Managerial Economics
Subject Overview
Managerial Economics applies economic theory to managerial decision-making — demand and indifference curve analysis, production and cost theory with revenue curves, market structure and pricing (perfect competition, monopoly, oligopoly) and factor pricing, and macroeconomic tools (IS-LM analysis, national income, consumption function, inflation and trade cycles) relevant to business decisions. A 4-credit core theory paper.
Unit-wise Syllabus
4 units — click WhatsApp below to get the full notes for each
Unit 1: Demand analysis
Meaning, scope and role of managerial economics, opportunity cost principle, production possibility curve, demand function and determinants, demand elasticity (price, income, cross), demand estimation and forecasting, indifference curve analysis and consumer equilibrium
Unit 2: Production, cost and revenue
Production function, productivity and technology, short-run and long-run production, isoquants and least-cost input combination, producer's equilibrium, returns to scale, cost concepts, revenue curves and their relationships
Unit 3: Market structure and pricing
Perfect competition, monopoly, monopolistic competition and oligopoly (collusive and non-collusive) equilibrium, price leadership model, supply curves, commodity and factor pricing practices, collective bargaining, rent/profit/interest rate theory
Unit 4: Macroeconomics for managers
Saving and investment function, aggregate supply and demand, investment and foreign trade multipliers, money market and liquidity preference, IS-LM analysis, national income measurement, Keynes's psychological law of consumption, inflation, unemployment trade-off, trade cycle theories