Microeconomic: Theory and Applications (Hardcover, 11)

Preface v Acknowledgments x Chapter 1: An Introduction to Microeconomics 1 1.1 The Scope of Microeconomic Theory 2 1.2 The Nature and Role of Theory 2 1.3 Positive versus Normative Analysis 4 1.4 Market Analysis and Real versus Nominal Prices 5 1.5 Basic Assumptions about Market Participants 6 1.6 Opportunity Cost 6 1.7 Production Possibility Frontier 10 Chapter 2: Supply and Demand 15 2.1 Demand and Supply Curves 16 2.2 Determination of Equilibrium Price and Quantity 23 2.3 Adjustment to Changes in Demand or Supply 25 2.4 Government Intervention in Markets: Price Controls 28 2.5 Elasticities 33 2.6 The Mathematics Associated with Elasticities 42 Chapter 3: The Theory of Consumer Choice 48 3.1 Consumer Preferences 50 3.2 The Budget Constraint 59 3.3 The Consumer's Choice 63 3.4 Changes in Income and Consumption Choices 68 3.5 Are People Selfish? 74 3.6 The Utility Approach to Consumer Choice 77 Chapter 4: Individual and Market Demand 85 4.1 Price Changes and Consumption Choices 86 4.2 Income and Substitution Effects of a Price Change 91 4.3 Income and Substitution Effects: Inferior Goods 96 4.4 From Individual to Market Demand 99 4.5 Consumer Surplus 101 4.6 Price Elasticity and the Price-Consumption Curve 107 4.7 Network Effects 109 4.8 The Basics of Demand Estimation 113 4.9 Deriving the Consumer's Demand Curve Mathematically 117 Chapter 5: Using Consumer Choice Theory 122 5.1 Excise Subsidies, Health Care, and Consumer Welfare 123 5.2 Subsidizing Health Insurance: ObamaCare 128 5.3 Public Schools and the Voucher Proposal 133 5.4 Paying for Garbage 137 5.5 The Consumer's Choice to Save or Borrow 141 5.6 Investor Choice 147 Chapter 6: Exchange, Efficiency, and Prices 158 6.1 Two-Person Exchange 159 6.2 Efficiency in the Distribution of Goods 165 6.3 Competitive Equilibrium and Efficient Distribution 169 6.4 Price and Nonprice Rationing and Efficiency 173 6.5 Some of the Mathematics behind Efficiency in Exchange 176 Chapter 7: Production 180 7.1 Relating Output to Inputs 181 7.2 Production When Only One Input Is Variable: The Short Run 182 7.3 Production When All Inputs Are Variable: The Long Run 189 7.4 Returns to Scale 194 7.5 Functional Forms and Empirical Estimation of Production Functions 197 7.6 The Mathematics behind Production Theory 201 Chapter 8: The Cost of Production 207 8.1 The Nature of Cost 208 8.2 Short-Run Cost of Production 209 8.3 Short-Run Cost Curves 213 8.4 Long-Run Cost of Production 218 8.5 Input Price Changes and Cost Curves 224 8.6 Long-Run Cost Curves 227 8.7 Learning by Doing 230 8.8 Importance of Cost Curves to Market Structure 232 8.9 Using Cost Curves: Controlling Pollution 234 8.10 Economies of Scope 237 8.11 Estimating Cost Functions 238 8.12 The Mathematics behind Production Cost 240 Chapter 9: Profit Maximization in Perfectly Competitive Markets 245 9.1 The Assumptions of Perfect Competition 246 9.2 Profit Maximization 248 9.3 The Demand Curve for a Competitive Firm 250 9.4 Short-Run Profit Maximization 252 9.5 The Perfectly Competitive Firm's Short-Run Supply Curve 257 9.6 The Short-Run Industry Supply Curve 260 9.7 Long-Run Competitive Equilibrium 2629.8 The Long-Run Industry Supply Curve 266 9.9 When Does the Competitive Model Apply? 274 9.10 The Mathematics behind Perfect Competition 276 Chapter 10: Using the Competitive Model 280 10.1 The Evaluation of Gains and Losses 281 10.2 Excise Taxation 287 10.3 Airline Regulation and Deregulation 296 10.4 City Taxicab Markets 301 10.5 Consumer and Producer Surplus, and the Net Gains from Trade 304 10.6 Government Intervention in Markets: Quantity Controls 310 Chapter 11: Monopoly 316 11.1 The Monopolist's Demand and Marginal Revenue Curves 317 11.2 Profit-Maximizing Output of a Monopoly 319 1