CONTENTS
Preface;
1 Introduction;
3 The Budget Constraint and the Consumer'sOptimal Choice;
3.1 Introduction;
3.2 The Standard Budget Constraint, the Budget Set, and the Budget Line;
3.3 Shifts of the Budget Line;
3.4 Odd Budget Constraints;
3.5 Income and Consumption over Time;
3.6 The Consumer's Optimal Choice: Graphical Analysis;
3.7 The Consumer's Optimal Choice: Utility Maximization Subject to the Budget Constraint;
3.8 Two Solved Problems;
Exercises;
Appendix. Maximization Subject to a Constraint: The LagrangeFunction Method;
4 Demand Functions;
4.1 Introduction
4.2 Demand as a Function of Income;
4.3 Demand as a Function of Price;
4.4 Demand as a Function of Price of the Other Good;
4.5 Substitution and Income Effects;
4.6 The Compensated Demand Curve;
4.7 Elasticity; 4.8 The Market Demand Curve;
4.9 A Solved Problem; Exercises;
5 Supply Functions for Labor and Savings;
5.1 Introduction to the Supply of Labor;
5.2 Choice between Consumption and Leisure;
5.3 Substitution and Income Effects in Labor Supply;
5.4 Other Types of Budget Constraints;
5.5 Taxing the Consumer's Wages;
5.6 Saving and Borrowing: The Intertemporal Choice of Consumption
5.7 The Supply of Savings;
5.8 A Solved Problem; Exercises;
6 Welfare Economics 1: The One-Person Case;
6.1 Introduction;
6.2 Welfare Comparison of a Per-Unit Tax and an Equivalent Lump-Sum Tax;
6.3 Rebating a Per-Unit Tax; 6.4 Measuring a Change in Welfare for One Person;
6.5 Measuring Welfare for Many People; A Preliminary Example;
6.6 A Solved Problem;
Exercises;
Appendix. Revealed Preference;
7 Welfare Economics 2: The Many-Person Case;
7.1 Introduction;
7.2 Quasilinear Preferences;
7.3 Consumer's Surplus;
7.4 A Consumer's Surplus Example with Quasilinear Preferences
7.5 Consumers' Surplus;
7.6 A Last Word on the Quasilinearity Assumption;
7.7 A Solved Problem;
Exercises; II Theory of the Producer;
8 Theory of the Firm 1: The Single-Input Model;
8.1 Introduction;
8.2 The Competitive Firm's Problem, Focusing on Its Output;
8.3 The Competitive Firm's Problem, Focusing on Its Input;
8.4 Multiple Outputs;
8.5 A Solved Problem; Exercises;
9 Theory of the Firm 2: The Long-Run, Multiple-Input Model;
9.1 Introduction;
9.2 The Production Function in the Long Run;
9.3 Cost Minimization in the Long Run;
9.4 Profit Maximization in the Long Run;
9.5 A Solved Problem
Exercises10 Theory of the Firm 3: The Short-Run, Multiple-Input Model;
10.1 Introduction;
10.2 The Production Function in the Short Run;
10.3 Cost Minimization in the Short Run;
10.4 Profit Maximization in the Short Run;
10.5 A Solved Problem; Exercises;
III Partial Equilibrium Analysis: Market Structure;
11 Perfectly Competitive Markets;
11.1 Introduction;
11.2 Perfect Competition;
11.3 Market/Industry Supply;
11.4 Equilibrium in a Competitive Market;
11.5 Competitive Equilibrium and Social Surplus Maximization;
11.6 The Deadweight Loss of a Per-Unit Tax;
11.7 A Solved Problem;
Exercises