What's in Principles of Microeconomics, unit by unit

Principles of Microeconomics is the half of intro economics that looks at single decisions: one household choosing what to buy, one firm choosing how much to make, one market finding a price. Encodr's free Principles of Microeconomics course follows the 20 chapters of OpenStax Principles of Microeconomics 3e plus its appendix on graphs, split into 20 units, 77 chapters and 1,194 study cards.

The course has a clear arc. It builds one tool (supply and demand), sharpens it (elasticity), then opens up the firm to see where supply comes from, and finally uses everything to study markets that don't work perfectly. Here is each unit in teaching order.

The foundations (units 1-5)

These five units are the toolkit. They are also the same five units that open Principles of Macroeconomics, because both OpenStax books start with the same chapters. If you take both courses, this is 20 chapters and 383 cards you only learn once.

Unit 1, Welcome to Economics (5 chapters, 58 cards). Scarcity and the division of labor, micro versus macro, theories and the circular flow model, traditional, command and market economies, and the math appendix: linear equations, slope and reading graphs.

Unit 2, Choice in a World of Scarcity (3 chapters, 76 cards). Budget constraints and opportunity cost, the production possibilities frontier and why it bows outward, and the objections to the economic approach, including positive versus normative statements. The PPF chapter has the first real calculations: reading opportunity cost off a table of production points.

Unit 3, Demand and Supply (5 chapters, 114 cards, the largest unit). The law of demand, equilibrium, what shifts each curve, the four-step process for predicting a new equilibrium, price ceilings and floors, and consumer, producer and social surplus. Almost everything later depends on this unit.

Unit 4, Labor and Financial Markets (3 chapters, 60 cards). The same model applied to wages and to interest rates, plus prices as signals that carry information no planner could collect.

Unit 5, Elasticity (4 chapters, 75 cards). The midpoint formula, elastic versus inelastic demand, the polar cases, how elasticity decides whether a price rise raises or lowers revenue, who bears a tax, and income, cross-price and wage elasticity. This is the most calculation-dense unit in the foundations; price elasticity of demand explained works through every problem type.

Consumers and firms (units 6-7)

Unit 6, Consumer Choices (3 chapters, 60 cards). Utility, diminishing marginal utility and the rule for spending a budget so the last dollar on each good adds the same utility. Then how income and price changes move the budget line, the income and substitution effects, and behavioral economics (loss aversion and other departures from the rational model).

Unit 7, Production, Costs and Industry Structure (5 chapters, 113 cards). Explicit versus implicit costs, accounting versus economic profit, short-run production and diminishing marginal product, the cost family (fixed, variable, total, average and marginal), and long-run average cost with economies and diseconomies of scale. It is the second-largest unit and the most table-heavy one in the course. Exams hand you a cost table and ask you to fill in the missing columns.

Market structures (units 8-11)

These four units (12 chapters, 229 cards) take the cost curves from unit 7 and ask how a firm picks its output under different levels of competition.

Unit 8, Perfect Competition (4 chapters, 74 cards). Price takers, the MR = MC rule, the break-even and shutdown points, entry and exit in the long run, and why perfect competition is both productively and allocatively efficient.

Unit 9, Monopoly (2 chapters, 59 cards). The five sources of barriers to entry, then how a monopolist reads price off the demand curve, why its marginal revenue sits below price, and why the result is allocatively inefficient: price ends up above marginal cost.

Unit 10, Monopolistic Competition and Oligopoly (2 chapters, 56 cards). Differentiated products and free entry, then a few large interdependent firms: collusion, cartels, the prisoner's dilemma and the kinked demand curve.

Unit 11, Monopoly and Antitrust Policy (4 chapters, 40 cards). Mergers measured with concentration ratios and the Herfindahl-Hirschman Index, illegal anticompetitive practices, the four choices for regulating a natural monopoly, and the deregulation of airlines and trucking.

When markets fall short (units 12-13)

Unit 12, Negative Externalities and the Environment (6 chapters, 58 cards). Private versus social cost, command-and-control rules, pollution charges, cap-and-trade permits and property rights, and weighing marginal benefit against marginal cost of protection.

Unit 13, Positive Externalities and Public Goods (3 chapters, 40 cards). Why private firms underinvest in innovation, patents and other tools to encourage it, and the excludable and rival grid that sorts private goods, public goods and common resources.

Labor, income and finance (units 14-17)

Unit 14, Labor Markets and Income (6 chapters, 59 cards). The hiring rule (hire until the value of the marginal product equals the wage), monopsony, unions, bilateral monopoly, employment discrimination and immigration.

Unit 15, Poverty and Economic Inequality (5 chapters, 39 cards). The poverty line, the poverty trap created by benefit phase-outs, the safety net, quintiles and the Lorenz curve, and policies to reduce inequality. The inequality material overlaps with the stratification units in what's in Intro Sociology, seen from a different angle.

Unit 16, Information, Risk and Insurance (2 chapters, 39 cards). Asymmetric information and lemons, actuarially fair premiums, moral hazard and adverse selection.

Unit 17, Financial Markets (3 chapters, 38 cards). How firms raise capital (reinvested profits, loans, bonds, stock), how households weigh return, risk and liquidity, and compounding. Students who also take Financial Accounting will see the same bonds and stock from the issuing company's books.

Government and trade (units 18-20)

Unit 18, The Public Economy (3 chapters, 38 cards). Public choice: rational ignorance, special interests and logrolling, median voter theory and voting cycles.

Unit 19, International Trade (4 chapters, 59 cards). Absolute versus comparative advantage from production tables, why trade helps even a country that is better at everything, intra-industry trade, and the gains from lowering barriers.

Unit 20, Globalization and Protectionism (5 chapters, 39 cards). Tariffs, quotas and nontariff barriers, who wins and loses, the five arguments for restricting imports, and how trade policy is made through the WTO and regional agreements.

Units 19 and 20 are also shared: they are the last two units of the macroeconomics course.

Where the math and the memorizing are

The course splits fairly cleanly into two kinds of material.

Every calculation in the course is a typed card whose answer was recomputed by script, and every graph is described in words. How to study for microeconomics has a plan for each kind of material. The calculation units reward working problems from memory over rereading worked examples, which is the testing effect in practice, and the cost and break-even ideas from units 7 and 8 connect directly to the business version in how to find your break-even point. For pacing a course this size, how long it takes to finish a big flashcard deck does the arithmetic.

Microeconomics is one of the gen-ed staples listed in free college gen-ed course flashcards. All 20 units are free on Encodr as Principles of Microeconomics flashcards.