This is the second of the two introductory courses in microeconomics, which covers the following topics: cost functions and their relation to market supply; the effects of entry and exit by producers on long-run market equilibrium; the constant returns to scale production function; the Solow Growth model; the decomposition of output growth into the weighted growth of the factors of production and the growth rate of productivity; the marginal product theory of income distribution; the meaning and importance of expected inflation and the real interest rate; time preference; durable asset returns and their relationship to interest rates and present values; the life cycle-permanent income hypothesis of consumer behavior; and deviations from perfect competition, the inefficiencies they can create, and the regulatory policies that have been developed to mitigate or prevent these deviations.