Preface
Greek philosopher Heraclitis said more than 2,500 years ago that “Nothing endures but change.” Forecasting is a tricky business, but this sentiment strikes us as being as safe a bet as one can make. Change—rapid change—underlies all our lives. As this revision was getting underway, both economic and political uncertainty had taken center stage. A once-in-a-century pandemic had swept the globe, an event that is likely (we hope!) to be the most extraordinary economic event of your lives. The recent COVID-19 pandemic intensified an existing political divide that culminated in a contested presidential election and the subsequent storming of the Capitol in the days before President Joe Biden’s inauguration. None of these events were widely predicted, and their long-run impact on the global economy is still uncertain. And yet, those events give us the opportunity to share economics principles and the economic way of thinking in a way that emphasizes their relevance to today’s world.
Economics is about people making decisions as they go about the ordinary business of life. To that end, we use applications from sports, politics, campus life, current events, and other familiar settings to illustrate the links between whiteboard theory and common experience. In this new edition we have incorporated case studies on the optimal amount of exercise, Uber’s surge pricing, the college textbook market, and a tuna cartel, among others. As in previous editions, we have provided a balance between current issues and historical context in an attempt to provide a sense of the intellectual excitement of the field and an appreciation for the gains it has made (as well as an awareness of the challenges that lie ahead). Because of the increasingly global nature of economic activity, we’ve maintained a clear and consistent international focus.
In this new edition, we have stayed true to what we believe are the elements that make this text effective. To ensure students realize that economics is a unified discipline and not a bewildering array of seemingly unrelated topics, we develop the presentation of microeconomics around integrating themes.
The integrating theme for microeconomics is the marginal decision rule, a simple approach to choices that maximize the value of some objective. We develop the marginal decision rule in an early chapter, and then draw on it repeatedly throughout our discussion of microeconomics. Instead of a hodgepodge of rules for different market conditions, this single rule can be applied within any market setting.
Recognizing that a course in economics may seem daunting to some students, we have tried to make the writing clear and engaging. Clarity comes in part from the intuitive presentation style, but each chapter contains pedagogical features that make learning economic concepts and principles easier and more fun:
Start Up—Each chapter begins with a real-world example that motivates readers to study the material that follows. These essays, on topics such as the value of a college degree in the labor market or how policymakers reacted to a particular economic recession, lend themselves to the type of analysis explained in the chapter. We often refer to these examples later in the text to demonstrate the link between theory and reality.
Learning Objectives—These succinct statements serve as guides to the content of each section. Instructors can use them as a snapshot of the important points of the section. After completing the section, students can return to the learning objectives to see if they have mastered the material.
Heads Up!—Notes to warn of common errors and explain how to avoid making them are included throughout the text. This feature provides additional clarification and shows students how to navigate potentially treacherous waters.
Key Takeaways—These statements review the main points covered in each content section.
Key Terms—Defined within the text, students can review these terms in context.
Pop! Goes the Econ features—These features include links to contemporary and engaging examples that instantly connect with students from movies such as Forrest Gump or television shows such as The Simpsons.
Try It! questions—At the end of every content section is a Try It! question. These problems are answered completely in the text and give students the opportunity to be active learners. They are designed to give students a clear signal as to whether they understand the material before they go on to the next topic. Each Try It! question is linked to a similar end-of-chapter problem.
Cases in Point—These essays, included at the end of each content section, illustrate the influence of economic forces on real issues and real people. Unlike other texts that use boxed features to present interesting new material or newspaper articles, we have written each case ourselves to integrate them more clearly with the rest of the text.
Summary—The information presented in the chapter is pulled together in a way that allows for a quick review of the material in just a few paragraphs.
End-of-chapter Concept Problems and Numerical Problems—These are bountiful and are intended to check understanding, to promote discussion of the issues raised in the chapter, and to engage students in critical thinking about the material. Included are not only general review questions to test basic understanding but also examples drawn from the news and from results of economics research. Some have students working with real-world data.
Chapter quizzes—Each chapter of the online version of the text includes embedded multiple choice questions that provide students with feedback on both correct and incorrect responses. The quizzes provide yet another way for students to test themselves on the material at the most teachable moments.
We hope that users will find this text an engaging and enjoyable way of becoming acquainted with economics principles and that mastery of the material will lead to looking at the world in a deeper and more meaningful way. We welcome all feedback.
—Libby Rittenberg, Alan Grant, and Timothy Tregarthen
What’s New in Version 4.0
This new edition builds on the solid foundation and structure of the previous versions, but brings fresh new content.
The book content has been significantly reorganized and streamlined.
New Pop! Goes the Econ video links let students see economics in their daily lives by connecting theory with movies, television, music, and the news.
Over twenty new or substantially revised Case in Point boxes highlight news items, academic research, and economic curiosities that help students connect theory with the real world.
New sections devoted to taxes, partial equilibrium analysis of tariffs, and price discrimination have been included.
Links to supporting video from Khan Academy have been added at point-of-use throughout the text.
Several new Start Up features have been added to this version.
Supplements
Principles of Microeconomics v4.0 is accompanied by a robust supplements program that augments and enriches both the teaching and student learning experiences. The authors personally prepared all of the supplements to ensure accuracy and full alignment with the book’s narrative. Faculty should contact their FlatWorld sales representative or FlatWorld support at support@flatworld.com for more information or to obtain access to the supplements upon adoption.
Sample Syllabi
Sample syllabi based on either 16-week or 10-week terms provide useful templates that help new adopters transition from their current course textbook to Principles of Microeconomics v4.0. Faculty can download the syllabi from the FlatWorld website or they can be obtained by contacting your local FlatWorld representative or FlatWorld support (support@flatworld.com).
Instructor’s Manual
The instructor’s manual (IM) includes the following for each chapter: Overview and Outline, Learning Objectives, Common Student Difficulties, Suggestions for Active Learning, Lecture Supplements, and Lecture Extensions, along with Additional Materials when applicable.
PowerPoint Slides
PowerPoint Slides organized by chapter include a concise and thorough outline, a list of Learning Objectives, and figures and tables contained in the text. These slides work well for both face-to-face and online learning environments, enliven lectures, and stimulate class discussions. Adopters can use the slides as composed to support lectures or customize and build upon them to suit their particular teaching goals.
Test Item File
The author-written Test Item File (TIF) includes more than 200 questions per chapter in multiple-choice, true/false, and short answer formats. All answers are provided, including possible responses to the short answer questions. The items have been written specifically to reinforce the major topics covered in each chapter and to align with FlatWorld Homework and in-text quiz items. The Test Item File questions are also available in pre-formatted form for easy export into popular learning management systems such as Canvas or Blackboard.
Test Generator—Powered by Cognero
FlatWorld is pleased to provide a computer-generated test program powered by the leading assessment provider Cognero to assist instructors with selecting, randomizing, formatting, loading online, or printing exams. Please contact your local FlatWorld representative or FlatWorld support (support@flatworld.com) for more information or to request the program.
FlatWorld Homework
Accompanying author-reviewed FlatWorld Homework for this text is provided in an easy-to-use interface. Multiple choice, fill-in-the-blank, matching, graphing, and other question types are available for use and are all auto-gradable. Students who utilize the homework questions should see their performance improve on examinations that are given using the Test Item File questions that accompany this book.
Solutions Manual
The Solutions Manual contains answers for all Concept Problems and Numerical Problems found at the end of each text chapter.
Online Quizzes and Flashcards
Author-created Quiz questions and Flashcards for student self-evaluation are organized by chapter and section and embedded in the online version of the book. Students can use the Quizzes and Flashcards to test themselves on their comprehension by section as they read and learn, once they have completed a chapter, or for test review.