Sub Code: 08MBA12 IA Marks: 50
No. of Lecture Hrs/week: 04 Exam Hours: 3 Hours
Total no. of Lecture Hrs: 56 Exam Marks: 100
MODULE 1 (7 Hours)
Introduction to Economics: Managerial Economics- Nature, Scope, &
significance. Role of Managerial Economist in Decision making -Decision
Making Process in Managerial Economics
MODULE 2 (7 Hours)
Fundamental Principles of Managerial Economics: Opportunity Costs,
Incremental Principle, Time perspective, Discounting and Equi-Marginal
MODULE 3 (7 Hours)
Demand Analysis: Law Of Demand, Exceptions to the Law of Demand,
Elasticity of demand – Price, Income & Cross elasticity, Uses of elasticity of
demand for Managerial decision making, Measurement of elasticity of
demand. Advertising and promotional elasticity of demand.-Demand
forecasting: Meaning & Significance.
MODULE 4 (7 Hours)
Concepts, Objectives of the firm, alternate objectives of firm, firm &
Industry. Marginalism – Importance in decision making.
Theories of firm-
Managerial theories: Baumol’s Model, Marris’s Theory, Williamson’s
Behavioural theories: Satisfying Behaviour, Simple model of Behaviourism.
MODULE 5 (7 Hours)
Production Analysis: Concepts, production function: Single Variable – Law
of Variable Proportions & Two variable Function – ISO-Quants & ISO-Costs
& Equilibrium (Least cost combination). Total, Average, & Marginal
Product. Returns to scale. Technological progress & Production function.
MODULE 6 (7 Hours)
Costs & Revenue functions: Short run and long run cost curves, combination,
expansion path. Economies and diseconomies of scale. Law of supply,
Elasticity of supply.
MODULE 7 (7 Hours)
Market Structure: Perfect Competition, Features, Determination of price
under perfect competition Monopoly: Feature, Pricing under monopoly, Price discrimination.
Oligopoly: Features, Kinked demand Curve, Cartels, Price leadership.
Monopolistic Competition: Features, Pricing Under monopolistic
competition, Product differentiation.
Descriptive Pricing Approaches: Full cost Pricing, Product Line Pricing,
Pricing Strategies: Price Skimming, Penetration Pricing, Loss leader pricing.
MODULE 8 (7 Hours)
Profits: Determinants of Short-term & Long-term profits. Classification –
Measurement of Profit.Break Even Analysis – Meaning, Assumptions,
determination of BEA, Limitations – Uses of BEA in Managerial decisions.

1. Managerial Economics-Theory and Applications by Dr. D M
Mithani : Himalaya Publication, 2/e, 2005
2. Managerial Economics by Craig H Petersen, W. Chris Lewis &
Sudhir K Jain-Pearson Education, 4th Ed. PHI.
3. Managerial Economics, Atmanand, Excel Books.

1. Micro Economics by Dominick Salvotore, Oxford publishers, 4/e,
2. Managerial Economics by D N Dwivedi -6th ed, Vikas Publication,
3. Managerial Economics by Christopher R Thomas, S Charless
Maurice – Special Indian, 8th Ed, Mc-Graw Hill Education
4. Economics by Samuelson Nordhavs 18th Edition, Mc-Graw Hill

Reference: www.vtu.ac.in/

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