About Principles of Microeconomics: Production and Consumption
- Course name: Principles of Microeconomics: Production and Consumption
Microeconomics: Production and Consumption will examine the ways in which markets increase overall welfare through the concepts of consumer and producer surplus. We will discuss the concepts of marginal costs and benefits and take a look at how they affect a firm's decision on whether or not to make one more or one less product - why firms produce certain levels of output, taking into consideration opportunity cost and sunk (fixed) cost.
We will then look at the causes and ramifications of income inequality. Protracted poverty and inequality can cause long term harm to an economy's development.
We then turn our attention to the individual consumer and the characteristics that compel a consumer (to choose) to spend income on goods and services. The consumer experiences utility - a measure of satisfaction - with every purchase that he or she makes, and economists measure that utility in order to find a consumer's optimal rate of consumption.
Finally, you will learn about one of the most important economic agents: the producer. The producer (firm) is responsible for creating the production function (output) and is subject to various cost measures as well as the results of diminishing returns. You will explore these ideas more fully as you delve into the relationship between quantity of input and quantity of output.
Course metrics
- Approximate learning hours: 30 hours
- Course: One of three micro courses for Principles of Microeconomics
- Level: 1st year Bachelor Degree
About Principles of Microeconomics
The purpose of these three micro courses is to provide you with a basic understanding of the principles of microeconomics.
At its core, the study of economics deals with the choices and decisions that have to be made in order to manage scarce resources available to us. Microeconomics is the branch of economics that pertains to decisions made at the individual level, i.e., by individual consumers or individual firms after evaluating resources, costs, and tradeoffs. When we talk about the economy, we are referring to the marketplace or system in which these choices interact with one another.
In these courses, you will learn how and why these decisions are made and how they affect one another in the economy. Each of the following lessons has been designed as a building block, where the concepts you learn in one lesson will enable you to understand the material you discover in the next lesson.
By the end of these courses, you will have a strong grasp on the major issues that face microeconomists, including consumer and producer behavior, the nature of supply and demand, the different kinds of markets and how they function, and the welfare outcomes of consumers and producers. You will also be able to apply the formal principles you learn to real world issues. The scope and emphasis of these courses goes beyond a general understanding of microeconomics to incorporate the core concepts of the overall field of economics.
