Chapter and sections in Taylor to Read
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Pg #
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Comments/Assignment
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10 Perfect Competition |
191 |
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Quantity Produced by a Perfectly Competitive Firm |
192 |
Read- Important. Pay particular attention to Exhibits 10-3, 10-4, and 10-5 |
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Comparing Total Revenue and Total Cost |
192 |
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Comparing Marginal Revenue and Marginal Costs |
194 |
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Marginal Cost and the Supply Curve |
195 |
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Profits and Losses with the Average Cost Curve |
196 |
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The Shutdown Point |
196 |
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Short-Run Outcomes for Perfectly Competitive Firms |
199 |
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Entry and Exit in the Long Run |
200 |
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How Entry and Exit Lead to Zero Profits |
200 |
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Economic Profit vs. Accounting Profit |
201 |
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The Economic Function of Profits |
202 |
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Factors of Production in Perfectly Competitive Markets |
203 |
Skip this section for now. |
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The Derived Demand for Labor |
203 |
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The Marginal Revenue Product of Labor |
204 |
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Are Workers Paid as Much as They Deserve? |
205 |
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Physical Capital Investment and the Hurdle Rate |
206 |
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Physical Capital Investment and Long-Run Average Cost |
207 |
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Efficiency in Perfectly Competitive Markets |
208 |
Read – Important |
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Conclusion |
209 |
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Key Concepts and Summary |
209 |
review |
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Review Questions |
211 |
optional |
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In addition to the new readings listed above, it is useful to re-read and review the following sections that we studied in earlier Units. |
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2 Choice in a World of Scarcity |
15 |
Skip. Not relevant to this unit. |
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Choosing What to Consume |
16 |
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A Consumption Choice Budget Constraint |
16 |
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How Changes in Income and Prices Affect the Budget Constraint |
18 |
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Personal Preferences Determine Specific Choices |
18 |
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From a Model with Two Goods to the Real World of Many Goods |
20 |
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Choosing between Labor and Leisure |
20 |
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An Example of a Labor-Leisure Budget Constraint |
20 |
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How a Change in Wages Affects the Labor-Leisure Budget Constraint |
20 |
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Making a Choice Along the Labor-Leisure Budget Constraint |
22 |
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Choosing between Present and Future Consumption |
22 |
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Interest Rates: The Price of Intertemporal Choice |
23 |
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The Power of Compound Interest |
24 |
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An Example of Intertemporal Choice |
25 |
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Three Implications of Budget Constraints: Opportunity Cost, Marginal Decision-Making, and Sunk Costs |
26 |
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Opportunity Cost |
26 |
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Marginal Decision-Making and Diminishing Marginal Utility |
28 |
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Sunk Costs |
29 |
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The Behavior of Profit-Seeking Firms |
29 |
Re-read |
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Defining Profits |
29 |
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Why Earning High Profits Isn’t Easy |
30 |
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The Production Possibilities Frontier and Social Choices |
30 |
Skip. Not relevant to this unit. |
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The Shape of the Production Possibilities Frontier and Diminishing Marginal Returns |
32 |
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Productive Efficiency and Allocative Efficiency |
34 |
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Why Society Must Choose |
35 |
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Confronting Objections to the Economic Approach |
35 |
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A First Objection: People, Firms, and Society Don’t Act Like This |
35 |
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A Second Objection: People, Firms, and Society Should’t Do This |
37 |
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Facing Scarcity and Making Trade-offs |
38 |
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Key Concepts and Summary |
38 |
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Review Questions |
40 |
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7 Elasticity |
129 |
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Price Elasticity of Demand |
130 |
Pay attention to the concept of “perfect elasticity”. It is important for the demand of one firm in perfect competition. |
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Calculating the Elasticity of Demand |
131 |
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A Possible Confusion, a Clarification, and a Warning |
133 |
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Price Elasticity of Supply |
134 |
Skip. Not relevant to this unit. |
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Calculating the Elasticity of Supply |
134 |
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Elastic, Inelastic, and Unitary Elasticity |
135 |
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Applications of Elasticity |
139 |
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Does Raising Price Bring in More Revenue? |
139 |
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Passing on Costs to Consumers? |
140 |
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Long-Run vs. Short-Run Impact |
143 |
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Elasticity as a General Concept |
144 |
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Income Elasticity of Demand |
144 |
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Cross-Price Elasticity of Demand |
145 |
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Elasticity in Labor and Financial Capital Markets |
146 |
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Stretching the Concept of Elasticity |
146 |
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Conclusion |
147 |
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Key Concepts and Summary |
147 |
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Review Questions |
149 |
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