KIRINYAGA UNIVERSITY
SCHOOL OF BUSINESS AND ECONOMICSCOURSE
OUTLINE
DEPARTMENT OF BUSINESS STUDIES
PROGRAMME:
YEAR: Three SEMESTER: One
UNIT CODE: BEC 2301
UNIT TITLE : Advanced Microeconomic Theory
LECTURE HOURS :42 CONTACT HOURS : Monday 7-10am
PRE-REQUISITE : Intermediate Microeconomic Theory
LECTURER: Waweru Gabriel
LECTURER CONTACTS: EMAIL
[email protected]Course Description
The course exposes students to a mathematical analysis of economic behaviour of households and firms and other
economic agents such as government and trade unions. Throughout the course equal emphasis will be placed on both
technical and applied aspects of analytical microeconomic models, and to apply them in thinking about practical economic
problems. Topics be to covered include: the Specifications of technology; Profit maximization; Cost minimization, cost function,
and conditional factor demands; Duality in production; The theory of consumer behaviour, choices and preferences, demand functions
and their properties; indirect utility functions and expenditure functions; Slutsky’s equation, uncertainty, expected utility theory; risk
aversion and measurement; Game Theory and Oligopoly.
Course Objectives
The course seeks to impact student with knowledge on Profit maximization; Cost minimization, the theory of consumer behaviour,
indirect utility functions and expenditure functions, duality in consumption, Game Theory and Oligopoly. At the end of the course,
students are expected to be able to:
1) Demonstrate understanding of profit maximization
2) Evaluate the concept of consumer behaviour
3) Appreciate the concepts of cost minimization
4) Understand game theory and oligopoly
Contact Hours
Venue:
Consultation hours:
COURSE CONTENT
MAIN TOPICS
1. Theory of the firm
2. Theory of the Consumer
3. Theory of the Market
COURSE DELIVERY PLAN
WEEK/DATE TOPICS/SUB-TOPICS
Page 1 of 3
TOPIC 1: THEORY OF THE FIRM
Sub-topic 1: Profit Maximization and Technology
WEEK 1
• Introduction
• Production Function, Production Sets, Input Requirements Set
• Cost function
WEEK 2 • Duality
Page 2 of 3
• Profit Function
WEEK 3
TOPIC 2: THEORY OF THE CONSUMER
WEEK 4 • Consumer preferences and behaviour
• Utility functions
• Indirect utility Functions
• Expenditure Functions
WEEK 5 • Slutsky Equation
CAT ONE 1hr sit in cat
WEEK 6
• Consumer demand functions
WEEK 7 • Duality in Consumption.
TOPIC 3: THEORY OF THE MARKET
WEEK 8 • Perfect Competitive market (Pure competition)
• Monopoly
• Oligopoly market
WEEK 9 • Stackelbery’s Model
• Price leadership Model
WEEK 10 • The Cournot Model
• Cartel / cooperation model
Week 11
▪ CAT TWO 2 hrs sit in cat
WEEK 12
▪ CAT FEEDBACK, REVISION AND EVALUATION
WEEK 13& 14
▪ End of Semester Exams
Course Evaluation
Type Weighting (%)
Final Examination 70
Coursework 30
CAT 1 (Supervised CAT) 15
CAT 2 (Supervised CAT) 15
Total 100 %
Required Textbooks
Colander, D., (2017). Microeconomics, 10th Edition, New York: McGraw-Hill Education
Jehle G. A. and P. Reny (2011). Advanced Microeconomic Theory, 3rd Edition, London:
Pearson Education
Layard, G. and Walters, A. (2015). Microeconomic Theory, New York: McGraw-Hill Book
Company
Nicholson, W. (2011). Microeconomic Theory: Basic Principles and Extensions 11th
Edition. Boulevard: South-Western, Cengage Learning
Pindyck, R. and Rubinfeld, D. (2013). Microeconomics, 8th Edition, New Jersey. Pearson
Education
Varian, H.R. (2014). Intermediate Microeconomics: A Modern Approach (Ninth Edition)
Page 3 of 3
Other selected textbooks
Chiang, A.(1997). Fundamental Methods of Mathematical Economics (McGraw Hills)
Herdeson, E. and Quandt R. Microeconomic Theory: A Mathematical Approach (McGraw Hills)
Koutsoyiannis, j. Modern Microeconomics (McGraw Hills)
Silberberg, E The Structure of Economics: A mathematical Approach (McGraw Hills)
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