Course: Managerial Economics(MB105)Course Instructor: Shweta MiglaniE- Mail Id: k_shweta81@yahoo.co.inContact No.:`` 9915633055Tests: 3Assignments: 4Case Studies: 4Total Marks:100Marks Breakup:External University Examination: 60Internal Examinations: 40Internal Breakup:Mid Semester Examinations: 15Ist and IInd Hourlies: 10(5 each)Presentation 5Assignments 5Case study and Class Test 5

Introduction

Economics is a study of mankind in ordinary business of life. The word Economy comes from Greek word for “ One who manages a household”. At first, this origin might seem peculiar. But in fact households and Economies have much in common

Objective

The subject is incorporated in the degree with major objectives as

To make you understand the world in which you live.

To make you more active participant in your economy

To make you a better decision maker in allocation of resources in your different needs of your life

Last but not the least to assist you in your business decision making

Keeping all the objectives in mind the course is being designed to give you extensive knowledge in Business Economics with special reference to MicroEconomics and Macro economics

A basic Framework called a module is being designed here that will guide and plan your learning of the course throughout a semester. It will be delivered to you Through

1. Lectures – Module of 45 lectures is being given to you. This contains the content to be delivered in each lecture. We will try to stick to the schedule but we can change the schedule as per the grasping and learning power of the students

2. Presentations – In this topic will be given to a group of 4 to 5 students in advance on which they have to present themselves in class. The evaluation of the same will be done on the spot.

3. Case Discussions – A situation will be given to you on related topics and student has to recognise a problem and recommend a solution to the same.

4. Assignments – A topic will be given to the students and students have to present information on the same either in electronic form or in hand written form (will be specified on the spot). Total of 4 assignment are planned in the course and more can be included as per the requirement). Assignment has to be submitted within 3 days of given date strictly by 10:00am in campus 1.

5. Tests- Total of 3 tests are being scheduled in the module. Out of which two will be hourlies(Taken at college level) and one will be taken at class level at the end of Semester. If need be, other tests can also be organized as per requirements of the class.

Assignment1Discuss Demand Forecasting methods with help of practical examples from the industry Assignment 2Pick up any Industry or service center and recognize different cost centers. Classify them under Fixed and variable cost. And find out Break even point for the same.

Assignment3A small case will be provided related to Global GDP Indicators in which the performance of various economies on the basis of GDP has been compared. Keeping in mind current Indian Economy Indicators, judge the position of Indian Economy vis-à-vis other Emerging Economies

Assignment4Effect of Monetary policy on Indian Economy

Presentation Topics1. BRIC- Future Prospects2. India's Contribution in global Inflation3. Fuel Price: Will it cross $200 Mark4. Economic Growth: Costs and benefits5. Role of Banks in Monetary Policy6. Indian Economic Indicators7. Challenges Before Emerging Market Economies8. India And China- Inclusive Growth9. Indian Population- An Asset or Liability10. Has Employment decreased over last 25 years

11. Recession or depression. What’s the difference12. Cost push inflatiom vs Demand pull inflation13. Baby boom and future of the economies14. Third world debt crisis

Activity 1

This is based on Case study 1 only, Products will be allocated in Groups and students has to develop a case on the assigned products predicting demand for the same in near future.

1. crude Oil2. Small Cars3. Airlines4. Electricity5. Luxury cars6. Petrol cars Vs other Fuel Cars7. Leisure Time activities like Clubs, Gyms8. Watches9. Designer Jewellery Vs Customized Jewellery10. Water

S.NO. Lectures Topics

1

Introduction (Lecture 1) Introduction to Managerial Economics as a part of MBA

Programme - Its meaning, Utility, what does it includes and how it helps an MBA in his/her life

2

Introduction to concept Of Economics

(Lecture 2-5)

Satisfaction of unlimited wants with limited Resources Principles of Economics Micro Economics - Study of one variable at a time Macro Economics- Study of group of Variables

3

Application Of Micro and Macro In ME - Subject Matter and contributions of other disciplines like Accounting, HR, Statistics etc in the same, Macro Vs Micro Economics

5

Principles Of ME opportunity Cost Principle- The Cost of Sacrificing next best Alternative. Ex - How person selects best Job out of various alternatives Marginal and Incremental Principles - How the costs are being affected by any decision in the business. Ex- college decides to open any new course

6

national Income- Amt of goods and services produced within one fiscal year at their market Prices GDP- Amt of goods and services produced within domestic boundaries if country by anybody including foreign national

7

Demand Analysis

(Lecture 6- 10)

Demand Analysis- Meaning Of demand- Quantity demanded at any given time Effective demand- Desire + Willingness to Buy + ability to buy Types Of goods- Categorisation on the basis of types of demand

8

Factors affecting Demand Price( Price Effect) - Law of Demand ie Inverse relation between price and Demand

9Other Factors affecting Demand - Income, Price of Related Goods etc

9

Elasticity Of Demand- Degree of Responsiveness of demand due to change in any one factor Factors affecting Elasticity - Type of Product, Number of Substitutes

10

Types of elasticity- Price Elasticity, Income, Cross and Promotional Elasticity of demand, Relationship between Elasticity and total Revenue

11   Case Discussion

12

Demand Forecasting Techniques

(Lecture 11-13)

Demand Forecasting- Ability to predict demand of various products, Need of Forecast - How does it affect Costs, Revenues Production, Types of Forecast - Active Forecasts, Passive Forecasts

14

Market experiment Method - When actual or sample product is tried and tested in market 1. Actual Market, 2. Market simulation Method

15

Survey of Consumer Intentions- 1. Census Survey, 2. Sample Survey, 3.Test Marketing

16

Statistical Method - 1. Regression, 2. Correlation, 3.Moving Average, 4. Leading Indicator

17

Utility Analysis (Lecture 14-15)

Indifference Curve analysis- Concept of Utility- Want Satisfying Power of Product, Indifference Curve - Locus of points showing different combinations of two products consumed and yielding same level of satisfaction Properties of Indifference Curve

18 

Properties of Indifference curve analysis (contd), Consumer Equilibrium- Best satisfaction level of consumer under Indifference curve analysis

19

Production Function

(Lecture 16-18)

Production Function- Relationship between factors of production and output Short Run- When atleast one factor of production is a variable factor Long Run Production Function - When all the factors are variable factors Law of Variable Proportions- Rate of change in output due to change in proportions of one factor of production, keeping other factor constant

20

Long Run Production Function- Application of Law of returns to scale ie rate of change in output when all the factors are variable Iso Quants and Iso Cost Line- locus of combinations of factors of production yielding same level of output and same level of cost respectively

21

Cost Function (Lecture 19-23)

Introduction to Cost Function- Relationship between production and cost function i.e level of output will decide cost

22

Theory of Costs Concept of Cost- Payment made to all the factors of production Types of Costs- 1. Fixed Cost 2. Variable Cost 3. Short Run Cost 4. Long Run Cost

23

Types of Costs-(Contd.) 5.Average Cost, 6. Marginal Cost, 7. Incremental Cost, 8. Private Cost, 9. Sunk Cost, 10.Externalities

24Short Run Cost Function- Explanation of different cost Curves under Short Run Function

25

Long Run Cost Function- Behaviour of cost when all the factors are variable Short Run Vs Log run- Which Function to adopt at what level of output

26

Price Function(Lecture

24)

Price Function- Function decided by demand and supply forces Moventment of Price- Case where Demand and supply moving in same direction Case Where demand and supply move in opposit Direction Factors affecting Price of Product,

27

Types of Pricing Techniques- Cost based Pricing, Marginal Pricing, Penetration Pricing, Price Skimming Strategy Breakeven analysis - Point of No Profit No Loss

28

Market Structure (Lecture 25-30)

Market Structure Concept of Market - Place where buyers and sellers come together to sell a product, Classification of market on the basis of degree of competition Perfect Competition- characterized by Large number of players selling alike Product Monopolistic Competition- characterized by large number of buyers and sellers selling hetrogenous products eg daily use Products like Toothpaste Oligopoly - Characterized by few big players selling Hetrogenous or homogenous Products eg Automobile Market Monopoly - characterized by one Player selling unique Product

29

Perfect Competition- Price and output determination under perfect competition giving rise to Supernormal Profits, Normal Profits, Losses

30

Monopoly - Features, Price Discrimination Charging different set of prices for same Product, Degrees - Ist Degree, IInd Degree, IIIrd Degree output Price and output determination under Pure monopoly

31

Price and output determination under discriminating monopoly - In two different markets, where in one is perfect competition and other has monopoly Myths under Monopoly markets

32 Monopolistic competition- Price and output determination

33

Oligopoly Cournot model Price and output is determined under zero Cost Structure Ex Mineral Water, Perfect Collusion model- when cartel is being formed by all players on mutual understanding and agrees to share profits equally

34

Kinked Demand Model- when upper part of demand curve is highly elastic and lower portion is highly inelastic give rise to kink in demand curve at its centre and making a price of product a rigid price

35   Test 2

36

Introduction to Macro Economics (Lecture 31)

Macro Economics - Study of group of variables, Macro economic Policies

37   Discussion of Case study 3

38

National Income (Lecture 32-33)

National Income- Amt of goods and services produced within one fiscal year at their market Prices GDP- Amt of goods and services produced within domestic boundaries if country by anybody including foreign national GNP- Amt of goods and services produced by indian National residing in any part of world.

39Methods of Measuring National Income- Income Method, expenditure Method, Value added Method

40 Social Accounting- Meaning, Method

41

Consumption Function (Lecture

34-35)

Consumtion Function- Relationship between Consumption and income of an individual, Attributes- Marginal propensity to consume and Average Propensity to consume, Keynes Psychological Law of Consumption

42Dussenbery and fried Man Hypothesis- Shows the movement of APC and MPC over a long period of time

43 Theories of

Income, output and Investment

(Lecture 36-38)

Claasical Theory of Income, output and Employment Assumes Levelof Full employment is a normal situation

44

Principle of effective Demand point where aggregate demand price is equal to Aggregate ssupply Price, Keynes theory of Income, Output and employment- Proves level of Full employment is abnormal situation and level of under employment a normal situation for any economy

45

Multiplier Function (Lecture 39-40)

Theory of Multiplier- Relationship between investment and income generation Static Multiplier- That does not take into consideration any time lag between income and consumption Dynamic Multiplier- that takes into consideration time lag between income and consumption, Leakages of Multiplier

46Government Multiplier, Tax Multiplier, Balanced Budget Multiplier

47

Inflation (Lecture 41-43)

Inflation- When too much money is chasing too few a goods Types of Inflation causes of Inflation- Supply or Demand

48   Discussion of Case study 4

49

Stabilisation Policies (lLecture 44-45) Monetary Policy&Fiscal Policy

50