Microeconomics is concerned with the behaviour of individual consumers and firms and their interaction in the market place. It introduces students to the basic analytical tools, reasoning and language of economics. This module explores the main pillars of microeconomic theory: the price mechanism and economic decision-making; demand and supply; the operation of markets; the theory of the firm; monopoly and competition.
Define economics and explain the concepts of scarcity, choice, and opportunity cost.
Explain the economic way of thinking and how economists develop theories and use models to analyse the economy.
Use demand and supply models to describe how prices are established in a market system.
Explain and apply price elasticity of demand, cross elasticity of demand, income elasticity and price elasticity of supply and their determinants.
Describe and illustrate graphically how cost affects the way firms use factors of production and make production decisions.
Explain and illustrate graphically how price and output are determined in competitive markets and how marginal and average costs affect firms' decisions.
Describe how price and output decisions are made in monopoly, monopolistic competition, and oligopolistic market structures.