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MICROECONOMICS

MICROECONOMICSP rinciples and AnalysisFrank A. CowellSTICERD and Department of EconomicsLondon School of EconomicsDecember 2004iiContentsContentsiiiList of TablesxiiiList of FiguresxvPrefacexxiii1 The r le of microeconomic principles .. Microeconomic models .. Purpose .. The economic actors .. Motivation .. The economic environment .. Assumptions and axioms .. Testing a model .. Equilibrium analysis .. Equilibrium and economic context .. The comparative statics method .. Dynamics and stability .. Background to this book .. Economics .. Mathematics .. Using the book .. A route map .. Some tips .. 72 The Basic setting .. The rm: basic ingredients .. Properties of the production function .. The optimisation problem .. Optimisation stage 1: cost minimisation .. The cost function .. Optimisation stage 2: choosing output.

MICROECONOMICS Principles and Analysis Frank A. Cowell STICERD and Department of Economics London School of Economics December 2004

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