MODULE 1: NATURE, SCOPE AND METHODS OF MANAGERIAL ECONOMICS
Scarcity, choice and allocation problems in business. Basic factors in business decision making:
Marginalism, Equi-marginalism, and Opportunity cost principle, Risks and uncertainties, Time
value of money. Use of quantitative techniques in managerial economics: Mathematical
functions, derivatives, optimization principles and statistical techniques.
MODULE 2: DEMAND ANALYSIS, ESTIMATION AND FORECASTING
Demand theory. Types of demand. Demand elasticity: Types, measurement and factors.
Elasticity of demand and marginal revenue. Uses of elasticity concept in business decision
making. Estimation of Demand function. Demand forecasting: Importance and methods.
Qualitative and quantitative techniques.
MODULE 3: PRODUCTION ANALYSIS
Production functions with one-variable and two-variable inputs. Returns to a factor and returns
to scale. Isoquants, isocost curves and ridgelines. Optimum factor combination. Elasticity of
output and Elasticity of substitution. Empirical production functions. Forms of Production
function. Cobb-Douglas and CES production functions. Production possibility analysis. Optimum
product mix of a multi product firm
MODULE 4: COST AND REVENUE ANALYSIS
Cost theory and its applications: Types of costs. Theoretical and Empirical cost curves. Shortrun
and long-run cost curves. Derivation of cost functions from production functions. Empirical
estimation of cost functions. Economies of scale versus economies of scope. Optimum firm.
Learning curve. Cost control and cost reduction. Revenue concepts and functions. Break-even
analysis.
MODULE 5: MARKET STRUCTURE AND PRODUCT PRICING
Features of and pricing-output decisions in perfect competition, monopoly, oligopoly and
monopolistic competition. Equilibrium of the firm and of industry under different market
conditions. Degree of monopoly power. Discriminating monopoly. Welfare triangle. Pricing
methods and practices of modern business firms: Cost-based and demand-based pricing
strategies.
MODULE 6: THEORIES OF THE FIRM AND PROFIT
Alternative objectives of the firm. Profit maximization versus sales maximization objectives.
Traditional, behavioral and managerial theories of the firm. Accounting profit versus Economic
Profit. Theories of Profits.
BOOKS RECOMMENDED
1. Atmanand, Managerial Economics, EB
2. Sk Misra and VK Puri, Indian Economy, HPH
3. Dominick Salvatore, Managerial Economics, Thomson
4. Damodaran, Managerial economics, Oxford
5. Keating and Wilson, Managerial Economics, Biztantra
6. Craig Peterson, Chris Lewis and Sudhir Jain, Managerial Economics, Person
7. Chirstopher Thomas and Charles Maurice, Managerial Economics, TMH
8. Mankar, Business Economics, McMillan
9. Paul Keat and Philip Young, Managerial Economics, Pearson
Scarcity, choice and allocation problems in business. Basic factors in business decision making:
Marginalism, Equi-marginalism, and Opportunity cost principle, Risks and uncertainties, Time
value of money. Use of quantitative techniques in managerial economics: Mathematical
functions, derivatives, optimization principles and statistical techniques.
MODULE 2: DEMAND ANALYSIS, ESTIMATION AND FORECASTING
Demand theory. Types of demand. Demand elasticity: Types, measurement and factors.
Elasticity of demand and marginal revenue. Uses of elasticity concept in business decision
making. Estimation of Demand function. Demand forecasting: Importance and methods.
Qualitative and quantitative techniques.
MODULE 3: PRODUCTION ANALYSIS
Production functions with one-variable and two-variable inputs. Returns to a factor and returns
to scale. Isoquants, isocost curves and ridgelines. Optimum factor combination. Elasticity of
output and Elasticity of substitution. Empirical production functions. Forms of Production
function. Cobb-Douglas and CES production functions. Production possibility analysis. Optimum
product mix of a multi product firm
MODULE 4: COST AND REVENUE ANALYSIS
Cost theory and its applications: Types of costs. Theoretical and Empirical cost curves. Shortrun
and long-run cost curves. Derivation of cost functions from production functions. Empirical
estimation of cost functions. Economies of scale versus economies of scope. Optimum firm.
Learning curve. Cost control and cost reduction. Revenue concepts and functions. Break-even
analysis.
MODULE 5: MARKET STRUCTURE AND PRODUCT PRICING
Features of and pricing-output decisions in perfect competition, monopoly, oligopoly and
monopolistic competition. Equilibrium of the firm and of industry under different market
conditions. Degree of monopoly power. Discriminating monopoly. Welfare triangle. Pricing
methods and practices of modern business firms: Cost-based and demand-based pricing
strategies.
MODULE 6: THEORIES OF THE FIRM AND PROFIT
Alternative objectives of the firm. Profit maximization versus sales maximization objectives.
Traditional, behavioral and managerial theories of the firm. Accounting profit versus Economic
Profit. Theories of Profits.
BOOKS RECOMMENDED
1. Atmanand, Managerial Economics, EB
2. Sk Misra and VK Puri, Indian Economy, HPH
3. Dominick Salvatore, Managerial Economics, Thomson
4. Damodaran, Managerial economics, Oxford
5. Keating and Wilson, Managerial Economics, Biztantra
6. Craig Peterson, Chris Lewis and Sudhir Jain, Managerial Economics, Person
7. Chirstopher Thomas and Charles Maurice, Managerial Economics, TMH
8. Mankar, Business Economics, McMillan
9. Paul Keat and Philip Young, Managerial Economics, Pearson
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