Principles of Managerial Economics

Table of Contents

• Licensing Information

• Chapter 1: Introduction to Managerial Economics

  • Why Managerial Economics Is Relevant for Managers
  • Managerial Economics Is Applicable to Different Types of Organizations
  • The Focus of This Book
  • How to Read This Book

• Chapter 2: Key Measures and Relationships

  • Revenue, Cost, and Profit
  • Economic Versus Accounting Measures of Cost and Profit
  • Revenue, Cost, and Profit Functions
  • Breakeven Analysis
  • The Impact of Price Changes
  • Marginal Analysis
  • The Conclusion for Our Students
  • The Shutdown Rule
  • A Final Word on Business Objectives

• Chapter 3: Demand and Pricing

  • Theory of the Consumer
  • Is the Theory of the Consumer Realistic?
  • Determinants of Demand
  • Modeling Consumer Demand
  • Forecasting Demand
  • Elasticity of Demand
  • Consumption Decisions in the Short Run and the Long Run
  • Price Discrimination

• Chapter 4: Cost and Production

  • Average Cost Curves
  • Long-Run Average Cost and Scale
  • Economies of Scope and Joint Products
  • Cost Approach Versus Resource Approach to Production Planning
  • Marginal Revenue Product and Derived Demand
  • Marginal Cost of Inputs and Economic Rent
  • Productivity and the Learning Curve

• Chapter 5: Economics of Organization

  • Reasons to Expand an Enterprise
  • Classifying Business Expansion in Terms of Value Chains
  • Horizontal Integration
  • Vertical Integration
  • Alternatives to Vertical Integration
  • Conglomerates
  • Transaction Costs and Boundaries of the Firm
  • Cost Centers Versus Profit Centers
  • Transfer Pricing
  • Employee Motivation
  • Manager Motivation and Executive Pay

• Chapter 6: Market Equilibrium and the Perfect Competition Model

  • Assumptions of the Perfect Competition Model
  • Operation of a Perfectly Competitive Market in the Short Run
  • Perfect Competition in the Long Run
  • Firm Supply Curves and Market Supply Curves
  • Market Equilibrium
  • Shifts in Supply and Demand Curves
  • Why Perfect Competition Is Desirable
  • Monopolistic Competition
  • Contestable Market Model
  • Firm Strategies in Highly Competitive Markets

• Chapter 7: Firm Competition and Market Structure

  • Why Perfect Competition Usually Does Not Happen
  • Monopoly
  • Oligopoly and Cartels
  • Production Decisions in Noncartel Oligopolies
  • Seller Concentration
  • Competing in Tight Oligopolies: Pricing Strategies
  • Competing in Tight Oligopolies: Nonpricing Strategies
  • Buyer Power

• Chapter 8: Market Regulation

  • Free Market Economies Versus Collectivist Economies
  • Efficiency and Equity
  • Circumstances in Which Market Regulation May Be Desirable
  • Regulation to Offset Market Power of Sellers or Buyers
  • Natural Monopoly
  • Externalities
  • Externality Taxes
  • Regulation of Externalities Through Property Rights
  • High Cost to Initial Entrant and the Risk of Free Rider Producers
  • Public Goods and the Risk of Free Rider Consumers
  • Market Failure Caused by Imperfect Information
  • Limitations of Market Regulation

• Chapter 9: References