Managerial Economics (Syllabus)

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Directorate of Distance & Continuing Education (Utkal University)

Master of Business Administration (MBA)

Contributed by

Himani Gagrani

Managerial Economics

Author

Dr. Sanjib Kumar Hota

NAAC A+ ACCREDATED
CENTER FOR DISTANCE AND ONLINE EDUCATION,
UTKAL UNIVERSITY, BHUBANESWAR -7
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CENTER FOR DISTANCE & ONLINE EDUCATION
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© Centre for Distance & Online Education, Utkal University, Vani Vihar, Bhubaneswar-751007 The study
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Name of the Study Material: Managerial Economics

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CENTER FOR DISTANCE & ONLINE EDUCATION
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MANAGERIAL ECONOMICS

Block
No
Block
Unit No
Unit
1
Significance and
Scope of
Managerial
Economics
1
Role of Managers in Business
2
Economic paradigms applicable to business analysis
2
Market Demand:
3
Determinants of Demand and Supply,
Elasticity of Demand,
4
Indifference Curve Analysis,
5
Consumer’s Equilibrium Price
6
Income and Substitution Effects,

7
Demand Forecasting.
3
Production
Function
8
Production decision making,
9
Short Run Long Run Production
Functions.
4

Market Analysis
Profit Analysis
10
Cost Structure, Various Cost Concepts
Cost Estimation,
11
Pricing and
Output decisions in Perfect Competition,
12
Monopoly, Monopolistic Competition
13
Oligopoly
14
Theories of Profit
15
Break Even Analysis, Managerial Decisions,
16
Business
Cycle.

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CENTRE FOR DISTANCE AND ONLINE EDUCATION, UTKAL UNIVERSITY,
BHUBANESWAR
Program Name: Master in Commerce Program Code: 03030
0 Course Name: Managerial Economic
Course Code: MCM-2.4 Semester: I Credit: 4 Block No. 1 to 4 Unit No. 1 to 16

EXPERT COMMITTEE:

COURSE WRITER:

Dr Sanjib Kumar Hota

COURSE EDITORS

REFERENCES

MATERIAL PRODUCTION

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UNIT-I SIGNIFICANCE AND SCOPE OF MANAGERIAL
ECONOMICS
1.1 MANAGERIAL ECONOMICS- CONCEPT, NATURE, SCOPE,
SIGNIFICANCE AND ROLE IN DECISION MAKING
1.1.1 Introduction to Managerial Economics
1.1.2 Scope of Managerial Economics
1.1.3 Nature of Managerial Economics
1.1.4 Principles of Managerial Economics
1.1.5 Role of a Managerial Economist
1.1.6 Significance of Managerial Economics
1.1.7 Important Economic Concepts and Terms
1.1.8 Different attributes for Managerial Economic skill Development
1.1.9 Summary
1.1.10 Self-Assessment Questions
UNIT-2 DEMAND AND CONSUMER BEHAVIOUR
2.1 THE DEMAND ANALYSIS

2.1.1 Concepts of Revenue: TR, AR and MR
2.1.2 Relationship between AR (Demand Curve) and MR curve under Perfect
competition
2.1.3 Relationship between AR(Demand curve) and MR curve under imperfect
competition
2.1.4 Significance of the Concept of Revenue
2.1.5 Demand-Concept
2.1.6 Determinants of Demand
2.1.7 Law of Demand
2.1.8 Market Demand
2.1.9 Shift in Demand
2.1.10 Elasticity of Demand - concept
2.1.11 Price Elasticity of Demand
2.1.12 Income Elasticity of Demand
2.1.13 Cross Elasticity of Demand
2.1.14 Promotional Elasticity of Demand
2.1.15 Supply Analysis and Market Equilibrium
2.1.16 Demand Forecasting
2.1.17 Summary
2.1.18 Self Assessment Questions

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2.2 THE INDIFFERENCE CURVE ANALYSIS

2.2.1 Consumer Behaviour- Introduction
2.2.2 Concept of Indifference Curve and Marginal Rate of Substitution
2.2.3 Properties of Indifference Curve
2.2.4 The Budget Line or Price Line
2.2.5 Consumer’s Equilibrium under IC Analysis
2.2.6 Price consumption curve and Price elasticity
2.2.7 Income Consumption Curve and Engle Curve
2.2.8 Price Change and Income and Substitution Effects
2.2.9 Derivation of Individual Demand Curves from IC
2.2.10 Summary
2.2.11 Self Assessment Questions
UNIT-3 PRODUCTION FUNCTION

3.1 PRODUCTION FUNCTION

3.1.1 Production Function
3.1.2 Production Function with one Variable Input (SRPF)
3.1.3 Production Iso-quants & Marginal Rate of Technical Substitution
3.1.4 Iso-cost Line
3.1.5 The Optimal Combination of Resources (Producers Equilibrium –LRPF)
3.1.6 The Expansion Path
3.1.7 Economic Region of Production
3.1.8 Returns to Scale –Concept
3.1.9 Returns to scale using Iso-quant
3.1.10 Summary
3.1.11 Self-Assessment Questions
Unit-4 MARKET ANALYSIS
4.1 COST OF PRODUCTION
4.1.1 Cost of Production: Social and private costs of production
4.1.2 Short run Cost and Cost Curve
4.1.3 Long run Average Cost Curve and its implications.
4.1.4 Summary
4.1.5 Self Assessment Questions

4.2 PERFECT COMPETITION
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4.2.1 Perfect competition: Concept and Assumptions
4.2.2 Demand Curve of a Firm
4.2.3 Supply Curve of Firm and Industry-Short run and Long-run
4.2.4 Equilibrium of the firm in Short-run
4.2.5 Equilibrium of the Industry in Short-run
4.2.6 Equilibrium of the firm in Long-run
4.2.7 Equilibrium of the Industry in Long-run
4.2.8 Measuring producer surplus under perfect competition
4.2.9 Summary
4.2.10 Self Assessment Questions

4.3 MONOPOLY
4.3.1 Monopoly: Concept
4.3.2 Short-Run Equilibrium under Monopoly
4.3.3 Long-Run Equilibrium under Monopoly
4.3.4 Absence of the Supply Curve in Monopoly
4.3.5 Effect of Shifts in the demand curve in Monopoly
4.3.6 Effect of the change in cost
4.3.7 Measurement of monopoly power and the rule of thumb for pricing,
4.3.8 Horizontal and vertical integration of firms
4.3.9 Differences between Monopoly and Perfect Competition
4.3.10 Summary
4.3.11 Self Assessment Questions

4.4 MONOPOLISTIC COMPETITION
4.4.1 Imperfect Competition
4.4.2 Monopolistic competition
4.4.3 Equilibrium of a firm (Short-run)
4.4.4 Equilibrium of a Group (long-run) and economic efficiency
4.4.5 Summary
4.4.6 Self Assessment Questions

4.5 OLIGOPOLY

4.5.1 Oligopoly:
4.5.2 Oligopoly and Interdependence (Kinked Demand Curve)
4.5.3 Basic concept of Game Theory
4.5.4 Summary
4.5.5 Self Assessment Questions
UNIT-5 PROFIT ANALYSIS
5.1 Profit and Theories of Profit
5.1.1 Introduction
5.1.2 Theories of profit
5.1.3 Break-even Analysis
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5.1.4 Summary
5.1.5 Self-Assessment Questions
5.2 BUSINESS CYCLE
5.2.1 Introduction- Concept of business cycle
5.2.2 Phases of business cycle
5.2.3 Causes of business cycle
5.2.4 Effects of business cycle
5.2.5 Remedial measures of business cycle
5.2.6 Theories of Business cycle
5.2.7 Summary
5.2.8 Self-Assessment Questions

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UNIT-I
SIGNIFICANCE AND SCOPE OF MANAGERIAL ECONOMICS
1.1 CHAPTER
MANAGERIAL ECONOMICS- CONCEPT, NATURE, SCOPE,
SIGNIFICANCE AND ROLE IN DECISION MAKING
Objectives
After studying this unit, you should be able to:
- understand the concept, nature and scope of managerial economics
- assess the relationship of managerial economics with other disciplines
- discuss why managers need to know economics
- analyze the role of managerial economics in business decision making

Structure:
1.1.1 Introduction to Managerial Economics
1.1.2 Scope of Managerial Economics
1.1.3 Nature of Managerial Economics
1.1.4 Principles of Managerial Economics
1.1.5 Role of a Managerial Economist
1.1.6 Significance of Managerial Economics
1.1.7 Important Economic Concepts and Terms
1.1.8 Different attributes for Managerial Economic skill Development
1.1.9 Summary
1.1.10 Self-Assessment Questions
1.1.1 Introduction to Managerial Economics
Managerial Economics is basically a blend of Economics and Management. Two branches of
economics i.e. micro economics and macro economics are the major contributors to
managerial economics. Micro Economics is the study of the behaviour of individual
consumers and firms whereas microeconomics is the study of economy as a whole.
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Managerial Economics (Syllabus)

Managerial Economics (Syllabus)

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