MANAGERIAL ECONOMICS

The Course:

Managerial Economics is a fundamental part of the business curriculum. The goal of this text is to provide
the students with the tools that they need to make sound Managerial Decisions

Course objectives:

1. The subject brings the complete and rigorous introduction to the basic Principles of Micro
Economics.
2. The introduction of Managerial Economics demonstrates how application of Economic Theory
can improve the decision making in different Businesses and how there exist variations in theory
and in Real Life Decision making.

Topics Books Recommended

1. Introduction to Managerial Economics Book 1. Ch1
Preview, the circular flow of Economic Activity, Nature of the Book 3.Ch1
Firm,

Concept of Economic Profit, Profit in market system, Economics

and decision making.

2.Demand and Supply Analysis Book 1. Ch3

Introduction, Individual and Market Demand, Book 4.Ch.3
Introduction, Individual and Market Supply
Concept of Elasticity and Business Relevance
3. Demand Estimation Book 1.Ch.4
Regression Techniques, Development of theoretical model, Data Book 3.Ch.4
collection, Choice of functional form, Estimation and
interpretation, problems with Regression analysis.)
4. Business and Economic Forecasting. Book 1.Ch5
Sources of data collection, Time Series Analysis, Barometric
forecasting, Input-Output Analysis.)
5. Production theory.
Production Function, Production with one and two variable inputs, Book 1.Ch6
Economies of scale and scope, Diseconomies of scale, Managerial Book 4.Ch7
decision making.
6.Cost Analysis Book 1.Ch7
The Economic cost, Production and cost, Short run and long run Book 3.Ch7
cost functions,
Operating Leverage, Estimation of Cost Functions, Plant size and
economies of scale, Learning Curves

7.Linear Programming Book 1.Ch 8

Significances, Applications, Assumptions, Profit and Cost Book 3.Ch 8
constraints, problems in linear programming.
8. Market structure. Book 1.Ch9&10
Perfect Competition
Monopoly, Comparison between PC and Monopoly.
Monopolistic Competition
Oligopoly, Price Leadership
9. Pricing of Goods. Book 1.Ch12
Pricing of multiple goods, Price Discrimination Book 2.Ch11
Product bundling, Peak load pricing,

10. Pricing And Employment Book 1.Ch13

Input pricing and employment, Economic rent, wage and income
differentials, Labor unions,
11. Risk and Capital Budgeting. Concept of risk, risk and Book 1.Ch14
decision making, risk management.
12. Manager’s guide to govt. in the Market place. Market Book 2.Ch 13
failures, externalities, public goods, govt. policies and international
markets, tariffs.

Books recommended

1. Petersen H. Craig, Lewis W. Cris (2003) “ Managerial Economics” 4th edition Pearson
2. Baye Michael R., (2000) “Managerial Economics and Business Strategy.” 2nd and 3rd edition,
Irwin, McGrew-Hill.
3. Salvatore Dominick, (2000). “Managerial Economics in a Global Economy” 2nd edition,
McGrew-Hill.
4. Keat G. Paul, Young K.Y. Phillip, (2003) “Managerial Economics” 4th edition, Pearson