Managerial Economics (MBME01-01)

Course No.:

MBME01-01

Course Title:

Managerial Economics

Hours Total:

150 h

Credit Points:

5 ECTS

Course Type: Pflicht

Course Availability: WS, SS

Course Duration: 1 Semester

Admission Requirements:

None

Course Coordinator / Instructor:

See current list of tutors in the Learning Management System

References to Other Modules:

Please see module description

Course Description:

This course takes an in-depth look into the economic framework underlying markets and economies and the economic rationale underlying strategic decisions. In order to enable students to analyze the economic environment and draw conclusions from a managerial perspective, the first part of the course is devoted to the description and analysis of market forces. Following this, strategic decision making makes up the second half of the course. In particular, these latter units deal with the role of different market structures and asymmetric information as well as the fundamentals of game theory, which supports students to understand with the underlying decision making processes at work in modern economics.

Course Objectives and Outcome:

Students will:

• learn about the micro-economic foundation of entrepreneurial decision making
• learn about the relationship between economic theory and economic practices within the firm
• be able to analyze and reflect upon the effects of micro-economic decisions
• learn how to design efficient decision-making processes within their firm in order to keep their companies competitive
• be able to explain economic behavior and design entrepreneurial strategies to manage a company successfully

Teaching Methods:

A variety of learning materials are offered to students: depending on the course, these include printed and online course books, vodcasts, podcasts, online tutorials, case studies, and online knowledge tests. This range of learning materials are offered to students so they can study at a time, place, and pace that best suits their circumstances and individual learning style.

Course Content:

1 The Nature, Scope, and Methods of Managerial Economics

1.1 The Nature and Scope of Managerial Economics

1.2 The Method of Managerial Economics

2 Market Force: Demand

2.1 Demand Analysis

2.2 Elasticity of Demand and Demand Determinants

2.3 Demand Estimation

3 Market Force: Supply

3.1 Production Theory

3.2 Cost Theory

3.3 The Determination of Price

4 Strategy Analysis

4.1 Nature of the Industry

4.2 Types of Market Structures Formed by the Nature of Competition

5 Game Theory and the Economics of Information

5.1 Game Theory

5.2 The Economics of Information

5.3 Auctions

6 Capital Budgeting and Investment Analysis

6.1 Capital Budgeting

6.2 Investment Analysis

Literature:

• Baye, M.R. (2007), Managerial Economics and Business Strategy, 6th edition McGraw-Hill.
• Gupta, G.S. (2006): Managerial Economics, 26th reprint, McGraw Hill.
• Keat, Paul G.,Young, Philip K.Y. (2008): Managerial Economics, Economic Tools for DecisionMakers, Prentice Hall.
• Png, Ivan/Lehman, Dale: (2012): Managerial Economics, 4th ed., Routledge.
• Besanko, D., Dranove, D., Shanley, M. (2010): Economics of Strategy, John Wiley and Sons
• Kreps, D. M. (2003): Microeconomics for Managers, Norton

Prerequisites to Qualify for Assessment:

• Depending on the course: Completion of online knowledge tests (approx. 15 minutes per unit, pass / not pass)
• Course evaluation

Assessment:

• Exam, 90 min.
• Written assessment: case study

Student Workload (in hours): 150

Self-study: 90
Self-testing: 30
Tutorials: 30