This managerial economics course is an advanced course in managerial economics.  It is concerned with resource allocation decision. This course is an applied branch of economics that is mostly based upon the microeconomic theory. The major objective of this managerial is to provide the theory and tools essential to the analysis and solution of those problems that have significant economic consequences, both for the firm and society.  This course will also study the economic goals of the firm and the optimal decision-making and in doing so it distinguishes between profit maximization and the maximization of the wealth of shareholders.

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Course Outcomes

1. Cite and compare the three basic economic questions from the standpoint of both a country and a company.
2. Understand the reasons for the existence of firms and the meaning of transaction costs
3. Demonstrate the usefulness of market value added and economic value added
4. Illustrate how the concepts of supply and demand can be used to analyze market conditions in which management decisions about price and allocations of resources must be made
5. Show how elasticity affects revenue
6. Specify the components of a regression model that can be used to estimate a demand equation
7. Define the three stages of production and explain why a rational firm always struggle to operate in stage II.
8. Explain how the concept of relevant cost is used in the economics of cost
9. Compare and contrast the short-run cost function and the long-run cost function and explain why economies of scale are considered to be a long-run phenomenon
10. Compare and contrast the degree of price competition among the four market types.

Topics Covered

1.The firm and its goals
2. Supply and demand
3.Demand elasticity
4.Demand estimation
5. The theory of estimation of production
6. The theory and estimation of cost
7. Pricing and output decision: perfect competition and monopoly
8. Pricing and output decision: Monopolistic competition AND OLIGOPOLY
9. Capital Budgeting and risk
10.The multinational corporation and globalization

Prerequisites

Beco 210, Beco 260 , Business statistics and managerial math or essential of economics

Textbook and Recommended Material

Textbooks

Managerial Economics-Paul G. Keat and Philip K. Young ( 7th Edition)Pearson Education, 2014

Managerial Economics Course Schedule 

Day	Textbook/Reference	Topic
1	Keat and Young	Ch. 1 : 1.The economics of business 2.A brief review of important economic terms and concepts
2	Keat and Young	Ch.2: 1. The firm 2.The economic goal of the firm and optimal decision making 3.Goals other than profit 4.Maximizing the wealth of stockholders
3	Keat and Young	Ch.3: 1. Market demand 2. Market supply 3. Market equilibrium 4.comparative statics analysis supply demand and price: the managerial challenge 5. International application
4	Keat and Young	Ch. 4: 1. The economic concept of elasticity 2. The price elasticity of demand 3. The cross elasticity of demand 4. Income elasticity and other elasticites 5. International application
5	Keat and Young	Ch.6 1. The production function 2. A short-run analysis of total average and marginal product 3. The long -run production function 4. The estimation of production function
6	Keat and Young	Ch. 7: 1. The importance of cost in managerial decisions 2. The definition and use of cost in economic analysis 3.The relationship between production and cost 4. The short-run cost  function 5.The long-run cost function 6. The learning curve 7. Economics of scope 8. Economics of scale 9. Supply chain management 10. Examples of ways companies have cut costs to remain competitive 11. Application
7	Keat and Young	Ch. 8: 1.competition and market types in economic analysis 2. Pricing and output decisions in perfect competition 3. Pricing and output decisions in monopoly Markets 4. The implications of perfect competition and monopoly for managerial decision making 5. International application
8	Keat and Young	Ch.9 1. Monopolistic Competiton 2. Oligopoly 3. Pricing in an oligopolistic market 4. competing in imperfectly competitive markets
9	Keat and Young	Ch.10 1. Cartel arrangements 2. Price leadership 3. revenue maximization 4. price discrimination 5. nonmarginal pricing 6. multiproduct pricing 7. transfer pricing 8. other pricing practices
10	Keat and Young	Ch.12 1. The capital budgeting decision 2. time value of money 3. methods of project evaluation 4. cash flows 5. cost of capital
11	Keat and Young	Ch.13 1. Globalization -Is globalization good or bad 2. Pro- and anti-globalization arguments 3. Globalization and the future 4. risks faced by multinational corporations 5. exchange rates – exchange rate hedging
12	Keat and Young	Projects