Microeconomics I 2400-FIM1MI
The aim of the course is to familiarize students with selected topics from the field of microeconomics:
1. The Market (consumers, producers, Pareto efficiency, competitive market, demand, supply, market mechanism);
2. Budget Constraint (budget set, budget constraint changes, numeraire);
3. Preferences (assumptions about preferences, indifference curves, examples of preferences);
4. Utility (utility function, monotonic transformation, examples of utility functions, marginal utility, MRS);
5. Choice (optimal choice, internal/ boundary solutions);
6. Demand (price changes, income changes, price offer curve, income offer curve, Engel curve, ordinary goods, Giffen goods, perfect substitutes, perfect complements, normal goods, inferior goods, luxury goods, inverse demand curve);
7. Revealed Preferences (Weak / Strong Axiom of Revealed Preferences, Quantity and Price Indices Laspeyers / Paasche);
8. Slutsky Equation (substitution and income effect);
9. Buying and Selling (net/ gross demands, Slutsky Equation – endowment income effect, initial endowment, labour supply);
10. Intertemporal Choice (optimal choice, inflation, real interest rate, Slutsky Equation and intertemporal choice, budget constraint in terms of present/ future value);
11. Asset Markets (present/ future value of assets, rate of return, bonds, consoles, valuing a stream of payments, arbitrage, balance on financial markets, equilibrium in financial markets);
12. Risk and Uncertainty (expected utility, expected value, variance, demand for insurance, risk aversion, diversification, lottery, certainty equivalent);
13. Consumer Surplus (consumer surplus, compensating and equivalent variation);
14. Market Demand (aggregate demand, elasticities, price elasticity of demand).
Type of course
Course coordinators
Learning outcomes
Successful completion of the course provides the basis for theoretical and practical analysis of consumer choices at the intermediate level.
Assessment criteria
1. The final grade (overall score) from the course Microeconomics I is calculated on the basis of the formula: 0.7 x (percentages from the exam) + 0.3 x (percentages from the tutorials).
2. Completion of the course requires obtaining at least 50% of the total points and at least 50% of the points from the final exam.
3. Only students who pass tutorial classes are allowed to attend the final exam. If student do not pass the tutorial classes in the first term, he or she are not allowed to write the final exam in the first term. The same applies to the second term.
4. The final exam will take place in a written form (single-choice test) on one date for all students.
5. The retake exam will take place in the same form.
6. Grading scale:
points (%) grade
<0,50) 2
<50,60) 3
<60,70) 3,5
<70,80) 4
<80,90) 4,5
<90,100> 5
Applied tools – if necessary, video platforms for remote learning approved by the University of Warsaw.
Bibliography
Required readings:
Varian Hal R. (2019), Intermediate Microeconomics: a modern approach, W.W. Norton (ebook format is not available in a library)
Bergstrom T.C., H.R. Varian (2009), Test bank for Intermediate Microeconomics A Modern Approach, W.W.Norton
Additional readings:
Bergstrom T.C., H.R. Varian (2014), Workouts in Intermediate Microeconomics, W.W. Norton
Additional information
Additional information (registration calendar, class conductors, localization and schedules of classes), might be available in the USOSweb system: