the list (you may need to expand the subject and term categories) and click the link. 4. Select a payment option and following the remaining instructions. Once you have registered and enrolled, you can log in at any time to complete or review your homework assignments. During sign up or throughout the term, if you have any technical problems or grading issues, send an email to [email protected] explaining the issue. The Sapling Learning support team is almost always faster and better able to resolve issues than your instructor. Attendance Policy: The best possible grade (BPG) that you could get will depend on the number of your absences; see the accompanying table for details. You will be marked absent if you miss ten minutes or more of a lecture or if you are not attentive in class. You must not sign the attendance sheet if you are more than ten minutes late. Signing another person’s name on the attendance sheet amounts to forgery and will not be tolerated.

Absences 6, 7 8, 9 10, 11 12, 13 14+

BPG B+ B BC+ D

No make-up tests will be given for the Midterm or the Final unless there are compelling medical reasons supported by a valid doctor’s note. In case you cannot take a test at the scheduled time, you (or someone representing you) must inform me of the reason(s) not later than twenty-four hours after the test. Ideally, I should be told before the test. The reason(s) you give for missing a test will affect my decision on whether or not you should get a make-up test but it will not affect your BPG. No make-ups will be given for the quizzes. Homework assignments completed late will not count. General Classroom Decorum: Students must make sure that their actions have no adverse effects on the ability of other students to learn and do their work. Students must behave honorably when taking 4

quizzes and tests and report dishonorable behavior to the instructor when they see such behavior. When in the classroom, students must not engage in any activity that is not directly part of the course. In particular, students must not use computers, phones, or other entertainment devices in the classroom. Students who feel sleepy should leave the classroom and sleep elsewhere. Students with Disabilities: The Americans with Disabilities Act (ADA) is a federal anti-discrimination statute that provides comprehensive civil rights protection for people with disabilities. Students with special needs as addressed by the ADA who need assistance should contact the Learning Support Center immediately; it is located in the lower level of Post Hall and its phone number is 516-299-3164. Please meet with me early in the semester if you require accommodations. I will make reasonable efforts to accommodate your special needs. For more information, please visit The Learning Support Center at http://www.liu.edu/CWPost/StudentLife/Services/LSC.aspx. The Learning Support Center provides a full range of support services, educational strategies, and opportunities to help student achieve their personal, academic and vocational goals. Course Calendar: The following is a tentative schedule for the course. I will do my best to stick to it. Nevertheless, I expect to stray from this schedule on a regular basis. Lecture 1 2 3 4

Date 4-Sep 9-Sep 11-Sep 16-Sep

Day W M W M

5 6 7 8 9 10 11

18-Sep 23-Sep 25-Sep 30-Sep 2-Oct 7-Oct 9-Oct

W M W M W M W

12 13 14 15 16 17 18 19 20

16-Oct 21-Oct 23-Oct 28-Oct 30-Oct 4-Nov 6-Nov 12-Nov 13-Nov

W M W M W M W Tu W

Spring 2013 Introduction, Ch. 2 Ch. 3 Interdependence and the Gains from Trade Ch. 3 Ch. 4 The Market Forces of Supply and Demand; End of Add/Drop and Late Registration Ch. 4 Ch. 4 Ch. 5 Elasticity and Its Application Ch. 5 Ch. 6 Supply, Demand, and Government Policies Ch. 6 Ch. 7 Consumers, Producers, and the Efficiency of Markets; No classes on Oct 14 (Columbus Day) Ch. 7; Registration for Spring 2014 begins on October 15 Midterm Ch. 9 International Trade Ch. 9 Ch. 10 Externalities Ch. 11 Public Goods and Common resources Ch. 13 Costs of Production; Last Day to Opt P/F or Withdraw is November 8 Ch. 13; Monday Classes Ch. 14 Firms in Competitive Markets 5

21 22 23 24 25 26

18-Nov 20-Nov 25-Nov 2-Dec 4-Dec 9-Dec 11-Dec 16-Dec 18-Dec

M W M M W M W M W

Ch. 14 Ch. 15 Monopoly Ch. 15; Thanksgiving during Nov. 27—Dec. 1 Ch. 18 The Markets for the Factors of Production Ch. 18 Ch. 20 Income Inequality and Poverty; Last lecture Study/Snow Days/Alternate Class Days Final (tentative) Final (tentative )

Contact Information: My office is at Room 206, Hoxie Hall (across from the Bookstore). My office phone number is (516) 299 2405/2321. My e-mail address is [email protected]. My own Web site is at http://myweb.liu.edu/~uroy/. My mailing address is: Udayan Roy, Economics Department, LIU Post, Brookville, NY 11548. Office Hours: My office hours are: 12:30 pm — 2:00 pm on Mondays and Wednesdays, and 4:30 pm – 5:30 pm on Wednesdays. For any other hours, a prior appointment will be necessary. Please stop by whenever you need any help with your coursework. During my office hours, you may also contact me by Skype; my Skype ID is udayan-eco. Web Sites: The course's Web site is at http://myweb.liu.edu/~uroy/eco10/. This web site contains a wealth of material for students including my PowerPoint lecture notes, and an up-to-date course calendar. The Web site for this course’s textbook is at http://www.cengage.com/search/productOverview.do?Ntt=9780538453042&N=16+4294922239+42949 66644+4294961406+4294959474+21&Ntk=P_Isbn13. It has a lot of material that might be of use to you. Have a great semester!

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