Microeconomics - A Comprehensive Economics Course

Explore how economics, a social science and philosophy, explains scarce resources and infinite wants shaping decisions of consumers and producers, with five core concepts: goods, services, wants, needs, resources.

Explore scarcity, choice, and opportunity cost as core economic ideas that shape utility and everyday decisions. See how the production possibilities curve illustrates how scarce resources influence price and allocation.

Explore the basic economic problem and the producer decision process: what to produce, how to produce, and for whom; contrast free markets and planned economies with a grocery service example.

Define the four factors of production—land, labor, capital, and entrepreneurship—as the resources that allow an economy to produce its goods and services.

The production possibilities curve shows combinations of goods and services an economy can produce with given resources and fixed technology, illustrating scarcity, choice, opportunity cost, and the factors of production.

Learn the difference between microeconomics and macroeconomics, focusing on consumers, producers, and market equilibrium under government involvement. See how macroeconomics measures inflation, unemployment, and income distribution across a country.

Explore positive and normative economics, where facts and unemployment data shape analysis, and learn how economists turn data into policy evaluations for government decision-making.

Learn rational economic thinking, where consumers maximize utility and producers maximize profits, forming predictable behavior and market equilibrium, with caveats and real-world examples like Patagonia.

Economists build theoretical models, like supply and demand graphs, to isolate a single variable under ceteris paribus and test its effects using the circular flow model.

Take a study break to reflect on your connection to microeconomics, and consider what this topic has to do with you.

Explore the circular flow of income, linking households, firms, banks, government, and foreign sectors, and explain leakages and injections within a country’s macroeconomy.

Examine the spectrum from free markets to planned economies, define rationing as price-based versus central planning, and identify the middle ground of mixed economies.

Explore the difference between economic growth and development, and see how GDP, HDI, health and education indicators reveal welfare and the rise of the middle class.

Explore demand, supply, and market equilibrium through the interactions of consumers and producers, price formation, and the demand and supply diagram, highlighting profit maximization and utility maximization.

Define demand as the quantity consumers are willing and able to purchase at a price, and explain the law of demand as price moving along the downward-sloping curve.

Explore the determinants of demand, including price, income, substitutes and complements, tastes, expectations, market size, and special circumstances, and how they shift or move along the demand curve.

Understand the law of supply: as price rises, quantity supplied increases, driven by the profit motive and determinants of supply—producers' willingness and ability to produce at a given price.

Explore the determinants of supply, including price, production costs, price of related goods, technology, expectations, government intervention, and market size, and how they shift the supply curve.

Explore the basic demand and supply diagram through the rule of 11, tracing the market equilibrium and the market clearing price with a step-by-step count of eleven elements.

In this microeconomics study break, explore the ideas of going to and want, as described by the caption.

Explore how market equilibrium creates efficient resource allocation by balancing demand and supply, and how excess supply (surplus) and excess demand (shortage) trigger price adjustments toward the market clearing price.

Explore how shifts in demand and supply, driven by determinants like tastes, production costs, and technology, create new equilibrium prices and quantities.

See how the price mechanism acts as a beacon that signals producers to adjust output in response to demand, illustrated with the gasoline market and the rule of eleven diagram.

Explore how demand and supply determine market efficiency and allocative efficiency, revealing consumer, producer, and community surplus at the socially optimal equilibrium.

Explore how demand and supply determinants form market equilibrium and the balance of price and quantity, using the nine central themes as a real-world lens.

Explore elasticity in microeconomics, introducing four elasticities—three for consumers and one for producers—using examples to show price, cross, and income elasticities of demand and price elasticity of supply.

Learn how price elasticity of demand (PED) measures percentage changes in quantity demanded relative to price, and identify elastic, inelastic, unit elastic, and extreme cases with insulin and currency examples.

Analyze how price elasticity of demand guides firm revenue strategies and government tax planning, illustrating elastic vs inelastic goods with dinner and cigarettes and their employment effects.

Explore the price elasticity of demand diagram, locate the unit elasticity point, and learn how elastic and inelastic ranges guide revenue maximization by adjusting price.

Explore the determinants of price elasticity of demand—substitutes, luxury versus necessity, time, income share, and addictive nature—and how they shape consumer choices and demand.

Explore cross elasticity of demand, showing how the quantity of good x responds to the price of good y to reveal substitutes and complements, with sign and magnitude indicating closeness.

Explore income elasticity of demand (yed), distinguishing normal and inferior goods, and showing when goods are income elastic (luxuries) or inelastic (necessities) with examples like bread and airline tickets.

Define price elasticity of supply as the percent change in quantity supplied over the percent change in price. Describe elastic, inelastic, and unit cases, plus short-run versus long-run implications.

Take a quick study break in the microeconomics course for everyone to pause within the complete economics course.

Explore how price elasticity of supply governs producers' output adjustments to price changes, and how government interventions rely on this elasticity to affect quantity and employment.

Examine the determinants of price elasticity of supply—costs that rise with output, unused capacity, factor mobility, time period, and storage ability—and how they shape short-run and long-run responsiveness.

Conclude the elasticity unit by reviewing price, cross, and income elasticities of demand and supply, and apply the nine IB core themes to analyze real-world market viability.

Explore how government intervention shapes markets through indirect taxes, a per unit subsidy, price floors, and price ceilings, and its potential to cause misallocation of resources away from free markets.

Explain why indirect taxes are levied on expenditures and how they shift the supply curve, affecting consumers, producers, and government revenue.

Explore how a per-unit indirect tax shifts the supply curve, creates government revenue, and distributes tax burdens among consumers and producers, with welfare loss analyzed.

Learn how per unit subsidies lower production costs, shift the supply curve outward, and influence prices, efficiency, and who pays, including potential effects on foreign markets.

Explore how a per-unit subsidy shifts the supply curve, creates a new price-quantity equilibrium, and examines consumer and producer benefits alongside welfare losses in a corn market example.

Take a study break to reflect on learning and the desire to go, in the context of microeconomics study.

This lecture introduces price controls as overt government interventions to protect consumers or producers, covering price ceilings and price floors, and explains how misallocation of resources follows their use.

Explore how a price ceiling below the equilibrium price creates a housing shortage. See how a government subsidy shifts supply to restore a usable price and quantity.

Explore how a price floor sets a minimum price above equilibrium, causing a shortage of buyers and a surplus of producers, prompting government intervention and minimum wage policies.

Explore how government intervention shapes markets through indirect taxes, per unit subsidies, and price controls like ceilings and floors, emphasizing scarcity, efficiency, and equity.

Explore market failure and government intervention to correct misallocated resources. Learn about negative and positive externalities in consumption and production, plus merit goods, public goods, and common access resources.

Explore how demand, supply, and market equilibrium yield allocative efficiency and social welfare, using margins like marginal social cost and marginal social benefit to locate the socially optimal point.

Explore the base diagram for market failure, with marginal social cost and private cost curves and marginal social benefit and private benefit curves, identifying point B where MSC equals MSB.

Explore the negative externality of consumption through the cigarette diagram, showing private benefit exceeding social benefit, welfare loss, and the socially optimal output Q1 where MSB equals MSC.

Explore government solutions to the negative externality of consumption, using cigarettes to move from Q2 toward the socially optimal Q1 via bans, indirect taxes, and education campaigns.

Explore the negative externality of production through the market failure diagram, where social cost exceeds private cost and output moves from the socially optimal Q1 to Q2, creating welfare loss.

Explore solutions to negative externalities of production, including taxes, bans, performance standards, and tradable emissions permits (cap and trade), to shift private costs toward the social optimum Q1.

The lecture presents the positive externality of consumption with education as an example, and explains how subsidies push output toward the socially optimal level to increase welfare.

Learn how governments tackle positive externalities of consumption by shifting costs or benefits toward a socially efficient output using subsidies, advertising, or laws such as schooling or vaccinations.

Examine the positive externality of production in the education diagram, noting the NPC shifts inward due to underprovision and how government actions move output toward the socially optimal level.

Explore two government fixes for positive externalities of production: subsidies to firms or direct vocational training. These measures shift private costs toward the socially optimal output and improve labor quality.

Explore common access resources, including common pool resources and common property resources, and how lack of exclusion leads to overuse, market failure, and need for sustainable governance across multiple countries.

Conclude with market failure theory, including externalities of consumption and production, and apply scarcity, choice, interdependence, economic well-being, equity, and efficiency to real-life situations.

Finish up microeconomics, the foundation of economics, and explore continuing study in theory of the firm, macroeconomics, international economics, and development economics; provide feedback to improve the course.