Penn State Erie Burke 105. Professor: Dr. Kerry Adzima Phone: (814) Syllabus - Fall 2011

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1 ECON Managerial Economics M,W,F 2:30-3:20pm Penn State Erie Burke 105 Professor: Dr. Kerry Adzima Phone: (814) Office: REDC kak38@psu.edu Office Hours: M, W 11:00am-12:05pm, 1:15-2:15pm or by appointment Syllabus - Fall 2011 The purpose of Managerial Economics is to apply microeconomic theory to the decision making process within the firm. Issues related to optimal pricing strategies, demand analysis, optimization, appropriate hiring decisions, and market structure, among others, can be successfully tackled using tools from Managerial Economics. Objectives for this course include: Learning the language of economics. This is useful for reading business publications as well as for dealing with specialists (e.g., consultants, economic forecasters) who speak in the jargon of economic theory. Acquiring new tools. Marginal analysis can help you fine tune decisions to improve your outcomes. This can give your firm the edge in an increasingly competitive world. Developing analytical skills to enhance one s ability to solve new business problems. Once you enter the workforce, it is very unlikely that you ll face the exact same problems we cover in class. Learning to apply economic tools to new problems will help prepare you for the variety of business decisions you may face in the future. Understanding how incentives and constraints translate into outcomes. For example, you will learn how consumer and producer behavior dictates the market structure in an industry. Analyzing strategic interactions. Managers cannot make successful decisions without considering their rivals responses. Prerequisites Everyone should have completed (and remember the material from) a course in Microeconomic Principles (ECON 002/ECON 102). Although Math 110 is not required, it is strongly recommended that you take this course or the equivalent before taking ECON 442. A working knowledge of exponents, logarithms, algebra, including graphing points and equations, and solving for the intersection of two equations is essential for this course. I will introduce the concept of total and partial derivatives which we will use extensively. We will also be running some simple regressions so an introductory course in quantitative methods or statistics will help (but again, is not required). Course Materials 1. Hirschey, Mark (2009). Managerial Economics, 12 th ed. Earlier editions are fine as well, but it is your responsibility to make sure you are reading the correct material. 2. A calculator that has exponent capabilities. 1

2 3. This course has a website on Angel ( PSU s tool for on-line course material. It will include the syllabus, required assignments, selected readings, video clips and other useful information. You will need to connect with this site to download course materials. Course Requirements 1. Midterm Exams and Final Project: Exams will be mostly quantitative and short answer with some multiple choice. The exams cover lectures, readings, extra handouts, cases, and homework assignments. In particular, the exams may cover material that was covered in class but is not in the textbook. Exams do NOT test your ability to memorize. You will only be excused from taking an exam at the scheduled time for official University approved reasons (death in family, serious illness, or other reasons which are beyond your control.) If you have an approved excuse on a midterm exam I will increase the weight of the remaining midterm exam and final project. Exam dates can be found in the course outline on the last pages of the syllabus. 2. Homework: You are responsible for 5 homework problem sets. Homework will be graded using an in-class quiz based on each assignment and your written answers to the problems. You are required to turn in both the quiz and your hand written homework on the day of the scheduled quiz. Sometimes the homework will be very challenging and you may be unable to complete all of the questions always turn in your best attempt to solve a problem with the solutions to the rest of the assignment. I will not accept late homework and there will be no make-up quizzes. If you must miss a quiz for a University approved reason, I will increase the weight on the remaining quizzes. 3. Final Project: During the last two weeks of the semester you will be working (individually) on a project that integrates concepts from the entire course. (Think of this project as your cumulative final exam.) The project contains a series of questions that require you to apply concepts and theories such as Porter s Five Forces Model, Marginal Analysis, Pricing Strategies and so on. Further details about the project will be given during class as we approach the end of the semester. Grading Final grades will be assigned according to the following weights: Grading Scale I use the following conversion scale for assigning letter grades: NOTE: I do NOT grade on a curve! Homework 20% 1 st Exam 25% 2 nd Exam 25% Final Project 30% Letter Range A 93%+ A % B % B 83-86% B % C % C 70-76% D 60-69% F <60% 2

3 Classroom Policies You are expected to be attentive and respectful during class so that you do not disturb the instructor or other students. If you engage in disruptive or disrespectful behavior, I reserve the right to have you leave class for the remainder of the period. Behavior considered disruptive or disrespectful includes, but is not limited to: a. reading a newspaper, magazine, or book unrelated to the course; b. talking to other students while the instructor is lecturing; c. frequently leaving the classroom and then returning; d. sleeping; e. sending or receiving text messages or surfing the internet; f. using a laptop computer; g. listening to music. 2. If you bring a cell phone to class you are expected to either turn it off or to select a setting that will prevent it from audibly ringing. If you are in possession of a cell phone that rings during class, I reserve the right to have you leave class for the remainder of the period. During exams you will not be allowed to use your cell phone as a calculator or for any other reason. 3. Excessive unexcused absences (more than five) will result in a failing grade. Grievance Procedure Anyone feeling that a dispute exists after the grading of any assignment or exam may submit a written grievance. This grievance should identify the item in dispute and arguments supporting the student s position. Grievances must be submitted in writing within two class periods following the return of the assignment. I will return a written response to the grievance within two class periods from its receipt. Cheating and Plagiarism The following statement is from the Office of the Chancellor at Penn State Erie: Penn State Erie puts a very high value on academic integrity, and violations are not tolerated. Academic integrity is one of Penn State s four principles to which all students must abide. This principle states: I will practice academic integrity. Academic integrity is a basic guiding principle for all academic activity at Penn State University, allowing the pursuit of scholarly activity in an open, honest, and responsible manner. In accordance with the University s Code of Conduct, I will practice integrity in regard to all academic assignments. I will not engage in or tolerate acts of falsification, misrepresentation, or deception because such acts of dishonesty violate the fundamental ethical principles of the University community and compromise the worth of work completed by others. Any violation of academic integrity will receive academic and possibly disciplinary sanctions, including the possible awarding of an XF grade, which is recorded on the transcript and states that failure of the course was due to an act of academic dishonesty. 3

4 All acts of academic dishonesty are recorded so repeat offenders can be sanctioned accordingly. More information on academic integrity can be found at the following website: Hints for a Successful Semester Every semester I have a handful of students come to me and say I understand everything you say in class so I thought I knew the material but I got a terrible grade on the exam. Here s the problem: Everyone who is enrolled in this course is smart enough to understand what I say in class. The goal of the course, however, is to help you learn how to analyze new economic problems. So, just understanding the material in class isn t enough. You have to be able to apply the problem solving technique. If you can t do that, then you will not have succeeded in this course and you will be disappointed with your grade. My suggestions about how to do well in this class are: 1. Ask questions. If a section of the lecture or a reading does not make sense to you, resolve your uncertainty sooner rather than later. If you find it difficult to ask questions in class then send me or stop by my office. 2. Study in groups. Take turns explaining portions of the material to each other. If your explanation doesn t make sense to your group, there is a good chance that you don t understand the material. Economics almost always sounds simple when someone who understands it explains it to you. 3. Review the class material frequently and practice doing problems. Come prepared to ask questions on sections which you found to be unclear. It will not be a productive study strategy to go back and just read over the notes again and again to prepare for the exam. Questions will focus on application of concepts and analysis of situations - and not memorization. Focus your energy on doing problems. Always try the homework well before it is due. If you can t solve a problem the first time correctly, get help working through it, wait a few days, and then try to solve it on your own without your notes. The best way to waste your time in this class is look at the homework and solutions at the same time. This study strategy promotes memorizing the answers and discourages learning to do the sort of problem solving which is the goal of this course. (I can tell who is memorizing homework they are the people who complain that the test questions weren t like the homework problems.) Memorizing economics is like memorizing the answers to one crossword (or Suduko) puzzle to help you work another one pointless. This is a very hard class to cram for students who have tried it before have been disappointed with their grades. MISCELLANEOUS INFORMATION The Academic and Career Planning Center (ACPC) can assist students with the process of career and life planning through a full range of programs and services. You may schedule appointments with the ACPC staff to discuss issues including interests, skills, values, and goal setting, as well as how to find career information, internships, full-time jobs, and graduate schools. You are encouraged to utilize the services of the ACPC every year from your first semester to graduation. 4

5 ACPC Location: Second floor Reed Building ACPC Phone: ACPC Web Site: Pregnancy Issues Due to the fact that I am carrying twins that are due around the end of December, there is a good chance that I may be conducting this course in an on-line format for the last 5 weeks of the semester. I have already prepared video clips of the lectures that you would have received in the classroom for these weeks. These clips, along with on-line notes and a variety of tools in ANGEL will ensure that you are exposed to the exact same material that you otherwise would have been if I had been able to continue teaching in the classroom. If you have any concerns about your ability to complete this course using the on-line format described in the course outline, please schedule an appointment to meet with me before the end of the second week of class. If I don t hear from you by September 2 nd, you are implicitly agreeing to the terms set forth in this syllabus. 5

6 Econ 442 Course Outline Week 1 Lesson 1: Managerial Economics - An Introduction and a Review of Principles Timeframe: August 22- August 26, Textbook - Chapter 1 pg. 3-5, Textbook Chapter 3 1. Watch the online review of derivatives and complete the practice problems as necessary. Week 2 Lesson 2: Demand and Regression Analysis Timeframe: August 29- September 2, Textbook - Chapter 4 pg Textbook - Chapter 5 pg Week 3 Lesson 3: The Production Process and Costs Timeframe: September 7- September 9, Textbook - Chapter 7 pg , Textbook - Chapter 8 pg , Complete HW #1 HW Assignment #1 will be turned in with your quiz at the end of the class on September 7 th. Announcements: 1. Quiz #1 is on September 7 th. 6

7 Week 4 Lesson 4: The Nature of Industry and Optimization in Competitive and Monopolistic Markets Timeframe: September 12- September 16, Textbook - Chapter 13 pg Textbook - Chapter 2 3. Textbook - Chapter 10 (review as necessary) 4. Textbook - Chapter 12 pg Week 5 Lesson 5: Optimization in Monopolistically Competitive Markets Timeframe: September 19- September 23, Textbook - Chapter 13 pg Complete HW #2 HW Assignment #2 will be turned in with your quiz at the end of the class on September 23 rd. Announcements: 1. Quiz #2 is on September 23 rd. Week 6 Lessons 1-5: Review (or Finish Monopolistic Competition if necessary) Timeframe: September 26- September 30, Textbook Review previously assigned chapters 1. No assignments are due this week. Announcements: 1. Exam #1 is on September 28 th. Week 7 Lesson 6: Optimization in Oligopoly Markets Timeframe: October 3- October 7, Textbook Chapter 13 pg

8 Week 8 Lesson 6: Optimization in Oligopoly Markets continued Timeframe: October 10- October 14, Textbook Chapter 13 pg (review) 1. Complete HW #3 HW Assignment#3 will be turned in with your quiz at the end of the class on October 14 th. Announcements: 1. Quiz #3 is on October 14 th. Week 9 Lesson 7: Game Theory Timeframe: October 17- October 21, Textbook Chapter 14 pg Week 10 Lesson 7: Game Theory continued Timeframe: October 24- October 28, Textbook Chapter 14 pg (review) 1. Complete HW #4 HW Assignment#4 will be turned in with your quiz at the end of the class on October 24 th. Announcements: 1. Quiz #4 is on October 24 th. 2. Exam #2 is on October 28 th. Week 11 Lesson 8: Advanced Pricing Strategies for Firms with Market Power continued Timeframe: October 31- November 4, Textbook Chapter 15 pg No assignments are due this week Announcements: 1. Video clips will be available on ANGEL for Lesson 8. 8

9 Week 12 Lesson 8: Advanced Pricing Strategies for Firms with Market Power continued Timeframe: November 7- November 11, Textbook Chapter 15 pg Week 13 Lesson 8: Advanced Pricing Strategies for Firms with Market Power continued Timeframe: November 14- November 18, Textbook Chapter 15 (review) 1. Complete HW #5 HW Assignment#5 will be turned in with your quiz at the end of the class on November 16 th. Announcements: 1. Quiz #5 is on November 16 th. 2. The Final Project will be available on ANGEL November 16 th. Week 14 Lesson 9: Time Warner Project Timeframe: November 28- December 2, Case Challenges at Time Warner Week 15 Lesson 9: Time Warner Project continued Timeframe: December 5- December 9, 2011 Disclaimer 1. Textbook Review previously assigned chapters (as necessary) 1. Complete Memos Memo Assignment is due by 11:00 AM on December 9 h. Drop off your assignment in the Business Office: Burke

10 This syllabus may be revised at the discretion of the instructor without the prior notification or consent of the student. The above schedule presents an approximate expectation of course progress. I reserve the right to add, delete, or modify any weeks of this schedule. Any changes will be announced in class or by . 10

Firms and Markets Saturdays Summer I 2014

PRELIMINARY DRAFT VERSION. SUBJECT TO CHANGE. Firms and Markets Saturdays Summer I 2014 Professor Thomas Pugel Office: Room 11-53 KMC E-mail: tpugel@stern.nyu.edu Tel: 212-998-0918 Fax: 212-995-4212 This