LAHORE SCHOOL OF ECONOMICS

INTRODUCTION TO MICRO
ECONOMICS ( ECO 101)

Program BBA/BSC I Winter 2023 Section A,C,H, & I

Credit Hours 3 CHs
Duration 16 Weeks
Prerequisites None
Resource Person Shamyla Chaudry/Faisal
Class timings

Office & Ext. Alumni Office, FH-9, Ext. 149

Office Hours Mondays 12 Noon to 2.45 pm, Tuesdays & Wednesdays 10.00am to
12 Noon.

E-mail shamyla@lahoreschool.edu.pk or cshamyla@gmail.com

Teaching Assistant LALARUKH SCHKOH (I), SIDRA IRFAN (A),QURATUL AIN

(C)&SAADIA HUSSAIN (H)

Shamyla Chaudry | ECO (101) 1

 Course: INTRODUCTION TO MICRO ECONOMICS
BBA/BSC I (August -December) Winter 2022

SYLLABUS

I. Introduction: Economics Issues

II. The Elementary Theory of Demand and Supply: Demand, Supply and price,
Elasticity of Demand and Supply, Demand in Action.

III. The Intermediate Theory of Demand: Marginal Utility, Indifference Preference

Theory.

IV. The Intermediate Theory of Supply: The Firm, Production and Cost, Cost and
Output, Perfect Competition, Monopoly, Imperfect Competition and the Theory of
Firm and Industry.

V. The Theory of Distribution: The Income of Labor.

VI. Microeconomics Policy: Public Policy towards Monopoly and Competition, the Case
for Free-Market Economies, the Case for Government Intervention, Aims and
Objectives of the Government.

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Course Description & Objectives: The basic objective of this course is to familiarize students
with a working knowledge of Microeconomics and to build a thorough understanding of the
theory of the consumer and producer.
Teaching Strategy: The lecture will be divided in two parts, the first being 1 hour long in which
the text will be explained, followed by a 30 minute discussion session, devoted to using and
applying the knowledge gained in class through individual as well as group activities. Primarily,
these sessions will consist of case studies, problem sets, presentations and most important of all
quizzes. The student should be prepared to expect a quiz in the class after the completion of a
particular section. Attendance is compulsory throughout the semester, failing to comply with this
will result in negative marks on your final grade.
Student Portal: All lecture slides, readings, solution to quizzes, assignment and quiz grades on
the student portal(student.lahoreschool.edu.pk) . All assignments submissions on the student
portal.
Quizzes: There will be 5 quizzes throughout the semester. CELL PHONES MAY NOT BE
USED AS CALCULATORS. If a quiz is missed for a valid excuse the student will not be
allowed to retake the quiz, however if the student misses one quiz during the entire semester an
average of the 4 quizzes with a 20% deduction will be calculated in lieu of the missed quiz
Attendance Policy
1% will be deducted for each absent class. If a student is absent for more than 8 classes in the
course, then the student will be dropped from the course and given an I (incomplete) grade in the
course.0.25% will be deducted for a late present.
Problem Sets/ Assignments
There will be approximately 10 problem sets and assignments throughout the semester. Problem
sets on each topic solved in class with students. Followed by a graded assignment that will
contribute to 1% of your grade. Students may work together on Assignments, with a maximum
of eight students per group or a minimum of 6 .However, each student in the group must turn in
their OWN responses to the problem set (i.e. one assignment with all member’s names on it will
not be accepted). Assignments submitted later than the deadline time on the date of submission,
there will be a 20% deduction from the score earned, and no assignments accepted after the date
of submission. All submissions on the student portal.

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 Course Learning Objectives

The course has been designed to achieve the following objectives:

CLO 1. Students will be able to relate the concept of scarce resources and unlimited wants.
CLO 2. Students will understand how markets work and how prices are determined.
CLO 3. Students will understand the theory of a single consumer, how is demand determined.
CLO 4. Students will be able to assess the level of competition amongst firms in the industry
and hence how is supply determined.
CLO 5. Students will be able to question various policies like support prices, price ceilings ,the
imposition of taxes on different types of demand(elastic and inelastic) and determine strategies
on day to day running of business decisions regarding pricing based on different levels of
consumer demand (elastic and inelastic).

Program Learning Objectives

PLO 1. To equip students with a sound knowledge of economics allowing them to

critically think about and respond to problems in a challenging global economy.
PLO 2. To produce graduates who can use economic reasoning to solve difficult
problems faced by economic actors including firms, households and policy makers.
PLO 3. To develop and nurture the leadership potential and make them realize the
importance of teamwork and collaborative environment in a challenging academic
environment.
PLO 4. To develop the skills to effectively communicate ideas, analysis and proposed
solutions to real world problems.
PLO 5. To produce graduates with advanced knowledge and in-depth understanding
of the theories, principles and analytical techniques to tackle issues in economics and
business policy.
PLO 6. To equip students with the abilities and analytical skills to contribute towards
financial management of organizations.

Indicate below how the course learning objectives specifically relate to any program learning goals

Shamyla Chaudry | ECO (101) 4

and objectives.
Program Learning Objectives
PLO 1. To equip students with a
sound knowledge of economics
allowing them to critically think
about and respond to problems
in a challenging global economy.
PLO 2. To produce graduates
who can use economic reasoning
to solve difficult problems faced
by economic actors including
firms, households and policy
makers.
PLO 3. To develop and nurture
the leadership potential and
make them realize the
importance of teamwork and
collaborative environment in a
challenging academic
environment.
PLO 4. To develop the skills to
effectively communicate ideas,
analysis and proposed solutions
to real world problems.
PLO 5. To produce graduates
with advanced knowledge and
in-depth understanding of the
theories, principles and
analytical techniques to tackle
issues in economics and business
policy.
PLO 6. To equip students with
the abilities and analytical skills
to contribute towards financial
management of organizations.
Course Learning Objectives Course Assessment Item
Students will be able to relate the concept of Assignments, Cases, Problem Sets &
scarce resources and unlimited wants. (CLO 1) Quizzes, Exams
Students will understand how markets work and
how prices are determined. (CLO 2)
Students will understand the theory of a single
consumer, how is demand determined.(CLO3)
Students will be able to assess the level of
competition amongst firms in an industry and
hence how is supply determined.(CLO4)
Students will be able to question various policies Problem Sets, Quizzes &
like support prices, price ceilings, the imposition Presentations
of taxes on different types of demand (elastic
and inelastic) and determine strategies on day to
day running of business decisions regarding
pricing based on different levels of consumer
demand (elastic and inelastic). (CLO 5)
Students will be able to question various policies Cases, Problem Sets & Presentations
like support prices, price ceilings, the imposition
of taxes on different types of demand(elastic and
inelastic) and determine strategies on day to day
running of business decisions regarding pricing
based on different levels of consumer demand
(elastic and inelastic). (CLO 5)
Students will be able to relate the concept of Assignments, Group Excel Activity
scarce resources and unlimited wants. (CLO 1) & final term presentation
Students will understand how markets work and Cases ,problem sets & final term
how prices are determined. (CLO 2) Presentations
Students will be able to assess the level of
competition amongst firms in an industry and
hence how is supply determined.(CLO4)
Students will understand how markets work and Cases ,problem sets & final term
how prices are determined. (CLO 2) Presentations
Students will be able to assess the level of
competition amongst firms in the industry and
hence how is supply determined. (CLO 4)
Shamyla Chaudry | ECO (101) 5
Recommended Text Book
1. Campbell R McConnell , Stanley L.Brue & Sean M. Flynn, Economics, 22stEdition (MB)
2. Lipsey &Chrystal , Economics,14th Edition(L)
Reference Books

1. Robert S Pindyck, Daniel L Rubinfeld, Micro Economics,9th Edition (RP)

2. Parkin Michael, Micro Economics 14th edition

Pedagogy
The course is heavily based on lectures followed by problem sets and case studies and will be
supplemented by in class assignments.
Examinations
There will be two examinations for this course. Mid-term exam (20%) in the middle of semester
and a final exam (35%) at the end of the semester. All lectures will be included in final exam.
The exams will consist of problems and theory questions based on assignments, class lectures,
and case discussions. No make-up exam will be given except for medical emergencies. The
make-up exam will only be administered if the request is approved by Lahore School
administration.
Missed Exam Policy
The controller of examinations must determine that a valid excuse has been accepted. If a mid-
term is missed with a valid excuse, the make-up will be given with the final exam. If a final-term
is missed with a valid excuse, the make-up will be given in the following semester during the
mid-term week. Any approved make up exam will be subject to a 20% deduction.
Unexcused missed mid-terms will receive a grade of zero. For unexcused missed final-term,s
students will have to take it the following year (i.e. the next time the course is offered). Students
without a valid excuse for the final exam will have to re-take the course.
Presentation Guidelines
End Term Presentation is based on the analysis of competition in Pakistani Industry. Each group
will have to choose an industry of their own choice to research on their sales, the number of
firms in that industry, the nature of the product, the barriers to entry, the prices and the
promotion strategies. With the help of this information the group would have to classify the
industry structure as perfectly competitive, monopoly, monopolistic competitive or oligopoly.

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Please note that the Lahore School Regulations on Student Code of Behaviour specifies penalties
for plagiarism in reports, research papers and presentations in courses taken and in articles
published while studying at the Lahore School.
Presentations by individual students/group of students must adhere to the following guidelines:
 Students’ attire should be formal.
 Should be completed within the given time frame.

 Each member of a group has to participate in the presentation

Policy on Plagiarism/Cheating
The plagiarism in group project/presentation or cheating during exam will result in a 0 on the
presentation. The students must note that plagiarism include the submission/presentation of a
report/article that has been previously used for another course (even by the same author) or using
the graded material of this course for some other course.
Lahore School of Economics Plagiarism Policy
Lahore School adheres strictly to HEC plagiarism policy available on the HEC website and
Lahore School handbook on plagiarism policy. The policy can be found at:
http://hec.gov.pk/english/services/faculty/Documents/Plagiarism/Plagiarism%20Policy.pdf
Assessment Criteria
The following will be the assessment criterion for the course

Final Exam 35%

Mid Term 20%
Quizzes 25%
Class Assignments 10%
End Term Presentation 5%
Attendance 5%
Core Requirements
1. Calculator (No Exceptions) CELL PHONES MAY NOT BE USED AS
CALCULATORS.
2. Note Book Students are encouraged to take class notes, hence they must come prepared
with a notebook and a pen or pencil in every class.
3. Name Card for display in class room.
4. The students are expected to read the assigned cases and background readings in advance.

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 CALENDAR OF ACTIVITIES
Week
TOPIC Discussion Topics Suggested Readings
 Introduction to Micro Economics:  Case: Cutting up the
Economic Issues, the source of Military
economic problems.  Chapter 1 RP
INTRODUCTION
 Opportunity Cost and Production  Chapter 1 MB
1
Possibility Frontiers
 Problem Set 1
 Case: Ford is Bullish
about its New Taurus
 Demand and Supply  Case: Grocery cart
MARKET
 The Determination of Price wars
2 EQUILIBRIUM
 Problem Set 2  Chapter 2 RP
 Chapter 3 MB

 Case: Case Study:

Nintendo, Sega Zap,
Prices as video games
war heats up
 Elasticity of Demand
3,4 ELASTICITES  Case: The Battle
 Elasticity of Supply
Against Bottlenecks
 Chapter 2 RP
 Chapter 6 MB

 Marginal Utility, the Utility theory of

demand
 Problem set 3  Case: Big Beer Makers
 Indifference Preference Theory  Case: US oil output
 How the consumer reaches equilibrium drops consumption also
 Problem set 4 falls
THEORY OF  How the consumers respond to changes  Case: India Shedding
THE in income & price on x- axis Tears over Onion Prices
5,6,7 CONSUMER  Problem set on the income and (HBS Case)
substitution effect  Chapter 7 MB
 How the consumers respond to a  Chapter 3 RP
decrease and increase in price on x-axis  Chapter 4 RP
 How the consumers respond to a
decrease in price and increase in price y-
axis
MID TERM EXAMINATION
8
COST OF  The Intermediate theory of supply, firm  Case: German firms
PRODUCTION ,production and costs, the firm in bemoan costs
9 practice in the short run  Chapter 9 MB
 Problem Set 5  Chapter 4 L

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  The Intermediate theory of supply, firm
,production and costs, the firm in
practice in the long run
 Perfect competition, market structure
and firm behavior, elements of theory of
perfect competition in short run
equilibrium  Chapter 10 MB
PERFECT
 Problem Set 6  Chapter 11 MB
1O,11 COMPETITION
 Perfect competition, market structure  Chapter 5 L
and firm behavior, elements of theory of
perfect competition in long run
equilibrium

 Case: Balancing the

Trade-Offs Between
Competition and
 Monopoly a single price monopolist Stability: Private Banks
 Problem Set 7 and Public Policy (HBS
 Monopoly &cartels as monopolies, a Case)
multi price monopolist: price  Case: OPEC
IMPERFECT
discrimination  Case: Anti-Trust Laws
COMPETITION
12.13  Imperfect Competition, imperfectly in the US/Competition
competitive market structures. Imperfect Board in Pakistan
competition among the many  Chapter 12 MB &
 Problem Set 8 Chapter 6 L
 Imperfect competition among the few(  Chapter 13 MB &
 Problem Set 9 Chapter 7 L
 Chapter 14 MB &
Chapter 7 L

THE PRICING
 The pricing and employment of
AND
14 resources: wage determination  Chapter 17 MB
EMPLOYMENT
 Problem Set 10
OF
RESOURCES:
COURSE
REVIEW AND  Presentations on Concentration ratio and
15
END TERM H-H Index
PRESENTATION

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 16 FINAL TERM EXAMINATION

Lecture # Lecture Subjects Discussion Sessions

1 Introduction to Micro Economics: Economic issues, the Assignment 1
source of economic problems. (chapter 1 RP)
2 Opportunity Cost and Production Possibility Case Study: Cutting up the Military
Frontiers(chpt 1MB) Problem Set 1
3 Demand and Supply(chpt2 RP&chpt3 MB ) Case: Ford is Bullish about its New Taurus
Case: Grocery cart wars
4 The Determination of Price(chpt2 RP& chpt 3 MB) Problem set 2
Assignment 2
5 QUIZ I(L1,&2) QUIZ I(L1,&2)

6 Elasticity of Demand (chpt6 MB &chpt 2 RP) Case Study: Nintendo, Sega Zap, Prices as video
games war heats up
7 Elasticity of Supply (chpt 2 RP& chpt6 MB) Case Study: The Battle Against Bottlenecks
Problem set 3
Assignment 3
8 Marginal Utility, the Utility theory of demand(chpt7 Case Handout: Big Beer Makers
MB)
9 Marginal Utility, the Utility theory of demand(chpt7 Problem Set 4
MB) contd Assignment 4
10 QUIZ II(L3,4,6&7) QUIZ II(L3,4,6,&7)
11 Indifference Preference Theory (chpt3 RP) How the consumer reaches equilibrium (chpt3 RP)
Problem set 5A
12 How the consumers respond to a decrease and How the consumers respond to changes in
increase in price on x-axis(chpt 4 RP) income& price on x- axis(chpt 4 RP) Case Study:
Shamyla Chaudry | ECO (101) 10
 US oil output drops consumption also falls
13 How the consumers respond to a decrease and Assignment 5
increase in price on Y-axis(chpt 4 RP) Problem set 5B
14 Mid Term Revision Assignment Case: India Shedding Tears over Onion Prices(HBS
Case)
15 MID TERM EXAM MID TERM EXAM
16 The Intermediate theory of supply, firm ,production Problem set 6
and costs, the firm in practice in the short run(chpt Assignment 6
9MB & chpt 4 L)
17 QUIZ III(L8,9,10,11,12&13) QUIZ III(L8,9,10,11,12&13)
18 The Intermediate theory of supply, firm ,production Case Study: German firms bemoan costs
and costs, the firm in practice in the long run(chpt 9
MB &chpt 5 L)
19 Perfect competition, market structure and firm Problem set 7
behavior, elements of theory of perfect competition in Assignment 7
short run equilibrium (chpt10 MB &chpt 6 L)
20 Perfect competition, market structure and firm Contd. Problem set 7 & Discussion on the role of
behavior, elements of theory of perfect competition in Government.
long run equilibrium(chpt11 MB &chpt 6 L) Assignment 7
21 Monopoly a single price monopolist (chpt 7 L &chpt Problem set 8 & Discussion on the role of
12 MB) Government .
22 QUIZ IV (L 16,18,19&20) QUIZ IV (L 16,18,19&20)
23 Monopoly &cartels as monopolies, a multi price Case: Balancing the Trade-Offs Between
monopolist: price discrimination (chpt7 L &chpt 12 Competition and Stability: Private Banks & Public
MB) Policy (HBS Case)
Assignment 8
24 Imperfect Competition, imperfectly competitive market Discussion on the role of Government.
structures. Imperfect competition among the many Case Study: OPEC
(chpt8 L &chpt 13 MB) Problem set 9
25 Imperfect competition among the few(chpt8 L &chpt Contd.Problem Set 9 & Discussion on the role of
14 MB) Government. Efficiency vs Equity
Case Study :Anti-Trust Laws in the US(chpt 21
MB/Competition Board in Pakistan
Assignment 9
26 The pricing and employment of resources: wage Problem Set 10
determination (chpt 17MB) Assignment 10

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27 QUIZ V (L 21,23,24,25 &26) QUIZ V (L 21,23,24,25 &26)

28 Presentations on Concentration ratio and H-H Index Presentations on Concentration ratio and H-H Index
29 Final Course Revision Revision Assignment
30 FINAL EXAM FINAL EXAM

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