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Economics for
Course Title Semester - I Weightage
Decision Making

Course Code MBA503 CIE 50%

Total No. of Contact Hours 55 SEE 50%
No. of Contact Hours/week Total
4:0:0 100
(L:P: SDA)
Credits 4 Exam. Duration 3 Hours
Teaching Dept., MBA

Course objectives are:

● To introduce the fundamentals, tools and theories of managerial economics.
● To provide an understanding of the application of economics in business
● To understand the basic micro and macro-economic concepts.
● To analyze consumer and producer behavior in various market structures using cost and production
functions.
● To expose business environment and application of macroeconomic policies on influencing
business decision making.
Module-1 RBT Level L1 & L2 13 Hours
Introduction:
Demand and Supply Analysis: Elasticity of demand and supply, Price determination and market
equilibrium.
Production and Costs: Marginal cost, average cost, and economies of scale.
Module-2 RBT Level L1, L2 & L3 12 Hours
Market Structures: Perfect competition, monopoly, monopolistic competition, oligopoly, Pricing
strategies and market power.
Game Theory and Strategic Interaction: Nash equilibrium and competitive strategies.
Market Failures and Externalities: Public goods, external costs/benefits, and government intervention.
Module-3 RBT Level L1, L2 & L3 10 Hours
National Income and GDP: Measurement of GDP, GNP, and related indicators, Components of
aggregate demand and supply.
Inflation, Unemployment, and Business Cycles: Causes and consequences of inflation and deflation,
Types of unemployment and their implications.
RBT Level L1,L2,L3
Module-4 10 Hours
Monetary and Fiscal Policy: Role of central banks, interest rates, and money supply, Government
spending, taxation, and budget deficits.
Module-5 RBT Level L1, L2 & L3 10 Hours
International Trade and Economics: Balance of payments, exchange rates, and trade policies, Impact of
globalization on markets.
Suggested Learning Resources:

Textbooks:

Geethika, N., Ghosh, P., & Choudhury, M. (2011). Managerial economics (2nd ed.).
1
McGraw-Hill Education.
2 Salvatore, D. (2016). Managerial economics (2nd ed.). Oxford University Press.
3 Samuelson, P. A., & Marks, S. G. (2015). Managerial economics (5th ed.). Wiley.
Reference Books:
1 Mithani, D. M. (2016). Managerial economics. Himalaya Publishing House.
McConnell, C. R., Brue, S. L., Flynn, S. M., & Ray Chaudhuri, B. (2004).
2
Microeconomics.
3 Krugman, P., & Wells, R. (2020). Microeconomics (7th ed.). Worth Publishers.
Kalkundrikar, A. B., & Inamdar, R. M. (2022). Managerial economics. R. Chand
4 &Co.

Web links and Video Lectures (e-Resources):

∙ https://www.edx.org/learn/managerial-economics
∙ https://www.indiabudget.gov.in/
∙https://onlinecourses.swayam2.ac.in/imb19_mg16/preview
∙ https://www.youtube.com/watch?v=ZXDKdJO3V6Y

Activity-Based Learning (Suggested Activities in Class)/ Practical Based learning

.
Unit 2: Price Elasticity of Demand Analysis
Objective: Determine the price elasticity of demand for your products and its implications for
pricing strategy.
Tasks:
1. Collect data on sales volume and prices over time.
2. Use regression analysis to estimate the price elasticity of demand.
3. Analyse how changes in price impact total revenue and profit.
4. Develop pricing strategies based on the elasticity findings to maximize revenue.

Unit 3: A. Cost-Volume-Profit (CVP) Analysis

Objective: Understand the relationship between costs, sales volume, and profits to make informed
business decisions.
Tasks:
● Gather data on fixed and variable costs, sales prices, and sales volumes.
● Conduct a CVP analysis to determine the break-even point and target profit levels.
● Use the analysis to evaluate the impact of changes in costs and volume on profitability.
● Develop strategies to optimize cost structures and improve profit margins.

Unit 4: Market Structure and Competitive Strategy

Objective: Analyse the market structure of your industry and develop competitive strategies
accordingly.
Tasks:
● Identify the type of market structure (e.g., perfect competition, monopoly, oligopoly) in the
 chosen industry of student choice.
● Collect data on market share, number of competitors, and barriers to entry.
● Analyse competitive behaviours such as pricing, product differentiation, and market
positioning.
● Develop strategic recommendations based on the analysis to enhance your competitive
advantage.
Unit 5: Externalities and Corporate Social Responsibility (CSR)
Objective: Assess the impact of externalities and develop CSR strategies.
Tasks:
● Identify positive and negative externalities associated with your business operations.
● Quantify the economic impact of these externalities on society and the environment.
● Analyse the costs and benefits of implementing CSR initiatives to address externalities.
● Develop CSR strategies that align with business goals and enhance social welfare

Course outcomes:
Students will gain a foundational understanding of managerial economics, including
CO1 key tools, concepts, and theories.
Students will gain insights into how economic concepts, such as supply and demand, market
CO2 structures, pricing strategies, influence business decisions and strategies, leading to more
informed decision-making in a business environment.
students will be able to apply the basic concepts to analyze economic issues at both
CO3
individual (micro) and national/global (macro) levels.
Students will be able to analyze and compare consumer and producer behavior across
CO4 different market structures, including perfect competition, monopoly, monopolistic
competition, and oligopoly.
students will gain insights into how macroeconomic policies (such as fiscal and monetary
CO5 policies) influence business decision-making, including investment, pricing, and strategic
planning.
Students will acquire the skills to assess how changes in economic conditions and policies
CO6
affect business strategies and competitive positioning.

CO/ PO PO PO PO PO PO PO
PO 1 2 3 4 5 6 7
CO1 3 1 3
CO2 3 2 1
CO3 2 1 3
CO4 2 3 1
C05 2 1 3 3
CO6 3 1

High-3, Medium-2, Low-1

SEE (Semester End Examination) and CIE (Continuous Internal Evaluation)
assessment.
The weightage of Continuous Internal Evaluation (CIE) is 50% and for Semester End Exam
(SEE) is 50%. The minimum passing mark for the CIE is 50% of the maximum marks.
Minimum passing marks in SEE is 40% of the maximum marks of SEE. A student shall be
deemed to have passed this course and earned credit allotted to this course, if the student
secures not less than 50% of the sum total of the CIE (Continuous Internal Evaluation) and
SEE (Semester End Examination).
SEE Question Paper Pattern
The Question Paper will consist of two parts namely Part A and Part B.
Part A carries 80 marks consisting of descriptive or numerical questions aligning with RBT
levels as defined.
Questions will be based on all 5 modules and each module carrying a weightage of 16% of
the total marks. Each module will have a choice of questions.
Part B carries 20 marks consisting of Case Study which is mandatory.
CIE Assessment Pattern:
There shall be a maximum of 50 CIE Marks in this course.
CIE Marks shall be based on the following
1. Internal Assessment Test consisting of 30 marks.
2. Continuous Evaluation consisting of 20 marks.
a) Internal Assessment Test
Two internal assessment tests covering all the modules shall be conducted. An additional test
may be conducted for the needy students with the approval of the Head of the Department to
provide an opportunity to improve internal assessment test marks before the end of the
semester. Internal assessment test marks shall be the average of the marks scored in at least
two of the above tests.
b) Continuous Evaluation
Continuous Evaluation consists of the following.
1. Minimum of two Quizzes carrying 10 marks.
2. Activity based learning carrying 10 marks consisting minimum of two of the below
mentioned activities.
● Assignments
● Simulations
● Case study
● Mini projects
● Oral examinations
● Fieldwork
● Presentations
● Flip Class
● Surprise Test
● Open book challenge
● Group Discussion
● Attendance and class participation
Deviations:
Basic economic concepts: scarcity, opportunity cost, and trade-offs (added in Module 1)
Consumer Behaviour: Utility maximization and consumer choice, Budget constraints and
indifference curves (added in Module 3)
Game theory and strategic behaviour, Externalities and their impact on market outcomes.
(added in Module 4)
50% of Module 6 (VTU) is merged with 5th module.