Managerial Economics Notes ( BBA)



(Course Code-202) 

Managerial Economics Notes ( BBA)


Course Objectives: - The purpose of this course is to apply micro economics concept and techniques in evaluating business decisions taken by firms. The emphasis is on explaining how tools of standard price theory can be employed to formulate a decision problem, evaluate alternative courses of action and finally choose among alternative.

Unit -1

Meaning of Demand, The Law of Demand Individual Demand, Market Demand, Individual Supply, Market Supply, Market Equilibrium, Price elasticity of Demand, Income elasticity of Demand, Cross price elasticity of Demand

Theory of Consumer Behavior: Cardinal utility theory, ordinal utility theory (indifference, curves, budget line, consumer choice, price effect, substitution effect, revealed preference theory.

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Producers and optimal production choice optimizing behavior in short run (geometry of Product curves, law of diminishing margin productivity three stages of production) optimizing behavior in long run ( iso-quants, iso-cost line ,optimal combination of resources).

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Traditional theory of cost, (Short run and long run geometry of cost curves, envelope curves), modern theory of cost (short run and long run) economies of scale.

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Meaning and Definition of Perfect competition Features of Perfect competition, Price determination under Perfect competition, Role of time in determining the Price

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Equilibrium of a firm and the Industry in the short and long runs, Including industries long run supply curves ,measuring producer surplus under Perfect Competition, effect of changes in Demand , Cost and imposition of Taxes.

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Basic Features, Short run Equilibrium, Long run Equilibrium, effect of changes in Demand, Cost and Imposition of Taxes, Price Discrimination

Basic Feature, demand and cost, Short run Equilibrium, Long run Equilibrium, excess capacity, Oligopoly; Features of Oligopoly, Pricing under Oligopoly, Kinked Demand Curve Model


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