HAS MAE2 Managerial Economics II* (Q2)

Faculty
Troels Troelsen

Course Coordinator
Troels Troelsen

Prerequisite/progression of the course

The students must document a level in English equal to TOEFL 575 and a level in mathematics equal to Danish level B.

Course content, structure and teaching

The course is planned to present models for decisions making with a focus on the service industry. The focus is on game theory, risk management, pricing, price discrimination, auctioning, selected managerial decision taking, investment and finance theory and business cases related to the curriculum.

Learning Objectives

The learning objectives to achieve for this course are:

Demonstrate knowledge within managerial economics with emphasis on the curriculum and workshops presented and an understanding for managerial decision making
Identify situations where managerial decisions are to be made, analyze conditions and assumptions and use this information together with models, concepts and theories to set up logical and rational managerial economic decision models
Expand the students understanding for the use of the managerial economic terminology within the company’s different functional areas and decision making processes.

More specifically, in the end of this course, the students should be able to:

Starting from oligopolistic market forms, set up assumptions for optimizing under different market forms, decision situations and restrictions and use this knowledge to set up relevant optimizing scenarios and models
Set up and apply multiple pricing models and a pricing strategy starting from different market forms
Understand and apply the pricing models of static, value based and dynamic pricing in different product, demand and supply situation
Account for the conditions for game theory and analyse different types of decisions using a game theory point of view to support decision making
Account for the fundamental elements of risk in a decision situation and set up different risk analysis to support decision making
Understand investment and finance theory and apply these models in cases implying decision making.

Type of examination, exam aids and assessment

Written 4 hours individual exam with open books

Exam aids:For this open book exam, students are allowed bring language dictionaries as well as literature and notes. The only electronic device allowed at the exam is a non programmable calculator ( in other words, the following are NOT allowed: laptop, USB stick, mobile phone, etc).

Teaching methods

All students / groups have to answer and hand in all 3 workshop-papers, approximately 5 pages (maximum 7 pages). Each student has to present individually at least once during the course (on behalf of his/her group) an ideal part of the workshop (approx. 45 minutes in total per group, including a class discussion). The presentation has to be approved by the lecturer on an individual level. The studying and preparation efforts for presentations are supposed to last 15-20 hours per workshop.

Recommended literature

ME: Dominick Salvatore,”Managerial Economics (ME)”
Dominick Salvatore: Managerial Economics in A Global Economy, 6.edition, Thomson- South-Western College, © 2004. 672 pages incl. appendixes, glossary and indexes. Chapters: 8, 9, 10, 11, 13 and 14
(BF) Bjarke Fogh, “Pricing in Theory and Practice”, First edition, Handelshøjskolens Forlag 1994, ISBN 87-16-12229-7
Michael Hedegaard: Notes in Investment and Finance theory- available at site-scape during the course

Papers and supplentary readings part of the curriculum:

Srivastava, Anita: “Dynamic Pricing Models”. Ernst & Young, 2001
Cressman, George E., jr.: “Value based pricing saves the day”. The CEO refresher, 2002
Dolan, Robert J. and Moon, Youngme: ”Pricing and market making on theInternet”. Harvard Business School, rev. November 9, 2000
Tucker, Joanne M. and Massad, Victor J.: “Comparing bidding and pricing between in-person and online auctions”. Journal of product & Brand management 2000, vol. 9, nr. 5, pp. 325-332
Hof, Robert D.: “The E-bay Economy”. BusinessWeek.com, August 25, 2003
Troels Troelsen: Chap. VII: It projects & Risk Management, Note on Sitescape
Lecturing notes and workshops