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Intermediate Microeconomics

Free Intermediate Microeconomics study guide: 10 units with summaries, key ideas, flashcards and 300 practice questions with step-by-step solutions.

Lines up with: College intermediate microeconomic theory.

Units

1. UNIT 01

   Budget Constraints

   The budget constraint describes every bundle a consumer can afford; it is half of every consumer choice problem, so you must be able to draw it, shift it and read its slope instantly.
2. UNIT 02

   Preferences and Utility

   Preferences describe how a consumer ranks bundles; utility functions are a convenient way to write those rankings, and the MRS turns them into a willingness to trade that drives every choice.
3. UNIT 03

   Utility Maximization and Demand

   Putting preferences and the budget together gives the consumer's optimal choice; solving that problem for general prices and income produces demand functions, which are the basis for every market model.
4. UNIT 04

   Income and Substitution Effects (Slutsky)

   Every price change has two parts: a substitution effect from changed relative prices and an income effect from changed purchasing power; separating them explains the shape of demand curves and how to measure welfare.
5. UNIT 05

   Production Functions

   A production function describes how inputs become output; marginal products, isoquants and returns to scale are the tools that later determine a firm's costs and supply.
6. UNIT 06

   Cost Minimization and Cost Curves

   Firms choose the cheapest input mix for each output level; doing that for every output gives the cost function, whose short-run and long-run shapes drive supply decisions.
7. UNIT 07

   Perfect Competition and Welfare

   Competitive firms take prices as given and set price equal to marginal cost; free entry drives profits to zero, and the resulting equilibrium maximizes total surplus, which is why taxes and price controls create deadweight loss.
8. UNIT 08

   Monopoly and Price Discrimination

   A monopolist sets marginal revenue equal to marginal cost and charges a markup that depends on demand elasticity; price discrimination lets it capture more surplus and can change total welfare.
9. UNIT 09

   Game Theory and Oligopoly

   When a few firms interact, each one's best choice depends on what the others do; game theory provides the tools, and the Cournot, Bertrand and Stackelberg models show how oligopoly outcomes fall between monopoly and competition.
10. UNIT 10

    Market Failures: Externalities, Public Goods, Information

    Markets fail to reach efficiency when some costs or benefits are unpriced or when one side knows more than the other; this unit covers how to measure those failures and the policies that fix them.