Microeconomics

Description

Steve Slavin’s lively and comprehensive Microeconomics has a student-friendly, step-by-step approach; value pricing; and a built-in Workbook/Study Guide. Instructors and students like the author’s humorous anecdotes, direct language, patient step-by-step treatment of math, and easy conversational style. The text encourages active rather than passive reading. Tittle Expanded Contents 1 A Brief Economic History of the United States Introduction The American Economy in the 19th Century Agricultural Development The National Railroad Network The Age of the Industrial Capitalist The American Economy in the 20th Century The Roaring Twenties The 1930s: The Great Depression The 1940s: World War II and Peacetime Prosperity The 1950s: The Eisenhower Years The Soaring Sixties: The Years of Kennedy and Johnson The Sagging Seventies: The Stagfl ation Decade The 1980s: The Age of Reagan The State of American Agriculture The “New Economy” of the Nineties The Ominous 00s Current Issue: America’s Place in History 2 Resource Utilization Economics Defi ned The Central Fact of Economics: Scarcity Scarcity and the Need to Economize The Economic Problem The Four Economic Resources Opportunity Cost Full Employment and Full Production The Production Possibilities Curve Productive Effi ciency Economic Growth Current Issue: Will You Be Underemployed When You Graduate? 3 The Mixed Economy The Three Questions of Economics What Shall We Produce? How Shall These Goods and Services Be Produced? For Whom Shall the Goods and Services Be Produced? To Sum Up The Invisible Hand, the Price Mechanism, and Perfect Competition The Invisible Hand The Price Mechanism Competition Trust Equity and Effi ciency The Circular Flow Model The Economic Role of Government Market Failure Externalities Curbing Environmental Pollution Lack of Public Goods and Services Government Failure Capital The “Isms”: Capitalism, Communism, Fascism, and Socialism The Decline and Fall of the Communist System Transformation in China Current Issue: The Bridge to Nowhere 4 Supply and Demand Demand Supply Equilibrium Surpluses and Shortages Shifts in Demand and Supply Price Ceilings and Price Floors Applications of Supply and Demand Interest Rate Determination College Parking The Rationing Function of the Price System Last Word Current Issue: High Gas Prices: Something Only an Economist Could Love 5 Demand, Supply, and Equilibrium Demand Defi ned Individual Demand and Market Demand Changes in Demand Increases in Demand Decreases in Demand Changes in Quantity Demanded and Changes in Demand Practice Problems What Causes Changes in Demand? Supply Defi ned Individual Supply and Market Supply Changes in Supply Practice Problems What Causes Changes in Supply? Graphing the Demand and Supply Curves Graphing the Demand Curve Graphing the Supply Curve The Equilibrium Point Shifts in Demand and Supply Current Issue: Why Can’t I Sell My House? 6 The Price Elasticities of Demand and Supply The Elasticity of Demand The Price Elasticity of Demand Measuring Elasticity The Meaning of Elasticity Determinants of the Degree of Elasticity of Demand Advertising Elasticity and Total Revenue Elastic Demand and Total Revenue Inelastic Demand and Total Revenue Income Elasticity of Demand Cross Elasticity of Demand Price Elasticity of Supply Elasticity over Time Tax Incidence Current Issue: The Price Elasticity of Demand for Oil 7 Theory of Consumer Behavior Utility What Is Utility? Marginal Utility Total Utility Maximizing Utility The Water–Diamond Paradox Some Limitations of Utility Applications Consumer Surplus Do Price Gougers Rip Us Off? Current Issue: All-You-Can-Eat Buffets 8 Cost Costs Fixed Costs Variable Costs Total Cost Marginal Cost The Short Run and the Long Run The Short Run The Long Run Average Cost Average Fixed Cost Average Variable Cost Average Total Cost Graphing the AFC, AVC, ATC, and MC Curves Why Are the AVC and ATC Curves U-Shaped? The Production Function and the Law of Diminishing Returns Economies of Scale Diseconomies of Scale A Summing Up The Decision to Operate or Shut Down The Decision to Go Out of Business or Stay in Business Choosing Plant Size The Long-Run Average Total Cost Curve Current Issue: Wedding Hall or City Hall? 9 Profi t, Loss, and Perfect Competition Part I: Profi t and Loss Total Revenue and Marginal Revenue Graphing Demand and Marginal Revenue Economic and Accounting Profi t Profi t Maximization and Loss Minimization A Summing Up Effi ciency Review of Effi ciency and Profi t Maximization Part II: Perfect Competition Defi nition of Perfect Competition The Perfect Competitor’s Demand Curve The Short Run The Long Run Third Method of Calculating Profi t and Loss The Perfect Competitor: A Price Taker, Not a Price Maker Effi ciency, Price, and Profi t Current Issue: The Internet Effect: A More Perfect Knowledge and Lower Prices 10 Monopoly Monopoly Defi ned The Graph of the Monopolist Calculating the Monopolist’s Profi t Review of the Monopolist’s Economic Analysis The Monopolist Losing Money Alternative Method of Calculating Monopolist’s Profi t or Loss The Monopolist in the Short Run and in the Long Run Are All Monopolies Big Companies? Barriers to Entry Limits to Monopoly Power Economies of Scale and Natural Monopoly What Is Natural Monopoly? Two Policy Alternatives Is Bigness Good or Bad? When Is Bigness Bad? When Is Bigness Good? The Economic Case against Bigness Conclusion Last Word Current Issue: Would You Allow Walmart to Open a Supercenter in Your Community? 11 Monopolistic Competition Monopolistic Competition Defi ned The Monopolistic Competitor in the Short Run The Monopolistic Competitor in the Long Run Product Differentiation Advertising and Monopolistic Competition The Typical Monopolistic Competitor Price Discrimination Is the Monopolistic Competitor Ineffi cient? Current Issue: Selling Status 12 Oligopoly Oligopoly Defi ned Two Measures of the Degree of Oligopolization Concentration Ratios The Herfi ndahl-Hirschman Index (HHI) The Competitive Spectrum Cartels Open Collusion Covert Collusion Price Leadership Cutthroat Competition Game Theory Conclusion Current Issue: Cutthroat Competition in the College Textbook Market Appendix: The Four Types of Competition: A Review Perfect Competition Monopoly Monopolistic Competition Oligopoly Perfect Competition versus Imperfect Competition Summary Tables 13 Corporate Mergers and Antitrust A Historical Perspective on Corporate Concentration Antitrust The Political Background The Sherman Antitrust Act The Clayton Antitrust Act The Federal Trade Commission Act (1914) Modern Antitrust Partial Breakdown of the Rule of Reason The 60 Percent Rule Two Landmark Cases European Antitrust Types of Mergers Horizontal Mergers Vertical Mergers Conglomerate Mergers Deregulation Corporate Misconduct How Effective Is Antitrust? The Trend toward Bigness Current Issue: Pharmaceutical Fraud 14 Demand in the Factor Market Derived Demand Productivity Prices of Substitute Resources Marginal Revenue Product (MRP) The MRP of the Imperfect Competitor Changes in Resource Demand Changes in Resource Demand versus Changes in Quantity of Resource Demanded The Four Reasons for Changes in Resource Demand Optimum Resource Mix for the Firm Current Issue: Washing Machines and Women’s Liberation 15 Labor Unions A Short History of the American Labor Movement The Early Years Key Labor Legislation Craft Unions versus Industrial Unions Union Organizing since the 1950s The Formation of Change to Win Jobs: Exportable and Nonexportable The Economic Power of Labor Unions The Economic Power of Large Employers Collective Bargaining Strikes, Lockouts, and Givebacks The Collective Bargaining Agreement The Strike Averting Strikes: Mediation and Arbitration Will You Ever Be a Member of a Labor Union? Current Issue: The Card Check Law 16 Labor Markets and Wage Rates The Supply of Labor Noncompeting Groups The Theory of the Dual Labor Market The Backward-Bending Individual Labor Supply Curve The Market Supply of Labor The Demand for Labor The Marginal Revenue Product Schedule Nonhomogeneous Jobs and Compensating Pay Differentials Determination of the Wage Rate: Supply and Demand High Wage Rates and Economic Rent Real Wages versus Money Wages The Minimum Wage and the Living Wage The Minimum Wage Rate: 1938 to the Present Should There Be a Minimum Wage Rate? The Living Wage The Effects of Employment Discrimination on Wages Employment Discrimination against Women Employment Discrimination against African Americans Conclusion Current Issue: The Education Gap 17 Rent, Interest, and Profi t Rent What Is Land? How Is Rent Determined? Economic Rent Are Prices High because Rents Are High, or Are Rents High because Prices Are High? Interest What Is Capital? How Is the Interest Rate Determined? Interest Rates and Consumer Loans The Present Value of Future Income Profi ts How Are Profi ts Determined? How Large Are Profi ts? Profi ts and Losses during the Great Recession Theories of Profi t Conclusion Current Issue: Subprime, Fringe, and Payday Lending 18 Income Distribution and Poverty Income Distribution in the United States The Poor, the Middle Class, and the Rich Distribution of Wealth in the United States Distribution of Income: Equity and Effi ciency What Determines Income Distribution? Poverty in America Poverty Defi ned Who Are the Poor? Child Poverty The Main Government Transfer Programs Theories of the Causes of Poverty The Conservative View versus the Liberal View Solutions Current Issue: Will You Ever Be Poor? 19 International Trade Part I: A Brief History of U.S. Trade U.S. Trade before 1975 U.S. Trade since 1975 The Effect of the Great Recession on Our Balance of Trade U.S. Government Trade Policy Part II: The Theory of International Trade Specialization and Trade Absolute Advantage Comparative Advantage Absolute Advantage versus Comparative Advantage The Arguments for Protection Tariffs or Quotas Conclusion Part III: The Practice of International Trade What Are the Causes of Our Trade Imbalance? Part IV: Our Trade Defi cit with Japan and China Japanese Trading Practices Our Trade Defi cit with China Trading with China and Japan: More Differences than Similarities Final Word Free Trade in Word and Deed Reducing Our Trade Defi cit Current Issue 1: Buy American? Current Issue 2: Globalization 20 International Finance The Mechanics of International Finance Financing International Trade The Balance of Payments Exchange Rate Systems The Gold Standard The Gold Exchange Standard, 1944–73 The Freely Floating Exchange Rate System, 1973 to the Present How Well Do Freely Floating (Flexible) Exchange Rates Work? The Euro The Yen and the Yuan The Falling Dollar and the U.S. Trade Defi cit Running Up a Tab in the Global Economy From Largest Creditor to Largest Debtor Living beyond Our Means A Codependent Relationship Why We Need to Worry about the Current Account Defi cit Editorial: American Exceptionality Glossary Photo Credits Index