Before you dive into the principles of microeconomics, you first need to explore some major ideas that lie at the heart of economics. For example, what is economics? What does it mean to say you are using “the economic way of thinking”? What do economists mean when they discuss “market structure,” “the invisible hand,” “productions possibilities,” “opportunity cost,” or "ceteris paribus?"
In this Credit Unit you will identify and define these terms before addressing the primary principle behind microeconomics: the idea that individuals and firms make rational choices based on self-interest. These decisions are necessary because all resources are scarce.
This Credit Unit will also introduce you to a number of economic models- such as the supply and demand models and the resulting market equilibrium- the assumptions and constraints associated with each, and the ways they help us better understand real-life situations.
Discuss the role scarcity plays in defining economic choices and how individuals, companies and nations resolve these issues.
Describe and apply marginal principle, principle of opportunity cost, principle of diminishing returns, comparative advantage, and elasticity.
Explain the mechanics of supply and demand and apply the supply and demand model to evaluate markets.
Discuss the efficiency and equity of both competitive and noncompetitive markets and how both are impacted by government intervention.