## Syllabus

### Updated A.Y. 2021-2022

**Textbook:**

H.R. Varian, Intermediate Microeconomics (latest edition), W.W. Norton & Company

**Workbook **(for practice classes):

T.C. Bergstrom and H.R. Varian, Workouts in Intermediate Microeconomics (latest edition), W.W. Norton & Company

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**List of topics **(for Part I):

Budget constraint (chapter 2)

• The Budget Constraint

• Two Goods are Often Enough

• Properties of the Budget Set

• How the Budget Line Changes

• The Numeraire

• Taxes, Subsidies, and Rationing

Preferences (chapter 3)

• Consumer Preferences

• Assumption about Preferences

• Inidifference Curves

• Examples of Preferences:

o Perfect Substitutes, Perfect Complements, Bads, Neutral, Satiation, Discrete Goods

• Well Behaved-Preferences

• The Marginal Rate of Substitution

• Other Interepretation of the Marginal Rate of Substitution

• Behavior of the Marginal Rate of Substitution

Utility (chapter 4)

• Cardinal Utility

• Construction a Utility Function

• Some Examples of Utility Functions:

o Perfect Substitutes

o Perfect Complements

o Quasilinear Preferences

o Cobb-Douglas Preferences

• Marginal Utility

• Marginal Utility and Marginal Rate of Substitution

Choice (chapter 5)

• Optimal Choice

• Consumer Demand

• Some Examples:

o Perfect Substitues

o Perfect Complements

o Neutrals and Bads

o Discrete Goods

o Concave Preferences

o Codd-Douglas Preferences

• Implications of the MRS Condition

• Choosing Taxes

Demand (chapter 6)

• Normal and Inferior Goods

• Income Offer Curves and Engel Curves

• Some Examples:

o Perfect Substutes

o Perfcet Complements

o Cobb-Douglas Preferences

o Homothetic Preferences

o Quasilinear Preferences

• Ordinary Goods and Giffen Goods

• Price Offer Curve and Demand Curve

• Some examples:

o Perfect Substitutes

o Perfect Complements

o Discrete Good

• Substitutes and Complements

• The Inverse Demand Function

• Appendix (on Quasilinear Preferences)

Slutsky Equation (chapter 8)

• The Subsitution Effect

• The Income Effect

• Sign of the Subsitution Effect

• The Total Change in Demand

• Rates of Change

• The Law of Demand

• Examples of Income and Substitution Effects

Buying and Selling (chapter 9)

• Net and Gross Demands

• The Budget Constraint

• Changing the Endowment

• Price Changes

• Offer Curves and Demand Curves

• The Slitsky Equation Revisited

• Use of the Slutsky Equation

• Labor Supply

• Comparative Statics of the Labor Supply

Intertemporal Choice (chapter 10)

• The Budget Constraint

• Preferences and Consumption

• Comparative Statistics

• The Slutsky Equation and Intertemporal Choice

• Inflation

• Present Value: A Closer Look

• Analyzing Present Value for Several Periods

Uncertainty (chapter 12)

• Contingent Consumption

• Utility Functions and Probabilities

• Expected Utility

• Why Expected Utilty is Reasonable

• Risk Aversion

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Exercises (numbers refer to the exercises from Workouts)

Exercises on chapter 2: 2.1 to 2.10

Exercises on chapter 3: 3.1 (only up to (g)), 3.3, 3.9 (excluded (d))

Exercises on chapter 4: 4.1, 4.2, 4.4, 4.5, 4.6, 4.11, 4.12

Exercises on chapter 5: 5.1, 5.3, 5.4, 5.7

Exercises on chapter 6: 6.1, 6.2, 6.3, 6.5, 6.6

Exercises on chapter 8: 8.1, 8.4, 8.5, 8.10, 8.11

Exercises on chapter 9: 9.1, 9.2, 9.3, 9.6, 9.7, 9.8

Exercises on chapter 10: 10.1, 10.2, 10.3, 10.4, 10.5

Exercises on chapter 12: 12.1, 12.3, 12.4, 12.8, 12.9, 12.11, 12.12