Students focus on the application of economic models and rationale choice to business decision
making. Topics include an overview of managerial economics; demand and supply; costs of
production and the organization of the firm; market structure and pricing and output decisions;
game theory and pricing strategies; and the economics of information and the role of government
in the marketplace.
After completing this course, students will be able to:
- List the different goals and constraints that firms face
- Apply the economic way of thinking to individual decisions and business decisions
- Use calculus (first and second order derivatives) to solve for an optimum solution
- Understand how prices get determined in markets, how market participants benefit in the form
of consumer surplus and producer surplus, and what are the consequences of government
- Measure the responsiveness of consumers' demand to changes in the price of a good or service,
the price of other goods and services, and income
- Understand the different costs of production and how they affect short and long run
- Derive the equilibrium conditions for cost minimization and profit maximization
- Understand economies of scale, diseconomies of scale, economies of scope, and cost
complementarities, and how each affects the cost of production
- Explain the principal-agent problem and why different forms of compensation exist
- Understand the four basic market models of perfect competition, monopoly, monopolistic
competition, and oligopoly, and how price and quantity are determined in each model
- Understand how game theory can be used to explain a number of business decisions
- Explain four different pricing practices such as discrimination, two part pricing, block
pricing, commodity bundling, transfer pricing, and peak load pricing
- Understand why there is a role for the government to play in market economies
ECON 3041: Managerial Economics includes the following six modules:
Module 1: The Fundamentals of Managerial Economics
Module 2: Demand and Supply
Module 3: Costs of Production and the Organization of the Firm
Module 4: Market Structures: Pricing and Output Decisions
Module 5: Game Theory and Pricing Strategies
Module 6: The Economics of Information and the Role of Government in the Marketplace
Required text and materials
- Baye, Michael. Managerial Economics and Business Strategy. 9th Edition. Boston:
McGraw-Hill Irwin, (2017).
Textbook. ISBN: 978-1-259-29061-9
Computer with Internet is required for this course.
A math calculator is required, preferably with several memories, square root functionality,
logarithms, correlation (regression) analysis, and financial analysis (e.g. present values and
the internal rate of return).
Please be aware that due to COVID-19 safety guidelines all in-person exams have been suspended. As such, all final exams are currently being delivered through ProctorU, which has an approximate fee of $35 involved. There will be more information in your course shell, on how to apply, if your course has a final exam.
To successfully complete this course, students must achieve a passing of 50% or higher on the
overall course, and 50% or higher on the final mandatory exam.
|Assignment 1: Fundamentals of Managerial Economics
|Assignment 2: Demand and Supply
|Assignment 3: Costs of Production and the Organization of the Firm
|Assignment 4 : Market Structures
|Assignment 5: Game Theory and Pricing Strategies
|Final Exam *
Open Learning Faculty Member
An Open Learning Faculty Member is available to assist students. Primary communication is
through the Learning Environment's "Mail" tool or by phone. Students will receive the necessary
contact information when starting the course.