ECO515

Lovely Professional University, PunjabCourse Code Course Title Course Planner Lectures Tutorials Practicals CreditsECO515 MANAGERIAL ECONOMICS 13612::Chander Shekhar Dogra 4.0 1.0 0.0 5.0Course Category Courses with conceptual focus

TextBooks Sr No Title Author Edition Year Publisher NameT-1 Managerial Economics Christopher R Thomas,S

Charles Maurice,Sumit Sarkar

9th 2011 Tata McGraw - Hill Education

Reference BooksSr No Title Author Edition Year Publisher NameR-1 Managerial Economics Dominick Salvatore,

Ravikesh Srivastava7th 2012 Oxford Higher Education

R-2 Advanced Economic Theory H.L. Ahuja 17th 2011 S. ChandR-3 Macroeconomics Theory and Policy D.N. Dwivedi 8th 2013 Tata McGraw - Hill EducationR-4 Managerial Economics Mark Hirschey 3rd 2011 Cengage Learning

Other Reading

Sr No Journals articles as Compulsary reading (specific articles, complete reference)OR-1 Introduction to Market structures, Managerial Economics 6th edition by W.W. Norton &Co,chapter 2 (Available in course file) , OR-2 Techniques of Project Appraisal by Arnold C Harberger, University of Chicago.(Available in course file) , OR-3 Five rules for pricing excellence by Patrick Lefler.(Available in course file) , OR-4 Demand, supply and market equilibrium, chapter 3 by Prenhall Publications.(Available in course file) , OR-5 Updating Managerial Economics by Thomas P. Egan, Business Economics; July 1995.(Available in course file) , OR-6 Social Cost-Benefit analysis in a nutshell by Rufus Pollock Emmanuel College, University of cambridge.(Available in course file) , OR-7 Strength of preference and cardinal utility by Veronika Kobberling, Economic Theory 2006.(Available in course file) , OR-8 On ordinal utility, cardinal utility and random utility , Theory and Decision, 2007.(Available in course file) ,

Audio Visual AidsSr No (AV aids) (only if relevant to the course) Salient FeaturesAV-1 Market structures.(Available in course file) PPT on market structures giving a comprehensive and simple overview of

monopolistic competition and monopoly.AV-2 Oligopoly models by Patrick Bajari.(Available in course file) PPT on Oligopoly models giving a mathematical exposition of oligopoly.AV-3 Demand Estimation.(Available in course file) PPT on demand estimation giving a simple yet mathematically oriented

approach to regression and other estimation techniques

AV-4 Monopoly and antitrust policy by Prentice Hall Publishing.(Available in course file) PPT giving advanced treatment on monopoly and impact on society.

Week Number

Lecture Number

Broad Topic(Sub Topic) Chapters/Sections of Text/reference books

Other Readings,Relevant Websites, Audio Visual Aids, software and Virtual Labs

Lecture Description Learning Outcomes Pedagogical ToolDemonstration/ Case Study / Images / animation / ppt etc. Planned

Week 1 Lecture 1 Nature and Scope of Managerial Economics(Concept,nature,scope and application of managerial economics)

T-1:1R-1:1R-4:1

L 1 Economic profit,value maximization,profit maximization and other basic concepts. L 2 Market structures and managerial decision making

L1Student will understand the basic concepts of managerial economics L2 Decision making in market structures

White board, caselets

Lecture 2 Nature and Scope of Managerial Economics(Concept,nature,scope and application of managerial economics)

T-1:1R-1:1R-4:1

L 1 Economic profit,value maximization,profit maximization and other basic concepts. L 2 Market structures and managerial decision making

L1Student will understand the basic concepts of managerial economics L2 Decision making in market structures


Lecture 3 Theory of Demand and Supply(Meaning)

T-1:2R-2:6R-4:3

Concept of demand and the Law of demand

Law of demand and its graphical representation


Theory of Demand and Supply(Law of Demand)

T-1:2R-2:6R-4:3

Application of Law of demand in the real world

Law of demand and its application

White board, Discussion of caselet-Did Globalization kill US Manufacturing from Managerial Economics: Concepts and Applications by Christopher Thomas, 9th Edition, p.64

Detailed Plan For Lectures

LTP week distribution: (LTP Weeks)Weeks before MTE 7

Weeks After MTE 7

Spill Over 4

Week 1 Lecture 4 Theory of Demand and Supply(Determinants)

T-1:2R-2:6R-4:3

OR-4 Determinants of demand and the movements in the demand curve

Understanding the difference between movement along the demand curve and shifts in the demand curve.

White board.Discussion of caselet-Gillette introduces Space Technology Global Razors from Managerial Economics by Dominick Salvatore, 7th Edition p.120

Week 2 Lecture 5 Theory of Demand and Supply(Law of supply)

T-1:2R-4:3

Supply curve and market equilibrium

Understanding supply curve factors affecting supply

White board and diagrammatic repesentation

Theory of Demand and Supply(Determinants of supply)

T-1:2R-4:3

Market equilibrium Understanding determination of market equilibrium.


Theory of Demand and Supply(Market equilibrium)

T-1:2R-4:3

Introduction to supply curve and market equilibrium

Understanding the supply curve and the determination of market equilibrium.


Lecture 6 Theory of Demand and Supply(Ceiling and Floor prices)

T-1:2R-1:3

R-4:11 4

L6 Ceiling and floor prices L7.Concept and measurement of price elasticity L7 Concept and measurement of income elasticity L8Concept and measurement of cross price elasticity of demand. L9 Applications of elasticity of demand in the real world

L6 Student will understand the concept of ceiling and floor prices in the real economy. L7-8 Understanding price elasticity, income elasticity and cross price elasticity of demand.L9This lecture can be used for contingency such as clarifying the concepts and numericals pertaining to elasticity.

White board and diagrammatic representation,examples and basic numericals. Discussion of caselet-Estimation of demand for oranges by market experiment from Managerial Economics by Domininck Salvatore, 7th edition, p 148.Discussion of caselet-Making Magic: The Multiplex way from Managerial Economics by Geetika Ghosh, 2nd edition,p.131

Week 2 Lecture 7 Theory of Demand and Supply(Ceiling and Floor prices)

T-1:2R-1:3

R-4:11 4





T-1:2R-1:3

R-4:11 4




Week 3 Lecture 10 Consumer behavior(Law of diminishing marginal utility)

R-2:7R-4:4

Introduction to marginal utility and law of diminishing marginal utility

Application of diminishing marginal utility in economic decision making

White board, examples

Lecture 11 Consumer behavior(Law of equi marginal utility)

R-2:7 Introduction to Equi-Marginal utiltiy

Understanding equi-marginal utility and derivation of demand curve from equi- marginal utiltiy

white board, examples

Week 3 Lecture 12 Consumer behavior(Indifference curve)

T-1:5R-2:8R-4:4

Introduction to Indifference curves and their properties

Understanding concept and applications of indifference curves in decision making

PPT, white board, examples.Discussion of caselet-To Fly Fast or Far: Tradeoffs in the Market from agerial Economics: Concepts and Applications by Christopher Thomas, 9th Edition p.161


T-1:2R-1:3

R-4:11 4




Week 4 Lecture 13 Consumer behavior(Consumer Equilibrium)

T-1:5R-2:8R-4:4

Introduction to consumer equilibrium

Understanding consumer equilibrium and its relationship with equi-marginal utility

PPT, white board, examples

Lecture 14 Consumer behavior(Price,income and substitution effect)

T-1:5R-2:8R-4:4

Income and substitution effects

Diagrammatic understanding of income, substitution and price effects

stepwise Diagrammatic representation on whiteboard

Lecture 15 Consumer behavior(Budget Line and shift in budget line)

T-1:5R-2:8R-4:4

Introduction to budget line and shifts in budget line.Income consumption curve and price consumption curve

Understanding normal and inferior goods through income consumption curve and price consumption curve

PPT, whiteboard,examples from real life

Lecture 16 Production and cost in the short run(Production Function,Total Product, Average Product and Marginal Product)

T-1:8R-2:18R-4:7

Introduction to Production function and basic concepts

Calculation and understanding of Total Product, Average Product and Marginal Product

PPT, whiteboard, caselets

Week 5 Lecture 17 Production and cost in the short run(Law of Variable Proportions)

T-1:8R-2:18R-4:7

Law of variable proportions and its applicability

Understanding the application of law of variable proportions in agriculture

Caselet,examples from real world, whiteboard, PPTs

Week 5 Lecture 18 Production and cost in the short run(Short run cost-Fixed and Variable costs,Average and Marginal costs)

T-1:8R-2:21R-4:8

Introduction to short run costs

Understanding of fixed and variable costs, calculation of average and marginal costs

Numerical examples and practice

Lecture 19 Quiz,Test,Presentation and Write Up1

Lecture 20 Production and cost in the short run(Relationship between short run costs and production)

T-1:8 Relationship between short run cost and production

Clear understanding of relationship between these variables and graphical representation

Graphs and numerical illustrations

Week 6 Lecture 21 Production and Cost in the Long run.(Isoquants and their properties)

T-1:9R-2:19R-4:7

Introduction to Isoquants and their properties

Understanding the role of isoquants in decision making

PPT, whiteboard,caselets

Lecture 22 Production and Cost in the Long run.(Isocost curves and shift in Isocost Curves)

T-1:9R-2:20

Introduction to Isocost curves and their applications

Isocost curves and their shift

PPTs, whiteboard

Lecture 23 Production and Cost in the Long run.(Producer equilibrium)

T-1:9R-2:20

L23 Introduction to producer equilibrium and expansion path L24 Shape of long run average cost curve due to economies and diseconomies of scale

L 23 Student will understand how the long run average cost curve is derived and shaped.

PPTs,whiteboard,caselets

Production and Cost in the Long run.(Expansion Path,Long Run Costs, economies and diseconomies of scale)

T-1:9R-2:20

Introduction to producer equilibrium and expansion path,shape of long run average cost curve due to economies and diseconomies of scale

Understanding how the long run average cost curve is derived and shaped.L 24 The lecture can be used for contingency such as relating concepts with examples.


Lecture 24 Production and Cost in the Long run.(Expansion Path,Long Run Costs, economies and diseconomies of scale)

T-1:9R-2:20

Introduction to producer equilibrium and expansion path,shape of long run average cost curve due to economies and diseconomies of scale

Understanding how the long run average cost curve is derived and shaped.L 24 The lecture can be used for contingency such as relating concepts with examples.


Production and Cost in the Long run.(Producer equilibrium)

T-1:9R-2:20

L23 Introduction to producer equilibrium and expansion path L24 Shape of long run average cost curve due to economies and diseconomies of scale

L 23 Student will understand how the long run average cost curve is derived and shaped.


Week 7 Lecture 25 Production and Cost in the Long run.(Returns to scale,Relationship between LAC and SAC curves, economies of scope)

T-1:9R-2:19 21

R-4:8

L 25 Concept of returns to scale. L 26 Shape of long run average cost and short run average cost curves L 27 Economies of scope, L28 Introduction to revenue curves.Revision of basic concepts

L25 Student will understand Returns to Scale by using isoquant map L26-27 Derivation of Long Run Average Cost curve L28 Introduction to revenue curves and also covering a basic understanding of market structures.Revision of concepts and planning contingencies.

Diagrammatic representation on whiteboard,PPTs and caselets

Lecture 26 Production and Cost in the Long run.(Returns to scale,Relationship between LAC and SAC curves, economies of scope)

T-1:9R-2:19 21

R-4:8




Lecture 27 Production and Cost in the Long run.(Returns to scale,Relationship between LAC and SAC curves, economies of scope)

T-1:9R-2:19 21

R-4:8




Week 7 Lecture 28 Production and Cost in the Long run.(Returns to scale,Relationship between LAC and SAC curves, economies of scope)

T-1:9R-2:19 21

R-4:8




MID-TERMWeek 8 Lecture 29 Market Structure: Perfect

competition, Monopoly and Monopolistic Competition(Meaning and importance of perfect competition)

T-1:11R-2:28R-4:10

Introduction to perfect competition and its characteristics

Understanding the prevelance of perfect competition in real world

caselets, PPTs, whiteboard

Lecture 30 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Price and output determination under perfect competition)

T-1:11R-2:28 29

R-4:10

L 30-31 Price and output determination in the short run.L32 Price and output determination in the long run

L30 Student will understand profit maximization,loss minimization, shut down decision, short runsupply curve. L32 Understanding of long run equilibrium and how it is achieved

PPTs, whiteboard,Discussion of caselet-Long run adjustment in the US cotton textile industry from Managerial Economics by Dominick Salvatore, 7th edition, p 358


T-1:11R-2:28 29

R-4:10





T-1:11R-2:28 29

R-4:10




Week 9 Lecture 33 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Introduction to monopoly)

T-1:12R-2:32R-4:12

AV-1 Introduction to monopoly and reasons for market power

Understanding the measurement and reasons formarket power and application in the real world

Case study,PPTs, whiteboard

Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Sources of monopoly)

T-1:12R-2:32R-4:12

AV-1 Introduction to monopoly and reasons for market power

Understanding the measurement and reasons formarket power and application in the real world

Case study,PPTs, whiteboard

Lecture 34 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Price and ouput determination in monopoly)

T-1:12R-2:32R-4:12

AV-4 L34 Short run equilibrium under monopoly L35 Long run equilibrium under monopoly

L34 Student will understand how short run equilibrium under monopoly is achieved. L35 Understanding how long run equilibrium under monopoly is different from other market structures

PPTs,whiteboard,caselet-Barriers to entry and monopoly by Alcoa from Managerial Economics by Domininck Salvatore, 7th edition, p 365

Lecture 35 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Price and ouput determination in monopoly)

T-1:12R-2:32R-4:12

AV-4 L34 Short run equilibrium under monopoly L35 Long run equilibrium under monopoly

L34 Student will understand how short run equilibrium under monopoly is achieved. L35 Understanding how long run equilibrium under monopoly is different from other market structures

PPTs,whiteboard,caselet-Barriers to entry and monopoly by Alcoa from Managerial Economics by Domininck Salvatore, 7th edition, p 365

Lecture 36 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Price discrimination)

R-2:33R-4:15

L36 Degrees of price discrimination L37 Dumping and its prevalence in the real world

L36 Understanding degrees of price discrimination. L37 Understanding dumping in the real world. Covering contingencies and further clarifying concepts related to market structures.

PPT, whiteboard

Week 10 Lecture 37 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Price discrimination)

R-2:33R-4:15

L36 Degrees of price discrimination L37 Dumping and its prevalence in the real world

L36 Understanding degrees of price discrimination. L37 Understanding dumping in the real world. Covering contingencies and further clarifying concepts related to market structures.

PPT, whiteboard

Week 10 Lecture 38 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Meaning of monopolistic competition and its importance)

T-1:12R-2:36R-4:13

OR-1AV-1

Introduction to monopolistic competition

Understanding relevance of monopolistic competition in the real world.

PPT, whiteboard,caselet-The monopolistically competitive medical private practice in India from Managerial Economics by Domininck Salvatore, 7th edition, p 373

Lecture 39 Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Product variation and selling expenses under monopolistic competition)

T-1:12R-2:36R-4:13

Determination of lonng run equilibrium under monopolistic competition

Understanding the difference between long run equilibrium under monopolistic competition and perfect competition

PPT, whiteboard,caselet-Advertiser competition in India from Managerial Economics by Dominick Salvatore, 7th edition, p 377

Market Structure: Perfect competition, Monopoly and Monopolistic Competition(Price and output determination in monopolistic competition)

T-1:12R-2:36R-4:13

Determination of short run equilibrium under monopolistic competition

Understanding the difference between long run equilibrium under monopolistic competition and perfect competition

PPT, whiteboard

Lecture 40 Oligopoly and Game Theory(Features of oligopoly)

T-1:13R-2:40R-4:13

AV-2 Features of oligopoly Crucial distinction between monopolistic competition and oligopoly

PPT, whiteboard

Oligopoly and Game Theory(Similarity and dissimilarity between monopolistic competition and oligopoly)

T-1:13R-2:40

AV-2 Difference between monopolistic competition and oligopoly

Crucial distinction between monopolistic competition and oligopoly

PPT, whiteboard

Week 11 Lecture 41 Oligopoly and Game Theory(Sweezy Price Rigidity Model)

T-1:13R-2:40R-4:13

Price rigidity in oligopoly

Student will understand the critical feature of oligopoly which is price stickiness

PPT, whiteboard,examples from real world

Lecture 42 Oligopoly and Game Theory(Introduction to Game Theory)

T-1:13R-2:44R-4:14

OR-1 Game theory and prisoner dilemma

Understanding how prisoner dilemma impacts decision making in competitive markets

PPT, whiteboard.Discussion of caselet-The airlines fare war in India and prisoner dilemma from Managerial Economics by Dominick Salvatore, 7th edition, p 444

Lecture 43 Oligopoly and Game Theory(Cartels and Collusions)

T-1:13R-1:9

R-2:40R-4:13

Cartels and collusions Diagrammatic representation of cartels and collusions as explained in prisoner dilemma

PPT, whiteboard.Discussion of caselet-The OPEC cartel from Managerial Economics by Dominick Salvatore, 7th edition, p 399

Week 11 Lecture 44 Measuring National Income(Meaning and Concepts)

R-3:4 National income concepts

Student will understand national income concepts

PPT, whiteboard

Week 12 Lecture 45 Measuring National Income(Methods of measuring national Income)

R-3:4 L45 Output method and income method of measuring national income

L45 Understanding measuring national income through GDP and aggregation of total income in an economy

PPT, whiteboard

Measuring National Income(Circular flow of national income)

R-3:4 L46 Expenditure method of measuring national income

L 46 Understanding national income through the equation:C+I+G+(X-M).Circular flow of income

PPT, whiteboard

Lecture 46 Measuring National Income(Circular flow of national income)

R-3:4 L46 Expenditure method of measuring national income

L 46 Understanding national income through the equation:C+I+G+(X-M).Circular flow of income

PPT, whiteboard

Measuring National Income(Methods of measuring national Income)

R-3:4 L45 Output method and income method of measuring national income

L45 Understanding measuring national income through GDP and aggregation of total income in an economy

PPT, whiteboard

Lecture 47 Measuring National Income(Three Sector model)

R-3:4 Three sector model of national income

Understanding three sector model and its significance

Step wise diagrammatic representation on whiteboard

Measuring National Income(Four sector model)

R-3:4 Four sector model of national income

Understanding four sector model and its significance

Step wise diagrammatic representation on whiteboard

Lecture 48 Quiz,Test,Presentation and Write Up3

Week 13 Lecture 49 Measuring National Income(Difficulties in measuring national income)

R-3:4 Difficulties in measuring national income specifically in developing countries

How national income measurements take place in developing countries

caselets, PPT, whiteboard

Lecture 50 Measuring National Income(Application/use of national income data)

R-3:4 Uses of national income data in various sectors of the economy

Understanding how national income data is actually used

Lecture 51 Monetary Policy and Fiscal Policy(Meaning and instruments)

R-3:29 L51 Meaning of monetary policy L52-53 Instruments of monetary policy and their impact on the economy.L54-55Meaning and instruments of fiscal policy and their use in economic stabilization

L51-53 Understanding how monetary policy works and its relevance for India in the current scenario. L54-55 Student will understand the role of fiscal policy in economic growth and stabilization.

L51-53 Examples from Indian monetary policy and impact on economy L54-55 examples of fiscal policy from Japan and US.

Week 13 Lecture 52 Monetary Policy and Fiscal Policy(Meaning and instruments)




Week 14 Lecture 53 Monetary Policy and Fiscal Policy(Meaning and instruments)












Lecture 56 Monetary Policy and Fiscal Policy(Target variables and impact on economy)

R-3:29 31 Discussion on monetary and fiscal policy variables and revision of basic concepts

In depth understanding of policy instruments.Revision of concepts

Case study, PPT, whiteboard

SPILL OVERWeek 15 Lecture 57 Spill Over

Lecture 58 Spill Over



Scheme for CA:

Component Frequency Out Of Each Marks Total Marks

Quiz,Test,Presentation and Write Up

2 3 10 20

Total :- 10 20

Details of Academic Task(s)AT No. Objective Topic of the Academic Task Nature of Academic Task

(group/individuals/field work

Evaluation Mode Allottment / submission Week

Presentation and Write Up1

To encourage students to think analytically and correlate economic concepts with real life issues

Each group of students will be allotted a unique case study on managerial economics. Each student is mandatorily required to submit a short written report on the case.This will be followed by a group presentation on the case involving mandatory participation by all students.

Group Written report (submitted individually by each student before the presentation)-5 marks. Group presentation comprising 25 marks divided into: Introduction to presentation and overview-5 marks Understa

5 / 12

Test1 To encourage students to understand economic concepts and apply them in attempting analytical questions.This will help to prepare students for the mid term examination

A mix of analytical and conceptual questions from Unit 1 and Unit 2

Individual 6 questions of 5 marks each thus comprising a total of 30 marks.

5 / 5

Quiz1 To refresh the learning experience of students through the semester by testing the preciseness of their understanding and knowledge

25 multiple choice questions will be asked from unit 1 to unit 5.The split of syllabus will be 30% before the mid term and 70% after the mid term.

Individual 25 questions of 1 mark or 2 marks each comprising a total of 30 marks.

12 / 12

Plan for Tutorial: (Please do not use these time slots for syllabus coverage)Tutorial No. Lecture Topic Type of pedagogical tool(s) planned

(case analysis,problem solving test,role play,business game etc)

Tutorial1 Demand analysis Case AnalysisTutorial2 Numericals on elasticity of demand Problem SolvingTutorial3 Indifference curves Case AnalysisTutorial4 Numericals on short run production and short run cost Problem SolvingTutorial5 Numericals on long run production and long run cost Problem SolvingTutorial6 Determination and shifts in market equilibrium Case AnalysisTutorial7 Doubt clearing and revision Resolving doubts on numerical problems and graphical illustration of concepts

After Mid-TermTutorial10 Presentations on case studies allotted to students for

AT 2.Discussion of real life examples on perfetc competition.

Presentation on case studies

Tutorial11 Presentations on case studies allotted to students for AT 2.Discussion on real life examples and current news on monopolistic competition.

Case Analysis,Presentation on case studies

Tutorial12 Presentations on case studies allotted to students for AT 2.Discussion on real life examples and illustrations on oligopoly.

Case Analysis,Presentation on case studies

Tutorial8 Perfect competition Case AnalysisTutorial9 Monopoly and monopolistic competition Case AnalysisTutorial13 Numerical problems on national income accounting Problem SolvingTutorial14 Revision and doubt clearing Resolving doubts on numerical problems and graphical illustration of concept

ECO515

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