PCM

 ECON 2302 MICROECONOMICS   

Below you will find the learning objective, concept, idea, term, or theory that each question on the exam will cover. Each number in the following list refers to the question number on Exam 3 that will test your knowledge of that specific learning objective. Each of these topics/learning objectives is discussed in the textbook in the order that they are listed below.  A much better understanding can often be attained by working through MyEconLab assignments connected to any of these objectives.

Chapter 22

 

  After reading this chapter, you should be able to:

  1. Distinguish between the short-run and the long-run
  2. Understand what is meant by a production function and be able construct a table illustrating this concept.
  3. Define what is meant by diminishing marginal product and illustrate the concept in a table.
  4. Differentiate between variable and fixed costs in the short run.
  5. Define what is meant by marginal cost, explain how it is related to diminishing marginal product and the other cost curves, and sketch a graph of it in relationship to the other cost curves.
  6. Describe the relationship between Total Cost, Average Fixed Cost, Average Variable Cost, Average Total Cost, and Marginal Cost.
  7. Identify and graph AFC, AVC, ATC, and MC curves. 
  8. Explain how the long-run cost curve is related to short-run average cost curves.
  9. Define what is meant by economies of scale/diseconomies of scale and sketch a graph that illustrates these concepts.
  10. Discuss Minimum Efficient Scale.

Chapter 23

 

  After reading this chapter, you should be able to:

  1. Discuss the characteristics of perfectly competitive market structure
  2. Understand the Demand curve for a perfectly competitive firm vs. the Demand curve for a perfectly competitive industry.
  3. Understand the formula for calculating Profits, MR, MC, P and the rule for profit maximization for a perfectly competitive firm.
  4. Understand the Pricing and Output decisions for perfectly competitive firms based on the desire to maximize profits.
  5. Calculate short-run profits/losses given price and cost information or by using a graph.
  6. Identify the short-run break-even and shut-down points for a firm on a graph or with the use of price and cost information.
  7. Describe the supply curve for a perfectly competitive firm and to identify it using a graph of such a firm's cost curves.
  8. Discuss price and profit signals determine entry and exit dynamics in competitive industries.
  9. Distinguish between industries that experience long-run decreasing costs, long-run constant costs, and long-run increasing costs.
  10. Discuss marginal cost pricing in competitive markets and be able to state how it relates to economic efficiency vs. market failure.

Chapter 24

 

  After reading this chapter, you should be able to:

  1. Define what it means for a firm to have a monopoly and identify situations that could give rise to a monopoly.
  2. Identify what a natural monopoly is and list all the ways that government action leads to monopoly.
  3. Explain the difference between the demand curve faced by a perfectly competitive firm and a monopoly and difference this makes to their respective marginal revenue curves.
  4. Discuss demand elasticity in relationship to monopoly.
  5. Define the profit maximizing rule for a monopolist, explain how it differs from a perfectly competitive firm, and identify the price and output levels of a monopolistic firm on a graph.
  6. Same as #35 and, in addition, be able to calculate a monopolist's profits from a graph or from price and cost data.
  7. Define what is meant by price discrimination, explain why firms like to practice price discrimination, and explain the characteristics of markets where price discrimination takes place.
  8. Explain the efficiency characteristics of Monopolistic markets compared to Competitive markets.
  9. Explain further the inefficiencies of Monopolistic markets and the misallocation of resource that result from them.
  10. Define what is meant by Consumer Surplus and identify it on a graph.(Appendix)

Chapter 25

 

  After reading this chapter, you should be able to:

  1. Define what is meant by a monopolistically competitive market structure and explain its characteristics relative to competitive and monopolistic market structures.
  2. Define the role that product differentiation plays in monopolistically competitive markets.
  3. Further discuss the characteristics of monopolistically competitive firms and implications these characteristics have on the demand and marginal revenue curves faced by such firms.
  4. Compare the equilibrium conditions (and their implied results) between monopolistically competitive and perfectly competitive firms.
  5. Discuss the short-run, profit maximizing, equilibrium position of monopolistically competitive firms using graphs or price, revenue, and cost data.
  6. Differentiate the short-run AND LONG RUN equilibrium situations of monopolistically competitive firms from perfectly competitive firms. (This is very similar to #35 above.)
  7. Repeat Learning Objectives 36.
  8. Explain the various ways monopolistically competitive firms try to differentiate their product or service from their competitors by establishing brand names and through advertising.
  9. Discuss various marketing strategies of monopolistically competitive firms and the types of goods and services that can be most effectively differentiated. (This Learning Objective is very similar to #38.)
  10. Discuss "information product" industries as examples of monopolistically competitive industries.