Microeconomics



Logistics and Review

Topics in this class cover 22 questions on the Midterm and 11 questions on the Final.

Logistics

Students absent last week need a syllabus and addendum

Last Week Review

• What is economics?

• Demand, Supply, Law of Demand, Quantity Demanded

• Supply, Law of Supply, Quantity Supplied

• Shifts versus Movement of Curves

• Equilibrium

• Shortage

• Surplus

Chapter 4 : Extensions of Demand and Supply Analysis

Markets and Price System

• Price System

• Prices

• Market

• Transaction Costs

• Middlemen

• Adjustment Speed

Rationing

• Rationing

• Rationing Function of Prices

• Methods of Non-Price Rationing:

Government-Imposed Price Controls

• Price Controls

1 Price Ceilings

2 Price Floors

• Black Markets

Concept Check A2A

Page 95, problems 3 and 7

Break

Chapter 5 : The Public Sector and Public Choice

Market Failures and Externalities

• Market Failure

• Externalities

• Negative Externalities

• Positive Externalities

How the Government Corrects Negative Externalities

• Special Taxes

• Regulation

Other Economic Functions of Government

• Provide a Legal System

• Promote Competition

• Provide Public Goods

• Private Good

• Public Good

• Free Rider Problem

• Ensuring Economic Stability

Paying for the Public Sector

• Taxes

• Average Tax Rate

• Marginal Tax Rate

• Tax Bracket

Taxation Systems

4 Proportional

5 Progressive

6 Regressive

Related Concepts

• Necessity Income

• Discretionary Income

Concept Check A2B

|Tax Bracket |Tax Rate |

|Lower |Upper |Marginal |

| $ - | $ 7,150 |15% |

| $ 7,151 | $ 29,050 |25% |

| $ 29,051 | $ 70,350 |34% |

Form different teams of two. Take time to introduce yourselves.

Using the tax tables provided, figure out what a single person’s average and marginal tax rate is if they make $30,000 per year. Show your work.

Label the assignment A2B

Chapter 6 : Taxes, Transfers, and Public Spending

Economic Issues of Public Education

• Subsidies

• Incentives

Social Security

Homework Assignments

Remember to use the blog:

Writing

W3: Imagine that you are a representative in the US Congress. In about a page, outline and describe the pros and cons of implementing a proportional (flat) consumption tax to replace the current progressive income tax. Label the assignment.

Reading and At-Home Quizzes

Each chapter has four tests. Although only one of the four tests is required, to get an A on your midterm and final, I suggest you do all four. After you have taken the test, click Submit for Grading when you are finished. When you are satisfied with the results, complete the Email Your Results form at the bottom of the page: Fill in your name and at least check the Instructor box and enter my email address in the space provided, selecting HTML in the Send As dropdown list box. You should get 100% on these since you can take them more than once! Send a copy of the test results to your own email address with correct answers to use to study for the midterm and final.

Visit

Find: I am a student who needs to use the free Companion Website.

Click the Student Resources link.

Navigate to the appropriate chapter:

► Chapter 20: Consumer Choice

► Chapter 21: Demand and Supply Elasticity

Use the menu on the left to access quizzes.

IMPORTANT: You are responsible for ensuring I receive your quizzes. Do not assume that just because you sent a quiz I have received it. I recommend you print a copy of each quiz and deliver it to me personally.

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