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MEM-Q12
PGDM-HRM 2012-14: Term-I

Course Name: Microeconomics for Managers (MEM)
Credits Three
Faculty Name Dr. Biresh K. Sahoo
Program PGDM-HRM
Academic Year and Term 2012-14/Term I

1. Course Description
The objective of this course is to acquaint the students with basic concepts and techniques of microeconomic analysis and their applications to managerial decision-making. Microeconomic analysis explains the behaviors of individual decision-making units such as business firms and consumers. The emphasis is on elucidating how the tools of standard price theory can be employed to formulate a decision problem, establish a decision criterion, and generate some of the information required to evaluate the alternative courses of action, and, finally, choose among the alternatives.

2. Student Learning Outcomes (typically 3-5 bullet points)

· Be able to ….. understand the basic concepts and techniques of microeconomic analysis and their applications to managerial decision makings.
· Be able to …. understand how price theory can be employed to formulate a decision problem, establish a decision criterion, and generate some of the information required to evaluate the alternative courses of actions.
· Be able to …. understand how theory of production can be employed to arrive at differential weight structures that can be used to assess credit risk, ratio analysis, stock selection, industry rankings, performance evaluation of employees, etc.
· Be able to … understand various indicators of firm performance such Technical efficiency, Cost efficiency, Revenue efficiency, Allocative efficiency, Productivity (and Eco-productivity) growth and its drivers – Technical Efficiency and Technical Change, and their linkage with financial performance.

3. Required Text Books and Reading Material

Text Book

Salvatore, D. and Srivastav, R. (2009) Managerial Economics: Principles and Worldwide Applications, New Delhi: Oxford University Press

Reading Lists
Michael R. Baye, Managerial Economics and Business Strategy, McGraw-Hill International Edition.
Robert H. Frank, Microeconomics and Behavior, New York: McGraw-Hill Publishing Company.
Hall R. Varian, Intermediate Microeconomics: A Modern Approach, New York: W. W. Norton & Company.


4. Tentative Session Plan
Session NumberTopics/ActivitiesReading/case list etc.
Module I Consumer Behavior and Demand Analysis
1What is Microeconomics? How is it different from Business?Text Book, Teaching Note
2Utility; Indifference curve; Marginal rate of substitution; Budget line; Consumer’s equilibriumText Book, Teaching Note
3 The demand-supply framework and the concept of a marketText Book, Teaching Note
4Determinants of consumer demand and producer supply Text Book, Teaching Note
5 The demand curve; price elasticity; cross elasticity; income elasticity, Relationship among price elasticity, total revenue, average revenue and marginal revenue Text Book, Teaching Note
6Applications:
· Which tax system is better - direct versus indirect tax?
· Which subsidy is better – cash versus kind subsidy?
· Indexing of social security payments		Text Book, Teaching Note
7Applications
· Why do some tennis clubs have an annual membership charge in addition to their hourly court fees?
· The welfare effects of changes in housing prices
· Can good news for farming be bad news for farmers?
· Does drug interdiction increase or decrease drug-related crime?		Text Book, Teaching Note
8 Case Study Discussion
Module II Production Decisions and Cost-Output Relationship
9Analysis of production process; total, marginal, and average product; Input combinations choice; Returns to scale; Production functionText Book, Teaching Note
10Various indicators of firm performance (I):
Analysis of Technical efficiency, Cost efficiency, Revenue efficiency, Allocative efficiency 		Teacher’s Notes
11 Various indicators of firm performance (II)
Analysis of Productivity (and Eco-productivity) growth and its drivers – Technical Efficiency and Technical Change 		Teacher’s Notes
12Various indicators of firm performance (III):
· Analysis of Technological CU and its underlying causal factors
· Analysis of Profit and Cost changes and their underlying drivers		Teacher’s Notes
13Various concepts of costs:
· Cost-output relation in the short run and long-run
· Long-run costs and economies of scale
· Minimum efficient scale, Firm size, and Plant size
· Learning curves, Economies of scale and scope		Text Book, Teaching Note
14Derived demand for inputs
Cost-volume-profit analysis		Text Book, Teaching Note
15 Applications of the theory of production
· Measuring credit risk/audit risk of company/people
· Ratio analysis; stock selection, industry ranking
· Performance evaluation of firms/employees		Teacher’s Notes
16 Case Study
Module III Pricing under Alternative Market Structures
17The Organization of the firm and the Nature of industry
Pricing in a perfectly competitive market		Text Book, Teaching Note
18Monopoly
Monopolistic competition		Text Book, Teaching Note
19OligopolyText Book, Teaching Note
20Pricing strategyText Book, Teaching Note


5. Evaluation

Quizzes (Known & Surprise) : 20%
Assignment, Classroom
Participation and Attendance : 10%
Mid-term examination : 35%
End-term examination : 35%

6. Academic Integrity

Utmost care is taken as to maintaining class decorum, following the exact evaluation norms, conducting fair examinations, fair and transparent evaluation of examination papers, etc to maintain the highest academic integrity.

Created By: Debasis Mohanty on 06/02/2012 at 11:44 AM
Category: PGDM(HRM)-I Doctype: Document

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