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Microeconomics For Dummies

Book Description

Your no-nonsense guide to microeconomics

The study of microeconomics isn't for the faint of heart. Fortunately, Microeconomics For Dummies is here to help make this tough topic accessible to the masses. If you're a business or finance major looking to supplement your college-level microeconomics coursework—or a professional who wants to expand your general economics knowledge into the microeconomics area—this friendly and authoritative guide will take your comprehension of the subject from micro to macro in no time! Cutting through confusing jargon and complemented with tons of step-by-step instructions and explanations, it helps you discover how real individuals and businesses use microeconomics to analyze trends from the bottom up in order to make smart decisions.

Snagging a job as an economist is fiercely competitive—and highly lucrative. Having microeconomics under your belt as you work toward completing your degree will put you head and shoulders above the competition and set you on the course for career advancement once you land a job. So what are you waiting for?

  • Analyze small-scale market mechanisms
  • Determine the elasticity of products within the market systems
  • Decide upon an efficient way to allocate goods and services
  • Score higher in your microeconomics class

Everything you need to make microeconomics your minion is a page away!

Table of Contents

    1. Cover
    2. Introduction
      1. About This Book
      2. Foolish Assumptions
      3. Icons Used in This book
      4. Beyond the Book
      5. Where to Go from Here
    3. Part I: Getting Started with Microeconomics
      1. Chapter 1: Discovering Why Microeconomics Is a Big Deal
        1. Peering into the Economics of Smaller Units
        2. Making Decisions, Decisions, and More Decisions!
        3. Understanding the Problems of Competition and Cooperation
        4. Investigating Why Markets Can Fail
      2. Chapter 2: Considering Consumer Choice: Why Economists Find You Fascinating
        1. Studying Utility: Why People Choose What They Choose
        2. Modeling Consumer Behavior: Economic Agents
        3. Pursuing Preferences and Investigating Indifferences
      3. Chapter 3: Looking at the Behavior of Firms: What They Are and What They Do
        1. Delving into Firms and What They Do
        2. Considering How Economists View Firms: The Black Box
        3. From Firm to Company: Why People Form Limited Liability Companies
    4. Part II: Doing the Best You Can: Consumer Theory
      1. Chapter 4: Living a Life without Limits
        1. Eating Until You’re Sick: Assuming that More Is Always Better
        2. Deciding How Low You’ll Go: Marginal Utility
      2. Chapter 5: Considering the Art of the Possible: The Budget Constraint
        1. Taking It to the Limit: Introducing the Budget Constraint
        2. Getting the Biggest Bang for Your Buck
        3. Putting the Utility Model to Work
      3. Chapter 6: Achieving the Optimum in Spite of Constraints
        1. Investigating the Equilibrium: Coping with Price and Income Changes
        2. Dealing with Price Changes for One Good
        3. Discerning a Consumer’s Revealed Preference
        4. Decomposing Income and Substitution Effects
    5. Part III: Uncovering the Alchemy of Firms’ Inputs and Outputs
      1. Chapter 7: Working with Different Costs and Cost Curves
        1. Understanding Why Accountants and Economists View Costs Differently
        2. Looking at a Firm’s Cost Structure
        3. Relating Cost Structure to Profits
      2. Chapter 8: Squeezing Out Every Last Drop of Profit
        1. Asking Whether Firms Really Maximize Profits
        2. Going Large! The Goal of Profit Maximization
        3. Slimming Down: Minimizing Costs
      3. Chapter 9: Supplying the Demanded Information on Supply and Demand
        1. Producing Stuff to Sell: The Supply Curve
        2. Giving the People What They Want: The Demand Curve
        3. Identifying Where Supply and Demand Meet
      4. Chapter 10: Dreaming of the Consumer’s Delight: Per  fect Competition
        1. Viewing the “Perfect” in Perfect Competition
        2. Putting the Conditions Together for the Perfectly Competitive Marketplace
        3. Examining Efficiency and Perfect Competition
    6. Part IV: Delving into Markets, Market Failure, and Welfare Economics
      1. Chapter 11: Stepping into the Real World: Oligopoly and Imperfect Competition
        1. Outlining the Features of an Oligopoly
        2. Discussing Three Different Approaches to Oligopoly
        3. Making Your Firm Distinctive from the Competition
      2. Chapter 12: Appreciating the Fundamental Theorems of Welfare Economics
        1. Getting the Welfare Back into Welfare Economics
        2. Understanding Why Partial Equilibrium Isn’t Enough
        3. Trading Your Way to Efficiency with Two Fundamental Theorems
      3. Chapter 13: The Monopoly Game
        1. Entering the World of the Monopoly
        2. Counting the Costs of Monopolies
        3. Tackling Monopolies in the Real World
        4. “You Make Me Feel Like a Natural Monopoly”
      4. Chapter 14: Examining Market Failure: Pollution and Parks
        1. Coming to Grips with Externality: Too Much of a Bad Thing
        2. Making the Market Produce What Otherwise It Would Not: Public Goods
      5. Chapter 15: Understanding the Dangers of Asymmetric Information
        1. Seeing the Effects of Asymmetric Information
        2. Changing Your Behavior because of Asymmetric Information
    7. Part V: Thinking Strategically: Life Is Just a Game!
      1. Chapter 16: Playing Games with Economic Theory
        1. Setting Up the Game: Mechanism Design
        2. Locking Horns with the Prisoner’s Dilemma
        3. Looking at Collective Action: The Stag Hunt
        4. Annoying People with the Ultimatum Game
        5. Getting out of the Dilemma by Repeating a Game
      2. Chapter 17: Keeping Things Stable: The Nash Equilibrium
        1. Defining the Nash Equilibrium Informally
        2. Looking for Balance: Where a Nash Equilibrium Must Apply
        3. Applying the Nash Equilibrium in Economics
      3. Chapter 18: Knowing How to Win at Auctions
        1. Spotting Different Kinds of Auction
        2. Bidding for Beginners
        3. Suffering from the Winner’s Curse
      4. Chapter 19: Understanding the Game: Credible Threats and Signals
        1. Refining the Nash Equilibrium to Deal with Threats
        2. Responding to Positive Economic Signals
    8. Part VI: The Part of Tens
      1. Chapter 20: Meeting Ten Great Microeconomists
        1. Alfred Marshall (1842–1924)
        2. Joseph Alois Schumpeter (1883–1950)
        3. Gary S. Becker (1930–2014)
        4. Ronald Coase (1910–2013)
        5. Elinor Ostrom (1933–2012)
        6. William Vickrey (1914–96)
        7. George Akerlof (born 1940)
        8. Joseph Stiglitz (born 1943)
        9. William Baumol (born 1922)
        10. Arthur Cecil Pigou (1877–1959)
      2. Chapter 21: Top Ten Tips to Take Away
        1. Respecting Choice
        2. Pricing a Good: Difficult but not Impossible
        3. Competing on Price or Quality
        4. Seeking Real Markets’ Unique Features
        5. Beating the Market in the Long Run is Very Difficult
        6. Knowing a Tradeoff Always Exists Somewhere
        7. Arguing about the Next Best Thing
        8. Using Markets Isn’t Always Costless
        9. Believing that Competition is Good — Usually
        10. Getting Cooperation and Organization in the World
    9. Glossary
    10. About the Author
    11. Cheat Sheet
    12. Advertisement Page
    13. Connect with Dummies
    14. End User License Agreement