Topic outline

  • This is the second half of the Intermediate Microeconomics course at Aalto. The course is taught by Marko Terviö. The teaching assistant is Eero Nurmi.

    The first half is taught in period 1, see  The second half follows the same policies, except where otherwise mentioned. 

    Make sure to read the syllabus carefully before registering for this course (link in the side panel at MyCourses). 

    Classroom lectures take place at Otakaari 1. (Click on the event code, e.g. L01, in the side panel Calendar to display the room information) 

  • TA sessions will be held on Mondays, starting in the second week of the classes. The times and locations for the sessions are:

    - 31.10. 15:15-16:45, Väre, L101 Ryhmäopetus

    - 7.11. 15:15-16:45, Ekonominaukio 1, V001 Jenny ja Antti Wihurin Rahasto

    - 14.11. 15:15-16:45, Ekonominaukio 1, T003

    - 21.11. 15:15-16:45, Väre, L101 Ryhmäopetus

    - 28.11. CANCELLED

    - 5.12. 15:15-16:45, Väre, L101 Ryhmäopetus

    The course also has a Zulip chat here:   Use your aalto email address to login.

  • Thinking through and working on problem sets is the most important learning method in this course. Most of the “self-study” in the estimated workload (see course syllabus) consists of working on problem sets. The schedule of problem set deadlines is available in the course schedule, which is linked from the course home page. (Working on problem sets is also the best single method of preparing for the exam.) While there is much variability between problems, on average one numbered problem in a set is expected to take about 1-2 hours to complete.

    Homework solutions to each problem set must be submitted in one pdf-file (unless otherwise noted). Add your clearly typed student ID on the top of the first page, this makes graders’ work easier. Make sure to test your scanning quality well before the first deadline. 

    You are allowed and indeed encouraged to discuss the problem sets with fellow students taking this course. However, each solution must be individually written up (with the exception of specifically pointed out Group work). 

    For a solution to be acceptable it must include the explanation behind your reasoning. A mere bottom line answer is not acceptable. You don't need to outline all intermediate steps in a calculation (even if the model solution does) but you do have to explain the rationale behind your calculations. Why did you set up this computation, and what did you find out with it? You can use calculators and computers to aid you as much as you want and also to produce graphs. 

    When asked to give your own example then do not use examples that are very close to those used in class or in the textbook.

    Weekly schedule

    Problem set questions are based on material from previous weeks' course topics, with the exception of the last problem set which is due on the day after the last lecture. 

    There is a 5 point bonus for submitting your assignment in time for the recommended deadline, which is usually on Wednesday 15:00. You can update your submission until the final deadline, but notice that the time of your final revision is your official submission time. The bonus cannot increase total points above 100, but will "make up" for any lost points in the same problem set.

    The final deadline is on Thursday exactly 24 hours after the recommended deadline. This is also the time when model solutions are published at MyCourses. After the final deadline submission becomes impossible -- later submissions will not be accepted. 

    Points earned from each question will be available usually within one week. Questions regarding the grading should be addressed to the teaching assistant. 

    A small number of interactive problems (at most 15% of total) will be done in class. They are graded separately, with the answers typically submitted during class.

    Standard interpretations

    The features explained in the initial part of a problem before any possible subparts (a, b, c…) apply to the entire problem unless otherwise noted. The features in each subpart only apply to that subpart, unless otherwise noted. If there are further instructions after the list of all subparts these also apply to the entire problem unless otherwise noted. Maximum points for each question are shown in the problem set, they are equally divided between the subparts, unless otherwise noted.

    Unless otherwise stated, you can assume that decision-makers are risk neutral and maximize the present value of their own payoffs (typically profits for firms, utility or consumer surplus for consumers). For discounting purposes, you can assume that future periodic payoffs are realized at the end of a period. In particular, period t=0 refers to now immediately ("current period", "this year", etc), period t=1 to the end of first period, that is, "one period from now", "next year", etc. 

    Even when a question asks you to find ``the equilibrium'' the correct answer might involve multiple equilibria or no equilibria. The singular phrasing is used for brevity only, unless otherwise noted. 

    In discrete-type pricing problems you can assume that a customer that is indifferent between two deals will choose the one that gives the seller more profit. No need to mess around with ``minus one cent'' prices to handle tie-breaking.

    Sometimes it makes sense to use a computer for calculations, e.g., Excel, Mathematica, or Python/NumPy. If you do, still make sure to explain your reasoning and show the equations you solved.

  • Model solutions to problem sets will appear here after the submission deadline. These model solutions often include additional commentary and steps than is needed for a perfect answer.

  • The course grade is based 50% on the exam and 35% on problem sets, and 15% on other assignments (e.g. a case write-up). In order to pass the course you must obtain at least 50% of the possible total points for the problem sets.

    The total points for problem sets takes into account your 4 highest problem set scores out of the 5 problem sets. This is meant to allow for one randomly missed deadline or sick days, etc.  Model solutions are released at the deadline so deadline extensions are not available under any circumstance.

    If the maximum points among all students from a problem set or the final exam is below 100 then the points for all students from that PS/exam will be rescaled so that the rescaled maximum is 100. (This does not apply to the retake exam, due to fewer takers).

    There are no secret methods for obtaining extra credit or additional retakes or deadline extensions. The same rules apply equally to everyone.