GSB 510 - Managerial Economics
Spring, 2002
Bridgeport Campus MAN 220
Thursday 6:00 PM - 8:30 PM
Course Outline
Objective: This course aims at application of economic theory and the tools of analysis of decision science to examine how a firm can make optimal decisions under the constraints it faces. The class will learn the theory of the firm to integrate and link macro and microeconomics, decision sciences such as mathematical economics and econometrics, and the functional areas of business such as finance, production and resource management.
Economic theory provides the analytical tools for optimal decision-making, while decision science provides the tools for optimization and for the estimation of economic relationships. As an overview course, this course integrates and links all of these topics and teaches their crucial importance in managerial decision making.
Text: Dominick Salvatore, Managerial Economics in a Global Economy, 4e
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Session |
Topic |
Text Ref |
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1 |
Ch 1-3 |
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2 |
Ch 3 Appendix |
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Indifference Curves |
Ch 3 Appendix |
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Budget Constraints |
Ch 3 Appendix |
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Consumption Equilibrium |
Ch 3 Appendix |
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Derivation of Demand Curve |
Ch 3 Appendix |
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Income & Substitution Effects of Price Change |
Ch 3 Appendix |
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Mathematical Approach |
Ch 3 Appendix |
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3 |
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The Demand for a Commodity |
Ch 3-1 |
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Price Elasticity of Demand |
Ch 3-2 |
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Income Elasticity of Demand |
Ch 3-3 |
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Cross Elasticity of Demand |
Ch 3-4 |
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Elasticity in Managerial Decision Making |
Ch 3-5 |
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4 |
Demand Estimation |
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Ch 4-3 |
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Ch 4-4 |
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Ch 4-5 |
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Ch 4-6 |
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Demand Estimation by Regression Analysis |
Ch 4-7 |
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5 |
Demand Forecasting |
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Ch 5-2 |
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Smoothing Techniques |
Ch 5-3 |
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Econometric Models |
Ch 5-4 |
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6 |
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Production Function with Single Input |
Ch 6-2 |
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Ch 6-3 |
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Production Function with Two Inputs |
Ch 6-4 |
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Optimal Input Combination & Profit Maximization/ Cost minimization |
Ch 6-5 |
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Returns to Scale |
Ch 6-6 |
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Mathematical Approach |
Ch 6 Appendix Ch 9 Appendix |
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7 |
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Short-Run Cost Functions |
Ch 7-2 |
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Long-Run Cost Curves |
Ch 7-3 |
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Plant Size & Economies of Scale |
Ch 7-4 |
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Learning Curves |
Ch 7-5 |
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Mathematical Approach |
Ch 7 Appendix |
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8 |
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Profit Maximization |
Ch 8-4 |
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Cost Minimization |
Ch 8-5 |
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Dual Problem and Shadow Prices |
Ch 8-6 |
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Market Structure |
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Ch 9-2 |
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Ch 9-4 |
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Monopolistic Competition |
Ch 9-5 |
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9 |
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Oligopoly Models |
Ch 10-2 |
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Sales Maximization |
Ch 10-3 |
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Strategic Behavior & Game Theory |
Ch 10-5 |
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Prisoner's Dilemma, Nonprice Competition & Cartel Cheating |
Ch 10-6 |
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Extensions of Game Theory |
Ch 10-7 |
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Mathematical Approach |
Ch 10 Appendix |
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10 |
Pricing Practices |
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Pricing Multiple Products |
Ch 11-1 |
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Price Discrimination |
Ch 11-2 |
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International Price Discrimination & Dumping |
Ch 11-3 |
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Transfer Pricing |
Ch 11-4 |
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Cost-Plus Pricing & Incremental Analysis |
Ch 11-5 |
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Homework & Pop Quiz: There will be occasional homework (including computer) assignments, which will be due the following session. You may be randomly called on to present effectively the solution on the board, so always be prepared. Quiz can be both announced and unannounced testing your understanding of technical materials. The pop quiz may test your understanding of the materials from the homework assignments.
Exams: There will be a midterm exam (or project) given in the class on the date to be determined. You may bring no more than a SINGLE sheet of formulas and 3 blank scratch papers. No other notes or aids other than a calculator will be allowed. Final is flexible and may be replaced with a (team) project. If it is determined to be a project, then each individual/ team will have a conference with me about the project he/she/they would like to do at least within the first three sessions.
Attendance & Class Participation: Most of the materials to be treated in the class are extremely technical. If you miss a class, it will be almost impossible to make it up on your own. Therefore, it is highly recommended that you attend each and every class. In light of the limited class time, class participation is welcomed only if it is appropriate and relevant to the material since we will be dealing with mostly technical topics, not fluffy verbiage.
Grading: Grades will be determined as follows:
Midterm Exam or Project: 40%
Final Exam or Project: 30%
Homework & Pop Quiz: 30%
Click here to download free Adobe Acorbat. Click here for syllabus in pdf format.