Structure Market equilibrium Quantity tax and equilibrium Tax incidence税收分担) Deadweight loss(额外净损失)

How Should a Monopoly Price? So far a monopoly has been thought of as a firm which has to sell its product at the same price to every customer. This is uniform pricing. Can price-discrimination-(差别定价 ) earn monopoly higher profits?

Structure Definition Consumption externality Production externality The tragedy of commons

Structure From Individual to Market Demand Functions Elasticities Revenue and ownprice- elasticity of demand Marginal revenue and price elasticity

Structure The cost minimization problem Average costs Returns to scale and total and average costs Short run and long run costs

Structure Utility function(效用函数) Definition Monotonic transformation(单调转换) Examples of utility functions and their indifference curves Marginal utility(边际效用) Marginal rate of substitution边际替代率 MRS after monotonic transformation

Revealed Preference Analysis Suppose we observe the demands (consumption choices) that a consumer makes for different budgets. This reveals information about the consumer's preferences. We can use this information to

Structure Money equivalent of utility gains to trade Consumer's' surplus Changes in consumer's' surplus Compensating and equivalent variations Producer's' surplus

Structure Endowments(禀赋) Budget constraints with endowments Net demands -Price offer curve Example: Labor supply Comparative statics Slutsky equation revisited

Structure Rational constrained choice Computing ordinary demands Interior solution内在解) Corner solution(角点解) “Kinky\ solution Example: Choosing taxes