Microeconomics, Global Edition

Cover
Title
Copyright
Detailed Contents
Preface
A Word of Thanks
Part 1: Introduction
	Chapter 1: Economics: Foundations and Models
		Is the Private Doctor’s Office Going to Disappear?
		1.1 Three Key Economic Ideas
			People Are Rational
			People Respond to Economic Incentives
			Making the Connection: Does Health Insurance Give People an Incentive to Become Obese?
			Optimal Decisions Are Made at the Margin
			Solved Problem 1.1: A Doctor Makes a Decision at the Margin
		1.2 The Economic Problem That Every Society Must Solve
			What Goods and Services Will Be Produced?
			How Will the Goods and Services Be Produced?
			Who Will Receive the Goods and Services Produced?
			Centrally Planned Economies versus Market Economies
			The Modern “Mixed” Economy
			Efficiency and Equity
		1.3 Economic Models
			The Role of Assumptions in Economic Models
			Forming and Testing Hypotheses in Economic Models
			Positive and Normative Analysis
			Don’t Let This Happen to You: Don’t Confuse Positive Analysis with Normative Analysis
			Economics as a Social Science
			Making the Connection: Should Medical School Be Free?
		1.4 Microeconomics and Macroeconomics
		1.5 A Preview of Important Economic Terms
		Conclusion
			An Inside Look: Look Into Your Smartphone and Say “Ahh”
		*Chapter Summary and Problems
			Key Terms
			Summary
			Review Questions
			Problems and Applications
		Appendix: Using Graphs and Formulas
		Graphs of One Variable
		Graphs of Two Variables
			Slopes of Lines
			Taking into Account More Than Two Variables on a Graph
			Positive and Negative Relationships
			Determining Cause and Effect
			Are Graphs of Economic Relationships Always Straight Lines?
			Slopes of Nonlinear Curves
		Formulas
			Formula for a Percentage Change
			Formulas for the Areas of a Rectangle and a Triangle
			Summary of Using Formulas
	Chapter 2: Trade-offs, Comparative Advantage, and the Market System
		Managers at Tesla Motors Face Trade-Offs
		2.1 Production Possibilities Frontiers and Opportunity Costs
			Graphing the Production Possibilities Frontier
			Solved Problem 2.1: Drawing a Production Possibilities Frontier for Tesla Motors
			Increasing Marginal Opportunity Costs
			Economic Growth
		2.2 Comparative Advantage and Trade
			Specialization and Gains from Trade
			Absolute Advantage versus Comparative Advantage
			Comparative Advantage and the Gains from Trade
			Don’t Let This Happen to You: Don’t Confuse Absolute Advantage and Comparative Advantage
			Solved Problem 2.2: Comparative Advantage and the Gains from Trade
			Making the Connection: Comparative Advantage, Opportunity Cost, and Housework
		2.3 The Market System
			The Circular Flow of Income
			The Gains from Free Markets
			The Market Mechanism
			Making the Connection: A Story of the Market System in Action: How Do You Make an iPad?
			The Role of the Entrepreneur
			The Legal Basis of a Successful Market System
			Making the Connection: Who Owns The Wizard of Oz?
		Conclusion
			An Inside Look: What’s on the Horizon at Mercedes-Benz?
	Chapter 3: Where Prices Come From: The Interaction of Demand and Supply
		Smartphones: The Indispensible Product?
		3.1 The Demand Side of the Market
			Demand Schedules and Demand Curves
			The Law of Demand
			What Explains the Law of Demand?
			Holding Everything Else Constant: The Ceteris paribus Condition
			Variables That Shift Market Demand
			Making the Connection: Are Tablet Computers Substitutes for E-Readers?
			Making the Connection: Coke and Pepsi Are Hit by U.S. Demographics
			A Change in Demand versus a Change in Quantity Demanded
			Making the Connection: Forecasting the Demand for iPhones
		3.2 The Supply Side of the Market
			Supply Schedules and Supply Curves
			The Law of Supply
			Variables That Shift Market Supply
			A Change in Supply versus a Change in Quantity Supplied
		3.3 Market Equilibrium: Putting Demand and Supply Together
			How Markets Eliminate Surpluses and Shortages
			Demand and Supply Both Count
			Solved Problem 3.3: Demand and Supply Both Count: A Tale of Two Letters
		3.4 The Effect of Demand and Supply Shifts on Equilibrium
			The Effect of Shifts in Supply on Equilibrium
			Making the Connection: The Falling Price of Blu-ray Players
			The Effect of Shifts in Demand on Equilibrium
			The Effect of Shifts in Demand and Supply over Time
			Solved Problem 3.4: What Has Caused the Decline in Beef Consumption?
			Shifts in a Curve versus Movements along a Curve
			Don’t Let This Happen to You: Remember: A Change in a Good’s Price Does Not Cause the Demand or Supply Curve to Shift
		Conclusion
			An Inside Look: Google and Apple Face Supply and Demand Concerns in the Smartphone Market
	Chapter 4: Economic Efficiency, Government Price Setting, and Taxes
		The Sharing Economy, Phone Apps, and Rent Control
		4.1 Consumer Surplus and Producer Surplus
			Consumer Surplus
			Making the Connection: The Consumer Surplus from Broadband Internet Service
			Producer Surplus
			What Consumer Surplus and Producer Surplus Measure
		4.2 The Efficiency of Competitive Markets
			Marginal Benefit Equals Marginal Cost in Competitive Equilibrium
			Economic Surplus
			Deadweight Loss
			Economic Surplus and Economic Efficiency
		4.3 Government Intervention in the Market: Price Floors and Price Ceilings
			Price Floors: Government Policy in Agricultural Markets
			Making the Connection: Price Floors in Labor Markets: The Debate over Minimum Wage Policy
			Price Ceilings: Government Rent Control Policy in Housing Markets
			Don’t Let This Happen to You: Don’t Confuse “Scarcity” with “Shortage”
			Black Markets and Peer-to-Peer Sites
			Solved Problem 4.3: What’s the Economic Effect of a Black Market in Renting Apartments?
			The Results of Government Price Controls: Winners, Losers, and Inefficiency
			Positive and Normative Analysis of Price Ceilings and Price Floors
		4.4 The Economic Impact of Taxes
			The Effect of Taxes on Economic Efficiency
			Tax Incidence: Who Actually Pays a Tax?
			Solved Problem 4.4: When Do Consumers Pay All of a Sales Tax Increase?
			Making the Connection: Is the Burden of the Social Security Tax Really Shared Equally between Workers and Firms?
		Conclusion
			An Inside Look At Policy: Does the Sharing Economy Increase Efficiency?
		Appendix: Quantitative Demand and Supply Analysis
		Demand and Supply Equations
		Calculating Consumer Surplus and Producer Surplus
Part 2: Markets in Action: Policy and Applications
	Chapter 5: Externalities, Environmental Policy, and Public Goods
		Can Economic Policy Help Protect the Environment?
		5.1 Externalities and Economic Efficiency
			The Effect of Externalities
			Externalities and Market Failure
			What Causes Externalities?
		5.2 Private Solutions to Externalities: The Coase Theorem
			The Economically Efficient Level of Pollution Reduction
			Making the Connection: The Clean Air Act: How a Government Policy Reduced Infant Mortality
			The Basis for Private Solutions to Externalities
			Don’t Let This Happen to You: Remember That It’s the Net Benefit That Counts
			Making the Connection: The Fable of the Bees
			Do Property Rights Matter?
			The Problem of Transactions Costs
			The Coase Theorem
		5.3 Government Policies to Deal with Externalities
			Making the Connection: Should the Government Tax Cigarettes and Soda?
			Solved Problem 5.3: Dealing with the Externalities of Car Driving
			Command-and-Control versus Market-Based Approaches
			The End of the Sulfur Dioxide Cap-and-Trade System
			Are Tradable Emission Allowances Licenses to Pollute?
			Making the Connection: Can a Carbon Tax Reduce Global Warming?
		5.4 Four Categories of Goods
			The Demand for a Public Good
			The Optimal Quantity of a Public Good
			Solved Problem 5.4: Determining the Optimal Level of Public Goods
			Common Resources
		Conclusion
	Chapter 6: Elasticity: The Responsiveness of Demand and Supply
		Do People Respond to Changes in the Price of Gasoline?
		6.1 The Price Elasticity of Demand and Its Measurement
			Measuring the Price Elasticity of Demand
			Elastic Demand and Inelastic Demand
			An Example of Computing Price Elasticities
			The Midpoint Formula
			Solved Problem 6.1: Calculating the Price Elasticity of Demand
			When Demand Curves Intersect, the Flatter Curve Is More Elastic
			Polar Cases of Perfectly Elastic and Perfectly Inelastic Demand
			Don’t Let This Happen to You: Don’t Confuse Inelastic with Perfectly Inelastic
		6.2 The Determinants of the Price Elasticity of Demand
			Availability of Close Substitutes
			Passage of Time
			Luxuries versus Necessities
			Definition of the Market
			Share of a Good in a Consumer’s Budget
			Some Estimated Price Elasticities of Demand
			Making the Connection: The Price Elasticity of Demand for Breakfast Cereal
		6.3 The Relationship between Price Elasticity of Demand and Total Revenue
			Elasticity and Revenue with a Linear Demand Curve
			Solved Problem 6.3: Price and Revenue Don’t Always Move in the Same Direction
			Estimating Price Elasticity of Demand
		6.4 Other Demand Elasticities
			Cross-Price Elasticity of Demand
			Income Elasticity of Demand
			Making the Connection: Price Elasticity, Cross-Price Elasticity, and Income Elasticity in the Market for Alcoholic Beverages
		6.5 Using Elasticity to Analyze the Disappearing Family Farm
			Solved Problem 6.5: Using Price Elasticity to Analyze a Policy of Taxing Gasoline
		6.6 The Price Elasticity of Supply and Its Measurement
			Measuring the Price Elasticity of Supply
			Determinants of the Price Elasticity of Supply
			Making the Connection: Why Are Oil Prices So Unstable?
			Polar Cases of Perfectly Elastic and Perfectly Inelastic Supply
			Using Price Elasticity of Supply to Predict Changes in Price
		Conclusion
	Chapter 7: The Economics of Health Care
		How Much Will You Pay for Health Insurance?
		7.1 The Improving Health of People in the United States
			Changes over Time in U.S. Health
			Reasons for Long-Run Improvements in U.S. Health
		7.2 Health Care around the World
			The U.S. Health Care System
			The Health Care Systems of Canada, Japan, and the United Kingdom
			Comparing Health Care Outcomes around the World
		7.3 Information Problems and Externalities in the Market for Health Care
			Adverse Selection and the Market for “Lemons”
			Asymmetric Information in the Market for Health Insurance
			Don’t Let This Happen to You: Don’t Confuse Adverse Selection with Moral Hazard
			Solved Problem 7.3: If You Are Young and Healthy, Should You Buy Health Insurance?
			Externalities in the Market for Health Care
			Making the Connection: Should the Government Run the Health Care System?
		7.4 The Debate over Health Care Policy in the United States
			The Rising Cost of Health Care
			Making the Connection: Are U.S. Firms Handicapped by Paying for Their Employees’ Health Insurance?
			Explaining Rapid Increases in Health Care Spending
			The Continuing Debate over Health Care Policy
			Making the Connection: How Much Is That MRI Scan?
		Conclusion
Part 3: Firms in the Domestic and International Economies
	Chapter 8: Firms, the Stock Market, and Corporate Governance
		Facebook Learns the Benefits and Costs of Becoming a Publicly Owned Firm
			8.1 Types of Firms
				Who Is Liable? Limited and Unlimited Liability
				Corporations Earn the Majority of Revenue and Profits
				Making the Connection: How Important Are Small Businesses to the U.S. Economy?
			8.2 The Structure of Corporations and the Principal–Agent Problem
				Corporate Structure and Corporate Governance
				Solved Problem 8.2: Should a Firm’s CEO Also Be the Chairman of the Board?
			8.3 How Firms Raise Funds
				Sources of External Funds
				Making the Connection: The Rating Game: Is the U.S. Treasury Likely to Default on Its Bonds?
				Stock and Bond Markets Provide Capital—and Information
				Don’t Let This Happen to You: When Facebook Shares Are Sold, Facebook Doesn’t Get the Money
				Why Do Stock Prices Fluctuate So Much?
				Making the Connection: Following Abercrombie & Fitch’s Stock Price in the Financial Pages
			8.4 Using Financial Statements to Evaluate a Corporation
				The Income Statement
				The Balance Sheet
			8.5 Corporate Governance Policy and the Financial Crisis of 2007–2009
				The Accounting Scandals of the Early 2000s
				The Financial Crisis of 2007–2009
				Did Principal–Agent Problems Help Cause the 2007–2009 Financial Crisis?
				Making the Connection: The Ups and Downs of Investing in Facebook
			Conclusion
			Appendix: Tools to Analyze Firms’ Financial Information
			Using Present Value to Make Investment Decisions
				Solved Problem 8A.1: How to Receive Your Contest Winnings
				Using Present Value to Calculate Bond Prices
				Using Present Value to Calculate Stock Prices
				A Simple Formula for Calculating Stock Prices
			Going Deeper into Financial Statements
				Analyzing Income Statements
				Analyzing Balance Sheets
	Chapter 9: Comparative Advantage and the Gains from International Trade
		Saving Jobs in the U.S. Tire Industry?
		9.1 The United States in the International Economy
			The Importance of Trade to the U.S. Economy
			Making the Connection: Goodyear and the Tire Tariff
			U.S. International Trade in a World Context
		9.2 Comparative Advantage in International Trade
			A Brief Review of Comparative Advantage
			Comparative Advantage and Absolute Advantage
		9.3 How Countries Gain from International Trade
			Increasing Consumption through Trade
			Solved Problem 9.3: The Gains from Trade
			Why Don’t We See Complete Specialization?
			Does Anyone Lose as a Result of International Trade?
			Don’t Let This Happen to You: Remember That Trade Creates Both Winners and Losers
			Where Does Comparative Advantage Come From?
			Making the Connection: Leaving New York City Is Risky for Financial Firms
			Comparative Advantage over Time: The Rise and Fall—and Rise—of the U.S. Consumer Electronics Industry
		9.4 Government Policies That Restrict International Trade
			Tariffs
			Quotas and Voluntary Export Restraints
			Measuring the Economic Effect of the Sugar Quota
			Solved Problem 9.4: Measuring the Economic Effect of a Quota
			The High Cost of Preserving Jobs with Tariffs and Quotas
			Making the Connection: The Effect on the U.S. Economy of the Tariff on Chinese Tires
			Gains from Unilateral Elimination of Tariffs and Quotas
			Other Barriers to Trade
		9.5 The Arguments over Trade Policies and Globalization
			Why Do Some People Oppose the World Trade Organization?
			Making the Connection: The Unintended Consequences of Banning Goods Made with Child Labor
			Dumping
			Positive versus Normative Analysis (Once Again)
		Conclusion
Part 4: Microeconomic Foundations: Consumers and Firms
	Chapter 10: Consumer Choice and Behavioral Economics
		J.C. Penney Learns That Simplifying Prices Isn’t Simple
		10.1 Utility and Consumer Decision Making
			The Economic Model of Consumer Behavior in a Nutshell
			Utility
			The Principle of Diminishing Marginal Utility
			The Rule of Equal Marginal Utility per Dollar Spent
			Solved Problem 10.1: Finding the Optimal Level of Consumption
			What If the Rule of Equal Marginal Utility per Dollar Does Not Hold?
			Don’t Let This Happen to You: Equalize Marginal Utilities per Dollar
			The Income Effect and Substitution Effect of a Price Change
		10.2 Where Demand Curves Come From
			Making the Connection: Are There Any Upward-Sloping Demand Curves in the Real World?
		10.3 Social Influences on Decision Making
			The Effects of Celebrity Endorsements
			Network Externalities
			Does Fairness Matter?
			Making the Connection: What’s Up with “Fuel Surcharges”?
		10.4 Behavioral Economics: Do People Make Their Choices Rationally?
			Pitfalls in Decision Making
			Making the Connection: A Blogger Who Understands the Importance of Ignoring Sunk Costs
			The Behavioral Economics of Shopping
			Making the Connection: J.C. Penney Meets Behavioral Economics
		Conclusion
		Appendix: Using Indifference Curves and Budget Lines to Understand Consumer Behavior
		Consumer Preferences
			Indifference Curves
			The Slope of an Indifference Curve
			Can Indifference Curves Ever Cross?
		The Budget Constraint
		Choosing the Optimal Consumption of Pizza and Coke
			Making the Connection: Dell Determines the Optimal Mix of Products
			Deriving the Demand Curve
			Solved Problem 10A.1: When Does a Price Change Make a Consumer Better Off?
			The Income Effect and the Substitution Effect of a Price Change
			How a Change in Income Affects Optimal Consumption
		The Slope of the Indifference Curve, the Slope of the Budget Line, and the Rule of Equal Marginal Utility per Dollar Spent
			The Rule of Equal Marginal Utility per Dollar Spent Revisited
	Chapter 11: Technology, Production, and Costs
		Fracking, Marginal Costs, and Energy Prices
		11.1 Technology: An Economic Definition
			Making the Connection: Improving Inventory Control at Wal-Mart
		11.2 The Short Run and the Long Run in Economics
			The Difference between Fixed Costs and Variable Costs
			Making the Connection: Fixed Costs in the Publishing Industry
			Implicit Costs Versus Explicit Costs
			The Production Function
			A First Look at the Relationship between Production and Cost
		11.3 The Marginal Product of Labor and the Average Product of Labor
			The Law of Diminishing Returns
			Graphing Production
			Making the Connection: Adam Smith’s Famous Account of the Division of Labor in a Pin Factory
			The Relationship between Marginal Product and Average Product
			An Example of Marginal and Average Values: College Grades
		11.4 The Relationship between Short-Run Production and Short-Run Cost
			Marginal Cost
			Why Are the Marginal and Average Cost Curves U Shaped?
			Solved Problem 11.4: Calculating Marginal Cost and Average Cost
		11.5 Graphing Cost Curves
		11.6 Costs in the Long Run
			Economies of Scale
			Long-Run Average Cost Curves for Automobile Factories
			Solved Problem 11.6: Using Long-Run Average Cost Curves to Understand Business Strategy
			Making the Connection: The Colossal River Rouge: Diseconomies of Scale at Ford Motor Company
			Don’t Let This Happen to You: Don’t Confuse Diminishing Returns with Diseconomies of Scale
		Conclusion
		Appendix: Using Isoquants and Isocost Lines to Understand Production and Cost
		Isoquants
			An Isoquant Graph
			The Slope of an Isoquant
		Isocost Lines
			Graphing the Isocost Line
			The Slope and Position of the Isocost Line
		Choosing the Cost-Minimizing Combination of Capital and Labor
			Different Input Price Ratios Lead to Different Input Choices
			Making the Connection: The Changing Input Mix in Walt Disney Film Animation
			Another Look at Cost Minimization
			Solved Problem 11A.1: Determining the Optimal Combination of Inputs
			Making the Connection: Do National Football League Teams Behave Efficiently?
		The Expansion Path
Part 5: Market Structure and Firm Strategy
	Chapter 12: Firms in Perfectly Competitive Markets
		Perfect Competition in Farmers’ Markets
		12.1 Perfectly Competitive Markets
			A Perfectly Competitive Firm Cannot Affect the Market Price
			The Demand Curve for the Output of a Perfectly Competitive Firm
			Don’t Let This Happen to You: Don’t Confuse the Demand Curve for Farmer Parker’s Wheat with the Market Demand Curve for Wheat
		12.2 How a Firm Maximizes Profit in a Perfectly Competitive Market
			Revenue for a Firm in a Perfectly Competitive Market
			Determining the Profit-Maximizing Level of Output
		12.3 Illustrating Profit or Loss on the Cost Curve Graph
			Showing a Profit on the Graph
			Solved Problem 12.3: Determining Profit-Maximizing Price and Quantity
			Don’t Let This Happen to You: Remember That Firms Maximize Their Total Profit, Not Their Profit per Unit
			Illustrating When a Firm Is Breaking Even or Operating at a Loss
			Making the Connection: Losing Money in the Solar Panel Industry
		12.4 Deciding Whether to Produce or to Shut Down in the Short Run
			Solved Problem 12.4: When to Pull the Plug on a Movie
			The Supply Curve of a Firm in the Short Run
			The Market Supply Curve in a Perfectly Competitive Industry
		12.5 “If Everyone Can Do It, You Can’t Make Money at It”: The Entry and Exit of Firms in the Long Run
			Economic Profit and the Entry or Exit Decision
			Long-Run Equilibrium in a Perfectly Competitive Market
			The Long-Run Supply Curve in a Perfectly Competitive Market
			Making the Connection: In the Apple iPhone Apps Store, Easy Entry Makes the Long Run Pretty Short
			Increasing-Cost and Decreasing-Cost Industries
		12.6 Perfect Competition and Efficiency
			Productive Efficiency
			Solved Problem 12.6: How Productive Efficiency Benefits Consumers
			Allocative Efficiency
		Conclusion
	Chapter 13: Monopolistic Competition: The Competitive Model in a More Realistic Setting
		Starbucks: The Limits to Growth through Product Differentiation
		13.1 Demand and Marginal Revenue for a Firm in a Monopolistically Competitive Market
			The Demand Curve for a Monopolistically Competitive Firm
			Marginal Revenue for a Firm with a Downward-Sloping Demand Curve
		13.2 How a Monopolistically Competitive Firm Maximizes Profit in the Short Run
			Solved Problem 13.2: Does Minimizing Cost Maximize Profit at Apple?
		13.3 What Happens to Profits in the Long Run?
			How Does the Entry of New Firms Affect the Profits of Existing Firms?
			Don’t Let This Happen to You: Don’t Confuse Zero Economic Profit with Zero Accounting Profit
			Making the Connection: The Rise and Decline and Rise of Starbucks
			Is Zero Economic Profit Inevitable in the Long Run?
			Solved Problem 13.3: Can It Be Profitable to Be the High-Price Seller?
		13.4 Comparing Monopolistic Competition and Perfect Competition
			Excess Capacity under Monopolistic Competition
			Is Monopolistic Competition Inefficient?
			How Consumers Benefit from Monopolistic Competition
			Making the Connection: Peter Thiel, e-Cigarettes, and the Monopoly in Monopolistic Competition
		13.5 How Marketing Differentiates Products
			Brand Management
			Advertising
			Defending a Brand Name
		13.6 What Makes a Firm Successful?
			Making the Connection: Is Being the First Firm in the Market a Key to Success?
		Conclusion
	Chapter 14: Oligopoly: Firms in Less Competitive Markets
		Competition in the Video Game Console Market
		14.1 Oligopoly and Barriers to Entry
			Barriers to Entry
		14.2 Using Game Theory to Analyze Oligopoly
			A Duopoly Game: Price Competition between Two Firms
			Firm Behavior and the Prisoner’s Dilemma
			Don’t Let This Happen to You: Don’t Misunderstand Why Each Firm Ends Up Charging a Price of $399
			Solved Problem 14.2: Is Same-Day Delivery a Prisoner’s Dilemma for Wal-Mart and Amazon?
			Making the Connection: Is There a Dominant Strategy for Bidding on eBay?
			Can Firms Escape the Prisoner’s Dilemma?
			Making the Connection: With Price Collusion, More Is Not Merrier
			Cartels: The Case of OPEC
		14.3 Sequential Games and Business Strategy
			Deterring Entry
			Solved Problem 14.3: Is Deterring Entry Always a Good Idea?
			Bargaining
		14.4 The Five Competitive Forces Model
			Competition from Existing Firms
			The Threat from Potential Entrants
			Competition from Substitute Goods or Services
			The Bargaining Power of Buyers
			The Bargaining Power of Suppliers
			Making the Connection: Can We Predict Which Firms Will Continue to Be Successful?
		Conclusion
	Chapter 15: Monopoly and Antitrust Policy
		A Monopoly on Lobster Dinners in Maine?
		15.1 Is Any Firm Ever Really a Monopoly?
			Making the Connection: Is Google a Monopoly?
		15.2 Where Do Monopolies Come From?
			Government Action Blocks Entry
			Making the Connection: Does Hasbro Have a Monopoly on Monopoly?
			Control of a Key Resource
			Making the Connection: Are Diamond Profits Forever? The De Beers Diamond Monopoly
			Network Externalities
			Natural Monopoly
			Solved Problem 15.2: Can a Seafood Restaurant Be a Natural Monopoly?
		15.3 How Does a Monopoly Choose Price and Output?
			Marginal Revenue Once Again
			Profit Maximization for a Monopolist
			Solved Problem 15.3: Finding the Profit-Maximizing Price and Output for a Cable Monopoly
			Don’t Let This Happen to You: Don’t Assume That Charging a Higher Price Is Always More Profitable for a Monopolist
		15.4 Does Monopoly Reduce Economic Efficiency?
			Comparing Monopoly and Perfect Competition
			Measuring the Efficiency Losses from Monopoly
			How Large Are the Efficiency Losses Due to Monopoly?
			Market Power and Technological Change
		15.5 Government Policy toward Monopoly
			Antitrust Laws and Antitrust Enforcement
			Making the Connection: Did Apple Violate the Law in Pricing e-Books?
			Mergers: The Trade-off between Market Power and Efficiency
			The Department of Justice and FTC Merger Guidelines
			Regulating Natural Monopolies
		Conclusion
	Chapter 16: Pricing Strategy
		Getting into Walt Disney World: One Price Does Not Fit All
		16.1 Pricing Strategy, the Law of One Price, and Arbitrage
			Arbitrage
			Solved Problem 16.1: Is Arbitrage Just a Rip-Off?
			Why Don’t All Firms Charge the Same Price?
		16.2 Price Discrimination: Charging Different Prices for the Same Product
			Don’t Let This Happen to You: Don’t Confuse Price Discrimination with Other Types of Discrimination
			The Requirements for Successful Price Discrimination
			Solved Problem 16.2: How Apple Uses Price Discrimination to Increase Profits
			Airlines: The Kings of Price Discrimination
			Making the Connection: How Colleges Use Yield Management
			Perfect Price Discrimination
			Price Discrimination across Time
			Can Price Discrimination Be Illegal?
			Making the Connection: The Internet Leaves You Open to Price Discrimination
		16.3 Other Pricing Strategies
			Odd Pricing: Why Is the Price $2.99 Instead of $3.00?
			Why Do McDonald’s and other Firms Use Cost-Plus Pricing?
			Making the Connection: Cost-Plus Pricing in the Publishing Industry
			Why Do Some Firms Use Two-Part Tariffs?
		Conclusion
Part 6: Labor Markets, Public Choice, and the Distribution of Income
	Chapter 17: The Markets for Labor and Other Factors of Production
		Who Is Zack Greinke and Why Is He Being Paid $147 Million?
		17.1 The Demand for Labor
			The Marginal Revenue Product of Labor
			Solved Problem 17.1: Hiring Decisions by a Firm That Is a Price Maker
			The Market Demand Curve for Labor
			Factors That Shift the Market Demand Curve for Labor
		17.2 The Supply of Labor
			The Market Supply Curve of Labor
			Factors That Shift the Market Supply Curve of Labor
		17.3 Equilibrium in the Labor Market
			The Effect on Equilibrium Wages of a Shift in Labor Demand
			Making the Connection: Will Your Future Income Depend on Which Courses You Take in College?
			The Effect on Equilibrium Wages of a Shift in Labor Supply
			Making the Connection: Veterinarians Fall Victim to Demand and Supply
		17.4 Explaining Differences in Wages
			Don’t Let This Happen to You: Remember That Prices and Wages Are Determined at the Margin
			Making the Connection: Technology and the Earnings of “Superstars”
			Compensating Differentials
			Discrimination
			Solved Problem 17.4: Is Passing “Comparable Worth” Legislation a Good Way to Close the Gap between Men’s and Women’s Pay?
			Making the Connection: Does Greg Have an Easier Time Finding a Job Than Jamal?
			Labor Unions
		17.5 Personnel Economics
			Should Workers’ Pay Depend on How Much They Work or on How Much They Produce?
			Making the Connection: Raising Pay, Productivity, and Profits at Safelite AutoGlass
			Other Considerations in Setting Compensation Systems
		17.6 The Markets for Capital and Natural Resources
			The Market for Capital
			The Market for Natural Resources
			Monopsony
			The Marginal Productivity Theory of Income Distribution
		Conclusion
	Chapter 18: Public Choice, Taxes, and the Distribution of Income
		Should the Government Use the Tax System to Reduce Inequality?
		18.1 Public Choice
			How Do We Know the Public Interest? Models of Voting
			Government Failure?
			Is Government Regulation Necessary?
		18.2 The Tax System
			An Overview of the U.S. Tax System
			Progressive and Regressive Taxes
			Making the Connection: Which Groups Pay the Most in Federal Taxes?
			Marginal and Average Income Tax Rates
			The Corporate Income Tax
			International Comparison of Corporate Income Taxes
			Evaluating Taxes
		18.3 Tax Incidence Revisited: The Effect of Price Elasticity
			Don’t Let This Happen to You: Don’t Confuse Who Pays a Tax with Who Bears the Burden of the Tax
			Making the Connection: Do Corporations Really Bear the Burden of the Federal Corporate Income Tax?
			Solved Problem 18.3: The Effect of Price Elasticity on the Excess Burden of a Tax
		18.4 Income Distribution and Poverty
			Measuring the Income Distribution and Poverty
			Explaining Income Inequality
			Making the Connection: What Explains the 1 Percent?
			Showing the Income Distribution with a Lorenz Curve
			Problems in Measuring Poverty and the Distribution of Income
			Solved Problem 18.4: Are Many People in the United States Stuck in Poverty?
			Income Distribution and Poverty around the World
		Conclusion
Glossary
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