Managerial Economics – Effective Business Decisionmaking
Managerial Economics is a field of Economics that analyzes business decisions. Managerial Economics allows business owners to answer the questions “How much should I produce?” and “What price should I charge?”. However, there is much more to Managerial Economics than simply determining the optimum price and quantity that a firm should produce. Managerial Economics also allows us to determine how our business will be affected by changes in the production of other businesses. It allows us to predict the impact that certain government legislation will have on our business. This course will examine business decisions from both the perspective of the supplier and the consumer.
Law of Supply and Demand
Indifference Curves and Budget Constraints
Elasticity of Demand
Isoquant and Isocost Curves
Minimizing Cost of Production
Benefits of Mergers
Time Value of Money
About the Instructor
Robert Reed is a current Masters of Business Administration candidate and veteran with four years of service in the 82nd Airborne Division of the United States Army. He holds a B.A. in Economics and has served as a student tutor for three years.
Welcome to the course! This is a brief introduction to the course, the topics we will cover, and the course outcomes.
Welcome to Managerial Economics. In this first lesson, we will discuss some fundamental concepts of Managerial Economics.
In this lesson, we discuss the time value of money. Learn why a dollar today is more valuable than a dollar tomorrow and how companies account for this difference between present value and future value.
In this lesson, we calculate the present value of a stream of infinite payments. This situation can arise when a company or business purchases an annuity, or when a business investment can be made in the present, but will yield dividends into the foreseeable future.
In this video, we will discuss the Law of Demand. The law of demand is a fundamental principle of Economics.
Supply and Demand
In this video, we will discuss consumer surplus. Consumer surplus is a term used to describe value that consumers get from purchasing a product.
In this lesson, we will discuss the Law of Supply. The Law of Supply is similar to the Law of Demand, but describes how producers are willing to produce more at higher prices.
Market equilibrium is a term that describes the intersection of the demand and supply curves. In this lesson, we will examine the concept of market equilibrium. Additionally, we will use demand and supply curves to calculate market price and quantity sold.
In this lesson, we continue our analysis of equilibrium markets and learn how to calculate producer surplus from the supply function.
In this video we will learn about a price ceiling and how it affects market price and quantity.
In this lesson, we examine the effects of a price floor on market quantity and price.
Elasticity of demand refers to how the change in one variable (price, price of competitors goods, etc. ) affects quantity.
In this lesson, we will take a more advanced look at elasticity. We will learn how to calculate elasticity from the demand function, and we will also learn how to derive elasticity using basic calculus.
In this lesson, we will discuss additional types of elasticities. We will learn how the formula for elasticities can be expanded to encompass variables such as marketing expenditures or income.
The demand function is critical for understanding market price and quantity. In this video, we will learn how economists estimate the demand function with regression analysis.
In this video, we will learn how to interpret a regression output. Is the model useful? How good of a model does the regression equation provide?
In this video, we will learn about indifference curves and the marginal rate of substitution.
This video discusses budget constraints and how consumers attempt to maximize utility given limited resources.
This video discusses the concept of an indifference curve.
In this lesson, we will discuss the basics of production. We will learn the differences between fixed, variable, and sunk costs.
This example uses a craft fair to illustrate the concept of a break even point and contribution margin.
In this video, we will discuss the basics of a production function. We learn how different amounts of inputs can lead to different quantity of outputs. By the end of the lecture, you will understand the importance of Marginal Product of Labor.
In this lesson, we will explore how firms choose the optimal amount of a certain input. We will continue to explore the production function by learning exploring the interaction between the Value of Marginal Product of Labor (VMPL) and the Wage Rate (W),
In this video, we will discuss the importance of Isoquant Curves. Isoquants allow us to see how a business can produce the same level of output while using different combinations of capital and labor.
In this lesson, we will discuss the Isocost Curve. This curve allows us to see how the cost of production is expressed in terms of different inputs.
In this video we will put together the Isocost and Isoquant curves to see how managers can choose the proper mix of capital and labor to minimize costs.
This video discusses the application of the Cobb-Douglas production function.
This lesson discusses the basics of perfect competition. Understanding the perfectly competitive market structure will give you a foundation for understanding other types of market structures.
In this lesson, we will learn about a monopoly and how it uses its market power to enhance profits.
In this lesson, we will learn about two measures of relative market power.
In this lesson, we will discus two ways of measuring the concentration of an industry.
In this lesson, we will learn how a monopolistic competition market structure operates.
In this lesson, we will discuss four types of oligopolies and the implications of each different type.
In this lesson, we will learn how firms with market power can use pricing strategies to increase profits and producer surplus.
Firm Organization and Strategy
This lesson will discuss vertical and horizontal integration as well as conglomerate mergers.
In this lesson, we will learn about the costs of inputs and the concept of vertical integration.
In this lesson, we will learn how managers can use performance incentives to maximize employee potential.
In this lesson, we will learn about perfect competition and the shutdown rule. In some circumstances, the firm should keep producing even when it is operating at a loss.