Topic 1 Introduction to Managerial Economics 2009.Spring.

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Presentation transcript:

Topic 1 Introduction to Managerial Economics 2009.Spring

Some Examples Boeing ’ s Struggle to Retain Market Leadership The Disney Corporation: Expansion of the Magic Kingdom In What Size Production Runs Should Toyota Produce Its Cars?

Relationships of Managerial Economics to Other Disciplines 傳統經濟學（理論） Theory of Consumer Behavior Theory of Firm Theory of Market Structure and Pricing 決策理論（分析方法） Numerical Analysis Statistical Estimation Forecasting Game Theory Optimization Risk Analysis 管理經濟學（應用經濟理論與決策方法解決企業問題）提供企業最佳決策企業管理（決策問題） Product Price and Output Make or Buy Production Technique Inventory Level Advertising Media and Intensity Labor Hiring and Training Investment and Financing

The Process of decision-making ¶Identify objectives ·Define the problem ¸Identify possible solutions ¹Select the best possible solution ºImplement the decision

Theory of the firm A theory indicating how a firm behaves and what its goals are Value of the firm The present value of the firm ’ s expected future cash flows

Present value of expected future profits (TR t - TC t ) (1+i) t where: TR t = the firm ’ s TR in year t TC t = the firm ’ s TC in year t i = the interest rate and t goes from 1 (next year) to n (the last year in the planning horizon) t=1 n

Principal-agent problem Occurs when owners can only imperfectly monitor the behavior of employees

Market demand curve Shows the amount of a commodity that buyers would like to purchase at various prices Demand Quantity Price

Market supply curve Shows the amount of a commodity that sellers would offer at various prices Supply Quantity Price

Market equilibrium price A price that can be maintained Supply Quantity Price Demand

Demand shifts: left Supply Quantity Price Demand

Demand shifts: right Supply Quantity Price Demand

Supply shifts: right Supply Quantity Price Demand

Supply shifts: left Supply Quantity Price Demand

See you Next Week Be Happy!!