Published May 06, 2024
Choice lies at the heart of all economic models. This course focuses on choice by consumers and firms. It explains the notion and use of utility functions and budgets, and shows how their interaction allows economists to make predictions about behaviour. The constrained maximization techniques from ECON 211 are used extensively, and extended to situations covering uncertainty (risk) and time. Profit maximization by firms is explored.
Prereq: ECON101 or ECON100/COMM103;ECON211 or one of MATH128,138,148; ECON221 or one of ARTS280,ENVS278,KIN222,232,PSCI214/314,PSYCH292, REC371, SDS250R, SMF230, SOC/LS280,STAT202, 206,211,220,230,240, SWREN250R; or Math/FARM students
| Describe and explain key economic models of consumer and producer choice. |
| Demonstrate the implications of these economic models for predictions about consumer and producer behaviour. |
| Analyze consumer and producer decision problems using graphs. |
| Use calculus to solve optimization problems faced by consumers and producers. |
| Explain how economic models of consumer and producer decisions help us make predictions about economic outcomes. |
Note: Some topics may be omitted in during the term because of time considerations. Students will be notified, in class and on LEARN, of the material they are responsible for prior to all assignments, midterms and exams.
1.1. Review of basic concepts
1.2. Tools for economic analysis
2.1. Alternatives and budgets
2.2. Preferences and utility functions
3.1. Consumer alternatives
3.2. Consumer budgets
3.3. Consumer preferences
3.4. Optimal consumption bundles
3.5. Application re consumer choice
4.1. Intertemporal alternatives
4.2. Intertemporal budgets
4.3. Intertemporal consumer preferences
4.4. Optimal consumption paths
4.5. Application re intertemporal choice (i)
4.6. Application re intertemporal choice (ii)
5.1. Production technology
5.2. Profit maximization
5.3. Application re Returns to scale and firm size
5.4. Cost minimization
5.5. Application re Costs and profits
6.1. Expected utility maximization
6.3. Application re choice under uncertainty (i)
6.4. Application re choice under uncertainty (ii)
| Title / Name | Notes / Comments | Required |
|---|---|---|
| No |
The topics of this course are covered in standard intermediate microeconomics textbooks (that use calculus). The main reference will be:
Two other useful references are:
Readings Available on LEARN: I will be posting lecture slides, class announcements, assignments and other relevant materials on the LEARN web site. It is the student’s responsibility to keep her/himself current with the posted materials as well as maintaining an understanding of the lecture content.
| Component | Value |
|---|---|
| Individual Assignments | 10% |
| In-class Participation Exercises | 10% |
| Midterm 1 | 20% |
| Midterm 2 | 20% |
| Final Exam | 40% |
Individual Assignments
In-class Participation Exercises
Midterms
Final Exam
No assignment screening will be used in this course.
The classroom is a handheld-device-free zone. Please turn off all handheld devices and put them away for the duration of the lecture. Laptop computers may only be used to view lecture material. Photographic devices as well as audio or video recording devices are not permitted in class due to copyright and privacy issues.
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f you are unable to complete a course component due to self-declared COVID-related reasons or a two-day short-term absence then you should submit a self-declaration of absence through Quest.
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Intellectual property includes items such as:
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Please alert the instructor if you become aware of intellectual property belonging to others (past or present) circulating, either through the student body or online. The intellectual property rights owner deserves to know (and may have already given their consent).
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Other on-campus supports
Off campus supports
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https://uwaterloo.ca/economics/undergraduate/resources-and-policies/deferred-final-exam-policy.
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It is the responsibility of the student to notify the instructor if they, in the first week of term or at the time assignment details are provided, wish to submit alternate assignment.