 ECONOMICS DEPARTMENT • SCHOOL OF ARTS AND SCIENCES • CORRALES STREET • CAGAYAN DE ORO CITY • 9000 PHILIPPINES 

COURSE OUTLINE IN ECONOMICS 65

INTERMEDIATE ECONOMICS
Credit Units: Three (3)

Course Description:
This course examines the individual actors - the citizens, the consumer, the firm – that comprise our economy,
and the relationship between their individual interests and their group interests as expressed through such markets,
governments, and households. We begin with a discussion of the theory of distribution, and then examine how well
markets hold up to benchmarks for distribution. We then examine the reasons why most individuals work for firms, and
then examine the working of firms and how effectively they are at production

Learning Objective:
On completing this course, the student will be able to:
• Understand the basic concepts of economics;
• Use the tools of economists;
• Understand the workings of demand and supply;
• Evaluate the role of government in market economies;
• Use utility analysis to determine consumer equilibrium;
• Apply elasticity analysis to market situations;
• Calculate cost and productivity measures;
• Understand the fundamentals of markets; and
• Understand the workings of factor markets.

Course Materials
Textbook:
Besanko, David and Braeutigam, Ronald R. Microeconomics. 2nd Ed. John Wiley & Sons (Asia) Pte Ltd,
India, 2006.

References:
Varian, Hal R. Intermediate Microeconomics: A Modern Approach. 7th Ed. W.W. Norton & Co, NY, 2006.
Katz, Michael L and Rosen, Harvey S. Microeconomics. 3rd Ed. Irwin McGraw Hill, NY,1998.

Content Outline:
Chapter 1 Analyzing Economic Problem
Why study Microeconomics?
Three Key Analytical Tools
Positive and Normative Economics

Chapter 2 Demand and Supply Analysis

Demand, Supply and Market Equilibrium
Price Elasticity of Demand
Other Elasticities
Elasticity in the Long Run versus the Short Run
Back of the Envelope

Chapter 3 Consumer Preference and the Concept of Utility

Representation of the Preference
Utility Functions

Chapter 4 Consumer Choice

The Budget Constraint
Optimal Choice
Consumer Choice with Composite Goods
 Revealed Preference
Chapter 5 Theory of Demand
Optimal Choice and Demand
Change in the Price of a Good: Substitution Effect and Income Effect
Change in the Price of a Good: The Concept of Consumer Surplus
Market Demand
Network Externalities
The Choice of Labor and Leisure
Consumer Price Indices

Chapter 6 Inputs and Production Functions

Introduction to Inputs and Production Functions
Production Functions with a Single Input
Production Functions with More Than One Input
Substitutability Among Inputs
Returns to Scale
Technological Progress

Chapter 7 Cost and Cost Minimization

Cost Concept for Decision Making
The Cost-Minimization Problem
Comparative Statics Analysis of the Cost-Minimization Problem
Short-Run Cost Minimization

Chapter 8 Cost Curves

Long-Run Cost Curves
Short-Run Cost Curves
Special Topics In Cost
Estimating Cost Functions

Chapter 9 Perfectly Competitive Markets

What is perfectly competition?
Profit Maximization by a price taking firm
How the Market Price is determined: Short-Run Equilibrium
How the Market Price is Determined: Long-Run Equilibrium
Economic Rent and Producer Surplus

Chapter 10 Monopoly and Monopsony

Profit Maximization by a monopolist
The Welfare Economics of Monopoly
Why Do Monopoly Markets Exist?
Price Discrimination

Chapter 11 Oligopoly
What is Oligopoly?
Profit Maximization by an Oligopolist

Course Policies :
• Students are expected to take full responsibility for his/her academic work and academic progress.
• Students are expected to attend class regularly, for consistent attendance offers the most effective
opportunity open to all students to gain developing command of the concepts and materials of the course.
• Class participation is highly encouraged. Students are expected to contribute significantly to discussion
voluntarily or when called upon.
• Feel free to come to the teacher to ask questions, discuss difficult material, or consult problems related to the
course. If the office hours are not convenient, you may set up an appointment for an alternative time.

Classroom Courtesy :

The best kind of classroom environment is one in which each person believes they are being treated with regard and
respect for their presence and contributions to the class. To that end, please note the following:
• Class preparation : You must read assignments before class sessions. Papers must be handed in on time.
All projects must be submitted in order to earn a final grade.
 • Coming and Going : It’s courteous to be on time and not leave class early. Students who arrive late may
miss important announcements or disrupt class unnecessarily. Students who walk out of class early risk
giving an unintentionally negative impression by exiting unexpectedly. If circumstances require you to be late
for class, or require you to leave early,
please alert the instructor either before or after class. Punctuality is highly appreciated; habitual lateness is
likely to have a negative impact on one’s grade.

• Respect for others : Having our opinions and ideas treated with respect is a basic courtesy that we all
appreciate. Respectful behaviors include listening carefully and attentively to what others have to say, offering
comments and challenges to ideas in ways that address issues
rather than personalities, coming to class on time, being prepared for the day’s readings and activities, and
refraining from talking or reading while others are speaking.
• Cell phones and other electronic devices : In today’s world, these devices are part of the everyday gear
that we carry yet we also know that the sounds they make can be terribly disruptive, especially within the
generally quiet ambience of the typical classroom. Please make certain that all electronic devices are turned
off before class begins (see Student Handbook).

Evaluation:
a +b
A. Midterm Grade (MG) = C. Transmutation Table
2
MG + c + d A = 90 –100
B. Final Grade =
3 A–= 80 – 89
Legend: B = 70 – 79
a = classwork before the midterm exam B–= 60 – 69
b = midterm exam grade C = 50 – 59
c = classwork after the midterm exam D = 40 – 49
d = final exam grade F = 00 – 39
MG = midterm grade

Grading System under J. Balaba:

5% Attendance
5% Class Participation
30% Group Report
30% Quizzes
30% Exam