1. IB Economics SL Syllabus Content Review Section 2: Microeconomics

2. Markets Markets Definition of markets with relevant local, national and international examples Brief descriptions of perfect competition, monopoly and oligopoly as different types of market structures, and monopolistic competition, using the characteristics of the number of buyers and sellers, type of product and barriers to entry. Importance of price as a signal and as an incentive in terms of resource allocation

3. Demand Definition of demand Law of demand with diagrammatic analysis Determinants of demand Fundamental distinction between a movement along a demand curve and a shift of the demand curve Exceptions to the law of demand (the upward-sloping demand curve) Ostentatious (Veblen) goods Role of expectations Giffen goods

4. Supply Definition of supply Law of supply with diagrammatic analysis Determinants of supply Effects of taxes and subsidies on supply Fundamental distinction between a movement along a supply curve and a shift of the supply curve

5. Interaction of demand and supply Equilibrium market clearing price and quantity Diagrammatic analysis of changes in demand and supply to show the adjustment to a new equilibrium Price controls Maximum price: causes and consequences Ceiling (upside down house) Minimum price: causes and consequences Floor (upside down house) Price support/buffer stock schemes Commodity agreements

6. Supply and Demand Supply Supply Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_e con_supplyelasticity_1.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_e con_supplyelasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_e con_supplyelasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_e con_supplyelasticity_1.htm Demand Demand Online presentation: http://www.tutor2u.net/decks/econdeck53.asp Online presentation: http://www.tutor2u.net/decks/econdeck53.asp http://www.tutor2u.net/decks/econdeck53.asp

7. Elasticity Price elasticity of demand (PED) Formula Definition Possible range of values Varying elasticity along a straight-line D curve Determinants of price elasticity of demand Cross-elasticity of demand Definition Formula Significance of sign with respect to complements and substitutes Income elasticity of demand Definition Formula Normal goods Inferior goods

8. Elasticity Price elasticity of supply Definition Formula Possible range of values Determinants of price elasticity of supply Applications of concepts of elasticity PED and business decisions: the effect of price changes on total revenue PED and taxation Cross-elasticity of demand: relevance for firms

9. Elasticities: Price, Income, Cross Price elasticity Price elasticity Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_priceel asticity_1.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_priceel asticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_priceel asticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_priceel asticity_1.htm Definitions and calculations Definitions and calculations Review quiz: Review quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_elasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_elasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_elasticity_1.htm Income and cross elasticity Income and cross elasticity Definitions and calculations Definitions and calculations

10. Online presentation: http://www.tutor2u.net/decks/econdeck30.asp Online presentation: http://www.tutor2u.net/decks/econdeck30.asp http://www.tutor2u.net/decks/econdeck30.asp Review quiz: Review quiz: http://www.tutor2u.net/quiz/economics/jbc_e con_crosspriceelasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_e con_crosspriceelasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_e con_crosspriceelasticity_1.htm http://www.tutor2u.net/quiz/economics/jbc_e con_crosspriceelasticity_1.htm IB Review Questions: Markets and Elasticity: http://www.bized.ac.uk/stafsup/options/qbank /page4.htm IB Review Questions: Markets and Elasticity: http://www.bized.ac.uk/stafsup/options/qbank /page4.htm http://www.bized.ac.uk/stafsup/options/qbank /page4.htm http://www.bized.ac.uk/stafsup/options/qbank /page4.htm Normal goods Normal goods Inferior goods Inferior goods PED and total revenue PED and total revenue Effect of elasticities on business Effect of elasticities on business

11. The Firm: Micro Economics definitions: definitions: Revenue Revenue total profit total profit gross profit gross profit fixed costs fixed costs variable costs variable costs total costs total costs marginal cost marginal cost Shut down point Shut down point

12. Market Structure IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page10.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page10.htm http://www.bized.ac.uk/stafsup/options/qbank/page10.htm Imperfect competition v perfect competition Imperfect competition v perfect competition Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_perfectcom petition_1.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_perfectcom petition_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_perfectcom petition_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_perfectcom petition_1.htm Price determination Price determination Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_pr icetheory_1.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_pr icetheory_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_pr icetheory_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_pr icetheory_1.htm

13. Imperfect Competition Monopolistic competition Monopolistic competition Oligopoly Oligopoly http://www.tutor2u.net/decks/econdeck49.asp http://www.tutor2u.net/decks/econdeck49.asp http://www.tutor2u.net/decks/econdeck49.asp Monopoly Monopoly http://www.tutor2u.net/quiz/economics/jbc_econ_m onopoly_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_m onopoly_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_m onopoly_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_m onopoly_1.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page11.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page11.htm http://www.bized.ac.uk/stafsup/options/qbank/page11.htm Product differentiation Product differentiation

14. The Firm: Production IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page8.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page8.htm http://www.bized.ac.uk/stafsup/options/qbank/page8.htm Producer – consumer sovereignty Producer – consumer sovereignty Productive and allocative efficiency Productive and allocative efficiency http://www.tutor2u.net/quiz/economics/jbc_econ_consumer_ producer_surplus_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_consumer_ producer_surplus_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_consumer_ producer_surplus_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_consumer_ producer_surplus_1.htm Economies of scale: http://www.tutor2u.net/decks/econdeck19.asp Economies of scale: http://www.tutor2u.net/decks/econdeck19.asp http://www.tutor2u.net/decks/econdeck19.asp

15. The Firm: costs and cost curves IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page6.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page6.htm http://www.bized.ac.uk/stafsup/options/qbank/page6.htm http://www.bized.ac.uk/stafsup/options/qbank/page6.htm The Firm: Equilibrium (mc, vc, tc curves) The Firm: Equilibrium (mc, vc, tc curves) IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page7.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page7.htm http://www.bized.ac.uk/stafsup/options/qbank/page7.htm http://www.bized.ac.uk/stafsup/options/qbank/page7.htm

16. Micro review: Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_1.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_1.htm http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_1.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_2.htm Review Quiz: http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_2.htm http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_2.htm http://www.tutor2u.net/quiz/economics/jbc_econ_te st_as_micro_2.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page1.htm IB Review Questions: http://www.bized.ac.uk/stafsup/options/qbank/page1.htm http://www.bized.ac.uk/stafsup/options/qbank/page1.htm http://www.bized.ac.uk/stafsup/options/qbank/page1.htm