How to learn basic microeconomics in a few hours (read my book)

micro made simple

My book on basic microeconomics, coauthored by Mike Piper, is out. It’s called Microeconomics Made Simple and, as the title suggests, it’s a gentle introduction to the basics. At just 100 pages, it’s a quick read.

I want you to buy it, to read it, to love it, and to tell your friends, family members, and social media followers about it.

Here are some possible reasons why you might be interested in the book:

  • You never learned microeconomics and yearn for a basic intro that won’t take much time or make your brain hurt
  • You learned microeconomics, but so long ago you’re rusty and want to brush up
  • You’re a student, with a microeconomics course in your future and you want to get a jump on the basic concepts
  • You’re taking a microeconomics course right now, but it’s going too fast for you and you want a simple way to review the fundamentals
  • You will be or are taking some other social science or business course for which a basic understanding of microeconomics would be helpful, even if it’s not required
  • You find yourself puzzled by some discussions of markets or profits or opportunity cost or other microeconomic concepts and want a way to get up to speed
  • You teach microeconomics or some other social science or business course and you think some or all of your students could benefit from access to a gentle introduction to microeconomics
  • You want a quick way to understand the limitations of economics (yeah, we cover that too)

For a limited time, the Kindle price will be discounted from $4.99 to $0.99. You can buy the book at Amazon.com. Below are some additional details, including a table of contents and links to excerpts.

Summary

Part One, explains the most fundamental concepts of microeconomics, such as utility, supply, demand, market equilibrium, and some ways in which governments intervene in markets.

Part Two focuses on the degree of competition in different types of markets, as well as the outcomes of competition. Market structures considered include: perfect competition, monopolies, oligopolies, and monopolistic competition.

The Authors

My coauthor, Mike Piper, is a certified public accountant and an expert at distilling complex topics into simple language and examples. This is his eighth book that does so (others here) and his blog on personal finance is excellent. As you know, I’m a health economist and, as such, have devoted a great deal of my professional life thinking about microeconomic concepts. We teamed up to explain all the microeconomics we could in 100 pages.

Special thanks go to Wade Pfau and Julian Jamison for contributing their time and expertise for technical editing.

Excerpts

Click on the following links for excerpts. Note that each is out of context. The book assumes no prior knowledge of economics so, in the context of the book, each excerpt is fully accessible to a non-expert.

Errata

Please bring errors in the book to our attention. As we find and fix them, we’ll post the details here.

Table of Contents

Introduction:

What Is Economics?

Macroeconomics vs. Microeconomics

Not a Perfect Model

Part One: Basic Economic Concepts

1. Maximizing Utility

What about Charity?

Decreasing Marginal Utility

Opportunity Cost

2. Evaluating Production Possibilities

Production Possibilities Frontier

Absolute Advantage and Comparative Advantage

3. Demand

Elasticity of Demand

Change in Demand vs. Change in Quantity Demanded

4. Supply

How Costs of Production Affect Supply

Elasticity of Supply

Change in Supply vs. Change in Quantity Supplied

5. Market Equilibrium

How Market Equilibrium Is Reached

The Effect of Changes in Supply and Demand

6. Government Intervention

Price Floors and Price Ceilings

Taxes and Subsidies

Part Two: Firm Behavior in Different Types of Markets

7. Costs of Production

Marginal Cost of Production

Fixed vs. Variable Costs

Short Run vs. Long Run

Sunk Costs Are Irrelevant

Economic Costs vs. Accounting Costs

Average Total Costs

8. Perfect Competition

Firms Are Price Takers

Making Decisions at the Margin

Calculating Profit or Loss

Zero Economic Profits in the Long Run

Firms Producing at Their Lowest Cost

Producing at a Loss in the Short Run

Consumer and Producer Surplus

9. Monopoly

Monopolies Have Market Power

Marginal Revenue Curve for a Monopoly

Maximizing Profit (Producing at MC = MR)

Profits and Losses for Monopolies

Monopolies: Producing at a Higher Cost

Loss of Surplus with a Monopoly

Monopolies and Government

10. Oligopoly

Firms Are Not Price Takers

Collusion in an Oligopoly

Cheating the Cartel

Government Intervention in Oligopolies

11. Monopolistic Competition

Making Decisions at the Margin

No Profits in the Long Run

Firms Do Not Produce at Lowest Cost

Loss of Surplus with Monopolistic Competition

Conclusion: The Insights and Limitations of Economics

Appendix A: Helpful Resources

Appendix B: Glossary

Acknowledgments

Other Books in the Series

Buy Microeconomics Made Simple.

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