BUS 531: Managerial Economics (MBA)
Course Syllabus Term 5 Summer 2011
Course Title:
Managerial Economics (MBA)
Course Number:
BUS 531 (MBA)
Professor:
Dr. Thomas Hardy
Email Address:
hardyfinancialplanning@comcast.net
Virtual Office Hours:
Contact via e-mail
Phone #:
734-678-0580
Fax #:
877-468-4432
Course Description
This Managerial Economics course studies the role of economic theory in management
analysis and decisions. The study of demand, cost, and supply theories from a business
viewpoint are also covered. This course is about economic principles and their relevance to
business decision-making. We will explore the interaction of information, economic
incentives and market competition and how these interact to determine prices, products
available, profits, and patterns of trade and organization. At the end of this course,
students should be able to understand how basic economic reasoning can lead to improved
managerial decisions.
Student Outcomes
Course Goals
After completing this class you should be able to:
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Use the rational-actor paradigm to predict firm and individual behavior.
Compute the relevant costs of any decision.
Use marginal analysis to make extent (how much) decisions.
Make investment decisions that increase firm value.
Set optimal prices and price discriminate.
Predict industry-level changes using demand/supply analysis.
Develop long-run strategies to increase firm value.
Use game theory to predict how your actions influence those of others.
Bargain effectively
Make decisions in uncertain environments.
Solve the problems caused by moral hazard and adverse selection.
Align individual incentives with the goals of the company.
Identify unconsummated wealth-creating transactions and devise ways to profitably
consummate them.
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Information Literacy
Students will determine the level and extent of information required to fulfill professional
responsibilities. Students will learn where and how to access the information effectively and
efficiently. Students will be able to critically evaluate the sources of information and know
what information to use to accomplish their purpose. Students will understand the
economic, legal and social issues surrounding the use of information in order to use the
information ethically and legally.
Creation of Value
Students will be able to effectively communicate information and recommendations to those
relying on their education, training and expertise. Students will synthesize information to
support their conclusions and recommendations.
Statistical Data Analysis
Students will learn to organize, order attribute, weight, screen, evaluate and use information
and data. They will be able to query required information to ultimately use raw data in the
pursuit of creating recommendations and to add value to conclusions.
Text Information:
Author’s name
Year of publication
Publisher
ISBN Number
Managerial Economics: A Problem Solving Approach 2rd Ed
Froeb, Luke and McCann, Brian
2008
Southwestern (Cengage)
978-0-5387-7124-5 (Bundled with MBA Primer)
Managerial Economics module of MBA Primer
(Bundled with textbook: http://v2.mbaprimer.com)
Both the textbook and the MBA Primer are required for this course. The Bundled price
is at significant discount to purchasing each individually.
Where to Purchase Books
Where to Purchase Books
You can go to CLU’s online bookstore efollet by using the following link:
http://www.callutheran.bkstr.com
Or you can use purchase or rent from the publisher:
www.cengagebrain.com/shop/en/US/storefront/US?cmd=catProductDetail&ISBN=978-0538-77124-5 (make sure there is no space between the 978-0- and the 538 in your
browser url address window)
Course Assignments/Assessments
Class Chat
A 60-90 minute chat session will be held each week on Tuesday starting at 6:00 PM
Pacific Time. In the chat session the instructor will review issues from the previous week as
well as discuss material from the current week and respond to student questions. During
some chat sessions students will make group presentations. Student attendance and
participation is required unless prior arrangements have been made with the instructor. The
chat session will be archived for student review and PowerPoint slides used by the instructor
will be distributed to the class.
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View Lesson
Each module contains a voice-over PowerPoint presentation reviewing the module topics.
Discussion Forum
Students will discuss topics relevant to the module material in the Discussion Forum.
Group Homework
Some weeks students will be assigned to groups and will answer a homework problem
selected by the group. The solution will submitted as a Wiki and as a PowerPoint
presentation and one or more groups will present their solution to the rest of the class.
MBA Primer
This is a hands-on “how to” primer that teaches the mechanics of costs, demand, marginal
analysis, and benefit-cost analysis. There are primers for Financial Accounting, Managerial
Economics, Finance, Accounting, and Statistics. Be sure to select MBA Primer Online:
Managerial Economics Module Volume 2, 2nd Edition and NOT any of the other primers.
Read the material, do the exercises, and take the quiz at the end of each section. Repeat
the quizzes and review the material until you are comfortable with the concepts and
techniques. Quiz yourself using variations of the MBA Primer questions. No deliverables
are required from the MBA Primer itself. Feel free to start working on the MBA Primer as
soon as you have purchased it.
Timed Quiz
When you have completed studying the material from the MBA Primer during the first four
weeks, you will take a quiz. The quizzes are timed and count toward the course grade.
Mid-Term Exam:
A Mid-term exam will be given at the end of the fourth week and will be comprehensive
over the material of the first four weeks. The exam is timed, single access, and contains
questions similar in difficulty and content to the timed quizzes.
Self-Paced Homework
During the last half of the course students will complete sets of untimed homework
problems that will assist in preparing them for the Final Exam. These homework sets will
have a small (<5%) contribution to the final course grade.
Final Case Study
The final case study will be an in-depth analysis of one of the key topics covered in the
course. The case study will be an individual effort and will be due at the beginning of the
last week of class. Selected students will present their results during the final chat session.
Final Exam:
The final exam will be a one-time access, timed activity. The course material builds upon
itself so the final exam will be comprehensive over the entire course however the exam will
primarily emphasize material covered after the mid-term exam. Note that the final exam
will not be a large portion of the total grade since student knowledge and performance will
be assessed over the entire term through quizzes and homework, the final case study, the
mid-term exam, forum discussions and participation.
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Grading
Assignment Type
Discussion Forum
Group HW
Timed Quizzes
Self-Paced Homework
Mid-term Exam
Final Case Study
Final Exam
Total Points
Points
120
100
80
30
100
100
100
630
MBA candidates are expected to meet all deadlines. All assignments must be submitted
no later than the date due to receive credit. The only exception is when there are
extenuating circumstances that are outside the student's control and PRIOR arrangements
have been made with the instructor.
As professionals, you are aware of the importance of strong writing skills. Letters, reports,
and even short e-mail notes all indicate to others our ability to communicate. Since good
writing follows clear thinking, others will form opinions about your ability and work ethic
based upon written correspondence. Typographical errors, grammatical errors, misspelled
words, or poor diction and an awkward writing style dramatically reduce the impact of your
work no matter how good the content, as do errors that come from not paying attention to
details such as leaving off dollar or percent signs.
Grading Scale: Course grades will be awarded as follows:
Percentage
≥94%
90% to 93%
87% to 89%
84% to 86%
80% to 83%
77% to 79%
74% to 76%
70% to 73%
67% to 69%
64% to 66%
60% to 63%
<60%
Grade
A
AB+
B
BC+
C
CD+
D
DF
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Course Outline
Week Readings
1
2
Assignment
Froeb Ch 1
Froeb Ch 2
Froeb Ch 3
MBA Primer Intro
MBA Primer 1
Timed Quiz
Froeb Ch 4
Froeb Ch 5
MBA Primer 2
Description
Introduction
The One Lesson of Business
Benefits, Costs and Decisions
What is Managerial Economics?
Using Economics in Management Decisions
Extent (How Much) Decisions
Investment Decisions
Understanding the Seller’s Costs
Timed Quiz
3
Froeb Ch 6
Froeb Ch 7
MBA Primer 3
Simple Pricing
Economies of Scale and Scope
Understanding the Buyer’s Demand
Timed Quiz
Group Homework
4
Froeb Ch 8
Froeb Ch 9
Froeb Ch 10
MBA Primer 4
Understanding Markets and Industry Changes
Relationships Between Industries
Strategy, the quest to slow profit erosion
Understanding Markets and Profit Maximization
Timed Quiz
Mid-Term Exam
5
8
Froeb
Froeb
Froeb
Froeb
Ch
Ch
Ch
Ch
11
12
13
14
Using Supply and Demand
More Realistic and Complex Pricing
Direct Price Discrimination
Indirect Price Discrimination
Self-Paced Homework
6
Froeb Ch 15
Froeb Ch 16
Strategic Games
Bargaining
Self-Paced Homework
Group Homework
7
Froeb
Froeb
Froeb
Froeb
Making Decisions with Uncertainty
Auctions
The Problem of Adverse Selection
The Problem of Moral Hazard
Self-Paced Homework
Ch
Ch
Ch
Ch
17
18
19
20
Froeb Ch 21
Getting Employees to Work in the Best Interests of the Firm
Final Case Study
Timed Final Exam
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Technical Requirements and Support
Students are required to have a computer, e-mail and Internet access to enroll in this
course. This course is delivered via online instruction. All materials with the exclusion of
the textbook are delivered via the Internet. Technical support is available 24/7/365.
Please see the section on Technical Help for more information. Students should also have
access to Microsoft Excel and an additional statistical software package to be
determined.
Policy on Instructional Modification
California Lutheran University is committed to providing reasonable accommodations in
compliance with ADA of 1990 and Section 504 of the Rehabilitation Act of 1973 to
students with documented disabilities. If you are a student requesting accommodations
for this course, please contact your professor at the beginning of the semester and
register with the Accessibility Resource Coordinator, Wendy Perkins, for the facilitation
and verification of need. The Accessibility Resource Coordinator is located in the Center
for Academic and Accessibility Resources (CAAR) Office in the Pederson Administration
building, and can be contacted by calling 805.493.3878 or emailing
wperkins@callutheran.edu
Statement on Academic Honesty:
Academic honesty the fair and straightforward representation of what one has actually
learned, researched, and/or written is the foundation of a healthy environment for
learning. Professors, administrators, and students are responsible for upholding high
moral and ethical standards of academic honesty in all academic endeavors, and the
academic community of the University must support the policy that any form of academic
dishonesty is a serious breach of ethics and will be dealt with surely and appropriately.
California Lutheran University defines scientific misconduct or research misconduct as
fabrication, falsification, plagiarism, or other practices that seriously deviate from those
that are commonly accepted within the scientific community for proposing, conducting,
or reporting research. It does not include honest error or honest differences in
interpretation or judgments on data.
Intellectual property rights are to be respected at all times, with appropriate
recognition/reference given to informational sources. Plagiarism occurs whenever a
source of any kind has not been acknowledged. Every student must understand the
correct procedures for acknowledging and identifying sources of borrowed material. The
basic rule is this: Give credit where credit is due. In other words, if you include any
material which is beyond your first hand experience, and which is not common
knowledge of scholars in your field, you must cite your source in a way that your reader
can [a] find the source from the information in your reference and [b] immediately
determine which information of your source’s contribution to scholarship and which is
yours.
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