Microeconomics: Theory and Applications with Calculus, Global Edition, 5th Edition
- Length: 849 pages
- Edition: 5
- Language: English
- Publisher: Pearson
- Publication Date: 2021-07-05
- ISBN-10: 1292359129
- ISBN-13: 9781292359120
- Sales Rank: #24994770 (See Top 100 Books)
This title is aPearson Global Edition. The Editorial team at Pearson has worked closely witheducators around the world to include content which is especially relevant tostudents outside the United States.
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Microeconomics:Theory and Applications with Calculus, 5th Edition, Global Edition remains thepremiere microeconomics text to marry formal theory with robust, thoroughlyanalyzed real-world problems. Intended as an intermediate microeconomics text,Perloff introduces economic theory through a combination of calculus, algebra,and graphs. It then integrates estimated, real-life problems and applications,using a step-by-step approach to demonstrate how microeconomic theory can beapplied to solve practical problems and policy issues. Compared with similartexts, the author places greater emphasis on using contemporary theories toanalyze markets, so students are prepared to apply economic theory to thelatest policy analysis in the field.
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Cover Half-Title Page Title Page Copyright Page Brief Contents Contents Preface Chapter 1 Introduction 1.1 Microeconomics: The Allocation of Scarce Resources Trade-offs Who Makes the Decisions How Prices Determine Allocations Application French Bonus-Malus Incentive System 1.2 Models Application Income Threshold Model and China Simplifications by Assumption Testing Theories Maximizing Subject to Constraints Positive Versus Normative New Theories 1.3 Uses of Microeconomic Models in Your Life and Career Summary Chapter 2 Supply and Demand Challenge Quantities and Prices of Genetically Modified Foods 2.1 Demand The Demand Function Summing Demand Functions Application Aggregating Corn Demand Curves 2.2 Supply The Supply Function Summing Supply Functions How Government Import Policies Affect Supply Curves 2.3 Market Equilibrium Finding the Market Equilibrium Forces That Drive a Market to Equilibrium 2.4 Shocking the Equilibrium: Comparative Statics Comparative Statics with Discrete (Large) Changes Application the Opioid Epidemic’s Labor Market Effects Comparative Statics with Small Changes Solved Problem 2.1 Why the Shapes of Demand and Supply Curves Matter 2.5 Elasticities Demand Elasticity Solved Problem 2.2 Application The Demand Elasticities for Google Play and Apple Apps Solved Problem 2.3 Supply Elasticity Solved Problem 2.4 Long Run Versus Short Run Application Oil Drilling in the Arctic National Wildlife Refuge Solved Problem 2.5 2.6 Effects of a Sales Tax Effects of a Specific Tax on the Equilibrium The Same Equilibrium No Matter Who Is Taxed Firms and Customers Share the Burden of the Tax Solved Problem 2.6 Application Subsidizing Ethanol The Similar Effects of Ad Valorem and Specific Taxes 2.7 Quantity Supplied Need Not Equal Quantity Demanded Price Ceiling Application Venezuelan Price Ceilings and Shortages Price Floor 2.8 When to Use the Supply-and-Demand Model Challenge Solution Quantities and Prices of Genetically Modified Foods Summary Exercises Chapter 3 A Consumer’s Constrained Choice Challenge Why Americans Buy E-books and Germans Do Not 3.1 Preferences Properties of Consumer Preferences Application You Can’t Have Too Much Money Preference Maps Indifference Curves Solved Problem 3.1 3.2 Utility Utility Function Willingness to Substitute Between Goods Solved Problem 3.2 Application Mrs Between Recorded Tracks and Live Music Curvature of Indifference Curves Solved Problem 3.3 Application Indifference Curves Between Income and Health 3.3 Budget Constraint 3.4 Constrained Consumer Choice Finding an Interior Solution Using Graphs Solved Problem 3.4 Finding an Interior Solution Using Calculus Solved Problem 3.5 Solved Problem 3.6 Solved Problem 3.7 Application Utility Maximization for Recorded Tracks and Live Music Finding Corner Solutions Minimizing Expenditure Solved Problem 3.8 3.5 Behavioral Economics Tests of Transitivity Endowment Effect Application How You Frame Policy Requirements Matters Salience Challenge Solution Why Americans Buy E-books and Germans Do Not Summary Exercises Chapter 4 Demand Challenge Paying Employees to Relocate 4.1 Deriving Demand Curves System of Demand Functions Graphical Interpretation Application Airplane Versus Train Travel 4.2 Effects of an Increase in Income How Income Changes Shift Demand Curves Solved Problem 4.1 Consumer Theory and Income Elasticities Solved Problem 4.2 Application Fast-Food Engel Curve Solved Problem 4.3 4.3 Effects of a Price Increase Income and Substitution Effects with a Normal Good Solved Problem 4.4 Application Substituting Cannabis for Prescription Drugs Solved Problem 4.5 Income and Substitution Effects with an Inferior Good Solved Problem 4.6 Compensated Demand Curve Solved Problem 4.7 Slutsky Equation 4.4 Cost-of-living Adjustment Inflation Indexes Effects of Inflation Adjustments Application Reducing the CPI Substitution Bias 4.5 Revealed Preference Recovering Preferences Substitution Effect Challenge Solution Paying Employees to Relocate Summary Exercises Chapter 5 Consumer Welfare and Policy Analysis Challenge Per-Hour Versus Lump-Sum Childcare Subsidies 5.1 Uncompensated Consumer Welfare Willingness to Pay An Individual’s Consumer Surplus A Market’s Consumer Surplus Application A Day with the President of the European Council Effect of a Price Change on Consumer Surplus Solved Problem 5.1 5.2 Compensated Consumer Welfare Indifference Curve Analysis Application Compensating Variation and Equivalent Variation for Smartphones and Facebook Compensated Demand Curves and Consumer Welfare Comparing the Three Welfare Measures Solved Problem 5.2 5.3 Effects of Government Policies on Consumer Welfare Quotas Food Stamps Application Cash, Food, or Vouchers? 5.4 Deriving Labor Supply Curves Labor-Leisure Choice Solved Problem 5.3 Income and Substitution Effects Solved Problem 5.4 Application Fracking Causes Students to Drop Out Solved Problem 5.5 Shape of the Labor Supply Curve Income Tax Rates and the Labor Supply Curve Solved Problem 5.6 Challenge Solution Per-hour Versus Lump-sum Childcare Subsidies Summary Exercises Chapter 6 Firms and Production Challenge Labor Productivity During Downturns 6.1 The Ownership and Management of Firms Private, Public, and Nonprofit Firms Application Chinese State-Owned Enterprises The Ownership of For-Profit Firms The Management of Firms What Owners Want 6.2 Production Production Functions Time and the Variability of Inputs 6.3 Short-Run Production: One Variable and One Fixed Input Solved Problem 6.1 Interpretation of Graphs Solved Problem 6.2 Law of Diminishing Marginal Returns Application Malthus and the Green Revolution 6.4 Long-Run Production: Two Variable Inputs Isoquants Application Self-Driving Trucks Substituting Inputs Solved Problem 6.3 Diminishing Marginal Rates of Technical Substitution The Elasticity of Substitution Solved Problem 6.4 6.5 Returns to Scale Constant, Increasing, and Decreasing Returns to Scale Solved Problem 6.5 Application Returns to Scale in Various Industries Varying Returns to Scale 6.6 Productivity and Technical Change Relative Productivity Innovations Application Robots and the Food You Eat Application A Good Boss Raises Productivity Challenge Solution Labor Productivity during Downturns Summary Exercises Chapter 7 Costs Challenge To Automate or not to Automate? 7.1 Measuring Costs Opportunity Costs Application The Opportunity Cost of an MBA Solved Problem 7.1 Opportunity Cost of Capital Sunk Costs 7.2 Short-Run Costs Short-Run Cost Measures Application The Sharing Economy and the Short Run Solved Problem 7.2 Short-Run Cost Curves Production Functions and the Shape of Cost Curves Application Short-run Cost Curves for a Japanese Beer Manufacturer Effects of Taxes on Costs Short-run Cost Summary 7.3 Long-run Costs Input Choice Solved Problem 7.3 Solved Problem 7.4 How Long-run Cost Varies with Output Solved Problem 7.5 Solved Problem 7.6 The Shape of Long-run Cost Curves Application 3D Printing Estimating Cost Curves Versus Introspection 7.4 Lower Costs in the Long Run Long-run Average Cost as the Envelope of Short-run Average Cost Curves Application A Beer Manufacturer’s Long-run Cost Curves Application Choosing an Inkjet or Laser Printer Short-run and Long-run Expansion Paths How Learning by Doing Lowers Costs Application Solar Power Learning Curves 7.5 Cost of Producing Multiple Goods Challenge Solution to Automate or Not to Automate? Summary Exercises Chapter 8 Competitive Firms and Markets Challenge Deregulating the Norwegian Taxi Market 8.1 Perfect Competition Price Taking Why a Firm’s Demand Curve Is Horizontal Perfect Competition in the Chicago Commodity Exchange Deviations from Perfect Competition Derivation of a Competitive Firm’s Demand Curve Solved Problem 8.1 Why Perfect Competition Is Important 8.2 Profit Maximization Profit Two Steps to Maximizing Profit 8.3 Competition in the Short Run Short-run Competitive Profit Maximization Solved Problem 8.2 Application Fracking and Shutdowns Short-run Firm Supply Curve Solved Problem 8.3 Short-Run Market Supply Curve Short-Run Competitive Equilibrium Solved Problem 8.4 8.4 Competition in the Long Run Long-run Competitive Profit Maximization Long-run Firm Supply Curve Application The Size of Ethanol Processing Plants Long-run Market Supply Curve Application Industries with High Entry and Exit Rates Application Upward-sloping Long-run Supply Curve for Cotton Application Reformulated Gasoline Supply Curves Solved Problem 8.5 Long-run Competitive Equilibrium Challenge Solution Deregulating the Norwegian Taxi Market Summary Exercises Chapter 9 Properties and Applications of the Competitive Model Challenge Liquor Licenses Freeze 9.1 Zero Profit for Competitive Firms in the Long Run Zero Long-run Profit with Free Entry Zero Long-run Profit When Entry Is Limited Application What’s a Name Worth? The Need to Maximize Profit 9.2 Producer Surplus Measuring Producer Surplus Using a Supply Curve Using Producer Surplus Solved Problem 9.1 9.3 Competition Maximizes Welfare Measuring Welfare Why Producing Less Than the Competitive Output Lowers Welfare Solved Problem 9.2 Application The Deadweight Loss of Christmas Presents 9.4 Policies That Shift Supply or Demand Curves Application Welfare Effects of Delaying 5G Technology 9.5 Policies That Create a Wedge Between Supply and Demand Curves Welfare Effects of a Sales Tax Application The Deadweight Loss from Gas Taxes Welfare Effects of a Price Floor Solved Problem 9.3 Application How Big Are Farm Subsidies and Who Gets Them? Welfare Effects of a Price Ceiling Solved Problem 9.4 Application The Social Cost of a Natural Gas Price Ceiling 9.6 Comparing Both Types of Policies: Trade Free Trade Versus a Ban on Imports Solved Problem 9.5 Application Russian Food Ban Free Trade Versus a Tariff Solved Problem 9.6 A Tariff Versus a Quota Rent Seeking Challenge Solution Liquor Licenses Freeze Summary Exercises Chapter 10 General Equilibrium and Economic Welfare Challenge Price Ceilings in a Pandemic 10.1 General Equilibrium Competitive Equilibrium in Two Interrelated Markets Application Partial-equilibrium Versus Multimarket-equilibrium Analysis in Corn and Soybean Markets Minimum Wages with Incomplete Coverage Solved Problem 10.1 Application Urban Flight 10.2 Trading Between Two People Endowments Mutually Beneficial Trades Solved Problem 10.2 Deriving the Contract Curve Solved Problem 10.3 Bargaining Ability 10.3 Competitive Exchange Competitive Equilibrium Solved Problem 10.4 The Efficiency of Competition Obtaining Any Efficient Allocation Using Competition 10.4 Production and Trading Comparative Advantage Solved Problem 10.5 Efficient Product Mix Competition 10.5 Efficiency and Equity Role of the Government Efficiency Equity Application Extremely Unequal Wealth Efficiency Versus Equity Theory of the Second Best Challenge Solution Price Ceilings in a Pandemic Summary Exercises Chapter 11 Monopoly and Monopsony Challenge Brand-name and Generic Drugs 11.1 Monopoly Profit Maximization The Necessary Condition for Profit Maximization Marginal Revenue and the Demand Curves Solved Problem 11.1 Marginal Revenue Curve and the Price Elasticity of Demand Application Amazon Prime Revenue An Example of Monopoly Profit Maximization Application Apple’s iPad Solved Problem 11.2 Choosing Price or Quantity Application Taylor Swift Concert Pricing Solved Problem 11.3 Effects of a Shift of the Demand Curve 11.2 Market Power and Welfare Market Power and the Shape of the Demand Curve The Lerner Index Solved Problem 11.4 Sources of Market Power Effect of Market Power on Welfare 11.3 Taxes and Monopoly Effects of a Specific Tax Solved Problem 11.5 Welfare Effects of Ad Valorem Versus Specific Taxes 11.4 Causes of Monopolies Cost Advantages Solved Problem 11.6 Government Actions That Create Monopolies Application The Botox Patent Monopoly 11.5 Government Actions That Reduce Market Power Regulating Monopolies Solved Problem 11.7 Application Natural Gas Regulation Increasing Competition Application Movie Studios Attacked by 3D Printers! Solved Problem 11.8 11.6 Internet Monopolies: Networks Effects, Behavioral Economics, and Economies of Scale Network Externalities Application Critical Mass and eBay Introductory Prices: A Two-period Monopoly Model Two-sided Markets Economies of Scale on the Internet Disruptive Technologies 11.7 Monopsony Monopsony Profit Maximization Welfare Effects of Monopsony Solved Problem 11.9 Challenge Solution Brand-name and Generic Drug Summary Exercises Chapter 12 Pricing and Advertising Challenge Sale Price 12.1 Conditions for Price Discrimination Why Price Discrimination Pays Which Firms Can Price Discriminate Application Disneyland Pricing Preventing Resale Application Preventing Resale of Designer Bags Not All Price Differences Are Price Discrimination Types of Price Discrimination 12.2 Perfect Price Discrimination How a Firm Perfectly Price Discriminates Solved Problem 12.1 Perfect Price Discrimination Is Efficient but Harms Some Consumers Application Botox and Price Discrimination Transaction Costs and Perfect Price Discrimination Application Google Uses Bidding for Ads to Price Discriminate 12.3 Group Price Discrimination Application Tesla Price Discrimination Prices and Elasticities Application Age Discrimination Solved Problem 12.2 Identifying Groups Application Buying Discounts Solved Problem 12.3 Welfare Effects of Group Price Discrimination 12.4 Nonlinear Price Discrimination 12.5 Two-part Pricing Two-part Pricing with Identical Consumers Two-part Pricing with Differing Consumers Application Pricing iTunes 12.6 Tie-In Sales Requirement Tie-In Sales Application Ties That Bind Bundling 12.7 Advertising Deciding Whether to Advertise How Much to Advertise Solved Problem 12.4 Application Super Bowl Commercials Challenge Solution Sale Price Summary Exercises Chapter 13 Game Theory Challenge Intel and AMD’s Advertising Strategies 13.1 Static Games Normal-form Games Failure to Maximize Joint Profits Application Strategic Advertising Pricing Games in Two-sided Markets Multiple Equilibria Solved Problem 13.1 Mixed Strategies Application Boomerang Millennials Solved Problem 13.2 13.2 Repeated Dynamic Games Strategies and Actions in Dynamic Games Cooperation in a Repeated Prisoners’ Dilemma Game Solved Problem 13.3 13.3 Sequential Game Game Tree Subgame Perfect Nash Equilibrium Credibility Dynamic Entry Game Solved Problem 13.4 Application Keeping Out Casinos Solved Problem 13.5 13.4 Auctions Elements of Auctions Bidding Strategies in Private-value Auctions Winner’s Curse Application Bidder’s Curse 13.5 Behavioral Game Theory Application GM’s Ultimatum Challenge Solution Intel and AMD’s Advertising Strategies Summary Exercises Chapter 14 Oligopoly and Monopolistic Competition Challenge Government Aircraft Subsidies 14.1 Market Structures 14.2 Cartels Why Cartels Form Why Cartels Fail Laws Against Cartels Application Employer “No-poaching” Cartels Maintaining Cartels Application Cheating on the Maple Syrup Cartel Mergers Application Airline Mergers 14.3 Cournot Oligopoly Model The Duopoly Nash-cournot Equilibrium The Cournot Model with Many Firms Application Mobile Number Portability The Cournot Model with Nonidentical Firms Solved Problem 14.1 Application How Do Costs, Price Markups, and Profits Vary Across Airlines? Solved Problem 14.2 Application Differentiating Bottled Water Through Marketing 14.4 Stackelberg Oligopoly Model Calculus Solution Graphical Solution Why Moving Sequentially Is Essential Strategic Trade Policy: An Application of the Stackelberg Model Solved Problem 14.3 Comparison of Collusive, Nash-cournot, Stackelberg, and Competitive Equilibria 14.5 Bertrand Oligopoly Model Nash-bertrand Equilibrium with Identical Products Nash-bertrand Equilibrium with Differentiated Products Application Rising Market Power 14.6 Monopolistic Competition Application Monopolistically Competitive Food Cart Market in the Philippines Monopolistically Competitive Equilibrium Fixed Costs and the Number of Firms Solved Problem 14.4 Application Subsidizing the Entry Cost of Dentists Challenge Solution Government Aircraft Subsidies Summary Exercises Chapter 15 Factor Markets Challenge Does Going to College Pay? 15.1 Factor Markets A Firm’s Short-run Factor Demand Curve Solved Problem 15.1 A Firm’s Long-run Factor Demand Curves Competitive Factor Markets Application Black Death Raises Wages Solved Problem 15.2 15.2 Capital Markets and Investing Interest Rates Discount Rate Stream of Payments Application Saving for Retirement Investing Solved Problem 15.3 Solved Problem 15.4 Durability Application Durability of Telephone Poles Time-varying Discounting Application Behavioral Economics: Falling Discount Rates and Self-control Capital Markets, Interest Rates, and Investments Solved Problem 15.5 15.3 Exhaustible Resources When to Sell an Exhaustible Resource Price of a Scarce Exhaustible Resource Application Redwood Trees Why Price Might Not Rise Challenge Solution Does Going to College Pay? Summary Exercises Chapter 16 Uncertainty Challenge BP and Limited Liability 16.1 Assessing Risk Probability Application Risk of a Cyberattack Expected Value Solved Problem 16.1 Variance and Standard Deviation 16.2 Attitudes Toward Risk Expected Utility Theory Risk Aversion Solved Problem 16.2 Solved Problem 16.3 Application Stocks’ Risk Premium Risk Neutrality Risk Preference Application Gambling Degree of Risk Aversion Solved Problem 16.4 16.3 Reducing Risk Just Say No Obtaining Information Diversification Application Investing in Your Employer Insurance Solved Problem 16.5 Application Flight Insurance Application Earthquake Insurance in Japan 16.4 Investing Under Uncertainty How Investing Depends on Attitudes Toward Risk Investing with Uncertainty and Discounting Solved Problem 16.6 16.5 Behavioral Economics and Uncertainty Biased Assessment of Probabilities Application Biased Estimates Violations of Expected Utility Theory Prospect Theory Comparing Expected Utility and Prospect Theories Challenge Solution BP and Limited Liability Summary Exercises Chapter 17 Rights, Externalities, Rivalry, and Exclusion Challenge Trade and Pollution 17.1 Externalities Application Disney’s Positive Externality 17.2 The Inefficiency of Competition with Externalities Supply-and-demand Analysis Cost-benefit Analysis Application Spam: a Negative Externality 17.3 Regulating Externalities Emissions Standard Emissions Fee and Effluent Charge Solved Problem 17.1 Application Why Tax Drivers Benefits Versus Costs from Controlling Pollution Taxes Versus Standards Under Uncertainty 17.4 Market Structure and Externalities Monopoly and Externalities Monopoly Versus Competitive Welfare with Externalities Solved Problem 17.2 Taxing Externalities in Noncompetitive Markets 17.5 Allocating Property Rights to Reduce Externalities Coase Theorem Application Buying a Town Markets for Pollution Application Acid Rain Program 17.6 Rivalry and Exclusion Open-access Common Property Application Road Congestion Club Goods Application Microsoft Word Piracy Public Goods Solved Problem 17.3 Application Free Riding on Measles Vaccinations Solved Problem 17.4 Reducing Free Riding Application What’s Their Beef? Valuing Public Goods Challenge Solution Trade and Pollution Summary Exercises Chapter 18 Asymmetric Information Challenge Dying to Work 18.1 Adverse Selection Insurance Markets Products of Unknown Quality Solved Problem 18.1 Solved Problem 18.2 18.2 Reducing Adverse Selection Equalizing Information Application Discounts for Data Application Adverse Selection and Remanufactured Goods Laws to Prevent Opportunism 18.3 Price Discrimination Due to False Beliefs About Quality Application Reducing Consumers’ Information 18.4 Market Power from Price Ignorance Tourist-Trap Model Solved Problem 18.3 Advertising and Prices 18.5 Problems Arising from Ignorance When Hiring Cheap Talk Application Cheap Talk in Ebay’s Best Offer Market Education as a Signal Solved Problem 18.4 Screening in Hiring Challenge Solution Dying to Work Summary Exercises Chapter 19 Contracts and Moral Hazards Challenge Clawing Back Bonuses 19.1 Principal-agent Problem A Model Types of Contracts Efficiency Solved Problem 19.1 Application Honest Cabbie? 19.2 Production Efficiency Efficient Contract Full Information Solved Problem 19.2 Asymmetric Information Application Sing for Your Supper 19.3 Trade-off Between Efficiency in Production and in Risk Bearing Contracts and Efficiency Solved Problem 19.3 Choosing the Best Contract Application Health Insurance and Moral Hazard Solved Problem 19.4 19.4 Monitoring to Reduce Moral Hazard Bonding Solved Problem 19.5 Application Capping Oil and Gas Bankruptcies Deferred Payments Efficiency Wages Application Walmart’s Efficiency Wages After-the-fact Monitoring 19.5 Contract Choice 19.6 Checks on Principals Application Layoffs Versus Pay Cuts Challenge Solution Clawing Back Bonuses Summary Exercises Calculus Appendix Regression Appendix Answers to Selected Exercises Definitions References Sources for Applications and Challenges Index Credits
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