Chapter 1 Introduction 1
1.1 What Is Economics? 2
1.2 Opportunity Cost and Production Possibility Frontier 7
1.3 Economics as a Science 13
1.4 Microeconomics and Macroeconomics 16
Chapter 2 Supply,Demand and Market Mechanism 22
2.1 Supply and Demand 22
2.2 Market Equilibrium 26
2.3 Shifts of Demand Curve 29
2.4 Shifts of Supply Curve 33
2.5 The Effects of Government Intervention 39
Chapter 3 Elasticities of Supply and Demand 46
3.1 Price Elasticity of Demand:An Initial Look 46
3.2 The Determinants of the Price Elasticity of Demand 52
3.3 Price Elasticity of Demand and a Firm's Total Revenue 53
3.4 Price Elasticity of Supply 55
3.5 Other Elasticities 58
3.6 Applications of Elasticities 61
Chapter 4 Utility and Consumer Demand 68
4.1 The Concept of Utility 68
4.2 Consumer's Purchasing Decision 72
4.3 Individual and Market Demand 75
4.4 Consumer Surplus 78
4.5 Application of the Concept of Consumer Surplus 82
Chapter 5 Consumer Preferences and Choice 88
5.1 Consumer Preferences 88
5.2 Budget Constraint 95
5.3 Consumer Choice 99
5.4 The Effects of Price and Income Changes 104
Chapter 6 Business Organizations and Production 114
6.1 Business Organizations 114
6.2 Production Function 116
6.3 Production in the Short Run 118
6.4 Production in the Long run 127
6.5 Returns to Scale 132
Chapter 7 The Cost of Production 138
7.1 Calculating Economic Cost and Profit 138
7.2 Costs in the Short Run 141
7.3 The Determinants of Short-Run Cost Curves 147
7.4 Costs in the Long Run 149
7.5 The Long-Run Cost Curves and Economies of Scale 154
Chapter 8 Perfect Competition 160
8.1 The Nature of Perfect Competition 160
8.2 Profit Maximization:Goal and Rule 162
8.3 Competitive Equilibrium in the Short Run 166
8.4 The Short-Run Supply Curve for a Competitive Firm and Industry 169
8.5 Competitive Equilibrium in the Long Run 174
8.6 The Competitive Industry's Long-Run Supply Curve 176
Chapter 9 Monopoly 185
9.1 The Definition and Sources of Monopoly 185
9.2 A Monopolist's Demand and Marginal Revenue Curves 188
9.3 A Monopolist's Output and Supply 193
9.4 Price Differentiation 200
Chapter 10 Monopolistic Competition and Oligopoly 210
10.1 Monopolistic Competition 211
10.2 Oligopoly 217
10.3 Game Theory 223
10.4 Comparison of the Four Market Structures 231
Chapter 11 Markets for Production Factors 237
11.1 Overview of Markets for Production Factors 237
11.2 Markets for Production Factors under Perfect Competition 241
11.3 Markets for Production Factors under Monopsony 252
Chapter 12 Labor and Capital Markets 259
12.1 Labor Markets 259
12.2 Capital Markets 269
12.3 Savings,Investment and Interest Rate Determination 274
Chapter 13 Monopoly,Externalities and Market Failure 283
13.1 Monopoly and Market Failure 283
13.2 Externalities and Market Failure 289
13.3 Externalities and Property Rights 295
Chapter 14 Public Goods,Asymmetric Information and Market Failure 301
14.1 Public Goods and Market Failure 301
14.2 Asymmetric Information and Market Failure 306
14.3 Ways to Deal with Asymmetric Information 312