Overview
This course provides the foundational knowledge of microeconomics and finance to analyze business situations and strengthen critical decision-making skills. It is designed to provide a rich set of tools and techniques that students can readily apply to a wide range of strategic business situations. It introduces how business leaders should make economic and financial decisions with cost-benefit analysis, the basics of financial markets and securities, how to resolve risk and uncertainty in making economic and financial decisions, and strategic decision-making depending on the type of market in which the firm operates.
Outline
This course is divided into eight ‘lessons.’
- Lesson 1: Managers, Profits, the Financial Value of a Firm, Agency Problem, Corporate Governance, and Markets
- Lesson 2: Demand, Supply, Market Equilibrium, and Marginal Analysis in Economic and Financial Decision-Making
- Lesson 3: Elasticity, Basic Estimation Techniques, and Demand Estimation and Forecasting
- Lesson 4: Basics of Risk and Uncertainty and their applications in economic and financial decision-making in the business management context. Emphasis on the no-free-lunch idea.
- Lesson 5: An introduction to financial markets and securities and their relevance to corporate financial management.
- Lesson 6: Production, Cost, and the Estimation of Production and Cost
- Lesson 7: Perfect Competition and Monopoly
- Lesson 8: Strategic Decision Making in Oligopoly Markets
Learning outcomes
By the end of this course, students should be able to:
- acquire knowledge of essential economics and finance principles relevant to managerial decision-making.
- enhance critical thinking skills by considering the aspects of cost and benefit.
- develop a sound analytical and logical approach to address business problems that may also involve risk and uncertainty.
- gain insight into several market structures and their roles in corporate strategic decisions.
- develop an understanding of financial markets and securities, as well as their dynamics, for effective corporate financial management.
- discuss and analyze a wide range of stylized business situations and real-world problems.
- develop some of the required skills for a successful career in business strategy.
Evaluation
Your grade will be based on the successful completion of the weekly discussions, two group projects, and the comprehensive individual assignment.
| Activity | Weight |
| Weekly Applied Problems | |
| —Own solution | 9% |
| —Discussions/comments on at least 2 solutions from others | 6% |
| Weekly Discussions | |
| —Discussion initiation | 9% |
| —Discussions/comments on others' postings | 6% |
| Group Project 1* | |
| —Submitted Assignment | 10% |
| —Participation, as reflected in the peer evaluations** | 5% |
| Group Project 2* | |
| —Submitted Assignment | 10% |
| —Participation, as reflected in the peer evaluations** | 5% |
| Comprehensive Individual Assignment | 40% |
| Total | 100% |
To be successful in this course, you must receive:
- an average of at least 60% overall on applied problems
- an average of at least 60% overall on the discussions
- an average of 60% overall on the two group projects
- at least 60% on the comprehensive individual assignment.
Materials
Digital course materials
Links to the following course materials will be made available in the course:
Thomas, C. R. (2024). Managerial economics: Foundations of business analysis and strategy. (14th ed.). McGraw Hill
The other textbook for the finance part is to be decided. We will use either parts of a foundational textbook or study guide notes