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**The Intermediate Micro Economics – I (ECON – 007) Course for BA (Hons) Economics Semester III, UGCF 2023, Delhi University has been taught by Mr. Dheeraj Suri. The Video Lectures are based upon the books prescribed by the University of Delhi. The Duration of Video Lectures is approximately 50 Hours.**

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**Demo Lectures**

**Demo Lectures****Demo PDF of Study Material**

Chapter-3-Utility

**Demo PDF of Study Material****Demo Quiz**

**Exam Pattern**

**The Question Paper of 90 Marks Will Have Two Parts (Part A & Part B)**

**Part A Will be of Marks and it is Based Upon **

**Part B Will be of Marks and it is based Upon **

**Course Content**** of Our ****Video Lectures**

**Course Content****of Our****Video Lectures****Lectures are as per Latest Syllabus for UGCF 2023**

**Unit I : Consumer Behaviour [ Marks]**

**Unit I : Consumer Behaviour [ Marks]**

**Chapter 1 : Budget Constraint [218 Minutes]**

**Based Upon Hal Varian Chapter 2**

**Number of Lectures 7 Lectures**

**Total Duration of Lectures 218 Minutes**

**Number of Questions in Notes 40 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Budget Constraint, Budget Set, Budget Line, Pivot & Shift in the Budget Line, Numeraire, Tax & Subsidies, Kink in the Budget Line, Rationing, Food Stamp Program****, Back Questions of Reading & Workbook**

**Budget Constraint, Budget Set, Budget Line, Pivot & Shift in the Budget Line, Numeraire, Tax & Subsidies, Kink in the Budget Line, Rationing, Food Stamp Program**

**, Back Questions of Reading & Workbook****Chapter 2 : Preference [213 Minutes]**

**Based Upon Hal Varian Chapter 3**

**Based Upon Hal Varian Chapter 3****Number of Lectures 7 Lectures**

**Total Duration of Lectures 213 Minutes**

**Number of Questions in Notes 61 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Consumer Preferences, Complete, Reflexive & Transitive Preferences, Indifference Curves, Economic Goods, Bads & Neutrals, Satiation Point, Discrete Goods, Well Behaved Preferences, Marginal Rate of Substitution****, Back Questions of Reading & Workbook**

**Consumer Preferences, Complete, Reflexive & Transitive Preferences, Indifference Curves, Economic Goods, Bads & Neutrals, Satiation Point, Discrete Goods, Well Behaved Preferences, Marginal Rate of Substitution****, Back Questions of Reading & Workbook****Chapter 3 : Utility [150 Minutes]**

**Based Upon Hal Varian Chapter 4**

**Number of Lectures 4 Lectures**

**Total Duration of Lectures 150 Minutes**

**Number of Questions in Notes 36 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Ordinal & Cardinal Utility, Utility Functions, Monotonic Transformations, Examples of Utility Functions (Cobb-Douglas, CES, Perfect Substitutes, Perfect Complements, Quasi Linear Utility Function etc.)****, Back Questions of Reading & Workbook**

**Ordinal & Cardinal Utility, Utility Functions, Monotonic Transformations, Examples of Utility Functions (Cobb-Douglas, CES, Perfect Substitutes, Perfect Complements, Quasi Linear Utility Function etc.)**

**, Back Questions of Reading & Workbook****Chapter 4 : Choice [319 Minutes]**

**Based Upon Hal Varian Chapter 5**

**Based Upon Hal Varian Chapter 5****Number of Lectures 9 Lectures**

**Total Duration of Lectures 319 Minutes**

**Number of Questions in Notes 81 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Consumer Equilibrium, Interior Optimum, Boundary Optimum, Concave Preferences, Demand Functions for Various Utility Functions, Income Tax V/s Quantity Tax****, Back Questions of Reading & Workbook**

**Consumer Equilibrium, Interior Optimum, Boundary Optimum, Concave Preferences, Demand Functions for Various Utility Functions, Income Tax V/s Quantity Tax**

**, Back Questions of Reading & Workbook****Chapter 5 : Demand [268 Minutes]**

**Based Upon Hal Varian Chapter 6**

**Number of Lectures 4 Lectures**

**Total Duration of Lectures 268 Minutes**

**Number of Questions in Notes 53 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Demand** Functions, Normal Goods, Inferior Goods, Giffen Goods, Income Offer Curve, Engel Curve, Price Offer Curve, Demand Curve, Substitutes and Complements**, Back Questions of Reading & Workbook**

**Demand**Functions, Normal Goods, Inferior Goods, Giffen Goods, Income Offer Curve, Engel Curve, Price Offer Curve, Demand Curve, Substitutes and Complements

**, Back Questions of Reading & Workbook**

**Chapter 6 : Revealed Preference [171 Minutes]**

**Based Upon Hal Varian Chapter 7**

**Based Upon Hal Varian Chapter 7****Number of Lectures 4 Lectures**

**Total Duration of Lectures 171 Minutes**

**Number of Questions in Notes 28 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Direct Revealed Preferences, Indirect Revealed Preferences, Weak Axiom of Revealed Preference (WARP), Strong Axiom of Revealed Preference (SARP), Quantity & Price Index Numbers and their effect on Consumers Welfare, Indexation of Social Security Payments****, Back Questions of Reading & Workbook**

**Direct Revealed Preferences, Indirect Revealed Preferences, Weak Axiom of Revealed Preference (WARP), Strong Axiom of Revealed Preference (SARP), Quantity & Price Index Numbers and their effect on Consumers Welfare, Indexation of Social Security Payments**

**, Back Questions of Reading & Workbook****Chapter 7 : Slutsky Equation [344 Minutes]**

**Based Upon Hal Varian Chapter 8**

**Number of Lectures 9 Lectures**

**Total Duration of Lectures 344 Minutes**

**Number of Questions in Notes 55 Questions**

**Number of MCQ Tests on this Chapter 4 Tests**

**Important Topics Covered**

**Price Effect, Income Effect, Substitution Effect, Slutsky Equation,** Separation of Income & Substitution Effect for Normal goods, Inferior Goods, Giffen goods and for Various Utility Functions, Law of Demand, Rebating a Tax, Voluntary Real Time Pricing, Hicksian Substitution & Income Effect**, Back Questions of Reading & Workbook**

**Price Effect, Income Effect, Substitution Effect, Slutsky Equation,**Separation of Income & Substitution Effect for Normal goods, Inferior Goods, Giffen goods and for Various Utility Functions, Law of Demand, Rebating a Tax, Voluntary Real Time Pricing, Hicksian Substitution & Income Effect

**, Back Questions of Reading & Workbook**

**Chapter 8 : Buying & Selling [441 Minutes]**

**Based Upon Hal Varian Chapter 9**

**Based Upon Hal Varian Chapter 9****Number of Lectures 8 Lectures**

**Total Duration of Lectures 441 Minutes**

**Number of Questions in Notes 33 Questions**

**Number of MCQ Tests on this Chapter 4 Tests**

**Important Topics Covered**

**Endowment, Gross Demand, Net Demand, Effect of Change in Endowment & Change in Price on Equilibrium**, Offer Curve, Demand Curve, Endowment Income Effect, Labour Supply, Effect of Change in Wage Rate & Overtime Wages on Labour Supply**, Back Questions of Reading & Workbook**

**, Offer Curve, Demand Curve, Endowment Income Effect, Labour Supply, Effect of Change in Wage Rate & Overtime Wages on Labour Supply**

**Endowment, Gross Demand, Net Demand, Effect of Change in Endowment & Change in Price on Equilibrium****, Back Questions of Reading & Workbook**

**Chapter 9 : Inter Temporal Choice [370 Minutes]**

**Based Upon Hal Varian Chapter 10**

**Number of Lectures 8 Lectures**

**Total Duration of Lectures 370 Minutes**

**Number of Questions in Notes 41 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Present Value, Future Value, Annuity, Inter Temporal Budget Constraint, Consumer’s Equilibrium with Intertemporal Budget Constraint, Effect of Change in Interest Rate & Change in Inflation Rate on Consumer’s Equilibrium, Slutsky Equation & Intertemporal Choice, Relation Between Real & Nominal Interest Rates, Bonds****, Back Questions of Reading** & Workbook** **

**Present Value, Future Value, Annuity, Inter Temporal Budget Constraint, Consumer’s Equilibrium with Intertemporal Budget Constraint, Effect of Change in Interest Rate & Change in Inflation Rate on Consumer’s Equilibrium, Slutsky Equation & Intertemporal Choice, Relation Between Real & Nominal Interest Rates, Bonds**& Workbook

**, Back Questions of Reading**

**Chapter 10 : Risk & Uncertainty [536 Minutes]**

**Based Upon Bernheim & Whinston Chapter 11**

**Based Upon Bernheim & Whinston Chapter 11****Number of Lectures 11 Lectures**

**Total Duration of Lectures 536 Minutes**

**Number of Questions in Notes 36 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Risk & State of Nature, Risk Preferences & Indifference Curves, Guaranteed Consumption, Expected Consumption, Certainty Equivalent, Risk Premium, Expected Utility, Nature & Demand for Insurance, Risk Management with Hedging, Diversification etc.****, Back Questions of Reading**

**Risk & State of Nature, Risk Preferences & Indifference Curves, Guaranteed Consumption, Expected Consumption, Certainty Equivalent, Risk Premium, Expected Utility, Nature & Demand for Insurance, Risk Management with Hedging, Diversification etc.****, Back Questions of Reading****Unit II : Decision Making Under Uncertainty [ Marks]**

**Chapter 10 : Risk & Uncertainty [536 Minutes]**

**Based Upon Bernheim & Whinston Chapter 11**

**Based Upon Bernheim & Whinston Chapter 11****Number of Lectures 11 Lectures**

**Total Duration of Lectures 536 Minutes**

**Number of Questions in Notes 36 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Risk & State of Nature, Risk Preferences & Indifference Curves, Guaranteed Consumption, Expected Consumption, Certainty Equivalent, Risk Premium, Expected Utility, Nature & Demand for Insurance, Risk Management with Hedging, Diversification etc.****, Back Questions of Reading**

**Risk & State of Nature, Risk Preferences & Indifference Curves, Guaranteed Consumption, Expected Consumption, Certainty Equivalent, Risk Premium, Expected Utility, Nature & Demand for Insurance, Risk Management with Hedging, Diversification etc.****, Back Questions of Reading****Unit III : Production behaviour & Markets [Marks]**

**Chapter 11 : Production Functions [452 Minutes]**

**Based Upon Nicholson & Snyder Chapter 9**

**Number of Lectures 14 Lectures**

**Total Duration of Lectures 452 Minutes**

**Number of Questions in Notes 56 Questions**

**Number of MCQ Tests on this Chapter 4 Tests**

**Important Topics Covered**

**Production Function, Average & Marginal Products, Diminishing Marginal Productivity, Relation Between TP**_{L}, AP_{L} & MP_{L}, Isoquants, Properties of Isoquants, Shape of Isoquants for Various Production Functions (eg., Cobb-Douglas, CES, Fixed Proportions, Linear Production Function, Leontief Production Function etc.), MRTS, Elasticity of Substitution, Returns to Scale, Homogeneous & Homothetic Production Functions**, Back Questions of Reading**

**Production Function, Average & Marginal Products, Diminishing Marginal Productivity, Relation Between TP**

*, AP*_{L}*& MP*_{L}*, Isoquants, Properties of Isoquants, Shape of Isoquants for Various Production Functions (eg., Cobb-Douglas, CES, Fixed Proportions, Linear Production Function, Leontief Production Function etc.), MRTS, Elasticity of Substitution, Returns to Scale, Homogeneous & Homothetic Production Functions*_{L}**, Back Questions of Reading****Chapter 12 : Cost Functions [453 Minutes]**

**Based Upon Nicholson & Snyder Chapter 10**

**Based Upon Nicholson & Snyder Chapter 10****Number of Lectures 9 Lectures**

**Total Duration of Lectures 453 Minutes**

**Number of Questions in Notes 41 Questions**

**Number of MCQ Tests on this Chapter 2 Tests**

**Important Topics Covered**

**Cost Functions, Cost Minimizing Input Choices, Contingent Demand for Inputs, Firm’s Expansion Path, Derivations of Cost Functions for Various Production Functions, Properties of Cost Functions, Shephard’s Lemma,** Short Run & Long Run Costs, Relation Between TC, AC, MC & AVC, Effect of Change in Input Prices on Cost Curves**, Back Questions of Reading**

**Short Run & Long Run Costs, Relation Between TC, AC, MC & AVC, Effect of Change in Input Prices on Cost Curves**

**Cost Functions, Cost Minimizing Input Choices, Contingent Demand for Inputs, Firm’s Expansion Path, Derivations of Cost Functions for Various Production Functions, Properties of Cost Functions, Shephard’s Lemma,****, Back Questions of Reading**

**Chapter 13 : Profit [288 Minutes]**

**Based Upon Nicholson & Snyder Chapter 11**

**Number of Lectures 6 Lectures**

**Total Duration of Lectures 288 Minutes**

**Number of Questions in Notes 21 Questions**

**Number of MCQ Tests on this Chapter 4 Tests**

**Important Topics Covered**

**Profit Maximization, MR & Elasticity, Price-Marginal Cost Breakup, Short Run Supply by a Price Taking Firm, Shut Down Decisions, Profit Functions, Properties of Profit Functions, Producer Surplus, Short Run & Long Run Profit Functions, Profit Maximization & Input Demand, Unconditional Input Demands, Substitution Effect, Output Effect, Back Questions of Reading **

**Profit Maximization, MR & Elasticity, Price-Marginal Cost Breakup, Short Run Supply by a Price Taking Firm, Shut Down Decisions, Profit Functions, Properties of Profit Functions, Producer Surplus, Short Run & Long Run Profit Functions, Profit Maximization & Input Demand, Unconditional Input Demands, Substitution Effect, Output Effect, Back Questions of Reading**

**Solutions of Previous Year Papers**

**2021 Paper**

**Duration of Lectures : 110 Minutes**

**2020 Paper**

**Duration of Lectures : 100 Minutes**

**2019 Paper**

**Duration of Lectures : 110 Minutes**

**2018 Paper**

**Duration of Lectures : 105 Minutes**

**2017 Paper**

**Duration of Lectures : 110 Minutes**

**2016 Paper**

**Duration of Lectures : 105 Minutes**

**Syllabus Prescribed by DU**

**DISCIPLINE SPECIFIC CORE COURSE -7 (DSC-7) : Intermediate Micro Economics – I (Behavourial Foundations of Market Interactions)**

**Course Description**

**Learning Objectives**

The Learning Objectives of this course are as follows:

- The course is designed to formally analyze the behaviour of individual agents like consumers and

producers under certain conditions. - Mathematical tools are used to facilitate understanding of the basic concepts.
- This course looks at the behaviour of the consumer and the choices of a competitive firm.

**Learning outcomes**

The Learning outcomes of this course are as follows:

- Students will learn the basic elements of consumption and production theories using various

technical frameworks. - This course provides them the behavioural foundations of market supply and demand.

**Syllabus**

**UNIT I: Consumer behaviour (15 hours)**Preference and utility, Budget and choice, Income and substitution effect, Demand derivation, Labour

supply, One-person welfare

**UNIT II: Decision-making under uncertainty (15 hours)**

Expected utility, Risk aversion, Insurance, Risk spreading

**UNIT III: Producer behaviour and markets (15 hours)**

Technology, Profit maximization, Cost minimization, Supply, Short and long run

**Recommended readings**

- Serrano, Roberto and Feldman, Alan (2012), A short course in intermediate Microeconomics with

Calculus, Cambridge University Press - Espinola-Arredondo, Ana and Mun˜oz-Garcia, Felix (2020), Intermediate Microeconomic Theory, MIT

Press - Osborne, M J and Rubinstein, A (2020), Models in Microeconomic Theory, Open Book Publishers
- Mun˜oz-Garcia,Felix (2017) Practice Exercises for Advanced Microeconomic Theory, MIT Press
- Dunaway, Eric; Strandholm, John C., Espinola-Arredondo, Ana and Munoz-Garcia, Felix (2020)

Practice Exercises for Intermediate MicroeconomicTheory, MIT press