Economic Analysis for Business Decisions

Aims of the course

- to expand the knowledge of elementary microeconomics into the field of business decision-making,
- to provide students the necessary analytical tools and enable them for making business decisions based on economic concepts
- to enable student to use their knowledge of economics in the application of business sciences

Course syllabus

1. Managerial economics – introduction

2. Business decision making
2.1. The objectives of the firm
2.2. The decision making criteria
2.2.1 Present value
2.2.2 Net present value
2.3. Business decision making and uncertain outcomes
2.3.1 Uncertainty, risk and expected present value
2.3.2 Cost of information

3. The attribute approach to consumer choice

4. Business costs for decision making
4.1. Accounting and economic aspect of costs
4.2 Private and Social Costs
4.3 Incremental Costs

5. Decisions for Profit Maximisation
5.1 Break-even Analysis
5.2 Contributive Analysis
5.3 Cost-Benefit Analysis

6. Pricing Analysis and Decisions
6.1. Markup pricing
6.2. Pricing in Established Markets
6.3. New Product Pricing
6.4. Competitive Bids and Price Quotes

7. Internal structure of the firm
7.1 Advantages of internal organisation
7.2 Types of organisations

8. Financial structure of the firm
8.1. Investment criteria
8.3. Cost of capital

Course director(s)