Course Descriptor

[Managerial Economics]

COURSE BASICS
Course Code ECON-5023
Credit Hours 3
Lectures [No. of Lec(s) Per Week] 1 Duration 180 minutes
Lab Sessions 3 Duration -

COURSE DISTRIBUTION
Program(s) Attached To MBA
Core / Elective core
Course Pre-requisites Microeconomics, Macroeconomics

COURSE DESCRIPTION
Managerial Economics is the application of economic theory and methodology to managerial decision making
problems within various organizational settings such as a firm or a government agency. The emphasis in this course
will be on demand analysis and estimation, production and cost analysis under different market conditions,
forecasting and decision making under uncertainty. This course will enable the students to investigate major areas
of management decision making in the context of various business oriented organizations for which economic
analysis is a useful input. It shows how an economist's understanding of certain phenomena may aid in the process
of management.

COURSE OBJECTIVES
The main objective of this course is to learn how the techniques and theories of microeconomics can be used to
explain how firms and consumers behave. A secondary objective is to understand when the behavior of firms and
consumers is efficient from society’s perspective. The emphasis throughout the course is on problem solving
.

LEARNING OUTCOMES
1. Draw on economics to explain the nature of the firm and the problems of its management;
2. Analyze the problems faced by firms in their interaction with consumers and the market;
3. Evaluate strategies for successful selling of a product in a specific market situation;
4. Prepare a response to a specified business problem.;
5. Communicate applications of economics to managerial issues and articulate possible solutions;
6. Identify a problem and formulate a proposed solution, using high level economic reasoning;
 MBA PROGRAM OBJECTIVES

1. Introduce students to an updated contemporary knowledgebase as well as best practices that are futuristic in nature. Our students
will be prepared to effectively manage and eventually spearhead growth oriented organizations and businesses
2. Inculcate sharp analytical capabilities and intrepid problem solving skills in our students. The rigor of the program will be designed in
a way to expose students to frequent, in-depth quantitative and qualitative analyses, thereby brushing up their intrinsic critical
reasoning capabilities
3. Train the students to identify and analyze emerging trends in global business environment and draw prudent correlations with the
factors dominant in indigenous industries or markets
4. Offer ample opportunities to the students to express and refine their innovativeness element. UCP MBA students will be encouraged
to conceive out-of-box ideas and express their ingenious to execute even stereotype solutions in unconventional ways
5. Instill curiosity in the students to boost their learning appetite. The program will obtain its leverage by synergizing inductive and
deductive teaching styles adopted on grounds of nature of course contents, varying from course to course
6. Encourage a diversity of student base in the program. This will ensure a healthy diversity of perspectives emanating from students
with varying backgrounds: be it cultural, social strata or simply past academic backgrounds at undergraduate level. This diversity will
also be sought after in the faculty mix for the program
7. Polish interpersonal skills of the students. The program will offer adequate opportunities to students to refine their oratory skills,
verbal and oral presentation skills, capabilities to build effective teams with result oriented group dynamics and general leadership
traits
8. Set high standards for integrity and fairness, encompassing all stakeholders of the program. Program leadership, faculty and students
will collectively promote a scholastic culture where merit and honesty are foremost values to be taken care of
9. Enunciate civic sense and upright professional ethics through meticulously designed course contents
10. Ensure that MBA projects align with the contemporary needs of local industry and serve as an instrument to bridge the gap between
academia and industry

Map if course objectives or outcomes specifically relate to any program objectives (along with corresponding assessment item):

PROGRAM OBJECTIVES (COURSE) LEARNING OUTCOMES COURSE ASSESSMENT ITEM

ASSESSMENT STRUCTURE
Assessment Items Percentage
Quiz(s) 10%
Assignments(s) 10%
Class Participation
Midterm Examination 30%
Final Examination 40%
Project/Presentation 10%
Other(s)
Any specific teaching/learning strategies:
This course include lectures and computer application. For the understanding of demand estimation and forecasting, a use of excel and SPSS
is required during lab sessions

COURSE CONTENT AND DELIVERY PLAN

Application (Learning Outcomes achieved
Lecture Topics Activities
through this topic)
Introduction 1: Understanding economics to
 The nature and scope of explain the nature of the firm and
Managerial Economics. the problems of its management
 Management Problem
 Effective Management
1
 Theory of firm
 The objective of the Firm
 Constrains faced by a firm
 Business vs. Economic profit
 Theories of Economic profit
Advanced Demand Analysis 1. Analyze the problems
 The Market Demand Function faced by firms in their
 Total and Marginal Revenue interaction with
 Sensitivity analysis consumers and the
 Computation of Price, Income market.
and Cross price Elasticity of 2. Evaluate strategies for
2
Demand by two Methods Quiz 1 successful selling of a
 Uses and Application of Price, product in a specific
Income and Cross-Price market situation;
Elasticity of demand 3. Prepare a response to a
 Some other Demand Elasticity specified business
problem.;
Advanced Demand Analysis
(continue)
 Price elasticity, Marginal Assignment 1
3
Revenue and Total Revenue
 Optimal Pricing Policy under
given price elasticity
Economic Optimization

 Mathematical tools for

derivatives
4&5  Unconstrained vs. Constrained
Optimization
 The substitution vs. the
Lagrange Methods of
Optimization
 Demand estimation by Regression 1. Evaluate strategies for
Analysis successful selling of a
product in a specific
 Simple Linear and Multiple market situation;
Linear Regression Models 2. Prepare a response to a
 Significance of estimated specified business
6&7 Quiz 2
coefficients and model problem.;
 Use of R2 3. Communicate
applications of economics
to managerial issues and
articulate possible
solutions;
8 Mid-Term
Demand Forecasting 1. Communicate
applications of economics
 Quantitative Methods for to managerial issues and
9 & 10 Forecasting articulate possible
 Best Forecasts solutions;
 Forecasting power of a
Regression Model
Production Analysis 1. Evaluate strategies for
successful selling of a
 Production Function product in a specific
 Total, Marginal and average market situation;
Products in case of single and 2. Prepare a response to a
two variable inputs specified business
11  Marginal Revenue Product problem.;
Quiz 3
and Optimal Employment of
Inputs
 Returns to scale vs. Returns to
factor

Cost Analysis

 Explicit and Implicit Costs

 Incremental and Sunk Costs
 Short-Run vs. Long-Run Costs
 Economies of Scale and
12
Economies of Scope
 Learning Curves Assignment 2
 Breakeven Analysis
 Degree of Operating Leverage

Pricing Practices 1. Evaluate strategies for

successful selling of a
13  Markup Pricing and profit product in a specific
maximization Mark up on market situation;
costs and price
  Optimal markup on price and 2. Prepare a response to a
cost specified business
 Price discrimination problem.;

Risk Analysis 1. Identify a problem and

formulate a proposed
 Economics Risk vs. Uncertainty solution, using high level
 Various types of risk economic reasoning
 Expected Profit of a Project Quiz 4
14
 Absolute vs. Relative Risk
 Beta as Measure of Risk
 Managerial Applications

Economics of Strategy--the Quest Submission of final

to Slow Profit Erosion Project

 Porter’s five forces and

15 diamond frame work
 Critical points of Product life
cycle
 Corporate and Competitive
Strategies
16 Presentations
Final Exam

LEARNING RESOURCES
 Dominick Salvatore (2014). Managerial Economics in a global Economy, 7th Edition, Oxford University Press, USA.
 Michael R. Baye (2007). Managerial Economics and business strategy, 6th Edition, McGraw Hill.
 Peter Cassimatis (1995). Introduction to Managerial Economics, Routledge