SVKM’s NMIMS ASMSOC – Course Outline

Course Code
Course Title Microeconomics
Course Boishampayan Chatterjee ,Khushboo Verma, Samir Ul Hassan, Bhavesh
Instructor/s Salunkhe, Sagar Raut
Course 4
Credit
Program BBA Semester-I
and
Semester
Pre- None
Requisite
Learning  Acquiring conceptual clarity of various functional areas (PLO1a)
Objectives  Analysis and interpretation of data which is used in decision making
(PLO2a)
 Demonstrate the ability to develop models/frameworks to reflect critically
on specific business context (PLO2b)
Learning CLO1: How consumers make decision
Outcomes CLO2: How firms analyse market demand
CLO3: How firms analyse their internal costs
CLO4: How firms interact in different market structures and make price, output
decision
Course Understanding Microeconomics is fundamental to managerial decision making.
Description Managers have to make decision based on alternatives and these alternatives have
cost and benefits. The goal of the manager is to add value to the firm through the
decision making process. This value is measured by profits which depends on
revenue and cost. Revenue in turn depends on demand and maximum profit
entails minimum cost. Finally, the decision to choose between alternatives and
design strategy accordingly must be consistent with the market structure.
Microeconomics encompasses all of the above and provides a foundation to
managerial decision making. The course is designed in the manner that it garners
the key elements of decision-making. As a result, the objectives of this course
maps with the objectives that the program is set to achieve. The students taking
this course will be skilled with basic concepts and techniques of microeconomic
analysis and their applications to managerial decision-making. It will also assist
students in developing their creativity and innovative thinking to make good
business decisions by correctly identifying problems and opportunities, analysing
the alternatives properly, and making the best choices.

Evaluation Specific % AOL Intended CLOs to be Assessed

Pattern Assessment Weightage Instrume
Methods / nts
Task
CLO1* CLO2* CLO3 CLO
4
Quiz (MCQ) 15 √ √ √ √
Midterm* 20 √ √
Project 15 √ √ √ √
End Term 50 √ √ √ √

*AOL PLO1a: “Acquiring conceptual clarity of various functional areas”;

PLO2a: “Analysis and interpretation of data which is used in decision
making”; PLO2b: “Demonstrate the ability to develop models/frameworks
 to reflect critically on specific business context” to be assessed in the
course.
Timeline for conducting ICA
MCQ MCQ1: after 1st and 2nd module
Quizzes MCQ2: after 3rd and 4th Module
MCQ3: after 5th module
MCQ4: after 6th Module
Midterm 17th to 19th November, 2022
Project by 10th December, 2022

Course Session Plan

Module Session Topics / Module Chapters (Mention Page

Numbers) / Articles /
Cases / Material and
Activities
1 Introduction to course, Ten principles Pre-reading: Ten
Introduction 1 of Economics principles of Economics
Mankiw (chapter 1)
Learning Outcome: Understand (pg.no.3-20)
fundamentals of decision making of
consumers and producers
2 The economic problem: scarcity and Mankiw (chapter 1),
choice; Basic problems of an economy (pg.no.4);
(What, How and for whom to produce) Samuelson Nordhaus
(chapter 1)
Learning Outcome: Understand
fundamentals of decision making of
consumers and producers
3 Choice and opportunity cost; the Mankiw (chapter 1,2),
production possibility curve, Micro (pg.no.4,5, 26-29);
and Macro economics Samuelson Nordhaus
(chapter 1)
Learning Outcome: Understand
fundamentals of decision making of
consumers and producers
2 4 Demand, Supply and Market Pre-Reading: Case
Demand & Equilibrium study-The demand for
Supply Big-Macs
(Ref: managerial
Learning Outcome: Understand the Economics: Principles
basics of demand and supply and Worlswide
Applications-Dominick
Salvatore)
Pindyck and Rubinfeld
(chapter 2) (pg.no 44-62)

5 Concept of Demand; Factor affecting Pindyck and Rubinfeld

demand (Demand Function); Law of (chapter 2) (pg.no 45-47)
demand; Individual Demand curve

Learning Outcome: Understand

how firms analyse market demand
 6 Market demand curve; Exceptions to Pindyck and Rubinfeld
law of demand; Movement along v/s (chapter 2) (pg.no 47-56)
shift of demand curve

Learning Outcome: Understand

how firms analyse market demand
7 Concept of supply; Factors affecting
supply (supply function); Law of
supply; Supply curve; Movement v/s
shift of supply curve
Learning Outcome: Understand
how firms analyse market supply
8 Market Equilibrium; change in market
equilibrium; Role of price as an
invisible hand
Pre-Reading: Case
study-The Weather in
Brazil and the price of
Coffee in New York
(Ref: Microeconomics:
Pindyck & Rubinfeld)
(chapter 2) (pg.no 44-45)
Pindyck and Rubinfeld
(chapter 2) (pg.no 47-54)

Learning Outcome: Understand

how market price is determined

9 Application of demand and Supply Pre-Reading: Case

curve: Measuring Consumer and study-Lines at the Gas
Producer surplus Pump;
The Minimum Wage
Learning Outcome: Understand and (Principles of
measure how consumers firms Microeconmics: :
derive benefit from participating in N.Gregory Mankiw)
a market Mankiw (chapter 6, 7)
(pg.no 111-153)

10 Price ceiling, Price flooring and dead Mankiw (chapter 6, 7)

weight loss (pg.no 111-121)

Learning Outcome: Understand and

measure market inefficiencies
3 11 Price elasticity of demand; Pre-reading: Case
Elasticity Measurement of price elasticity of study-Can good news
demand for farming be bad news
for farmers?;
Why did OPEC fail to
Learning Outcome: Understand and keep the price of oil
measure the degree to which high?
demand responds to changes in (Principles of
prices Microeconmics: :
N.Gregory Mankiw)

Pindyck and Rubinfeld

(chapter 2)
(pg.no 55-70)

12 Total revenue and price elasticity of Pindyck and Rubinfeld

demand; Determinants of price (chapter 2) (pg.no 55-70)
elasticity of demand and numerical worksheet

Learning Outcome: Understand

how price elasticity of demand
affects revenue of firms
 13 Income elasticity of demand (Normal Pindyck and Rubinfeld
v/s Inferior goods); Cross price (chapter 2) (pg.no 55-70)
elasticity of demand (substitutes v/s and numerical worksheet
complements)

Learning Outcome: Understand and

measure the degree to which
demand responds to changes in
income and prices of related
commodities
14 Numerical Worksheet on price Numerical Worksheet
elasticity of demand

Learning Outcome: Understand

how to measure the degree to which
demand responds to changes in
various factors affecting demand

15 Numerical Worksheet on price Numerical Worksheet

elasticity of demand

Learning Outcome: Understand

how to measure the degree to which
demand responds to changes in
various factors affecting demand

16 Case study on taxation: taxes on Mankiw (chapter 6)

sellers and tax incidence, numerical (pg.no 121-131) and
problem numerical worksheet

Learning Outcome: Understand and

measure tax burden on consumers
and producers
17 Case study on taxation: taxes on Mankiw (chapter 6)
buyers and tax incidence, numerical (pg.no 121-131) and
problem numerical worksheet

Learning Outcome: Understand and

measure tax burden on consumers
and producers
4 18 Consumer Behavior -cardinal utility Pre-reading: Consumer
Consumer analysis- Law of Diminishing Behavior Chapter 3,
Behaviour Marginal Utility Pindyck Rubinfeld

Learning Outcome: Understand Pindyck and Rubinfeld

how consumers make consumption (chapter 3, 4) (pg.no 89-
decision 117, 132-152)

19 Consumer Behavior: Ordinal Utility Pre-reading: Case

Learning Outcome: Understand
how consumers make consumption
decision
Study-Designing New
Automobiles (I)
(Ref: Microeconomics:
Pindyck & Rubinfeld)
Pindyck and Rubinfeld
(chapter 3, 4) (pg.no 89-
117, 132-152)
 20 Analysis-Notion of Preferences and Pindyck and Rubinfeld
Indifference (chapter 3, 4) (pg.no 89-
117, 132-152)
Learning Outcome: Understand
how consumers make consumption
decision
21 Indifference curve analysis Pindyck and Rubinfeld
(chapter 3, 4) (pg.no 89-
Learning Outcome: Understand 117, 132-152)
how consumers make consumption
decision
22 Consumer’s equilibrium using Pindyck and Rubinfeld
indifference curve analysis (chapter 3, 4) (pg.no 89-
117, 132-152)
Learning Outcome: Understand
how consumers make consumption
decision
23 Price Consumption curve and demand Pindyck and Rubinfeld
curve (normal good) (chapter 4)
(pg.no 132-134)
Learning Outcome: Understand
how consumers make consumption
decision
24 Income consumption curve and Engel Pindyck and Rubinfeld
curve (normal good) (chapter 4)
(pg.no 134-136)
Learning Outcome: Understand
how consumers make consumption
decision
5 25 Theory of Production- Fixed and Pindyck and Rubinfeld
Production Variable Inputs (chapter 6)
& Cost (pg.no 209-233)
Learning Outcome: Understand the
factors of production
26 Production function (Short run and Pindyck and Rubinfeld
long run) (chapter 6)
(pg.no 209-233)
Learning Outcome: Understand the
relation between input and output
27 Production with one variable input Pre-reading: Case
(Labor); Concept of Total product, Study-Masterji’s
average product and marginal product grocery store

Learning Outcome: Understand Pindyck and Rubinfeld

how firms make production decision (chapter 6)
in the short run (pg.no 209-233)
28 Law of variable proportion, three Pindyck and Rubinfeld
stages of production (chapter 6)
(pg.no 209-233)
Learning Outcome: Understand
how firms make production decision
in the short run
29 Production with two variable input; Pindyck and Rubinfeld
Isoquants (chapter 6)
(pg.no 209-233)
Learning Outcome: Understand
how firms make production decision
in the long run
 30 MRTS, Returns to scale (constant, Pindyck and Rubinfeld
increasing and decreasing returns to (chapter 6) (pg.no 209-
scale) 233)

Learning Outcome: Understand

how firms make production decision
in the long run
31 Concept of cost: Accounting cost and
Economic Cost; Short run costs- Total
fixed and variable cost
Learning Outcome: Understand the
costs associated with various types
of inputs
Pre-reading: Example-
Sunk, Fixed, and
Variable Costs:
Computers, Software,
and Pizza
(Ref: Microeconomics:
Pindyck & Rubinfeld)

Pindyck and Rubinfeld

(chapter 7: pg 237-270)

32 Short run Average cost curve; Pindyck and Rubinfeld

Marginal cost; Relationship between (chapter 7: pg 237-270)
AC and MC

Learning Outcome: Understand the

cost structure of a firm in short run
33 Long run average cost curve-; Pindyck and Rubinfeld
Economies of scale (chapter 7: pg 237-270)

Learning Outcome: Understand the

scale of operations of firms in the
long run
34 Worksheet on production and cost Numerical Worksheet

Learning Outcome: Understand

how to calculate the output decision
and its associated cost of a firm
35 Optimal combination of factors: Pindyck and Rubinfeld
Maximizing output subject to cost (chapter 7: 252-258)
constraint

Learning Outcome: Understand

how firms make production decision
in the long run
36 Optimal combination of factors: Pindyck and Rubinfeld
minimizing cost subject to output (chapter 7: 252-258)
constraint

Learning Outcome: Understand

how firms make production decision
in the long run
6 37 Concept of total revenue average Pindyck and Rubinfeld
Market revenue and marginal revenue; (chapter 8: 289-297)
Structures Relationship between AR and MR

Learning Outcome: Understand the

fundamental concepts required for
profit maximization
38 Numerical Worksheet; Profit
Maximization: A graphical exposition
Pindyck and Rubinfeld
(chapter 8: 289-297)
Numerical Worksheet
 Learning Outcome: Understand the
process of profit maximization

39 Perfect Competition – Meaning and Pre-reading: Case- The

characteristics of PC; Demand curve evolution of Market
of PC firm; Structure in the
Computer Industry
Learning Outcome: Understand the (Ref: Managerial
characteristics of a perfectly Economics and Business
competitive market Strategy-Bay and Prince

Pindyck and Rubinfeld

(chapter 8: 289-297)

40 Profit maximizing equilibrium of a Pindyck and Rubinfeld

firm and industry under PC (Short run) (chapter 8: 297-310)

Learning Outcome: Understand

how firms make output decision in a
perfectly competitive market in
short run
41 Profit maximizing equilibrium of a Pindyck and Rubinfeld
firm and industry under PC (Long run) (chapter 8: 310-313)

Learning Outcome: Understand

how firm and industry output is
decided in a perfectly competitive
market
42 Break Even point and shut down point, Pindyck and Rubinfeld
supply curve of a firm and industry (chapter 8: 297-310)
under Perfect Competition conditions.

Learning Outcome: Understand to

analyse profit of firms with
heterogeneous cost conditions

43 Monopoly- Monopoly: meaning and Pindyck and Rubinfeld

features; Profit Maximization: Price (chapter 10: 370-377)
and output equilibrium under
monopoly

Learning Outcome: Understand the

characteristics of a monopoly firm
and how a monopolists decide price
and output
44 Measure of Monopoly power, Pindyck and Rubinfeld
deadweight loss under Monopoly (chapter 10: 370-377)

Learning Outcome: Understand

inefficiency in a monopoly market
45 Price Discrimination, Numerical on Pindyck and Rubinfeld
Monopoly (chapter 11: 415-418)
Numerical Worksheet
Learning Outcome: Understand
how firms use different types of
pricing strategies in a market

46 Pricing with Market power-Two-part Pindyck and Rubinfeld

tariff (chapter 11: 428)
 Learning Outcome: Understand
how firms use different types of
pricing strategies in a market
47 Pricing with Market power- bundling, Pindyck and Rubinfeld
block pricing (chapter 11: 433, 418)

Learning Outcome: Understand

how firms use different types of
pricing strategies in a market
48 Monopolistic competition- features;
Price
and output equilibrium under MC
market
Learning Outcome: Understand the
characteristics of a monopolistically
competitive market and how a firm
in this market decides price and
output
49 Monopolistic Competition and
economic efficiency
Pre-reading: Case-
Monopolistic
Competition in the
Markets for Colas and
Coffee
(Ref: Microeconomics:
Pindyck & Rubinfeld)
Pindyck and Rubinfeld
(chapter 12: 447-450)
Pindyck and Rubinfeld
(chapter 12: 465-468)

Learning Outcome: Understand the

concept of excess capacity in a
monopolistically competitive market
50 Numerical Worksheet on profit Numerical worksheet
maximisation; Case Studies

Learning outcome: Understand how

to calculate the profit maximizing
level of price, output and profit in
different market structures

51 Numerical Worksheet on profit Numerical Worksheet

maximisation; Case Studies

Learning outcome: Understand how

to calculate the profit maximizing
level of price, output and profit in
different market structures

52 Oligopoly Market Structure Pre-reading: Case-

Features of oligopoly market
Types of oligopolistic firms
-Sweezy Kinked demand curve model
Learning Outcome: Understand the
characteristics of oligopolistic
market; price rigidity in
oligopolistic market
53 Types of oligopolistic firms
- Cartel (concept with examples)
-Cournot and Stackelberg Oligopoly
(only concepts)
Mobile Phone Networks
(Ref: Managerial
Economics A Problem-
Solving Approach-Nick
Wilkinson)
Pindyck and Rubinfeld
(chapter 12: 470-477)
Pindyck and Rubinfeld
(chapter 12: 470-477)
 Learning Outcome: Understand the
basics of different types of
oligopolistic market

7 54 Asymmetric Information (Quality Pindyck and Rubinfeld

Market Uncertainty, Moral Hazard, principal- (Chapter 17: 645-660 and
Failure and agent problem: concepts to be done Chapter 18: 705-708)
the Role of briefly with examples)
Government Public Goods
- Characteristics of Public Good
- Public Goods and Market Failure
(brief concept with examples)

Learning Outcome: Understand the

fundamentals of some cases of
market failure

55 Externalities and Inefficiency (only Pindyck and Rubinfeld

concept with examples)
Ways to correct inefficiency due to (Chapter 18: 675-689)
externality ( brief concepts with
examples: Emissions Standard,
Emissions fee, tradable emissions
permit, Recycling)

Learning Outcome: Externalities

and market failure

56 Group Presentation: Real World

applications of microeconomic
principles
57 Group Presentation: Real World
applications of microeconomic
principles
58 Group Presentation: Real World
applications of microeconomic
principles
59 Group Presentation: Real World
applications of microeconomic
principles
60 Group Presentation: Real World
applications of microeconomic
principles
Prescribed Text Books:
Microeconmics by Robert Pindyck and Daniel Rubinfeld, 9th
Reading Edition (2017)-Latest Edition
List and
References
References:
Principles of Microeconomics, N.Gregory Mankiw, 8th Edition
(2016)
Economics, Paul A. Samuelson, William D. Nordhaus, 19th
Edition (2010)
 Prepared by Faculty Approved by Program Approved by Associate
Members Chairperson Deans

Approved by I/C Dean –

ASM SOC