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MECO 111– Principles of Microeconomics

Fall Semester 2019

Instructor Dr. Ummad Mazhar

Room No. SDSB – 324
Office Hours Tuesday, Wednesday, and Thursday (11.00 to 12.00) or by appointment
Email ummad.mazhar@lums.edu.pk
Telephone
Secretary/TA Bushra Kanwal
TA Office Hours
Course URL (if any)

Course Basics
Credit Hours 3 Cus
Lecture(s) Nbr of Lec(s) Per Week 2 Duration 75 min/session
Recitation/Lab (per week) Nbr of Lec(s) Per Week Duration
Tutorial (per week) Nbr of Lec(s) Per Week Duration

Course Distribution
Core Yes
Elective
Open for Student Category
Close for Student Category

COURSE DESCRIPTION
To provide the students with an introduction to the basic macroeconomic principles; to enable students to appreciate the workings of goods and
asset/money markets and the nature of equilibrium in each market; to emphasize the role of macroeconomic policies that affect internal and
external deficits, inflation and growth of per capita income. Throughout the course a focus will be on analyzing macroeconomic problems.

COURSE PREREQUISITE(S)

None

COURSE LEARNING OUTCOMES (CLO)

Upon successful completion of the course, students should be able to:

1. Develop an understanding of the basic microeconomic concepts and their application to real world situations.
2. Identify core microeconomic decisions related to consumption, production, and market structure
3. Enable students to understand the microeconomic interdependence across management, marketing, and decision
theory.

Moreover, students should also learn to:

4. Apply microeconomic toolkit to understand economic issues

5. Evaluate critically the economic reasoning and its limitations in various contexts.
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UNDERGRADUATE PROGRAM LEARNING GOALS & OBJECTIVES

General Learning Goals & Objectives
Goal 1 –Effective Written and Oral Communication
Objective: Students will demonstrate effective writing and oral communication skills
Goal 2 –Ethical Understanding and Reasoning
Objective: Students will demonstrate that they are able to identify and address ethical issues in an
economic policy context.
Goal 3 – Analytical Thinking and Problem Solving Skills
Objective: Students will demonstrate that they are able to identify the economic aspect of the
problems and generate viable solutions of the social and national issues.
Goal 4 – Application of Information Technology
Objective: Students will demonstrate that they are able to use current technologies in business and
management context.
Goal 5 – Teamwork in Diverse and Multicultural Environments
Objective: Students will demonstrate that they are able to work effectively in diverse environments.
Goal 6 – Understanding Organizational Ecosystems
Objective: Students will demonstrate that they have an understanding of Economic, Political,
Regulatory, Legal, Technological, and Social environment of organizations.

Major Specific Learning Goals & Objectives

Goal 7 (a) – Program Specific Knowledge and Understanding
Objective: Students will demonstrate knowledge of key business disciplines and how they interact
including application to real world situations.
Goal 7 (b) – Understanding the “science” behind the decision-making process
Objective: Students will demonstrate ability to analyze a business problem, design and apply
appropriate decision-support tools, interpret results and make meaningful recommendations to support
the decision-maker

Program Learning Goals and
Objectives
Goal 1 –Effective Written and Oral
Communication
Goal 2 –Ethical Understanding and
Reasoning
Goal 3 – Analytical Thinking and Problem
Solving Skills
Goal 4 – Application of Information
Technology
Goal 5 – Teamwork in Diverse and
Multicultural Environments
Goal 6 – Understanding Organizational
Ecosystems
Goal 7 (a) – Program Specific Knowledge
and Understanding
Course Learning Objectives (CLO) Course Assessment Item
Minor goal: Operationalized through class CP,in-class activities & discussions
participation and in-class activities
(CLO#4)
MinorGoal: Looking at the other side of View problems in terms of costs and
the picture benefits
Minor goal: Application of microeconomic Quizzes and exams
principles in real world scenario (CLO # 1,2
& 5)
Minor goal: Opertioalized through Assignment writeup
challenging students ability to solve issues
with real world applications (CLO#4)
Minor Goal: Students have to work in Quiz, assignment, in-class activities
random groups for assignments plus in-
class activities (CLO#4)
Minor: Students will learn the impact of Class discussion, examples.
political and social environment on
markets and on the decisions of agents
Major Goal: Comprehensive coverage of CP, quizzes and exams
topics in microeconomics (CLO# 1- 5)
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Goal 7 (b) – Understanding the “science” Major Goal: Operationalized through Critical reasoning through in-class
behind the decision-making process economic models of consumer, producer, discussions/challanges
and government policy maker.

Grading Breakup and Policy

Quiz(s) 20% (4 quizzes; all announced)

Assignments 10%
CP and Attendance 10% + 5 %
Midterm Examination: 25%
Final Examination: 30%

 Late comers will be marked absent.

 Regular attendance and class participation is vital for better understanding of course. There will be no penalty for first three absences.
However, up to five absences, there will be 1% reduction in CP. After five absences it will result in 2% reduction in CP for each marginal
absence. After 8 absences your possibility of continuing the course will be reconsidered.

Examination Detail

Midterm
Yes
Exam

Final Exam Yes

     
COURSE OVERVIEW
Lecture/ Recommended Session Outcome(s)
Topics
Module Readings (Students will be able to …)
1. Introduction, course plan, grading method Course outline Importance of the course; best learning strategy
2. Core principles of economics Mankiw chp 1 Ten basic principles of economics
A first look at economics and Mankiw Chp 2 How economists use models to understand the real world?
3. microeconomics Difference in microeconomics and macroeconomics;
Normative and positive statements.
Gains from trade Chp 3 Benefits of trade. Limitations over time especially in the
4. case of developing countries
5. Market mechanism Chp 4 How markets work? Demand and supply
6. Market mechanism Chp 4 Meaning of market efficiency
Elasticity (concept) Chp 5 What are different forms of elasticity and how they are
7.
measured?
Elasticity applications Chp 5 How to calculate elasticity? What it tells us about the
8.
nature of goods?
9. Markets and government policy Chp 6 Why government policy is needed for market operations?
10. Consumer surplus and producer surplus Chp 7 How to measure consumer and producer welfare?
11. Application: The cost of taxation Chp 8 How basic principles of economics guide policy makers?
12. Critical appraisal of market process From readings Readings 1, 2, 3, and 4
13. Economics of the public sector Chp 10 What are externalities? How they fail markets?
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Public policy to solve externalities Chp 10 What are different solutions to the problem of
14.
externalities?
Public goods and common sources Chp 11 What are different kinds of public goods? Examples. What
15.
are common resources?
16. Mid Term
17. Design of the tax system Chp 12 What is the meaning of efficiency and equity of tax system?
18. The costs of production Chp 13 What are costs? Different measures of costs
Costs over time Chp 13 Short run and long cost curves and their relation with each
19.
other
20. Firms in competitive markets Chp 14 What is a competitive market? How firms operate in them?
Firsm in competitive markets II Chp 14 Firms in short and long run in competitive markets; other
21.
issues
Monopoly Chp 15 Why monopoly exists? Production decision of a monopoly;
22.
welfare costs of monopoly
23. Monopoly II Chp 15 Price discrimination; Public policy towards monopoly
Monopolistic competition Chp 16 How monopolistic competition decide output and prices?
24.
The role of advertising
25. Oligopoly Chp 17 What is oligopoly? Strategic decision making
Markets for the factor of production Chp 18 How demand for factors of production is determined? How
26.
supply is determined?
27. Topics in micro Chp 22 Asymmetric information; political economy
28. Topics in micro II Chp 22 Behavioral economics
29. Final Exam

Textbook(s)/Supplementary Readings

Principles of Economics by Gregory Mankiw. 8th Edition. Cengage Learning, 2018. [Chapters 1 to 22]

Suggested Readings and Websites

 Intermediate Microeconomics by Hall R Varian. 9th Edition. WW Norton & Company, 2014.
 A very short introduction to microeconomics by Avinash K Dixit. Oxford University Press, 2014.
 Price Theory by Steven Landsburg. 9th Edition. Cengage Learning , 2014.