All goods and services are subject to scarcity at some level. Scarcity means that society must develop some allocation mechanism – rules to determine who gets what. Over recorded history, these allocation rules were usually command based – the king or the emperor would decide. In contemporary times, most countries have turned to market based allocation systems. In markets, prices act as rationing devices, encouraging or discouraging production and encouraging or discouraging consumption in such a way as to find an equilibrium allocation of resources. We will construct demand curves to capture consumer behavior and supply curves to capture producer behavior. The resulting equilibrium price “rations” the scarce commodity. Markets are frequent targets of government intervention. This intervention can be direct control of prices or it could be indirect price pressure through the imposition of taxes or subsidies. Both forms of intervention are impacted by elasticity of demand.
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University of Illinois at Urbana-Champaign
The University of Illinois at Urbana-Champaign is a world leader in research, teaching and public engagement, distinguished by the breadth of its programs, broad academic excellence, and internationally renowned faculty and alumni. Illinois serves the world by creating knowledge, preparing students for lives of impact, and finding solutions to critical societal needs.
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TOP REVIEWS FROM FIRM LEVEL ECONOMICS: CONSUMER AND PRODUCER BEHAVIOR
In the beginning I thought this was going to be a very basic course, but the way the professor explained the topics really make it interesting a practical, going beyond the classical economic theory.
This was awesome. I did not know Firm Level Economics when I joined this course. The explanations were simple and Prof DeBrock explained really difficult concepts in a very easy to understand manner.
Larry is one of my all time favorite professors. No one teaches price theory like him. He makes the material entertaining and creates an enjoyable learning experience. I wish he taught more courses.
Had lot of fun learning in this course. Although I had a basic concept of economics but with the help of this course I now have a clear and better understanding on Consumer and producer behavior.
About the Managerial Economics and Business Analysis Specialization
In order to effectively manage and operate a business, managers and leaders need to understand the market characteristics and economic environment they operate in. In this Specialization, you will build a solid understanding of the operation of markets and the macro-economic environment with real-world examples. You will be able to identify firm and country-level economic factors that impact business decisions, develop an analytical framework using statistical tools, and apply economic theory and data in the analysis of business environment and trends to make effective business decisions.
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