MGE2112: Managerial Economics

Semester I – 2004-05

Faculty Name: Alexander Mosesov
Phone: 06 543 9444 ext. 211
Office Location: Main Block, Room F19
Office Hours: Morning: Sat. 10:00-12:00; Sun. 09:00-12:00; Wed. 09:00-10:00
Evening: Sat. 18:00-20:00; Sun. 18:00-21:00; Wed. 18:00-20:00

MIE1102 (Microeconomics)

Number of Credits: 3 Credits

Course Introduction: Economics is the study of how societies choose to allocate scarce resources among competing uses. Many of the decisions we make are economic decisions, and many of our interactions with others are influenced by economic institutions. To understand the functioning of any economy, one must have a basic knowledge of Economics.
Managerial Economics is economics applied to business. It deals with the application of economic concepts and economic analysis towards formulating rational business decisions. Managerial Economics is designed to provide a solid foundation of economic understanding for application in managerial decision-making process. Businessmen and women have to develop special skills to tackle their problems. The methods of reasoning, concepts, tools and techniques provided by Managerial Economics aid the process of business decision-making. Managerial Economics uses basic economic paradigms as a functional tool for problem solving.

Course Contents:

- An overview of Managerial Economics

- Features of the Firm & Its Environment

- Business Objectives & Models of Business Firms

- Risk & Uncertainty

- Consumer Behavior & Demand Forecasting for Business

- Production, Costs, & Models of Competitive Structure

- Business Strategy & Rivalry

- Pricing Decisions and Market Failure

- Non-price Competition & Marketing Mix

- Cost-benefit Analysis & Investment Decisions

- Business & Economic Forecasting

- Industrial Policy & Role of Small Firms

Course Objectives: Upon completing this course, the students will be able to:

- Understand the essence of managerial economics

- Analyze the nature of firms & their environment

- Assess the business objectives and business strategy of firms

- Conduct fundamental production & cost analysis

- Explicate the significance of demand sensitivity & economic forecasting for business

- Assess the major market structures

- Understands the importance of risk and uncertainty

- Examine pricing decisions and market failure

- Carry out cost-benefit analysis of projects & investments

- Analyze the growth and scope of large firms, industrial policy and role of small firms

Course Policies:

Attendance & Academic Dishonesty: Attendance and all types of academic misconduct and their consequences are subject to the Skyline College regulations explicitly stated in the Student’s Handbook.
4 Quizzes: Student who failed to take a scheduled quiz receives zero points for this quiz. In case of an excusable reason (sickness or critical family matters) a re-take or a verbal test could be organized.
4 Assignments: Assignments are due on the date specified in the assignment. Late submissions are penalized by the top-grade discounts.
4 Mid-Term & Final Exams: Penalties, as well as all other regulations for these assessments are imposed according to current college policies.

Core text: Craig H. Peterson / W. Cris Lewis (2002), Managerial Economics, 4 th edition, Prentice-Hall of India Private Ltd., New Delhi, India

Additional Reading, Reference Books:
4 Dominick Salvatore (2002) Managerial Economics in a Global Economy, 3rd Edition., McGraw-Hill Inc., New York, USA
4 Howard Davies / Lan Pun-Lee (2001) Managerial Economics, 3rd edition, Financial Times/Prentice Hall, London, U. K.
4 Alan Griffiths / Stuart Wall (2001) Applied Economics, 8th edition, Pearson Education, Harlow, UK
4 Mark Hirschey / James L. Pappas (2000) Fundamentals of Managerial Economics, 5th Edition, Dryden Press, New York, USA
4 Edwin Mansfield (1999) Managerial Economics, Theory, Applications and Cases, 3rd Edition, W. W. Norton & Co., New York, USA
4 Win Hornby (Latest Ed.) Business Economics, Longman, London, UK
Internet Related Resources:

Assessments / Grading:

Students’ performance is assessed in each registered course out of 100 percent marks*. Current course grading will be based on the following weighted assessments:

Type of Assessment Weight Towards the Final Grade, % Schedule / Timing
Quiz 1:
Week 4
Quiz 2:
Week 6
Mid-Term Exam
Week 8
Quiz 3:
Week 10
Week 12
Quiz 4:
Week 14
Participation & Attendance
Final Exam
Week 16

* - For the grading scale of 100: A is 90 points & above; B =80-89; C =70-89; D =60-79; F is 59 & below

Delivery Methods & Class Schedule: This course is delivered in the form of interactive lectures summarized in handouts and accompanied by transparency presentations. Most important issues within each concept and/or topic are clarified through discussions and class participation. Topics will be delivered according to the following schedule:

Week Concept/Topic Mode/Aid* Source: Core Text
1 Overview of Managerial Economics L / T / D / H Ch 1, App, pp. 4-31
2 Basic tools of Managerial Economics L / T / D Ch 2, App 33-68
3 Consumer Theory L / T / D / H Cht 3, pp.72-111
4 Demand Estimation L / T / D / H Cht 4, pp.113-143
5 Business Forecasting L / T / D / H Cht 5, pp.145-179
6 Production Theory L / T / D / H Cht 6, pp.184-229
7 Cost Theory L / T / D / H Cht 7, pp.231-268
8 Linear Programming L / T / D / H Cht 8, pp.272-302

Mid-Term Exam


Open Questions Test

9 Perfect Competition vs. Monopoly L / T / D / H Cht 9, pp.308-339
10 Monopoly / Oligopoly L / T / D / H Cht 10, pp.341-367
11 Pricing L / T / D / H Cht 12, pp.402-435
12 Risk in Decision-Making L / T / D / H Cht 14, pp.468-503
13 Capital Budgeting L / T / D / H Cht 15, pp.505-542





Final Exam



* - L=Lecture; T=Transparency; D=Discussion; H=Handouts; Cht=Chapter; App =Appendix

Last modified: November 20, 2004