Managerial Economics

Unit

Course Description

Sessions

I

Introduction to Managerial Economics: Managerial Economics: Meaning, Nature, Scope, & Significance. Relationship of Managerial Economics with Statistics.

3

II

Fundamental Concepts: Opportunity Costs, Incremental Principle, Time Perspective, Discounting and Equi-Marginal Principles. Theory of the Firm: Firm and Industry.

3

III

Demand and Supply Analysis: Theory and Law of Demand, Individual and Market Demand, Determinants of Demand, Concept of Elasticity of Demand, Types of Elasticity of Demand, Uses of Elasticity of Demand for Managerial Decision Making, Measurement of Elasticity of Demand. Concept of Demand Forecasting, Methods – Qualitative and Quantitative (Basic Concepts Only

Supply – Law of Supply, Its Determinants and Elasticity of Supply.

3

IV

Cost Analysis and Pricing Approach: Cost - Concept and Types of Costs, Short Run Cost Analysis - Fixed, Variable, Total, Average and Marginal Cost Curves. Long Run Cost Analysis - Economies and Diseconomies of Scale, Factors Affecting Cost at Micro-Level. Full Cost Pricing, Product Line Pricing, Product Lifecycle Pricing. Pricing Strategies: Price Skimming, Penetration Pricing, Differential Pricing, Promotional Pricing, etc.

4

V

Production and Utility Analysis: Concepts, Production Function with One Variable Input - Law of Variable Proportions. Production Function with Two Variable Inputs and Laws of Returns to Scale. Consumer Behavior and Surplus. Marginal Utility Analysis, Economies of Scale.

4

VI

Market Structure and Pricing Practices: Perfect Competition: Features, Pricing under Perfect Competition. Monopoly: Features, Pricing under Monopoly. Price Discrimination. Monopolistic Competition: Features, Pricing under Monopolistic Competition, Product Differentiation. Oligopoly: Features, Kinked Demand Curve, Cartels, Price Leadership.

2

VII

Concepts of National Income, Index Number and Business Cycle: National Income- Concept, GNP,NNP,GDP,PCI Methods and Difficulties in Measurement of National Income.

Review of index Number- Meaning, Importance and Limitations. 

Meaning and Features of Business Cycles, Phases of Business Cycles

3

VIII

Profits: Determinants of Short-term & Long-term Profits. Classification - Measurement of Profit. Break Even Analysis - Meaning, Assumptions, Determination of BEA, Limitations, Uses of BEA in Managerial Decisions.

2

SECTION B

At Least one Case Study from each UNIT. Questions will be case/inferences/application based