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Rebecca Stein

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Microeconomics: The Power of Markets

University of Pennsylvania

About this Course

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We make economics decisions every day: what to buy, whether to work or play, what to study. We respond to markets all the time: prices influence our decisions, markets signal where to put effort, they direct firms to produce certain goods over others. Economics is all around us. 
This course is an introduction to the microeconomic theory of markets: why we have them, how they work, what they accomplish. We will start with the concept of scarcity and how specialization according to comparative advantage helps us achieve more than we could alone. Next we model a marked using the tools of Supply and Demand and learn what well working markets accomplish and what their limit are. We end by exploring the impact of government intervention on perfect markets. Examples are taken from everyday life, from goods and services that we all purchase and use. We will apply the theory to current events and policy debates through weekly exercises. These will empower you to be an educated, critical thinker who can understand, analyze and evaluate market outcomes.

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Approx. 15 hours to complete

English

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Skills you will gain

Economics
Microeconomics
Economic Analysis
Market (Economics)

Flexible deadlines

Reset deadlines in accordance to your schedule.

Shareable Certificate

Earn a Certificate upon completion

100% online

Start instantly and learn at your own schedule.

Approx. 15 hours to complete

English

Could your company benefit from training employees on in-demand skills?

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Instructor

Instructor rating

4.82/5 (236 Ratings)

Rebecca Stein

Offered by

University of Pennsylvania

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Syllabus - What you will learn from this course

Content Rating95%(5,137 ratings)

Week

Week 1

3 hours to complete

The Concept of Scarcity

Where do markets come from? We will start with understanding the constraint of scarcity that we face and the concept of opportunity cost that reflects the true cost of any decision we make. We will learn to model scarcity using the Production Possibilities Frontier that allows us to visualize tradeoffs, distinguish between efficient, inefficient and unattainable points. We will also discuss how economic growth affects our options and allows us to achieve the previously unattainable.

3 hours to complete

17 videos (Total 54 min), 2 readings, 3 quizzes

17 videos

The Power of Markets: Introduction1m

1.1.1 Opportunity Cost: Introduction2m

1.1.2 Opportunity Cost: The Cost of Education2m

1.1.3 Opportunity Cost: Numeric Example 13m

1.1.4 Opportunity Cost: Numeric Example 22m

1.1.5 Opportunity Cost: Numeric Example33m

1.1.6 Opportunity Cost: Numeric Example 42m

1.2.1 Scarcity: Introduction2m

1.2.2 Production Possibilities Frontier: Definition2m

1.2.3 Allocative Efficiency: Defining Marginal Cost and Marginal Benefit3m

1.2.4 Allocative Efficiency: When Marginal Cost Equals Marginal Benefit1m

1.2.5 Production Possibilities Frontier: Graphical Approach4m

1.2.6 Production Possibilities Frontier: Numerical Example4m

1.2.7 Production Possibilities Frontier: Understanding the Slope2m

1.2.8 Production Possibilities Frontier: Modeling Technological Change and Growth2m

1.2.9 Allocative Efficiency: Graphical Approach 13m

1.2.10 Allocative Efficiency: Graphical Approach 27m

2 readings

Additional Readings: General Suggestions10m

Additional Readings: Week 110m

3 practice exercises

Opportunity Cost30m

Production Possibility Frontier (PPF)30m

Production Possibilities Frontier and Growth30m

Week

Week 2

2 hours to complete

Specialization & Trade

Trade allows us to achieve the unattainable- we can consume more than we can produce on our own. We will introduce the concept of Comparative Advantage and discuss how gains from specialization allow us to use our resources efficiently. We will apply these concepts to a simple model of trade, showing that now the Consumption Possibilities Frontier allows points outside the Production Possibilities Frontier.

2 hours to complete

14 videos (Total 39 min), 1 reading, 2 quizzes

14 videos

2.1.1 Markets and Trade: Introduction1m

2.2.1 Comparative Advantage: Numerical Example 1 - Set up1m

2.2.2 Comparative Advantage: Numerical Example 2 - Individual PPFs3m

2.2.3 Comparative Advantage: Numerical Example 3 - Joint PPF2m

2.2.4 Comparative Advantage: Numerical Example 4 - Joint PPF Completed3m

2.3.2 Comparative Advantage: Definition57s

2.2.5 Comparative Advantage: Numerical Example 5 - Gains from Specialization4m

2.2.6 Comparative Advantage: Numerical Example 61m

2.2.7 Comparative Advantage: Numerical Example 72m

2.3.1 Absolute Advantage: Definition42s

2.4.1 Gaining from Specialization Through Trade3m

2.4.2 Gaining from Specialization: The Consumption Possibilities Frontier4m

2.4.3 Gaining from Specialization: General Graphical Approach5m

2.4.4 Gaining from Specialization: Imports and Exports3m

1 reading

Additional Readings: Week 210m

2 practice exercises

Comparative Advantage30m

Trade30m

Week

Week 3

3 hours to complete

Supply and Demand

We will introduce the central model of Supply & Demand. This will allow you to communicate with other economists and finally understand those business pages and market updates. We will distinguish between a movement along and a movement of the supply & demand curves. We will define market equilibrium as understand that at an equilibrium price there is neither excess demand nor excess supply. We will end by a few scenarios where exogenous changes affect supply and/or demand and analyze the impact on equilibrium price and quantity.

3 hours to complete

15 videos (Total 44 min), 1 reading, 4 quizzes

15 videos

3.1.1 Supply & Demand: Introduction1m

3.1.2 The Demand Curve3m

3.1.3 Shifts of Demand: Part 13m

3.1.4 Shifts of Demand: Part 24m

3.1.5 The Supply Curve4m

3.1.6 Shifts of Supply: Part 12m

3.1.7 Shifts of Supply: Part 23m

3.1.8 Market Equilibrium: Definition2m

3.1.9 Market Equilibrium: Understanding Who Buys and Who Sells2m

3.1.10 The Invisible Hand: Part 13m

3.1.11 The Invisible Hand: Part 22m

3.1.12 Changes in Demand: Effect on Market Equilibrium3m

3.1.13 Changes in Supply: Effect on Market Equilibrium2m

3.1.14 Simultaneous Changes in Demand & Supply: Effect on Market Equilibrium2m

3.1.15 Supply & Demand: Conclusion1m

1 reading

Additional Readings: Week 310m

4 practice exercises

The Demand Curve30m

The Supply Curve30m

Market Equilibrium30m

A Change in Market Equilibrium30m

Week

Week 4

4 hours to complete

Understanding Markets: Elasticities, Market Surplus, Efficiency, and Equity

There is a lot of terminology this week. We will introduce of the concept of elasticity of demand that measures the responsiveness of quantity demanded to a change in the price of a good. We will explore the relationship between change in price and revenue or sales and how elasticities can help us predict whether a decrease in price will increase or decrease revenue. We then introduce other elasticities of note: cross price elasticity, income elasticity and elasticity of supply. We end the week by exploring the great accomplishment of markets: maximizing the size of the pie or the total benefit to society.

4 hours to complete

23 videos (Total 82 min), 1 reading, 4 quizzes

23 videos

4.1.1 Elasticity: Introduction2m

4.1.2 Elasticity of Demand4m

4.1.3 What Affects Elasticity of Demand4m

4.1.4 Perfectly Inelastic and Perfectly Elastic Demand4m

4.1.5 Elasticity Along a Straight Line Demand Curve3m

4.1.6 Elasticity and Revenue: Part 13m

4.1.7 Elasticity and Revenue: Part 21m

4.1.8 Unit Elastic Demand Curve2m

4.1.9 Cross Price Elasticity: Complements vs. Substitutes2m

4.1.10 Income Elasticity: Normal vs. Inferior Goods2m

4.1.11 Elasticity of Supply3m

4.1.12 Elasticity: Summary1m

4.2.1 Efficiency & Equity: Introduction2m

4.2.2 Consumer Surplus5m

4.2.3 Producer Surplus4m

4.2.4 Maximizing Total Surplus1m

4.2.5 T.S. at a Quantity Greater Than Equilibrium Quantity4m

4.2.6 T.S. at a Quantity Smaller Than Equilibrium Quantity4m

4.2.7 Efficiency & Equity: Conclusion1m

4.2.8 Price Ceiling5m

4.2.9 Price Floors: The Case of Minimum Wage5m

4.2.10 Calculating Total Surplus: Numerical Example4m

4.2.11 Price Ceilings: A Numerical Example5m

1 reading

Additional Readings: Week 410m

4 practice exercises

Elasticity of Demand30m

Elasticity of Demand & Revenue30m

Other Elasticity Terms30m

Consumer and Producer Surplus30m

Reviews

4.7

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TOP REVIEWS FROM MICROECONOMICS: THE POWER OF MARKETS

by KKJun 10, 2020

an amazing course and amazing lecturer professor Rebecca Stein

, I have learned a lot in this course and thanks a lot for the University of Penn and professor Rebecca Stein

by MTApr 5, 2020

From this course I have received an in depth knowledge about basic concepts of microeconomics and have thoroughly enjoyed the course. I will use these concepts in my further studies.

by JSOct 14, 2022

A very good course.Teaching methods are at a very high level.There is a very good level of evaluation methodology.The lecture does a good job of teaching.

by WSMar 4, 2020

I really liked this course. The lecturer is able to convey terminologies clearly in a short time. The problems are more sophisticated and worth time thinking instead of just toy questions.

View all reviews

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Microeconomics: The Power of Markets

Microeconomics: The Power of Markets

About this Course

Skills you will gain