MGEC02

Topics in Price Theory

(Intermediate Microeconomics II)
Summer 2020
Instructor Contact Information:

Name: Dr. Ata Mazaheri

Office: IC288
Office hours: On Quercus (Tuesday, Thursday 12-2)
Email: [email protected]
Telephone: 416-287-7348
Course website: http: portal.utoronto.ca

Course Delivery

MGEC02 will be delivered completely online so a reliable internet access is imperative.

The lectures will be recorded using “Snagit” and posted on a weekly basis on Quercus. For each
lecture, you are expected to complete the readings, watch the videos, and practice the problem sets. To
help you with all these, there will be TA office hours on Bb collaborate as well as discussion boards.
My TAs will also conduct tutorials on Bb Collaborate, those will also be recorded and can be played at
a later date.

Time-zones: All times posted will be in EST, i.e. local Toronto time. If you are in a different
time zone, please make sure you correctly identify what EST converts to where you are. Errors in
calculations are not an acceptable reason to miss deadlines.

Course Description:

This course extends the coverage of the intermediate level beyond what has been covered in MGEB02. While
MGEB02 studied the individuals and firms decisions to develop the demand and supply decisions and their
interaction in two extreme markets – namely the perfectly competitive market as well as the monopolistic
market, MGEC02 primarily studies the interaction of firms other more prevalent markets as well as the impact
of these markets on economic outcomes. More specifically, our point of interest is to see how efficient firms
behave in oligopolistic markets where strategic decisions are important. In technical term we would like to
study the market failure – e.g. non-efficient behavior of firms – in the non-competitive markets and the venues

Management, 1265 Military Trail, Toronto, ON, M1C 1A4, Canada

www.utsc.utoronto.ca/mgmt 1
the government can intervene to alter the market behavior. In addition to the analysis of the market failure
and the role of government to provide remedies for these failures, we also study general equilibrium analysis
(i.e., feedback effects in the overall economy) as well as externalities and public goods, which are two
additional market situations that can lead to market failures.

Prerequisite(s):

Prerequisite: MGEB02H3 & [MATA32H3 & MATA33H3] (or equivalents)

Textbook/Required Course Materials:

Pindyck and Rubinfeld, "Microeconomics", 9th Edition, Pearson Prentice Hall, 2018.

Lecture Notes and Other Announcements:

• Lecture notes are posted on the portal several days ahead of the lecture. It is important to read them
before attending each lecture. It is necessary to try the assigned problems after each lecture before
attending the next lecture.
• Supplemental sample problems will be posted on the website. Some of those questions will be
taken during the tutorials. Practice the questions before attending the scheduled review sessions.

Evaluation and Grading:

Component Weight/Value Due Date

Test-1 25% On Quercus
Test-2 25% On Quercus
Term Paper 10% August 7
Final 40% On Quercus

Term Paper

As you know all courses in the Department of Management (including Economics courses) are required
to include a writing component that is worth at least 10% of the overall mark in the course. In order to
fulfill this requirement, there will be a short 1200-1300 words that must be submitted on or before the
last calendar day of this term. In general, this paper will you help to review the material covered in the
course in preparation for the final exam. I will post several recent microeconomic articles from which
you are to choose one and critically analyse/discuss using the material learned in class. I will provide
further information on the Term Paper in Due time.

Management, 1265 Military Trail, Toronto, ON, M1C 1A4, Canada

www.utsc.utoronto.ca/mgmt 2
“Normally, students will be required to submit their course essays to Turnitin.com for a review of
textual similarity and detection of possible plagiarism. In doing so, students will allow their essays
to be included as source documents in the Turnitin.com reference database, where they will be
used solely for the purpose of detecting plagiarism. The terms that apply to the University's use of
the Turnitin.com service are described on the Turnitin.com web site”. (Note: Turnitin is integrated
into Quercus)

Coverage

• Test-1: Material covered to the end of Week-5 Lecture.

• Test-2: Material covered from Week-6 to Week-9.
• Final Exam: is cumulative and covers the entire course.

Aids Allowed for Term Tests and Final Exam

• The term tests as well as the final are open book assessments.
• By taking the assessments you are making the following pledge:
• "The University of Toronto's Code of Behaviour on Academic Matters applies to all
University of Toronto students. The Code prohibits all forms of academic dishonesty
including, but not limited to, cheating, plagiarism, and the use of unauthorized aids. Students
violating the Code may be subject to penalties up to and including suspension or expulsion
from the University.
• In submitting the assessments in Quercus under my name, I confirm that my conduct during
this assessment adheres to the Code of Behaviour on Academic Matters. I confirm that I did
NOT act in such a way that would constitute cheating, misrepresentation, or unfairness,
including but not limited to, using unauthorized aids and assistance, collaborating with another
person, impersonating another person, and committing plagiarism."

Policy on Missed Assignments/Examinations:

There will be no makeup test. If you miss a term test for any reason, the final exam will be re-adjusted
for the total of 65%. If you miss both term tests, the second miss will be automatically zero.

Academic Support

The Department of Management, in collaboration with the UTSC library, will be providing academic
research support in the IC Building. To refine your research skills or to learn more about various
scholarly resources, please contact the Librarian for Management and Economics students.

Lola Rudin, Subject Librarian, Management and Economics

Room IC375

Management, 1265 Military Trail, Toronto, ON, M1C 1A4, Canada

www.utsc.utoronto.ca/mgmt 3
Office hours: Monday & Thursday, 1:00 – 3:00pm or by appointment
Email: [email protected]
Web: http://guides.library.utoronto.ca/utsc_mgmt

The English Language Development Centre (ELDC) helps students develop the critical thinking,
vocabulary and academic communication skills essential for achieving academic and professional
success. Personalized support includes: RWE (for academic writing); Communication Cafés (oral);
Discussion Skill-Building Cafés; Vocabulary Cafés; seminars/workshops; personal ELD consultations;
drop-in sessions. http://ctl.utsc.utoronto.ca/eld/

The Writing Centre (TWC) offers invaluable services to students (learn to become a better writer!) and
offers many different kinds of help: drop-in sessions, individual consultations, workshops, clinics, and
online writing handouts. http://ctl.utsc.utoronto.ca/twc/

Academic Misconduct

Students should note that copying, plagiarizing, or other forms of academic misconduct will not be
tolerated. Any student caught engaging in such activities will be subject to academic discipline
ranging from a mark of zero on the assignment, test or examination to dismissal from the university as
outlined in the academic handbook. Any student abetting or otherwise assisting in such misconduct
will also be subject to academic penalties.

Management, 1265 Military Trail, Toronto, ON, M1C 1A4, Canada

www.utsc.utoronto.ca/mgmt 4
 Schedule
Topic Session Material Practice

Week-1 Introduction, Review of Monopoly, Monopsony Chapter-10 Problem Set-1

Week-2 Price discrimination and quality discrimination-I Chapter-11 Problem Set-2

Week-3 Price discrimination and quality discrimination-II Chapter-11

Week-4 Oligopoly-I Chapter-12 Problem Set-3

Week-5 Oligopoly-II Chapter-12

Review for Test-1
Test-1

Week-6 Strategy and Game Theory-I Chapter-13 Problem Set-4

Week-7 Strategy and Game Theory-II Chapter-13

Week-8 Market with Asymmetric Information Chapter-17 Problem Set-5

Week-9 General Equilibrium, Pareto Efficiency, the Chapter-16 Problem Set-6

Edgeworth Exchange Box-I
Week-10 General equilibrium, Edgeworth Production Box, Chapter-16
the Production Possibilities Frontier -II
Review for Test-2
Test-2

Week-11 Externalities, Public Goods and Market Failure(I) Chapter-18 Problem Set-7

Week-12 Externalities, Public Goods and Market

Failure(II)
Note: References are to Pindyck’s textbook.

Management, 1265 Military Trail, Toronto, ON, M1C 1A4, Canada

www.utsc.utoronto.ca/mgmt 5