Managerial Economics: Economic Analysis and Optimization

Description

This course covers the broader subject of managerial economics and specializes in economic analysis and optimization. Both are crucial because the goal of optimization is to create a situation where a company’s marginal revenue is equal to its marginal cost, and accurate analysis is needed to assess how to obtain optimization. ‘Marginal analysis’ and ‘incremental analysis’ are some of the leading concepts that will be unravelled. Other concepts addressed include the importance of revenue and cost. The material also covers basic assumptions in economics, notably ‘ceteris paribus’ (‘all other things being equal’ or the idea in economics of the effect one variable has on another, provided all other variables are unchanged) and economic rationality.

You will then learn about economic functions and their variables, along with the slope of a function and differential calculus. The course also highlights the techniques used for optimization: revenue maximization or cost minimization. Two key techniques will be particularly emphasized, namely, the substitution technique and the Lagrange multiplier method. By the end of the course, the regression technique and the least square method will also be unravelled.

Starting with the basic concepts of managerial economics (also known as industrial economics), you will be led through the complexities around sound economic analysis and optimization. This course will be of great interest to people who would like to have a better understanding of economics and how it relates to the actual world, especially business owners, entrepreneurs and sales managers. Students attending schools in the commercial sector or specializing in finance will find the course particularly interesting.