ECO515:MANAGERIAL ECONOMICS

L:4 T:1 P:0

Course Objectives:
To make the student understand the concept of managerial economics and the techniques
that can help them to solve business problems.
Enhancement of analytical skills and as well as solution of business problems.
To lay down a solid foundation for the student to gain further understanding about the
theoretical foundations of business decisions and practical implications of theoretical
concepts.
Unit I
Nature and Scope of Managerial Economics : Concept,nature,scope and
application of managerial economics
Theory of Demand and Supply : Meaning, Determinants, Law of Demand,
Movement vs shift in demand curve, Law of supply, Determinants of supply, Market
equilibrium, Ceiling and Floor prices
Unit II
Consumer behavior : Law of diminishing marginal utility, Law of equi marginal
utility, Indifference curve, Consumer Equilibrium, Price,income and substitution
effect, Budget Line and shift in budget line
Unit III
Production and cost in the short run : Production Function,Total Product, Average
Product and Marginal Product, Law of Variable Proportions, Short run cost-Fixed and
Variable costs,Average and Marginal costs, Relationship between short run costs and
production
Production and Cost in the Long run. : Isoquants and their properties, Isocost
curves and shift in Isocost Curves, Producer equilibrium, Expansion Path,Long Run
Costs, economies and diseconomies of scale, Returns to scale,Relationship between
LAC and SAC curves, economies of scope
Unit IV
Market Structure: Perfect competition, Monopoly and Monopolistic
Competition : Meaning and importance of perfect competition, Price and output
determination under perfect competition, Introduction to monopoly, Sources of
monopoly, Price and ouput determination in monopoly, Price discrimination, Meaning
of monopolistic competition and its importance, Price and output determination in
monopolistic competition, Product variation and selling expenses under monopolistic
competition
Oligopoly and Game Theory : Features of oligopoly, Similarity and dissimilarity
between monopolistic competition and oligopoly, Sweezy Price Rigidity Model,
Introduction to Game Theory, Cartels and Collusions
Unit V
Measuring National Income : Meaning and Concepts, Methods of measuring
national Income, Circular flow of national income, Three Sector model, Four sector
model, Difficulties in measuring national income, Application/use of national income
data
Unit VI
Monetary Policy and Fiscal Policy : Meaning and instruments, Target variables
and impact on economy
Text Books:
1. Managerial Economics by Christopher R Thomas,S Charles Maurice,Sumit Sarkar,
Tata McGraw - Hill Education, 9th Edition, (2011)
Credits:5
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References:
1. Managerial Economics by Dominick Salvatore, Ravikesh Srivastava, Oxford
Higher Education, 7th Edition, (2012)
2. Advanced Economic Theory by H.L. Ahuja, S. Chand, 17th Edition, (2011)
3. Macroeconomics Theory and Policy by D.N. Dwivedi, Tata McGraw - Hill
Education, 8th Edition, (2013)
4. Managerial Economics by Mark Hirschey, Cengage Learning, 3rd Edition, (2011)
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