ECON1001 · Introductory Microeconomics
The Complete Exam Bible · S1 2026Introductory Microeconomics
ECON1001 Introductory Microeconomics is the University of Sydney's first-year gateway to economic reasoning: you build demand from consumers' marginal benefit and supply from firms' marginal cost, then run that single toolkit across surplus, elasticity, monopoly, game theory, taxes, externalities and trade. The stakes sit at the end — an in-person, closed-book, AI-prohibited final exam worth 50%, backed by a 30% in-semester test — so the whole course rewards students who can both compute (find Q, P, profit, DWL) and explain the intuition in one move. This free layer maps every examinable topic in our own words; the full Exam Bible unlocks the worked drills, diagrams and mark-by-mark model answers.
What ECON1001 covers
The whole subject → one exam-ready map. Each topic links to its free chapter guide.
How ECON1001 is assessed
| Component | Weight | Format |
|---|---|---|
| Four online quizzes (incl. Week 3 Early Feedback Test 5% + three pre-scheduled tests 15%) | 20% | Online; AI allowed |
| In-semester test (IST) | 30% | In person, closed book, AI prohibited; MCQ on bubblesheet, non-programmable calculator + printed dictionary permitted |
| Final exam | 50% | In person, closed book, AI prohibited; emphasises Weeks 7-13, assumes the Weeks 1-6 toolkit |
Single-price monopoly: price, quantity, profit and deadweight loss
- 2 marks · MR ruleDerive marginal revenue. For linear demand P = a − bQ, MR has the same intercept and twice the slope: MR = 200 − 4Q.
- 2 marks · MR=MC and read price off demand, not MRSet MR = MC: 200 − 4Q = 8 + 2Q → 192 = 6Q → Q_m = 32. Price off the demand curve: P_m = 200 − 2(32) = 136.
- 2 marks · correct TR and TCProfit = TR − TC = (136 × 32) − (100 + 8(32) + 32²) = 4352 − (100 + 256 + 1024) = 4352 − 1380 = 2972.
- 2 marks · P=MC conditionEfficient quantity sets P = MC: 200 − 2Q = 8 + 2Q → 192 = 4Q → Q* = 48 (price P* = 104).
- 2 marks · base, height, areaDWL is the triangle between Q_m and Q*: base = 48 − 32 = 16; height = demand at Q_m minus MC at Q_m = 136 − (8 + 2×32) = 136 − 72 = 64. DWL = ½ × 16 × 64 = 512.
Key terms
- Opportunity cost
- The value of the next-best alternative forgone when a choice is made. It includes implicit (non-cash) costs as well as explicit payments, and excludes unrecoverable sunk costs.
- Comparative advantage
- The ability to produce a good at a lower opportunity cost than another party. A party can hold comparative advantage in a good even without absolute advantage, and gains from trade flow from specialising accordingly.
- Marginal analysis
- The rule that an activity should be expanded while its marginal benefit exceeds its marginal cost and stopped when MB falls below MC; the optimum is where MB = MC.
- Consumer surplus
- The gap between buyers' willingness to pay and the price actually paid, summed across all units traded — geometrically, the area between the demand curve and the price line.
- Deadweight loss (DWL)
- The total surplus destroyed when a market trades away from the efficient quantity — for example under monopoly, a tax, a binding price control, an externality, or a tariff.
- Pareto efficiency
- An allocation in which no one can be made better off without making someone else worse off; equivalently, the allocation that maximises total surplus. Competitive equilibrium achieves it but says nothing about fairness.
ECON1001 FAQ
Is the ECON1001 final exam open or closed book, and is AI allowed?
The final exam is in person, closed book, and AI prohibited. The same conditions apply to the 30% in-semester test (IST). Only the online quizzes (20% total) permit AI. You may bring a non-programmable calculator and an approved printed dictionary to the closed-book assessments.
How is ECON1001 assessed overall?
Four online quizzes worth 20% in total (a 5% Week 3 Early Feedback Test plus three pre-scheduled tests totalling 15%), a 30% in-semester test, and a 50% final exam. The final is the single dominant component, so the bulk of revision should target exam-style problems.
What does the final exam actually cover?
The final emphasises the Weeks 7-13 material — monopoly, price discrimination, game theory, taxes, externalities, public goods and trade. The Weeks 1-6 toolkit (demand, supply, cost curves, elasticity, surplus) is not tested as a separate block but is a prerequisite skill set you must be fluent in to answer the later topics.
Do I need to buy the textbook?
No. The set text is Essentials of Microeconomics by Nguyen and Wait (1st or 2nd edition), described as recommended but not mandatory and available through the USyd library. The lecture decks are a modified version of those slides, so the slides plus tutorials are the primary study source.
Is ECON1001 mostly maths or mostly intuition?
Both, and the exam rewards the link between them. You need to compute equilibria, elasticities, profits and deadweight losses cleanly, but most marks also require you to explain the economic intuition — why output is restricted, who bears a tax, why a market under- or over-produces. Practise stating the one-sentence reason alongside every number.
How to study for the exam
Treat the demand/supply and cost-curve mechanics from Weeks 1-6 as the alphabet you must over-learn early, because every Week 7-13 topic is written in it. For each model, drill the same loop: set up the curves, apply the optimisation condition (MB = MC, MR = MC, P = MC, or MSB = MSC), solve for Q then P, then layer on surplus and deadweight loss. Build a one-page condition sheet so the trigger ('monopoly → MR = MC, price off demand'; 'tax → wedge of size t, inelastic side bears more') is instant under closed-book pressure. Use the AI-allowed quizzes to find your weak topics, then rehearse those under timed, calculator-only conditions. Finally, for every worked answer write the intuition sentence next to the arithmetic — that habit is where the exam's explanation marks live.
