Econ 10-6 : UNC-CH
World Wilde Web Page
Welcome to the WWWPage of Professor James Wilde of the Department of Economics at the University of North Carolina, Chapel Hill. This page has been created in order to enhance the learning of students enrolled in Econ 10-6 during the Fall Semester, 2002. Its major function is the replication of the more elaborate graphs and tables that are presented during the lecture sessions of this course. Since student note-taking becomes rather ineffective at best or positively confusing at worse if it does not occur with accuracy, it becomes more than a little important for graphs, tables and text in student notes to be in agreement. This webpage allows students to check on the accuracy of their notes by referring to the correct versions of my presentation information. The daily schedule of lecture topics follows, along with a very brief class outline. As you know, there are lectures in which the screen presentations are not particularly involved or difficult to copy. In such cases, the schedule will simply show the lecture topic. When lectures do include fairly complicated visuals, these will be available on this page through a "link" which follows the lecture topic. When you click on the Link, which appears in either blue or red letters, the tables and/or graphs from that lecture will appear on the screen. This will keep you from having to scroll through all the earlier graphs as the semester progresses. This is a work in progress, with the lecture schedule and associated graphs being added periodically.
Students: please give me your evaluation of the usefulness of this page and feel free to make suggestions for improvement.
PROFESSOR JAMES A. WILDE- Office: Gardner 006G
- Department of Economics, CB#3305, University of North Carolina, Chapel Hill NC 27599
- jwilde@email.unc.edu
- Phone: 919-966-5328 or 966-2383
- Office Hours: MW 2-4 or by appointment
TEACHING ASSISTANTS:
- Tiffany Green(head TA): tlgreen@email.unc.edu;
Hanes 301;office hours TR 12:20-1:20
- Liang Ding: ding@email.unc.edu;
Hanes 304B; office hours T 2:30-3:30, W 3-4
- Kevin Muller: kmuller@email.unc.edu;
Hanes 303; office hours R 8:15-9:15 & 11-12
- Codrin Nedita: nedita@email.unc.edu;
Hanes 304B; office hours MW 11-12
- Emil Rusev: rusev@email.uns.edu;
Hanes 303; office hours W 3-5
RECITATION SECTIONS
- 601 at 4W in Ga307 (Ding)
- 602 at 2T in Ga103 (Muller)
- 603 at 5W in Ga307 (Rusev)
- 604 at 4T in Ga103 (Nedita)
- 605 at 8W in Ga103 (Muller)
- 608 at 11W in Ga103 (Green)
- 609 at 12W in Ga103 (Green)
- 610 at 1W in Ga103 (Rusev)
- 611 at 2W in Ga103 (Rusev)
- 612 at 3W in Ga103 (Nedita)
- 613 at 4W in Ga103 (Nedita)
- 614 at 4:30T in Ga009 (Ding)
- 616 at 3:30T in Ga009 (Ding)
- 617 at 1T in Ga103 (Muller)
Latest revision on 9 September 2002
- August 20: Introduction to Concepts
- August 22: Production Possibility Frontiers: Individual and Group
- August 27: Exchange between Individuals; Principles of Demand
- August 29: Using Demand curves; Principles of Supply; Equilibrium
- September 3: Disequilibrium, Controls, and Elasticity
- September 5: Wilde Bagel Cart: production and costs;Table9/8; Table 9/10
- September 10: Profit-maximizing choices of a Competitive Firm;Figure 9/16/1; Figure 9/16/2
- September 11: review session for first test in Carroll 111 from 5pm to 6:30pm; practice with First Test and its Graphs1 from Fall'00, which is on reserve, with answers posted at Gardner006.
- September 12: FIRST TEST: bring scantron/bubblesheet and #2 pencil/eraser; calculators may be used during test for personal use but may NOT be shared during test
- September 17: Long run options for profit-maximizing firm; Figure 9/23
- September 19: Competitive markets in short run and long run equilibrium; Figure 9/24
- September 24: A single seller maximizes profits;Figure 9/25;Figure 9/252
- September 26: Natural monopoly: should there be regulation?Figure 9/27
- October 1: Monopolistic competition via advertising;Figure 9/30
- October 3: Cartels and OPEC: trying to monopolize a market;Figure 10/2
- October 8: The market for labor inputs
- October 9: Review Session for second test in Carroll 111 from 5pm to 6:30pm;practice with Second Test and its Graphs2 and Graphs3 from Fall'00, which is on reserve, with answers posted at Gardner006.
- October 10: SECOND TEST:bring scantron/bubblesheet and #2 pencil/eraser; calculators may be used during test for personal use but may NOT be shared during test
- October 15: Introduction to macroeconomic variables
- October 17-18: FALL BREAK
- October 22: Consumption spending by households
- October 24: Investment and two-sector equilibrium;Table 10/16
- October 29: Spending changes and THE WILDE multiplier;Table 10/21
- October 31:Total expenditure, aggregate demand and aggregate supply
- November 5: Taxes and total expenditure patterns;Table 10/28
- November 7: Government budget in three-sector macromodel;Table 10/30
- November 12: Money and banks and fractional reserves
- November 13: Review Session for third test in Carroll 111 from 5pm to 6:30 pm; practice with Third Test and its Graphs4 from Fall'00, which is on reserve, with answers posted at Gardner006.
- November 14: THIRD TEST: bring scantron/bubblesheet and #2 pencil/eraser; calculators may be used during test for personal use but may NOT be shared during test
- November 19: Lending behavior of banks; F.R.B. operations and Monetary policies
- November 21: Monetary policy techniques and effects on economy
- November 26: International trade and the macroeconomy;Table 11/22
- November 28: THANKSGIVING
- December 3-5: Foreign exchange rates
- December 11: Review Session for Final Exam in Carroll 111 from 4 to 6pm; practice with Final Exam and its Graphs5 and Graphs6 from Fall'00, which is on reserve and available electronically on the Library's webpage(electronic reserve); answers are posted at Gardner 006.
- December 12: FINAL EXAM in Carroll 111 from 9a.m. to noon: bring bubblesheet and #2 pencils/eraser
NOW WE'RE READY FOR THE HOLIDAYS!
RECITATION AGENDAS
- Week of August 20: NO Recitations
- Week of August 27: Problem Set I
- Week of September 3: Problem Set II
- Week of September 10: Problem Set III
- Week of September 17: Return and review of first test
- Week of September 24: Problem Set IVA
- Week of October 1: Problem Set IVB
- Week of October 8: Review Cartels
- Week of October 15: Return and review of second test
- Week of October 22: Begin Problem Set V
- Week of October 29: Finish Problem Set V
- Week of November 5: Start Problem Set VI
- Week of November 12: Finish Problem Set VI
- Week of November 19: Return and review of third test
- Week of November 26: Problem Set VII
- Week of December 3: Problem Set VIII
EXAM REVIEW SESSIONS
- For first test: Wednesday, September 11: 5-6:30pm in Carroll 111
- For second test: Wednesday, October 9: 5-6:30pm in Carroll 111
- For third test: Wednesday, November 13: 5-6:30pm in Carroll 111
- For final exam: Wednesday, December 11: 4-6pm in Carroll 111
Inverse schedule from an earlier semester
- December 7: Fixed or Variable exchange rates?
- December 4: Demand and Supply of foreign currencies
- December 2: International trading and policies
- November 30: Adding the international sector to the macro-economy;Table 11/22
- November 27: THANKSGIVING
- November 25: Budget deficits, borrowing, interest rates and the economy
- November 23: Federal Reserve and Macro-equilibrium
- November 20: Monetary policy options
- November 18: Roles of the Federal Reserve Bank
- November 16: Banks deal with Fractional Reserves
- November 13: Banking as a business
- November 11: HOUR EXAM - bring bubblesheet to Union Auditorium
- November 10: Review session - 7:30-9p.m. in Venable 268
- November 9: Introducing money
- November 6: Supply-side Economics as fiscal policy
- November 4: Government spending and three-sector equilibrium;Table 10/30
- November 2: Taxes and fiscal policy;Table 10/28
- October 30: Aggregate supply and general price levels
- October 28: Total Expenditure and Aggregate Demand
- October 26: Expenditure changes and THE Multiplier; Table 10/21
- With GDP on horizontal axis, C is upward-sloping curve:more output means more disposable income means more consumer spending(mpc>0)
- With GDP on horizontal axis, I is upward-sloping curve:more output brings production closer to capacity, so firms seek to expand capacity with new investment
- With GDP on horizontal axis, TE=C+I is an upward-sloping curve
- Autonomous changes in TE:those that result from causes OTHER THAN changes in GDP
- Autonomous changes in TE:shifts up or down in the TE curve
- Shift up in TE causes new higher equilibrium GDP
- Autonomous change in TE< resulting change in GDP: there is a multiplier effect
- THE WILDE multiplier = 1/(1-slope of TE)
- October 23: Investment spending and two-sector equilibrium; Table 10/16
- Aggregating household consumer spending: the importance of acknowledging the distribution of income
- Purchases of new plant and equipment: the biggest part of investment spending
- Why new P&E?(1)replacement of worn-out P&E; (2)replacing workers with more capital; (3)more capital for expanded operations (greater capacity);(4)better capital/improved technology for cost reduction;(5)new capital to produce new products
- Investment spending influenced by(1)interest rates;(2)technological changes;(3)production levels(GDP) relative to current capacity
- Macro equilibrium: where total spending (TE)=total output (GDP)
- In two-sector economy(households+boards of directors), TE=C+I
- Graphic equilibrium: where TE curve intersects the 45-degree line
- October 21: Consumer spending
- Unemployment rate:labor force and those unable to find work
- Various concepts of the money supply
- Various interest rates
- Consumer spending by individual households is influenced by (1)household disposable income;(2)household wealth;(3)interest rates;(4)thriftiness attitudes; (5) optimism; (6)size of family
- Marginal propensity to consume: how do changes in income affect consumer spending
- October 19: Introduction to Macroeconomic data
- Gross Domestic Product: today's output @ today's prices
- Real GDP: today's output @ 1992 prices
- GDP Deflator:Today's prices compared to 1992 prices
- Spending sectors:(1)Consumption spending on goods and services; (2)Investment = (a)new Plant and Equipment + (b)Residential construction + (c) change in inventories (production - sales);(3)Government spending on goods and services; (4)Net exports = Exports - Imports
- Consumer Price Index: prices of products bought by average family
- Producer Price Index: prices of goods at the wholesale level
- October 16: FALL BREAK
- October 14: HOUR EXAM - bring bubblesheet to Union Auditorium
- October 13: Review session - 7:30-9p.m. in Venable 268
- October 12: Labor Supply and Equilibrium Wages
- Potential worker faces time "budget": work vs. leisure in 168 hours per week
- Value of work vs. value of leisure
- Price of work vs. price of leisure
- Individual S of labor: impact of wage rate change through income and substitution effects
- Individual S of labor: positive or negative or vertical curve: all rational
- Market labor S: adding up worker choices and bringing in new workers
- Equilibrium wage rate
- October 9: Market demand for labor
- Market demand is sum of individual firm demands
- Demand for numbers of workers or demand for numbers of hours of work
- October 7: Individual firm demand for workers
- Back to workers and marginal physical product
- With firms selling competitive product (P constant), going from MPP to Marginal Revenue Product
- With firms buying competitive workers (Wage rate constant), MC of a worker is wage rate
- Profit-max.: MC of worker = MRP
- Firm D for workers is downward-sloping part of MRP
- October 5: Oligopolies and cartels: the case of OPEC; Figure 10/2
- Oligopoly: few firms, difficult entry, interaction of firm decisions
- Cartel: joint decisions to monopolize market and raise group profits
- Comparing competitive and cartel decisions
- Cartel setting of output quotas for each member
- P>MC as temptation for members to cheat by raising output
- Quiet vs. broad cheating: who to sell cheaper oil to
- Other members find out about cheating
- October 2: Monopolistic competition,brands, and advertising; Figure 9/30
- MC:Many firms, easy entry & exit, differentiated (branded) products
- Sliding along D involves switch of brands as well as switch in products:flatter
- Same profit-max graph as monopoly
- Advertising: its role in shifting demand/changing P, Q, and profits
- Advertising: its role in changing costs (AFC,AVC,ATC,MC), P, Q, and profits
- September 30: Natural monopolies: regulation or ownership; Figure 9/27
- Natural monopolies when ATC decreasing
- Case I: MC=0 (extra units of the service are costless to produce: bridge-crossing case)
- When MC=0, AVC=0 and ATC=AFC (so ATC decreases as Q rises)
- When MC=0, MC=MR when MR=0P>MC indicates inefficiency
- Efficient P=MC occurs at Q where PCase II: MC=constant=AVC and thus ATC=AVC+AFC (and ATC downward-sloping):electricity
- Profit-maximization result is inefficient (P>MC)
- Efficient Q (where P=MC) requires subsidy funds
- Regulated price as P=ATC ensures that only consumers pay and only normal profits earned
- September 28: A single supplier maximizes profits; Figure 9/25
- With single supplier, market D = firm D (downward-sloping)
- With downward-sloping D, P>MR (can you explain why the economics of pricing works out this way?)
- Profit-maximization where MC=MR and P is on the D curve
- If MR=MC where ATC is rising,P>MR=MC>ATC and monopoly firm has positive economic profits
- P>MC indicates inefficiency
- September 25: Why we like perfect competition
- When econ. profits=0, P= the min. of ATC=MC
- When D=S, value at margin=cost at margin
- When market demand shifts, industry and firms react in SR and LR
- September 23: Competitive markets in the long run
- Finding the best supply curve for a competitive firm
- Locking into the lowest point on the long run ATC curve
- Re-aggregating for market S with a given number of firms
- Recalculating economic profits at the market equilibrium P
- Entry or exit of firms in response to the profit picture
- How many firms will be in the industry in long run equilibrium?
- September 21: Competitive firm faces long run decisions;Figure 9/23
- In the long run a producer can change the amount and type of all inputs
- Economies of Scale: the study of outcomes when all inputs are changed proportionally
- Increasing returns to scale: Output rises faster than the proportional increase in inputs:ATC falls
- Constant returns to scale: Output rises at the same rate as the proportional increase in inputs: ATC constant
- Decreasing returns to scale: Output rises more slowly than the proportional increase in inputs: ATC rises
- Suppliers may also be able to reduce costs by (1) changing the mix of capital and labor; (2) changing the types of capital and labor used; (3) Utilizing different technologies; (4) taking advantage of quantity discounts in the purchase of inputs
- September 18: Many firms and short run competitive equilibrium
- In short run, competitive market has a fixed number of firms, each of which has a fixed amount of capital
- The market supply curve is the aggregation of this number of S (MC) curves
- The market supply curve is the aggregation of the individual D curves of all consumers
- The resulting equilibrium market price will yield various SR profit results for the given number of suppliers
- September 16: HOUR EXAM - bring bubblesheet to Union Auditorium
- September 15: Review session - 7:30-9p.m. in Venable 268
- September 14: Market price and competitive firm supply in the short run
- At each P, find that Q where MC=MR=P represents profit-maximization
- For PFor P>AVC, profit-maximizing Q lies along the MC curve
- Competitive firm's short run S is its MC curve above AVC
- Short run profits may be positive or negative, but never less than -TFC
- September 11: Profit-maximizing Q for a perfect competitor;Figure 9/16/1; Figure 9/16/2
- Graphing AFC, AVC, ATC, and MC
- U-shaped MC as the result of increasing and then diminishing marginal returns
- MC vis-a-vis U-shaped AVC and ATC
- Demand curve faced by an individual competitive firm: a horizontal line
- Market price =AR=MR for the competitive firm
- Profit-maximization and the relationship between MR and MC:the picture
- September 9: Short run costs at the WBC; Table 9/10
- With given cart and technology:the role of input prices
- Opportunity costs and prices: an owned cart and an owner/worker's time
- Concepts of fixed costs and variable costs
- Total costs = total fixed costs and total variable costs
- Averages and marginals and the relationship between them
- September 7: Labor Day
- September 4: Workers and output at the Wilde Bagel Cart; Table9/8
- A production function
- How workers affect maximum output
- Specialization and division of tasks: increasing marginal returns
- More workers at the same cart:diminishing marginal returns
- The relationship between totals, averages and marginals
- September 2: Changes, new equilibria, and elasticity
- Forced disequilibrium: market controls - who gains, who loses
- Moving from one equilibrium to another
- Why? - as D and/or S shifts
- Implications for equilibrium P and Q
- Influence of elasticity
- August 31: Market equilibrium and disequilibrium
- Review upward-sloping S and increasing marginal costs
- Review Supply curve givens
- Equilibrium: price at which quantity demanded =quantity supplied (intersection)
- Disequilibrium responses: P above or below equilibrium: unhappy participants
- August 28: Individual supply curves
- Supply curve labels: cause and effect
- Slope:meaning for individual producer
- Ceteris paribus assumptions
- Moving along S vs. shifting S
- August 26: Individual demand curves
- Demand curve labels: cause and effect
- Slope:meaning for individual consumer
- Ceteris paribus assumptions
- Moving along D vs. shifting D
- Income effect vs. substitution effect
- August 24: Individual PPFs and exchange of goods
- Review:from linear individual PPFs to bowed-out group PPF
- Self-sufficiency:PPF=CPF
- Trading goods as a response to different relative capabilities
- Deciding to produce one good and trade for another good
- August 21: Individual PPFs and group PPFs
- Individual PPF:meaning
- cause and effect?
- shape and slope
- assumptions:resource availability
- differences between individual PPFs
- From individual to group PPF (w/o interaction)
- August 19: Introduction
- Course structure
- WebPage
- Difference between micro and macro
- Drawing on student experience:labor market and macro variables
Professor James A. Wilde
Office: Gardner 006G
Office Hours: 2:00 to 4:00 Monday/Wednesday or by appointment
Office phone: 966-5328 or 966-2383
E-mail: jwilde@email.unc.edu
Thanks for assistance and support to Damon Sauve, Kathy Thomas and Bob Herndon of the Simple Start Program. To learn more about this program, click on Simple Start.
To UNC-CH Home Page
Created on: Wed Aug 14 11:54:29 EDT 1996
