曼昆经济学原理课件

C ITHE CONTENTS OF THIS COURSEPART I : IntroductionPART II: Supply and demandPART III: Elasticity and its applicationPART IV: Consumer behavior theoryPART V: : Firm behavior theoryPART VI: Factors market theoryPART VII: Market failuresAssessment ItemsClass participation 20%Papers and class presentation20%Final examination 60%Ten Principles of EconomicsChapter 1The purpose of Chapter 1 is to lay out ten economic principles that will serve as building blocks for the rest of the text. The ten principles can be grouped into three categories: how people make decisions, how people interact, and how the economy works as a whole. Throughout the text, references will be made repeatedly to these ten principles.LEARNING OBJECTIVES:that economics is about the allocation ofscarce resources.that individuals face tradeoffs.the meaning of opportunity cost.how to use marginal reasoning when making decisions.how incentives affect peoples behavior.why trade among people or nations can begood for everyone.why markets are a good, but not perfect, way to allocate resources.what determines some trends in the overall economy.1.1 Economics.1 .Economy The word economy comes from a Greek word for “one who manages a household/A household and an economyface many decisions:Who will work?What goods and how many of them should be produced?What resources should be used in production?At what price should the goods be sold?2 .Scarcity J. means that society has limited resources and therefore cannot produce all the goods and services people wish to have.3 .Limited ResourcesThe resources that are used to produce goods and services are:LaborLandCapitalEntrepreneurshipLimited ResourcesLaborThe time and effort that we devote to producing goods and services.LandThe gifts of nature that we use to produce goods and services.Limited ResourcesCapitalThe goods we use to produce other goods and services.Includes physical capitalinterstate highways, buildings, and damsand human capitalthe knowledge and skill that people obtain from education and on-the-job training EntrepreneurshipThe resource that organizes labor, land, and capital.4 .Unliniited WantsOur wants are insatiable.Humans, by nature, would like to have more of those things they find desirable.终日奔波只为饥 衣食两般皆俱足 取得美妻生下子 买到田园多广阔 槽头扣了骡和马 县丞主簿还嫌小 作了皇帝求仙术 若要世人心里足方才一饱便思衣 乂想娇容美貌妻 恨无天地少根基 出入无船少马骑 叹无官职被人欺 乂要朝中挂紫衣 更想登天跨鹤飞 除是南柯一梦西5 .Resources and WantsWe have limited resources.We have unlimited wants.This leads to scarcity.Scarcity exists when there are insufficient resources to satisfy peoples wants.6 .EconomicsEconomics is the study of the choices people make to cope with scarcity. Economists study.How people make decisions.How people interact with each other.The forces and trends that affect the economy as a whole.1.2Ten Principles of EconomicsPeople face tradeoffs.The cost of something is what you give up to get it.Rational people think at the margin.People respond to incentives.Ten Principles of EconomicsTrade can make everyone better off.Markets are usually a good way to organize economic activity.Governments can sometimes improve economic outcomes.Ten Principles of EconomicsThe standard of living depends on a countrys production.Prices rise when the government prints too much money.Society faces a short-run tradeoff between inflation and unemployment.1. People face tradeoffs.“There is no such tiling as a free lunch!”2. People face tradeoffs.To get one thing, we usually have to give up another thing.Guns v. butterFood v. clothingLeisure time v. workEfficiency v. equity3. People face tradeoffs.Efficiency means society gets the most that it can from its scarce resources.Equity means the benefits of those resources are distributed fairly among the members of society.4. The cost of something is what you give up to get it.Decisions require comparing costs and benefits of alternatives.Whether to go to college or to work?Whether to study or go out on a date?Whether to go to class or sleep in?5. The cost of something is what you give up to get it.6. Rational people think at the margin.Marginal changes are small, incremental adjustments to an existing plan of action.7. People respond to incentives.Marginal changes in costs or benefits motivate people to respond.Tlie decision to choose one alternative over another occurs when that alternatives marginal benefits exceed its marginal costs!8. Trade can make everyone better off.People gain from their ability to trade with one another.Trade allows people to specialize in what they do best.Adam Smithabsolute advantage theoiygoods Agoods Bcountry 136country 2David Richard comparative advantage theorygoods Agoods Bcountry 136country 24129. Markets are usually a good way to organize economic activity.In a market economy, households decide what to buy and who to work for.Firms decide who to hire and what to produce.Adam Smith made the observation that households and firms interacting in markets act as if guided by an “invisible hand.”10. Maikets are usually a good way to organize economic activity.Because households and firms look at prices when deciding what to buy and sell, they unknowingly take into account the social costs of their actions.As a result, prices guide decision makers to reach outcomes that tend to maximize the welfare of society as a whole.11. Governments can sometimes improve market outcomes.When the market fails (breaks down) government can intervene to promote efficiency and equity.7. Governments can sometimes improve market outcomes.Market failure occurs when the market fails to allocate resources efficiently.Market failure may be caused by an extemality, which is the impact of one person or firms actions on the well-being of a bystander.Market failure may also be caused by market power, which is the ability of a single person or firm to unduly influence market prices.8. The standard of living depends on a countrys production.Standard of living may be measured in different ways:By comparing personal incomes.By comparing the total market value of a nations production.9. The standard of living depends on a countrys production.Almost all variations in living standards are explained by differences in countries productivities.Productivity is the amount of goods and sendees produced from each hour of a worker time.10. Prices rise when the government prints too much money.Inflation is an increase in the overall level of prices in the economy.One cause of inflation is the growth in the quantity of money.When the government creates large quantities of money, the value of the money falls.11. Society faces a short-run tradeoff between inflation and unemployment.The Phillips Curve illustrates the tradeoff between inflation and unemployment:Inflation UnemploymentIts a short-run tiadeoff!Table 1 Ten Principles of Economics1.3 The reasons to study economicsThree reasons for western students to study economics listed in the textbook written by Samurson:In order to earn moneyIn order not to be illiterateBe attracted by the reputation of economics(an ironic story)Economic phenomena in realityWhen the grain is cheap,the farmers suffer Advertisements about agricultural products Small profits but quick turnover Tax incidenceOPECPrice discriminationThe painting will be valuable after the painter diedWhy we can not stop the phenomenon of ticket scalping Thrift paradoxHow can we spend money on the edge of knifeC2Thinking Like an EconomistCh叩ter 2By the end of this chapter, students should understand:how economists apply the methods of science.how assumptions and models can shed light on the world.two simple modelsthe circular flow and the production possibilities frontier.the difference between microeconomics and macroeconomics.the difference between positive and normative statements.the role of economists in making policy.why economists sometimes disagree with one anotherEvery field of study has its own terminologyEvery field of study has its own terminologyThe purpose of Chapter 2 is to familiarize students with how economists approach economic problems. They will see how economists employ the scientific method, the role of assumptions in model building, and the application of two specific economic models. Students will also learn the important distinction between two roles economists can play: as scientists when we try to explain the economic world and as policymakers when we try to improve it.2.1 The Economist as a ScientistThe economic way of thinkingInvolves thinking analytically and objectively.Makes use of the scientific method.1 .The Scientific MethodUses abstract models to help explain how a complex, real world operates.Develops theories, collects, and analyzes data to prove the theories.2 .The Role of AssumptionsEconomists make assumptions in order to make the world easier to understand.The art in scientific thinking is deciding which assumptions to make.Economists use different assumptions to answer different questions.The story in the desertUnder -controlled experimentsThe disadvantages of economists3 .Economic ModelsEconomists use models to simplify reality in order to improve our understanding of the worldTwo of the most basic economic models include:1.1 The Circular-Flow ModelThe circular-flow model is a simple way to visually show the economic transactions that occur between households and firms in the economy.The Circular-Flow DiagramThe Circular-Flow DiagramThe Circular-Flow Diagram1.2 The Production Possibilities FrontierThe production possibilities frontier is a graph showing the various combinations of output that the economy can possibly produce given the available factors of production and technology.Production Possibility FrontierOpportunity CostThe Production Possibilities FrontierThe Production Possibilities FrontierConcepts Ilustrated by the Production Possibilities FrontierEfficiencyTradeoffsOpportunity CostEconomic GrowthThe ProductionPossibilities Frontier1.3 Microeconomics and MacroeconomicsMicroeconomics focuses on the individual parts of the economy.How households and firms make decisions and how they interact in specific marketsMacroeconomics looks at the economy as a whole.How the markets, as a whole, interact at the national level.Microeconomics and MacroeconomicsMicroeconomics is the study of individual people and businesses and the interaction of those decisions in markets.Studies:Prices and QuantitiesEffects of government regulation and taxesDecomposion of the definition:Its objectivesIts center theoryThe problem it solveAssumption :Perfect rationalPerfect informationMarket clearingIts contents:Five Big Economic QuestionsWhat?How?When?Where?Who?CASE:福特公司推出“金牛车型”“汽车尾气排放标准”的制定What Economists DoMicroeconomics and MacroeconomicsMacroeconomics is the study of the national economy and the global economy as a whole.Studies:Average prices and total employment, income, and productionEffects of taxes, government spending, a budget deficits on total jobs and incomesEffects of money and interest ratesDecomposion of the definition:Its objectivesIts center theoryThe problem it solveAssumption :government should and has the ability to intervene the economy1.4 Two Roles of EconomistsWhen they are trying to explain the world, they are scientists.When they are trying to change the world, they are policymakers.1.5 Positive versus Normative AnalysisPositive statements are statements that describe the world as it is.Called descriptive analysisNormative statements are statements about how the world should be.Called prescriptive analysisPositive statements are about what is.Can be proven right or wrong.Can be tested by comparing it to facts.Normative statements are about what ought to be.Depend upon personal values and cannot be tested.1.6 Obstacles and Pitfalls in Economics1 .Unscrambling Cause and EffectCeteris Paribus2 .Fallacy of CompositionThe statement that what is true of the parts is true of the whole or what is true of the whole is true of the parts.3 . Post Hoc FallacyThe error or reasoning that a first event causes a second event because the first occurred before the second.2.6 Research methods of economicsEquilibrium analysis methodUnequilibrium methodC3The Market Forces of Supply and DemandCh叩ter 3阿尔弗雷德马歇尔(ALFRED MARSHALL.1842-1924)3.1 Markets1) The definition of marketA market is a group of buyers and sellers of a particular good or service.The terms supply and demand refer to the behavior of people . . . as they interact with one another in markets.Buyers determine demand.2、The Types of MarketProducts are the sameNumerous buyers and sellers so that each has no influence over priceBuyers and Sellers are price takers2) MonopolyOne seller, and seller controls price3) OligopolyFew sellersNot always aggressive competition4) Monopolistic CompetitionMany sellersSlightly differentiated productsEach seller may set price for its own product3.2 Demand Theory1、Several concepts of demand1) Quantity demandedQuantity demanded is the amountof a good that buyers arewilling and ableto purchase.2) Demand ScheduleThe demand schedule is a tablethat shows the relationshipbetween the price of the good and the quantity demanded.3) Demand CurveThe demand curve is the downward-sloping line relating price to quantity demanded.a. Price is generally drawn on the vertical axis.b. Quantity demanded is represented on the horizontal axis.Demand CurveCeteris paribus is a Latin phrase that means all variables other than the ones being studied are assumed to be constant. Literally, ceteris paribus means “other tilings being equal.”4) Market DemandMarket demand refers to the sum of all individual demands for a particular good or service.Graphically, individual demand curves are summed horizcmfalK to obtain the market demand curve.Up to this point we have assumed that peoples demands for a good are independent of one another.In fact, a persons demand may be affected by the number of other people who have purchased the good.If this is the case, a network externality exists.Network externalities can be positive or negative.Network ExternalitiesA positive network externality exists if the quantity of a good demanded by a consumer increases in response to an increase in purchases by other consumers.Negative network externalities are just the opposite.The Bandwagon EffectThis is the desire to be in style, to have a good because almost everyone else has it.This is the major objective of marketing and advertising campaigns (e.g. toys).The Snob EffectThe snob effect refers to the desire to own exclusive or unique goods.2、Law of Demand1) The content of the law of demandThe law of demand states that there is an inverse relationship between price and quantity demanded.other things equal, the quantity demanded of a good falls when the price of the good rises.2) The Reasons for the Law of DemandSubstitution EffectIncome Effect3) Exceptions to the Law of Demand3、Determinants of DemandMarket priceConsumer incomePrices of related goodsPopulationTastesPreferencesExpectations1) Consumer IncomeAs income increases the demand for a normal good will increase.As income increases the demand for an inferior good will decrease.Normal GoodInferior Good2) Prices of Related GoodsWhen a fall in the price of one good reduces the demand for another good, the two goods are called substitutes.When a fall in the price of one good increases the demand for another good, the two goods are called complements.Two goods are independent when a change in the price of one good has no effect on the quantity demanded of the other4、Demand functionD=f(a, b9 ct d9 ，n)D=f(P)5、Change in Quantity Demanded versus Change in DemandChange in Quantity DemandedMovement along the demand curve.Caused by a change in the price of the product.Changes in Quantity DemandedChange in DemandA shift in the demand curve, either to the left or right.Caused by a change in adeterminant other than the price.Changes in DemandChange in Quantity Demanded versus Change in DemandCase Study: Two Ways to Reduce the Quantity of Smoking DemandedPublic service announcements, mandatory health warnings on cigarette packages, and the prohibition of cigarette advertising on television are policies designed to reduce the demand for cigarettes (and shift the demand curve to the left).Raising the price of cigarettes (through tobacco taxes) lowers the quantity of cigarettes demanded.Studies have shown that a 10% increase in the price of cigarettes causes a 4% reduction in the quantity of cigarettes demanded. For teens a 10% increase in price leads to a 12% drop in quantity demanded.Studies have also shown that a decrease in the price of cigarettes is associated with greater use of marijuana. Thus, it appears that tobacco and marijuana are complements. 3.3 Supply1 Several concepts of supply1) Quantity suppliedQuantity supplied is the amount of a good that sellers are willing and able to sell.2) Supply ScheduleThe supply schedule is a table that shows the relationship between the price of the good and the quantity supplied.Supply Schedule3) Supply CurveThe supply curve is the upward-sloping line relating price to quantity supplied.Supply Curve4)、Market SupplyMarket supply refers to the sum of all individual supplies for all sellers of a particular good or service.Graphically, individual supply curves are summed horizontally to obtain the market supply curve.Market Supply as the Sum of Individual Supplies2、Lzaw of Supply1) The content of the law of supplyThe law of supply states that there is a direct (positive) relationship between price and quantity supplied.the claim that, other things equaL the quantitysupplied of a good rises when the price of the good rises.2) Reasons for the Law of SupplyThe change of firms numberThe change of firms scale3) Exceptions to the Law of Supply3、Determinants of SupplyMarket priceInput pricesTechnology Expectations Number of producers4、Supply functionS = f(a, b, c, d,.，n)S = f(P)5 Change in Quantity Supplied versus Change in SupplyChange in Quantity SuppliedMovement along the supply curve.Caused by a change in the market price of the product.Change in Quantity SuppliedChange in SupplyA shift in the supply curve, either to the left or right.Caused by a change in a determinant other than price.Change in SupplyChange in Quantity Supplied versus Change in Supply3.4 Supply and Demand Together1、EquilibriumEquilibrium PriceThe price that balances supply and demand. On a graph, it is the price at which the supply and demand curves intersect.The equilibrium price is often called the market-clearing” price because both buyers and sellers are satisfied at this price.Equilibrium QuantityThe quantity that balances supply and demand. On a graph it is the quantity at which the supply and demand curves intersect.Equilibrium ofSupply and Demand2、Price as a RegulatorIf the price is too low, quantity demanded exceeds quantity supplied.If the price is too high, quantity supplied exceeds quantity demanded.1) SurplusWhen the price is above the equilibrium price, the quantity supplied exceeds the quantity demanded. There is excess supply or a surp