Prelims Microeconomics
Michaelmas 2016
Scheduling: Ordinarily, classes will be held on Mondays at 4:00--6:00pm, in the PPE Suite (FB1 Rm 10). Our first meeting is in week 2. One of the advantages of holding a 2-hour class like this is that we shall be able to cover more material than is possible in a 1-hour tutorial.
Problem sets: Each week I shall assign you a subset of the problems from the tutorial worksheets posted on the course weblearn page. These must be submitted to me, via the Lodge, by 5pm on Saturday. I shall not grade your answers to all the problems that have been assigned: instead, I shall only grade a certain subset of these (to be decided upon after you have submitted your solutions); in the classes I shall give priority to going through the solutions to those questions that I do not grade.
I shall also assign some reading to complement the lecture slides: generally this will be drawn from Varian, Intermediate Microeconomics (8th or 9th ed.); and also Perloff, Intermediate Microeconomics with Calculus (2nd or 3rd ed.) [But I regard this reading as being very subsidiary to the problem sets.]
Format: The classes will be run along the following lines:
Clarifying / answering questions about the lecture material (and any assigned readings). Please email me questions and/or requests for clarification of any of that material, in advance of our meeting: this will help ensure that I am able to answer your queries in a satisfactory way.
Covering the solutions to the assigned problem set questions, with priority given to those questions that I haven't graded.
Discussion of one or two of the assigned 'discussion questions' from the tutorial worksheets.
Tutorial 1 (Week 2)
Problems: 1b, 1d, 2, 3, 5, 6, 7
Questions: write an essay plan (3/4 to 1 page of A4, in bullet points) for q2; also prepare to discuss q1 in class.
Reading (for this tutorial and the next): Perloff Ch. 1--2 and Varian, Ch 1.
If your interest was piqued by Ian's discussion of the methodology of economics, you might want to delve into Part I (and possibly also Part II) of Blaug (1992) The Methodology of Economics (2nd ed.) [But please be aware that much of Part III is hopelessly out of date, and therefore apt to mislead -- empirical, econometric work is now a far more prominent part of research in economics than it was when Blaug wrote the first edition of this book back in 1980!]
Tutorial 2 (Week 3)
Note from last tutorial: when writing out lengthy mathematical derivations, please add some words explaining what you are doing.
Problems: 1c, 1d, 2, 3, 5, 6
Questions: write an essay plan (preferably typed) for either q2 or q6
Tutorial 3 (Week 4)
Reading: Perloff Ch. 6 & 7 ('Firms and Production' and 'Costs') and Varian Ch. 21 & 22 ('Cost minimization' and 'Cost curves') [these correspond to Ch. 20 & 21 in the 8th Ed.]
Problems: 1, 2, 3, 4, 5
Questions: write an essay plan (preferably typed) on q1
Tutorial 4 (Week 5)
Reading: Varian Ch. 23, 24, 28, 29 ('Firm supply'; 'Industry supply'; 'Oligopoly'; 'Game Theory') [these are Ch. 22, 23, 27, 28 in the 8th Ed]; and Perloff Ch. 8, 13, 14, 15.2 ('Competitive firms and markets'; 'Game Theory'; 'Oligopoly'; 'Capital markets and investing').
Problems: 1, 2, 3
Questions: write an essay on q4 ('Explain and compare ...'): 800--1000 words in length; the essay must be typed, with at least 1.5 spacing, and margins of at least 2cm. Accompanying diagrams are encouraged, and may be drawn by hand (but please label these 'Figure 1', Figure 2', etc., and refer to them in this manner in the text).
You must hand your solutions to the problems by 5pm Saturday; the deadline for the essay is 5pm Sunday.
Tutorial 5 (Week 6)
Reading: Varian Ch. 2--6, 8--9 ('Budget constraint'; 'Preferences'; 'Utility'; 'Choice'; 'Demand'; 'Slutsky equation'; 'Buying and selling'); and Perloff Ch. 3, 4, 5.5 ('Consumer Theory'; 'Demand'; 'Deriving labor supply curves').
Problems: 1, 2, 3, 4, 5. Also answer Q1 ('What does each of the following ...'): this only requires a brief answer (i.e. only a paragraph or two).
Tutorial 6 (Week 7): MEETING IS ON THURSDAY, 4--6pm
Reading: Varian Ch. 7.8-7.9, 10, 14, 15 ('Index numbers'; 'Intertemporal choice'; 'Consumer's surplus'; 'Market demand'); and Perloff Ch. 5 ('Consumer welfare and policy analysis').
Problems: 1, 2, 4, 5.
Questions: write an essay on q3 ('The government decides to help ...'): 600--1000 words in length, with diagrams. (You must include diagrams to answer this sort of question, which is in the style of question you could be asked in the exam.) The essay must be typed, with at least 1.5 spacing, and margins of at least 2cm. Accompanying diagrams may be drawn by hand (but please label these 'Figure 1', Figure 2', etc., and refer to them in this manner in the text).
You must hand your solutions to the problems by 5pm Saturday; but you may hand the essay in to me at the start of the tutorial (I will grade it later in the week).
Tutorial 7 (Week 8)
Reading: Varian Ch. 25, 26 ('Monopoly'; 'Monopoly behaviour') [these are Ch. 24 & 25 in the 8th Ed]; and Perloff Ch. 11.
Problems: 1, 2, 3, 4.
Tutorial 8 (Hilary, Week 1): MEETING IS ON TUESDAY, 3:30--5:30pm
Reading: Varian Ch. 34, 35 & 38 ('Welfare', 'Externalities', 'Asymmetric information') [these are Ch. 33, 34 & 37 in the 8th Ed]; and Perloff Ch. 17 & 18.
Write an essay on q4 ('Outline (i) how a system ...'): 800--1200 words in length. The essay must be typed, with at least 1.5 spacing, and margins of at least 2cm. Accompanying diagrams are encouraged and may be drawn by hand (but please label these 'Figure 1', Figure 2', etc., and refer to them in this manner in the text).
The essay must be submitted by 5pm on Friday of Week 0.
Revision Tutorial 1 (Trinity, Week 5): FRIDAY, 4:00--6:00pm
We will go through the solutions to the indicated problems in class. Although I will not ask you to hand your solutions in, I strongly advise attempting these problems before we meet, so as to get as much out of the class as possible. We will also briefly discuss the nominated essay questions, if time permits. I realise that you may not have access to past collections, so all the exam papers referenced below have been made available here [Oxford IP required].
Material from lectures: MT1-MT4 ('Exchange' and 'Firms')
Problems:
Exchange: Tutorial 2, q4 [taxation]; HT16Coll., Part A, q2 [trade]; LV16Exam, Part A, q1 [trade]
Firms: Tutorial 3, q6 [profit max.]; Tutorial 4, q5 [Cournot olig.]; LV15Exam, Part A, q3 [costs/exit]
Essay questions: LV16Exam, Part B, q7 [Nash eq.]; HT16Coll., Part B, q5 [NPV]
Revision Tutorial 2 (Trinity, Week 6): FRIDAY, 4:30--6:30pm
Material from lectures: MT5-MT8 ('Individuals' and 'Market failures')
Problems:
Individuals: Tutorial 6, q6; HT16Coll., Part A, q3; HT17Coll., Part A, q2; HT15Coll., Part A, q3
Market failures: TT15Exam, Part A, q3 [monopoly];
Essay questions: Tutorial 7, q2, q5; LV16Exam, Part B, q8 [market failures]; HT16Coll., Part B, q4 [market failures]