Department of Business Administration

Course Title:
Course Code:
Pre-requisite Courses:
Credit Hours:
Semester:
Degree:

Principles of Microeconomics
ECO211
Introduction to Business
Three (3)
Second (2)
BBA Program

Course Description:
The course introduces the students to the fundamentals of economics and how individual
units operate in the economy. The topics included are introduction to microeconomics,
law of demand and supply, theory of cost and market mechanism, price and output
determination under different market structures.
Course Objectives:
The course has been designed to enable the students:
1.
2.
3.
4.

To understand and discuss the fundamental concepts of Economics

To have a sound idea of the factors involved in allocating of scarce resource
To identify the roles carried out by different markets
To posses a theoretical awareness of basic economic theories and models for
allocation of scarce resources to derive achieve maximum satisfaction

Learning Outcomes: At the end of this course it is expected that the student should be
able to:
1. Create a meaningful understanding of basic concepts about economics.
2. Analyze the allocation of scarce resources.
3. Use of limited resource to fulfill the maximum needs and wants.
4. Apply the concept of opportunity cost and apply this concept to his practical life.
5. Analyze Economic problem of allocation and distribution of resources.
6. Explain concept and factors that determine demand and supply.
7. To create an understanding of elasticity of demand and supply.
8. Differentiate between change in quantity supplied and change in supply.
9. Discuss equilibrium level of price and may comment about shortages and surpluses.
10. Describe and analyze the total revenue, average and marginal revenue.
11. Discuss total cost and its different features.
12. Discuss different examples related to this market structure.

1|P age

Teaching Methodology:
Learning will be accomplished through lectures, outside readings, case analysis and
student participation in classroom discussion and presentations. Grading will tend to
focus on students overall personality rather than on one or two aspects
Code of Conduct:
Students have to follow the rules stated below to avoid a failing grade in the course:
Understand and follow the University policy regarding attendance.
Arrive in and leave the classroom strictly on time. Late arrival will be marked as
absence. If you leave the classroom in the middle of a session even for a short
while, you will be marked absent.
Keep your cell phone off during the class.
Do the assigned readings for a class before coming to the class.
Maintain a disciplined, cordial, and respectful attitude towards the teacher and
your fellow students.
Submit your homework on the due date before the class begins.
Do not plagiarize from books, journals, or the internet.
Do not cheat (make someone else do your work or present work for some other
course as work for this course).
The teachers decisions about marks and grade will be final
Course Contents:
Week Topics to be covered
1.
Introduction to Microeconomics and the use of graphs and
tables.
a) Definition of Economics
b)
Importance of Economics in our life
c) Needs vs. Wants
d) Opportunity Cost
e) Different Graphs and Curves
f) Ten Principles of Economics
2.
Thinking Like an Economist &
Interdependence and the Gains from Trade
a)
Think in terms of alternatives.
b) Evaluate the cost of individual and social choices.
c) How certain events and issues are inter-related.
d) The Economic Way of Thinking
i.e. Descriptive and Analytical (abstract reasoning)
e) Absolute Advantage and Comparative Advantage
f) Benefits of Trade
3.
Demand Model

Remarks

Assignment

Quiz
2|P age

4.

5.

6.
7.

8.

9.

a) Definition of demand
b) Quantity Demand
c) Determinants of Demand
d)
Law of Demand
e) Change in Quantity Demanded
f) Change in Demand
Supply Model and Market Equilibrium,
Effects of shifts in demand and supply curve on Market
Equilibrium
a) Definition of Supply
b) Quantity Supplied
c) Determinants of Supply
d)
Law of Supply
e) Change in Quantity Supplied and Change in Supply
f)
Market Equilibrium
Elasticity
a) What is elasticity?
b) Different types of elasticity
c)
Importance and use of elasticity
Elasticity (continued)
a) Producers and Consumers perspective
b) Elasticity and Total Revenue
Supply, Demand, The Costs of Taxation and Government
Policies
a)
Price Ceiling and Price Flooring
b) Consumer Surplus
c) Producer Surplus
d) What is tax
f) Effect of tax on market equilibrium.
g)
Deadweight loss
h) Effects of tax on total surplus
MID-TERM EXAMINATION
Cardinal Utility Theory
a) Introduction of cardinal and ordinal utility theory
b) Theory of consumer behavior
c) Law of diminishing marginal utility
d) Law of equi-marginal utility
Ordinal Utility Theory
a) Background of ordinal utility theory
b) Theory of consumer choice
c) Indifference Curve and Budget Line

Project

Assignment
&
Quiz

Assignment

Assignment
&
Quiz
3|P age

10.

11.

12.

13.

14.

15.

d) Total Price effect (Income effect and Substitution effect)

Production Theory and Cost Analysis
a) Total Revenue, Average Revenue and Marginal Revenue
b) Fixed and Variable Cost
c) Total Cost, Average Cost and Marginal Cost
d) Optimum Level of Production
e) Economies of scale
Isoquant and Isocost Approach
a) Overview of Isoquant and Isocost
b) The least cost factor combination
c) Producers Equilibrium and Optimization
Perfect Competition
a) Overview of Perfect Competition
b)
Its Characteristics (Advantages and Disadvantages)
c) Firms Equilibrium under Perfect Competition
d) Graphical presentation (Long run and Short run)
Monopoly and Monopolistic Competition
a) Overview of Monopoly and Monopolistic
b)
Its Characteristics (Advantages and Disadvantages)
c) Firms Equilibrium under Monopoly and Monopolistic
d) Graphical presentation (Long run and Short run)
Duopoly and Oligopoly Competition
a) Overview of Duopoly and Oligopoly
b)
Its Characteristics (Advantages and Disadvantages)
c) Firms Equilibrium under Duopoly and Oligopoly
d) Graphical presentation (Long run and Short run)
PROJECT PRESENTATIONS
FINAL EXAMINATION

Project
Feedback

Project
Final
Submission

Quiz

Rescheduling of Class:
The teachers at Iqra University are very particular about taking their classes, but in case
of an emergency, an alternate teacher may conduct the class. Students are informed
through SMS in case of rescheduling of a class.
Grading Policy:
A Grade:
B+ Grade:
B Grade:
C+ Grade:
C Grade:
F Grade:

88 and above
81-87
74-80
67-73
60-66
Below 60
4|P age

Marks Distribution of 100%:

Quizzes
Assignments/Case Studies:
Project/Project presentations:
Mid-term
Final Exam
Total

______10_____
______10_____
______15_____
______25_____
______40_____
100____

Recommended Reading(s):
1. Principles of Economics, N. Gregory Mankiw, South-Western College Pub, 6th
edition (February 10, 2011)
ISBN-10: 0538453052; ISBN-13: 978-0538453059
2. Economics, Michael Parkin, Prentice Hall, 11th edition (March 26, 2013)
ISBN-10: 0133423921; ISBN-13: 9780133423921
3. In addition the teacher may prescribe any additional reading material.
Reference Book(s):
th
1. Microeconomics, Robert Pindyck, Daniel Rubinfeld, Prentice Hall, 8 edition
(March 11, 2012)
ISBN-10: 013285712X; ISBN-13: 978-0132857123
2. Economics, Paul A. Samuelson, William D. Nordhaus, McGraw-Hill/Irwin, 18th
edition (July 27, 2004)
ISBN-10: 0072872055; ISBN-13: 978-0072872057
3. Economics Micro & Macro (CliffsAP), Ronald Pirayoff, Cliffs Notes, 1st edition,
(February 27, 2004)
ISBN-10: 076453999X; ISBN-13: 978-0764539992
4. *Principles of Microeconomics, Karl E. Case, Ray C Fair, Sharon Oster, Prentice
Hall, 11th edition *(Estimated Availability: May 10, 2013)
ISBN-10: 0133450872 ISBN-13: 9780133450873
5. Schaum's Outline of Microeconomics, Dominick Salvatore, McGraw-Hill, 4th
edition (January 27, 2011)
ISBN-10: 0071755454; ISBN-13: 978-0071755450

5|P age